2012 – Page 44 – Republic of Mining

The oil patch opens an eastern front – by Shawn McCarthy (Globe and Mail – October 11, 2012)

October 11, 2012

The 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.

OTTAWA – The battle over Alberta’s oil sands is spreading east as governments in Quebec and the eastern U.S. are confronted with aggressive moves by western crude producers to access new markets.

The oil industry’s critics in Quebec and Maine are gearing up for a fight over existing plans and potential projects that would reverse the flow of oil in a cross-border pipeline network in order to carry crude from Alberta and North Dakota to refineries in Quebec and perhaps as far as the U.S. East Coast.

The latest flashpoint is in Maine, where activists held a news conference on Wednesday to denounce an allegedly secret plan by Portland Pipe Line Corp. to open a new route to carry western crude by way of Ontario and Quebec through northern New England to the Atlantic coast.

That prospect highlights the mismatch between abundant, low-cost western crude and the reliance of eastern refineries on premium-priced offshore imports. As the oil industry looks to spread eastward, governments in Quebec and New England will be thrust into the centre of oil politics and environmental concerns.

Ontario’s new mining rules eliminate most exploration on private land – by Tom Spears (Ottawa Citizen – October 9, 2012)

October 10, 2012

http://www.ottawacitizen.com/index.html

OTTAWA — Big changes to Ontario’s Mining Act will prevent companies from looking for uranium and other resources on private land, and require consultation elsewhere from First Nations.

That makes Marilyn Crawford happy, mostly. She belongs to a group that opposed uranium exploration near her South Frontenac home, but she says there are still loopholes in the new rules. Some native groups think so too.

At the same time the mining industry is worried, believing exploration is about to become slower and more expensive. And one Conservative MPP predicts the industry will shun Ontario as the new rules drive delays and costs too high.

The source of this flurry is a century-old law that used to allow mining companies access to land where private owners own the surface but the Crown owns mineral rights under them. In the past few years a wave of exploration for uranium has stirred up resentment among residents of Lanark and Frontenac Counties, especially around Sharbot Lake.

Last week the Ministry of Northern Development and Mines issued a “modernization” of the Mining Act. Starting in April, it will oblige companies to consult with aboriginal groups who would be affected by their projects at an early stage in exploration.

How to become better hewers of wood and drawers of water – by James Munson (iPolitics.com – October 9, 2012)

October 10, 2012

http://www.ipolitics.ca/

Outside advice keeps pouring in as Canada tiptoes closer to becoming a commodity economy, and nothing has provided such a wide-ranging shake-up as a report released this week by the Canadian International Council.

A carbon tax, more provincial sovereign wealth funds, looser foreign investment restrictions and fewer temporary foreign workers are just some of the policies inside The 9 Habits of Highly Effective Resource Economies, a report released by the CIC Tuesday.

The report’s author Madelaine Drohan looked around the world at how countries govern their resources and posed the question: how can Canada better manage its natural resource wealth?

“There was no perfect model,” said Drohan, who spoke to over 160 people during a five-month break from her day job as a Canadian contributor to The Economist to find the answer. But she said she did find worldwide trends in resource governance that Canada, despite having many isolated policies related to resources, ignores at its peril.

“We like to put things in discrete silos and you can’t really do that with resources because there’s political and social (issues),” said Drohan. “This doesn’t just involve the Natural Resource Department. It involves Foreign Affairs and Environment and the Finance Department.”

New study provides glimpse of mining’s potential for all of Ontario

October 10, 2012

This article was provided by the Ontario Mining Association (OMA), an organization that was established in 1920 to represent the mining industry of the province.

A recently released regional economic study provides a glimpse of mining’s future potential to boost Ontario’s society and economy on a province-wide basis. “Mining in Northwestern Ontario: Opportunities and Challenges” focuses on the employment, infrastructure development and tax generating potential of nine advanced mineral projects in the region, which are anticipated to begin production between 2013 and 2017.

The direct, indirect and induced employment created in Ontario from these projects is expected to total 23,588, with 8,107 during the construction phases of these operations and 23,588 during the operating life of the mines, which is averaged at 17.5 years. More than 13,000 of these new positions are expected to remain in Northwestern Ontario. Potential tax revenues for federal, provincial and municipal governments is conservatively estimated to exceed $16 billion.

“Overall, the purpose of the study is to highlight the significant role that government policy related to the mining industry can have on the economy,” said the report. “Government, Aboriginal people and industry must collaborate to take advantage of these mining opportunities. Government policy decisions have significant impact on the very survival of existing mines and on the development of new mines.”

