FRASER INSTITUTE NEWS RELEASE: New Brunswick trumps Alberta as world’s No. 1 spot for mining investment;

February 23, 2012

TORONTO–New Brunswick is the world’s most attractive jurisdiction for
mineral exploration and development in the view of the international mining industry, according to the Survey of Mining Companies: 2011/2012, released today by the Fraser Institute, Canada’s leading public policy think-tank.

“New Brunswick shot to the top of the rankings as miners lauded the province for its fair, transparent, and efficient legal system and consistency in the enforcement and interpretation of existing environmental regulations,” said Fred McMahon, Fraser Institute vice-president of international policy research and coordinator of the survey.

“Combine that with a competitive taxation regime and minimal uncertainty
around disputed land claims and New Brunswick has emerged as a superstar in the view of the global mining community.”

New Brunswick vaulted to first place from 23rd last year, unseating Alberta
at the top of the global rankings as that province fell to third overall.
Quebec, which enjoyed a three-year reign at No. 1 from 2007 to 2010,
continued to lose support among mining executives as it fell to fifth place
from fourth in 2011.

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The principal risks affecting mining in Africa – by Christy Filen ( – February 16, 2012)

Two risk analysis experts shared their views on the principal risks facing investment in mining in Africa on the fringes of the recent Indaba conference in Cape Town.

JOHANNESBURG (Mineweb) –  Government intervention is a recurring theme in an analysis of the top risks for the mining industry on the African continent as identified by experts in their fields.

Ironically the nationalisation research report by South Africa’s ruling African National Congress (ANC) party is entitled SIMS (State Intervention in the Minerals Sector).

Not surprisingly, the risk of war and strife to business is taking a back seat to the instigations of power wielding politicians in an effort to assuage the electorate.

On the fringes of the Invest in African Mining Indaba, Control Risks managing director for southern and east Africa, Dave Butler and Robert Besseling, the head of business development for Exclusive Analysis in South Africa, shared their views on the top risks facing the mining industry on the African continent.

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AngloGold CEO says Warren Buffett just doesn’t understand gold and gold investors – by Alec Hogg ( – February 16, 2012)

Mineweb’s Editor-in-chief, Alec Hogg, interviews AngloGold Ashanti’s Mark Cutifani and hears some forthright views on Warren Buffet’s most recent attack on gold.

JOHANNESBURG –  Anglogold Ashanti’s CEO Mark Cutifani is to local South African gold mining what top South AFfrican asset manager, John Biccard is to the local asset management sector, the man other money managers would most trust to handle their savings. In mining, Cutifani’s astute management has raised the bar for an industry where performance was once measured by volume of rock through the mill rather than gold delivered.

The Australian-born head of Africa’s biggest gold producer has been walking on water lately. He took history’s biggest ever bet on the gold price by closing out the industry’s largest hedge book – at a cost of billions. As the gold price kept steaming ahead, that decision continues to reward Anglogold Ashanti. In the three months to end December it added another $200m to the bottom line.

Cutifani was clearly on a high during our chat this week after the release of his group’s December quarter results. Who could blame him? Apart from that $200m, costs were reasonably controlled, the company got more South African Rands for its gold and the result was a fresh record for profit in any three months. Shareholders joined in the applause when hearing that the yearend dividend was being doubled.

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How First Quantum recouped its seized mine – by Matthew McClearn (Canadian Business Magazine – January 19, 2012)

Founded in 1928, Canadian Business is the longest-publishing business magazine in Canada.

In 2007 the government of the Democratic Republic of Congo announced it would autocratically tear up and renegotiate contracts with foreign mining companies. The price Vancouver-based First Quantum Minerals paid for resisting: the forcible seizure and resale of its properties in the country, including two operating mines and another on which construction was nearly complete.

