2012 – Page 3 – Republic of Mining

First Nation clashes with Red Lake gold miner – by Ian Ross (Northern Ontario Business – December 21, 2012)

December 21, 2012

Established in 1980, Northern Ontario Business provides Canadians and international investors with relevant, current and insightful editorial content and business news information about Ontario’s vibrant and resource-rich North. Ian Ross is the editor of Northern Ontario Business ianross@nob.on.ca.

A small northwestern Ontario First Nation community is threatening legal action against a Red Lake gold miner which is advancing a high-grade deposit toward an early 2014 startup.

Wabauskang First Nation Chief Leslie Cameron said negotiations for a benefits agreement are not going well between his community of 300 and Rubicon Minerals over its Phoenix Gold project.

The band has instructed its lawyers to file a lawsuit at the Ontario Superior Court opposing Rubicon’s project. While the band is frustrated with the pace of development by the Vancouver-based miner, it has an even bigger bone to pick with the federal and provincial governments.

In a Dec. 17 news release, the band said it has repeatedly reminded and complained to Queen’s Park and Ottawa of its “constitutional obligations to consult and accommodate,” with First Nations on mining and exploration projects. But the band said both levels of government have ignored them and foisted those duties onto the mining companies.

NEWS RELEASE: Wabauskang First Nation Files Lawsuit Against Ontario and Rubicon

December 21, 2012

Wabauskang First Nation
Treaty 3
December 20, 2012

Wabauskang First Nation’s lawsuit opposing Rubicon Mineral’s proposed Phoenix Mine at Red Lake, Ontario has been filed at the Ontario Superior Court of Justice.

“We will oppose Rubicon’s mine until our Treaty rights are respected,” said Wabauskang Chief Leslie Cameron. “We would rather not go to court, but until Canada and Ontario fulfill their responsibilities to us, we have no choice.”

Wabauskang’s lawsuit asks the court to either suspend or entirely cancel the approval of the closure plan, which is the primary authorization that will let Rubicon go into production. The lawsuit relies on last year’s court win by Grassy Narrrows First Nation in Keewatin, where the court found that only the federal government can justify an infringement of Treaty rights.

“We know that Ontario has been informing companies that any authorizations they get in the Keewatin lands may not be valid because the court has found that Ontario doesn’t have jurisdiction to issue authorizations. We think Rubicon’s closure plan is an example of an authorization that will ultimately be cancelled by the court.”

Liberal hopeful backs [Ring of Fire] rail system – by Ron Grech (Timmins Daily Press – December 21, 2012)

December 21, 2012

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – Ontario Liberal leadership candidate Charles Sousa is a strong supporter of rail systems and believes more needs to be done to enhance the service throughout the province.

During a stop Thursday in Timmins, Sousa’s declared support for Ontario Northland Transportation Commission fell short of offering to reverse the government’s current plans to privatize the ONTC if he succeeds in being elected provincial Liberal leader.

“I have advocated for increases in transportation,” Sousa said during an interview with The Daily Press. “I have said we need high-speed rail throughout the southern corridor and we need the ONTC or the rail system going up the North, to the spine up to the Ring of Fire. We need to have these transportation systems in place.”

Partnership with private enterprise is the key to developing enhanced rail systems, Sousa said.

Sousa is one of seven candidates running for the Ontario Liberal leadership. He is at least the third candidate to have come through Timmins during this current campaign. The party will elect its new leader to replace Premier Dalton McGuinty at a convention being held in Toronto Jan. 25-27.

The Mississauga South MPP was asked what he would do to address the overriding sense in the region that Queen’s Park is out of touch with Northern Ontario.

South Africa’s ANC vetoes plan to nationalize mining – by Geoffrey York (Globe and Mail – December 21, 2012)

December 21, 2012

Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

BLOEMFONTEIN, SOUTH AFRICA — After years of damaging debate, South Africa’s ruling party has finally vetoed the idea of nationalizing its mining sector.

The announcement is part of a broad defeat for the left-wing factions in the African National Congress, reassuring investors and allowing more influence for pro-business leaders in the party. But in a compromise with the left-wingers, the ANC agreed to impose some form of higher taxes on the mining sector, and it promised a bigger role for a state-controlled mining company.

As the world’s biggest platinum producer and the fifth-biggest gold producer, South Africa should be attracting interest from mining investors from around the world. But many companies are scared away by its poor labour relations, heavy government involvement in the sector, and the continuing talk of nationalization.

Many Canadian mining companies have avoided South Africa, preferring to invest in other places, especially West Africa, where governments are seen as friendlier. Canadian mining companies are among the biggest investors in West African countries such as Burkina Faso, Mali, Niger and Senegal.

Alberta bolsters pipeline push as price gap pinches profit – by Nathan Vanderklippe, Carrie Tait and Josh Wingrove (Globe and Mail – December 21, 2012)

December 21, 2012

Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

CALGARY and EDMONTON — With no place to transport burgeoning supplies of crude oil, Canada’s energy industry, and the provinces and investors that depend on it, has reached a moment of crisis as profits bleed from one of the country’s most economically important sectors.