World’s richest manCarlos Slim bets on Mexican gold mining – by Dorothy Kosich (Mineweb.com – October 10, 2012)

October 10, 2012

www.mineweb.com

Billionaire Carlos Slim’s Minera Frisco is acquiring Mexican assets belonging to AuRico Gold for $750 million.

RENO (MINEWEB) – Little more than a month after AuRico Gold announced the Ocampo mine would lose at least 40,000 to 45,000 ounces of gold equivalent production this year and as much as 50,000 GEO in 2013; AuRico announced it would sell Ocampo and adjacent exploration properties to Carlos Slim’s Minera Frisco SAB

Billionaire Slim’s third-largest holding, Frisco–spun off last year from his holding company Grupo Carso SAB–will acquire Ocampo, the exploration projects Venus and Los Jarros, all located in the Chihuahua State and a 50% interested in AuRico’s Orion advanced development project in Nayarit State, Mexico, for a total cash consideration of $750 million.

“Upon closing of the transaction, the company expects to use the net proceeds from the transaction to eliminate certain debt obligations, invest in internal growth opportunities, provide sufficient working capital and liquidity for the company going forward and to undertake a significant return of capital to shareholders,” said AuRico in a press release. The transaction is expected to close in December.

Ocampo’s problems stemmed from what AuRico said is an “unusually high turnover of skilled labor,” as well as “significantly reduced underground ore development in the Northeast underground mine.”

Chinese workers fill B.C. mining jobs – by Peter O’Neil (Vancouver Sun – October 10, 2012)

October 10, 2012

http://www.vancouversun.com/index.html

Canadians ‘just don’t have the experience’ to operate equipment to extract coal

The first of a group of 200 temporary Chinese workers approved by the federal government will start arriving in B.C. in coming weeks to work in the burgeoning northeast coal industry, a mine project spokeswoman confirmed Tuesday.

In total, anywhere from 1,600 to just under 2,000 Chinese nationals could find full-time work in four projects being proposed in coming years for the region, due to the shortage of underground mining skills in Canada, according to industry officials.

The four projects could create an estimated 480 to 800 full-time mining jobs for Canadians. Canadians “just don’t have the experience” operating the equipment needed to safely extract coal in underground mines, said John Cavanagh, chief executive of Vancouver-based Canadian Dehua International Mines Group Inc., a company founded by China-born Vancouver businessman Naishun Liu.

“Without the Chinese and the technology they’re bringing … these particular mines would not have been developed.” The necessity of foreign work ers wasn’t mentioned in B.C. Premier Christy Clark’s Nov. 9, 2011 news release from Beijing, in which she announced $1.4 billion in Chinese funding for two of the four coal projects.

The female pipeline perspective! Wait, what? – by Marni Soupcoff (National Post – October 10, 2012)

October 10, 2012

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

What has been missing in the debate about energy and pipeline development in the West? A female perspective, apparently. At least, that’s the purported rationale for a trip along the proposed Northern Gateway Pipeline route that is being led by Jody Williams. Williams, a Nobel Peace Prize winner for her work on banning landmines, and a delegation of other prominent women, including Canadian singer-songwriter Sarah Harmer, will participate in a week of meetings to — well, to do what, exactly?

The trip is being organized by Nobel Women’s Initiative, a group the Canadian Press describes as “an Ottawa-based organization of women who have won the Nobel Peace Prize and advocate women’s rights.” One of the weird things about that (and there are many) is that only 15 women have won the Nobel Peace Prize. Ever. So, you’d think they’d be able to do whatever they need to do — including advocating women’s rights and giving thumbs downs to pipelines — without a formal group. There are 15 of you, ladies. Just get on a conference call and work it out. You don’t need a website and a newsletter.

Anyway, where was I? Oh, right. The pipeline trip. So, here’s the other weird thing. The Executive Director of Nobel Women’s Initiative, Liz Bernstein, says that the group has not prejudged the pipeline issue and will be open to thoughts on all sides of the debate. “I’m sure we’ll hear all kinds of perspectives,” she told CP. “And so we’ll be listening to all of them before forming any of our recommendation at the end of our visit.”

Former B.C. energy minister doubts Enbridge’s ability to get Northern Gateway pipeline built – by Peter O’Neil (Vancouver Sun – October 9, 2012)

October 10, 2012

http://www.vancouversun.com/index.html

OTTAWA — One of Canada’s most outspoken champions of the oil and gas industry has doubts whether Enbridge will ever build a pipeline to the B.C. coast — even if the $6-billion project gets federal approval.