The DRC investigated First Quantum for what it called “suspected widescale misconduct.” Its courts, which are not independent, slapped a stinging US$12-billion judgment on the company. The government transferred the properties for nominal sums to close associates of DRC president Joseph Kabila, who promptly flipped them for significant profits; Eurasian Natural Resources Corp. (ENRC), a large London-based company dominated by Kazakh owners, paid just US$175 million for the Kolwezi project, which cost First Quantum nearly $800 million to purchase and construct.

First Quantum immediately sought redress, but its hand seemed weak. ENRC CEO Felix Vuilis had maintained his company owed nothing to the former owners. “Any dispute that First Quantum has is with the relevant DRC authorities,” he declared shortly after the purchase.

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Africa: The Back Story to Cida-Mining Partnerships – by Catherine Coumans (All – February 9, 2012)

Catherine Coumans is the research co-ordinator and Asia Pacific program co-ordinator for MiningWatch Canada. She is the author of Whose Development? Mining, Local Resistance, and Development Agendas.


Mining companies’ branding of themselves as bringers of development needs to be critically examined against the burgeoning ‘resource curse’ literature that links mining to deepening national impoverishment in mining-dependent developing countries

The Canadian International Development Agency’s funding of Corporate Social Responsibility projects mostly near mine sites is intended to help Canadian mining companies compete for access to lucrative ore bodies in developing countries in the face of increasing local opposition to mining.

As I write this, thousands of Cajamarcans in Peru are protesting Newmont Mining Corp.’s proposed Conga mine that will destroy four lakes they depend on for their water supplies and livelihoods.

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Gold cost profiles and nationalisation – Cutifani [AngloGold Ashanti CEO] – by Geoff Candy ( – February 10, 2012)

This interview came from:

In a wide ranging discussion, AngloGold Ashanti’s CEO Mark Cutifani talks about nationalisation, cash cost and the outlook for the gold price.

CAPE TOWN – GEOFF CANDY: Hello and welcome to this Newsmaker podcast, my name is Geoff Candy and joining me from the Mining Indaba, in Cape Town, is Mark Cutifani, he’s the CEO at AngloGold Ashanti. Mark, I suppose the first question I wanted to ask you was if we look at where AngloGold is, one of the big unknowns at a macroeconomic level is what’s going to happen with oil and what I wanted to get a sense of from you is how much of an impact does oil play on your business and is this a concern?

MARK CUTIFANI: Ja, I think it is, it’s a concern for everyone. The good thing from an AngloGold Ashanti point of view is given the high proportion of underground operations that we have, oil tends to be less of an issue for us than, let’s say, compared to the North Americans, who have large open carts with lots of waste stripping and low grades but it’s still a 10% to 13% cost factor for us, so it’s material. But it’s not as material as, let’s say, for the North Americans but it’s one we watch carefully and if we saw a 20% rise, then from us that would have a 2% to 3% impact on our unit cost, so it’s one we watch fairly carefully.

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Official Welcoming Address to the Mining Indaba Conference 2012 – by Susan Shabangu: Minister of Mineral Resources for the Republic of South Africa (February 7, 2012)

This speech is from the website:

CAPE TOWN, South Africa –

Programme Director: Mr Jonathan Moore; Organisers of the Mining Indaba; Honourable Ministers of Mineral Resources from other African countries; Members of the Diplomatic Corps; The investment community; Senior government officials; Delegates; Distinguished Guests; Ladies and gentlemen


On behalf of the democratic Government of South Africa, I bid you the warmest of welcomes to our country, and to this region of the Western Cape, in whose capital city we meet today amidst its splendour and beauty.

Even if mining has always been somewhat elusive in this region, may you have a chance to make interesting side trips, for instance, viewing where oceans converge, where wine farms abound, or where a  world famous mountain with a flat top towers over a beautiful city.

Investing in African Mining Indaba 2012

It was Mark Twain, travelling the world more than a century ago, who called Table Mountain “a majestic pile” (Following the Equator, Dover Publications, USA, 1989, page 710). He described visiting the old Cape Parliament, “where they quarrelled in two languages and agreed in none.” 