Alberta Premier Alison Redford on Thursday said there’s been a “monumental shift” in the economics of Alberta oil, as delays in the construction of new pipelines pinch the thick profits that have long sustained both the energy industry and the broader Western economy. Alberta this week warned depressed prices for its crude resulting from choked markets for its landlocked oil could lead to bigger deficits and spending cuts for the government.

Alberta needs new pipelines to reach new markets and give its oil sector a boost, “because this is about a product that we need to get to market,” Ms. Redford said. Economic woes are spurring a “profound change in the way that Canadians look at the world, the way we look at our economy,” one she hopes will win support for pipeline projects.

Record discounts for Albert crude in recent weeks are now spurring a strong new push by the oil patch to make the case that more needs to be done, and fast.

[Toronto’s Leading Junior Explorer Financier] Ned Goodman looks ahead to 2013 – Interview by Susan Kirwin (Mining Markets – December 2012)

December 21, 2012

Please click here for the entire digital version of December issue of Mining Markets: http://www.miningmarkets.ca/issues/de.aspx

As we say goodbye to 2012, Mining Markets sought the advice of one of the mining industry’s most seasoned investors to find out what 2013 and beyond might have in store. Toronto-based journalist Susan Kirwin sat down with Ned Goodman, president, CEO, and founder of Dundee Corp., in a boardroom on the 21st floor of the Dundee Place tower in downtown Toronto on Nov. 19.

With 50 years of experience in the mining industry, the geologist and financier still visits the odd mining project to “kick the tires,” and was in Sierra Leone just a few months ago. Goodman, a self-described optimist, explains why commodity prices will keep rising, why a return to the gold standard makes sense, and offers some tough-love advice for would-be investors.

Mining Markets : What’s your outlook for the mining industry in 2013 — what commodities do you think will do well and where will you invest your money?

Ned Goodman : My commodity would be gold. My view is that the world is basically in a pretty desperate situation except that the world population is increasing and the population of the world is far more knowledgeable about what is going on in the world so people are asking for more. Clearly, something’s got to happen that will take Europe out of the mess that it’s in and something that would take the United States out of the mess that it’s in.

Gold market seen moving forward in 2013 – by Henry Lazenby (MiningWeekly.com – December 20, 2012)

December 21, 2012

http://www.miningweekly.com/page/americas-home

TORONTO (miningweekly.com) – A new report by auditing house PricewaterhouseCoopers (PwC) has found the gold price is expected to increase in 2013, driving increased spending on exploration and merger and acquisitions (M&A).

The ‘2013 global gold price report’ found more than 80% of gold executives expect to see a rise in the price of gold, and an analysis of the 46 largest TSX- listed gold mining companies pointed to more than 20 of these gold companies having cash reserves greater than $500-million.

“Gold miners are adamant about proving to the market that they’re once again a good investment – not just for the interim, but for the long-term. Receiving investors’ approval will involve establishing cost-effective management strategies, increasing dividend payments and responsibly investing in production growth – all on the back of a strong gold price,” PwC mining leader for Canada and the Americas John Gravelle said.

He added there has been a shift in focus with gold executives concentrating on the bottom line – specifically focusing on the rate of return for every ounce produced. According to the report, the long-term price of gold used by gold miners has increased by 6% from last year and 29% from two years ago, to $1 400/oz.

Vale’s massive $4.2 bn write-down on Onca Puma and Norsk Hydro stake – by Dorothy Kosich (Mineweb.com – December 21, 2012)

December 21, 2012

ttp://www.mineweb.com/

After selling a majority stake of its bauxite and aluminum assets to Norsk Hydro 22 months ago, Vale is now taking a $4.2 billion write-down on its Hydro shares and its Onca Puma ferronickel ops.

RENO (MINEWEB) – Vale has decided to take a US$4.2 billion write-down on its Onça Puma ferronickel operation, along with the company’s aluminum assets, increasing its fourth-quarter write-downs to US$4.65 billion.

Issues with Onça Puma’s two smelters halted operations since June 2012. After analysis, Vale decided to rebuild one of the furnaces at an estimated cost of US$188 million in 2013 with start-up planned for the fourth quarter of 2013.

“Given this event and in the face of the current market environment for ferronickel, the valuation of Onça Puma determined the need to recognize an impairment charge before tax of $2.848 billion,” the company said Thursday in a news release. “The book value of Onça Puma was US$3.778 billion as of September 30, 2012.”

Meanwhile, Vale observed, “The downward volatility of aluminum prices and the macroeconomic uncertainties about the European economy have contributed to reduce the market value of our 22% stake in Norsk Hydro ASA, a Norwegian aluminum producer, to a level below the book value of our investment.”

Ring of Fire mining prospects empower Canada’s most disenfranchised natives – by Heather Scoffield (Canadian Press/Global News -December 20, 2012)

December 20, 2012

http://www.globalnews.ca/

MARTEN FALLS, Ont. – For Christmas, Chief Eli Moonias received a Toronto Maple Leafs jersey autographed by Wendel Clark. His remote northern Ontario community of Marten Falls got 50 turkeys and a visit from Santa, laden with children’s gifts.