Former B.C. energy minister Richard Neufeld, now a Conservative senator, said he strongly supports the construction of pipelines to the B.C. coast so Canada can ship Alberta’s diluted bitumen crude to booming Asian markets.

But he said Enbridge has so badly mismanaged the $6-billion project that he questions whether the Calgary company has the public credibility to proceed with the megaproject even if the National Energy Board approves the application next year.

“I don’t know whether Enbridge has actually screwed up bad enough that even if it was okayed, whether let’s say the NEB says, ‘Hey, this plan looks good, we can go ahead,’ that Enbridge would be able to actually build that pipeline,” he told The Vancouver Sun.

“I just think Enbridge has left such a sour taste in most peoples’ mouths.” Neufeld also said he supports B.C. Premier Christy Clark’s demand to get a bigger share of cash for B.C. from the project before approving it.

Why Northern Gateway shouldn’t go near Great Bear Rainforest – by John Honderich (Toronto Star – October 7, 2012)

October 10, 2012

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

BELLA BELLA, B.C.—Sometimes in life you have to witness a place firsthand to really get it. See it. Experience it. Sense it.

I had watched a video of the channels and byways in western British Columbia that supertankers will ply if the controversial Northern Gateway Pipeline is approved. But I decided I wanted to see them up close, then form my own opinion.

So I paid to join a five-day sailing trip through the Great Bear Rainforest region organized by the World Wildlife Federation. To say this region showcases some of the most spectacular scenery that Canada has to offer barely captures it. But more on this later.

I should make it clear, right off the top, that I understand fully Alberta’s desire to sell its oil abroad. It’s the “how” and “where” we must get right. My journey turned out to be one of both discovery and surprise, a once-in-a-lifetime experience.

We began at Kitimat, the endpoint of the proposed bitumen pipeline. Within minutes of our Gitga’at guide Marven Robinson showing us the likely marine terminal site, three orcas splashed by. Then a pod of seven humpbacks. The oh-so-familiar juxtaposition of trade pitted against the environment was set early, a theme that would haunt throughout.

Harper to talk ‘blood minerals’ conflict, trade in DRC – by Colin Horgan (iPolitics.com – October 9, 2012)

October 10, 2012

http://www.ipolitics.ca/

The prime minister hopes to discuss the worsening security situation in the eastern Democratic Republic of Congo during his trip there for the Francophonie summit later this week, but the economy will still be on his mind.

Canada is looking to strengthen commercial relations with other members of the Francophonie in order to “benefit Canadian businesses,” the prime minister’s press secretary, Andrew MacDougall, told reporters during a briefing Monday. “For instance, Canada is currently negotiating a free trade agreement with 22 Francophonie member countries or observers.”

In an accompanying release, the government outlines one of its objectives within the Francophonie is “to promote the principles of sound economic management and policies aimed at ensuring greater transparency in public administration.” To that end, it says, Canada will call for the Francophonie “to focus on elaborating on an economic strategy as part of its next ten-year plan.”

Part of Canada’s focus will be on natural resources and environmental issues. “Canada believes it is in the interest of all partners (governments, civil society and the private sector) that the extractive industries operate in a responsible manner,” the government said in its release.

Mine Explorers See Cost Rising From 2013 Rules – by Liezel Hill – (Bloomberg.com – October 9, 2012)

October 9, 2012

http://www.bloomberg.com/

Changes to century-old mining rules in Ontario signal delays and added costs for hundreds of explorers in a $1 billion industry that provides a crucial source of new deposits for global metal producers.

Prospectors such as Northern Shield Resources Inc. (NRN) and Mistango River Resources Inc. (MIS), which are accustomed to drilling their mining claims without permission in the Canadian province, will need to submit details of almost every stage of their exploration plans and consult with native groups under rules published last week that become mandatory April 1.

Ontario says the changes will provide certainty for exploration companies and will help pre-empt disputes with native groups, known in Canada as First Nations. Prospectors say the delays and expense resulting from the new rules will be an added burden in an industry that relies on hard-to-come-by financing from investors.

“There’s enough hurdles in mining exploration these days with market conditions and financing, First Nations consultations,” Ian Bliss, chief executive officer of Ottawa- based mineral explorer Northern Shield, said by phone last week. “Now we are just throwing in another complication which slows the process, and there’s a cost to it.”

As Australia pulls back on mines, Canada on alert – by Pav Jordan (Globe and Mail – October 8, 2012)

October 9, 2012

The 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.