And in March, the 61-year-old chief will be granted his wish of travelling to China – if he can get his passport in time. They’re all gifts from mining companies who need the chief’s support to develop what could be a world-class base-metal discovery.

Moonias’s community sits next to what has become known as the Ring of Fire. Marten Falls is a small, fly-in reserve — just three streets of houses for about 300 people at the junction of the Albany and Ogoki rivers. It’s in the middle of one of the only forests in the world that has never been touched by industry, an area that hosts six of Canada’s biggest rivers.

When trapping for furs lost its lustre several decades ago, nothing replaced it in Marten Falls. Unless the residents are working for the band office or a government-run social service, they’re almost certainly unemployed — and more often than not, addicted to prescription painkillers at the expense of putting food on the table for their families. Never have they felt more empowered.

“If you don’t reassure me, that’s when I say No,” Moonias says in an interview at the band’s resource office, wallpapered with maps and surveys. About 130 kilometres to the north of the reserve, multinational miner Cliffs Natural Resources wants to develop a huge chromite mine to make a key ingredient in stainless steel. The firm brought Marten Falls the Christmas turkeys.

Russia’s Klondike? Not yet – by Clara Ferreira-Marques (Reuters.com – December 20, 2012)

December 20, 2012

http://www.reuters.com/

(Reuters) – It looks like any one of remote eastern Siberia’s low-lying, peat-colored hills: only the thin trenches that scar Sukhoi Log hint at the work of generations of geologists to measure the riches beneath.

This bleak expanse, uninviting against a steel grey sky, is probably the world’s largest virgin gold deposit, with mineral wealth to rival the world’s largest, at Grasberg in Indonesia.

Yet it has remained untapped for half a century, held back by its remoteness, state restrictions and, in recent years, a lack of interest on the part of a Moscow government riding the wave of energy profits and holding out for higher gold prices.

“(The government) would love more gold, but they have no time to think about these issues at the top level,” said Sergei Guriev, rector of the New Economic School in Moscow.

“At the lower level, people are happy with the status quo.” Soviet geologists surveyed Sukhoi Log intensively in the 1970s yet little came of it. But now the Russian government has stirred long-dormant interest, suggesting it might invite bids to mine the gold. While such talk has come and gone in the past – and no details of any tender have been given – there is new debate on how, and at what cost, the ore might be exploited.

Steelworkers suggest B.C. coal mines controlled by Chinese government – by Dirk Meissner (iPolitics – December 19, 2012)

December 20, 2012

http://www.ipolitics.ca/

The Canadian Press – VICTORIA – The United Steelworkers says it has dug up what it calls close ties between the Chinese government and the reportedly privately-run coal mine in northeastern British Columbia embroiled in a foreign-worker controversy.

The union released a report Wednesday that suggests HD Mining International Ltd. — the firm developing the proposed Murray River mine near Tumbler Ridge — has ownership links to the government in China, where workers receive low wages in unsafe conditions.

A union report titled “Who Owns Huiyong Holdings and other Questions on Planned Chinese-Owned Coal Mines in B.C. ” examines the ownership of Huiyong Holdings Group, which owns Huiyong Holdings (BC) Ltd., and holds 55 per cent of HD Mining.

Steve Hunt, Western Canada director for the Steelworkers’ union, said Wednesday the union found little evidence of the company’s mining operations in China.

“We employed an investigator in China who has some knowledge of what goes on in China and we just searched the best we could possibly search and we couldn’t find very much detail on the company at all, other than some of the players,” he said. “We’re trying to find out something about the mines that they have. . .What are they experts in? It’s hard to do because we can’t find anything about them.”

Why First Quantum’s bid for Inmet likely won’t be its last – Bloomberg News (National Post – December 18, 2012)

December 20, 2012

The National Post is Canada’s second largest national paper.

The cheapest copper mining deal in five years has traders convinced that First Quantum Minerals Ltd.’s latest bid for Inmet Mining Corp. won’t be its last.

The C$5.1 billion ($5.2 billion) offer values Inmet, owner of the second-biggest copper mine under construction, at the lowest multiple of earnings before interest, taxes, depreciation and amortization for a deal of its size in the industry since 2007, according to data compiled by Bloomberg. Inmet shares climbed yesterday 1.2 percent above the C$72-a-share proposal — First Quantum’s third offer for the Toronto-based company since October — indicating arbitrageurs who bet on acquisitions expect another boost, the data show.

After Inmet last week raised estimates for the amount of copper contained at its Cobre Panama mine, Canaccord Financial Inc. said it would take a bid of at least C$80 a share to win over investors, particularly with the top shareholders controlling a majority of the stock. While Inmet could draw other suitors, Vancouver-based First Quantum’s desire for a friendly deal suggests it may be willing to pay more whether or not there are rival bidders, according to Bank of Montreal.

“The market is clearly saying that we are going to need a higher price to push this through,” Barry Schwartz, a Toronto-based fund manager at Baskin Financial Services Inc., which oversees about C$450 million including Inmet shares, said in a telephone interview.

Cobre Panama “is going to be one of the greatest mines that’s going to come on stream in the second half of the decade. We’re running out of quality finds of copper, and Inmet has one of them.”