When China sneezes, other nations catch cold – especially ones that have thrived by supplying the Asian giant with raw materials.

The world saw a graphic demonstration of that this past week as mining powerhouse Australia surprised international markets with an interest rate cut designed to stem the bleeding of an economy that depends heavily on exports destined for China.

The cut of 0.25 percentage points, to 3.25 per cent, was the latest evidence that slower economic growth in China is having an impact on major resource-based economies.

Australia, which used its proximity to China to become one of its chief suppliers of iron ore and coal over the past decade, is feeling the deepest and most immediate effects, as leading miners postpone investment plans and shutter projects. But Canada’s mining community is also heavily exposed to Chinese demand, and has deep ties to Australia’s mining sector.

Long viewed as one of the world’s most attractive mining jurisdictions, Australia is now facing challenges that go beyond just the global economic slowdown. Costs have boomed in its mines and its wages are now some of the highest in the global industry. It is also suffering from a shortage of skilled labour.

Study finds little environmental impact from oil sands – by Nathan Vanderklippe (Globe and Mail – October 9, 2012)

October 9, 2012

The 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 — In 2010, a single oil-sands operation run by Suncor Energy released into the atmosphere 28,940 tonnes of volatile organic compounds, 22,210 tonnes of sulphur dioxide and 14,011 tonnes of particulate matter.

With those three types of substances combined, Suncor emitted into the air pollutants equivalent in weight to nearly 4,800 city buses – and the company operates just one of several mines sprawling across the landscape north of Fort McMurray, Alta.

Yet when scientists drilled into lake bottoms 200 kilometres from those oil-sands mines, they discovered something surprising: At that distance, levels of those pollutants were negligible. In fact, the lake sediments, whose layers opened a window onto hundreds of years of air and water quality, showed that in many ways those lakes are cleaner today than they were decades, and even centuries, ago.

“It’s still, by and large, a natural landscape,” said Roland Hall, a University of Waterloo professor of biology and one of the lead researchers on the new study. Communities downstream of the oil sands, such as Fort Chipewyan, have long pointed the finger at oil-sands operations for sullying water, fish and people with toxins.

More of the same for Venezuela oil after Chavez clinches re-election – by Daniel Wallis and Marianna Parraga (National Post – October 9, 2012)

October 9, 2012

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

Reuters – CARACAS – President Hugo Chavez’s re-election on Sunday means Venezuela’s state oil company PDVSA will remain highly politicized and will continue its discount supply deals with his socialist allies.

Chavez, 58, won a new six-year term with more than 54% of the vote against opposition rival Henrique Capriles, a young state governor who sought to end his 14-year, self-styled revolution.

Critics say Chavez has hobbled PDVSA with the weight of his government’s financial demands — it helps pays for everything from sports teams to health clinics and home building – meaning it has neglected to invest enough in the oil business.

The industry brings in more than 95% of the OPEC nation’s hard currency revenue. PDVSA produces almost 3 million barrels per day (bpd) and boasts the biggest crude reserves in the world.

But the company, which has more than 100,000 employees, has repeatedly failed to hit its own production targets and has suffered a string of sometimes-deadly accidents in recent years. Following Chavez’s comfortable victory, his government will seek to push forward a raft of ambitious joint ventures with foreign partners in the huge Orinoco extra-heavy crude belt – one of the planet’s biggest, mostly untouched oil reserves.

Canada, Russia will share Arctic riches, scientist predicts – by Matthew Fisher (Postmedia News – October 9, 2012)

October 9, 2012

http://o.canada.com/

ST. PETERSBURG – The scientist responsible for preparing Russia’s claim to seabed rights at the top of the world says Canada and his country are both poised to reap staggering economic benefits when a deal on who owns title to what in the northern ocean is finally struck.

“Canada has a wonderful shelf and basin, so of course Canada can get very rich from this,” said Victor Posyolov, deputy director of Russia’s Institute of World Ocean Geology and the head of its Arctic research program.

Poring over maps tracking the evidence that he is amassing for Russia’s claim, Posyolov estimated that his country, with the longest Arctic coastline, would gain rights to about 1.2 million square kilometres of seabed. He reckoned Canada would get about 800,000 square kilometres of sub-surface territory. That would be about twice as much seabed as the other claimants, Denmark and the United States, are likely to get.

“The biggest shelves and basins are in Canadian waters and it will benefit the most. The U.S. and Denmark have modest sectors,” Posyolov said in a room dominated by a circumpolar map that Canada and Russia jointly produced in 1992.