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Blood Diamond (Mining Movie – 2006)

This information is from Wikipedia, the Free Encyclopedia:

Blood Diamond is a 2006 political thriller film co-produced and directed by Edward Zwick and starring Leonardo DiCaprio, Jennifer Connelly and Djimon Hounsou. The title refers to blood diamonds, which are diamonds mined in African war zones and sold to finance conflicts, and thereby profit warlords and diamond companies across the world.

Set during the Sierra Leone Civil War in 1992-2002, the film shows a country torn apart by the struggle between government soldiers and rebel forces.[1] It also portrays many of the atrocities of that war, including the rebels’ amputation of people’s hands to discourage them from voting in upcoming elections.

The film’s ending, in which a conference is held concerning blood diamonds, is in reference to an actual meeting that took place in Kimberley, South Africa in 2000 and led to the Kimberley Process Certification Scheme, which seeks to certify the origin of diamonds in order to curb the trade in conflict diamonds. The film received mixed, but generally favourable reviews.

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Is Canada helping the world’s poor, or Canadian [mining] companies? – by Elizabeth Payne (Ottawa Citizen – February 2, 2012)

This column is from:

Elizabeth Payne is a member of the Citizen’s editorial board.

Few  Canadians have likely heard of the Canada Investment Fund for Africa. But, since 2005, it has been busy investing Canadian foreign aid dollars – $100 million of them, in fact – on companies doing business in Africa.

The objective of the fund, which was eventually worth more than $200 million in public and private money, was “to spur economic growth by providing risk capital for commercially successful private-sector businesses.”

A number of those 16 businesses, including Orezone, a gold mining company operating in Burkina Faso and Banro Mining, a Canadian gold mining company which operates in the Democratic Republic of Congo, are Canadian. The fund also invested in Candax, a Toronto-based oil and gas company working in Tunisia, as well as a number of African companies, including the Commercial Bank of Rwanda, Mr. Big’s Fast Foods, and others.

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Congolese citizens will appeal to Supreme Court in suit against Canadian mining – by Sidhartha Banerjee (Winnipeg Free Press – February 2, 2012)

This ariticle came from:

The Canadian Press

MONTREAL – A coalition of human-rights groups say they will make a last-ditch plea to the Supreme Court of Canada in an effort to sue a Canadian mining company on behalf of the victims of a massacre in Congo.

The Canadian Association Against Impunity, a coalition of human-rights groups and non-governmental organizations acting on behalf of Congolese citizens, says it’s imperative that those people have access to justice in Canada. Quebec’s Court of Appeal last week overturned a lower-court ruling from April 2011 that had paved the way for a civil suit to be heard in Canada.

In their claim, the groups had argued that Anvil Mining Limited (TSX:AVM) provided logistical support to the Congolese military as it moved to crush a rebel uprising in 2004.

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Kinross Gold Could Be a Takeover Target – by Charles Mead, Liezel Hill and Rita Nazareth ( – January 20, 2012)

By paying too much for acquisitions in western Africa, Kinross Gold Corp. (K) is now turning itself into the cheapest gold-mining target in the world.

Kinross, Canada’s third-largest gold producer, fell the most in almost two decades after saying this week it will write down the value of its Tasiast mine in Mauritania. The company sold for 76 cents per dollar of net assets yesterday, versus the industry median of 2.5 times, according to data compiled by Bloomberg. Writing off the excess $4.6 billion it spent on Tasiast would still leave Kinross at a 50 percent discount to its competitors, the data show.

While Kinross bought the Mauritanian mine for almost three times what the gold deposit is worth, the company is facing rising labor and raw material costs that may delay production at some of its projects. After more than quadrupling revenue in the past five years as gold prices reached a record, Kinross may now attract interest from Newmont Mining Corp. or Polyus Gold International Ltd. (PLGL) as they try to boost capacity to meet demand, said Stifel Nicolaus & Co. On its own, analysts say Kinross is worth 50 percent more than its current price.

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Kinross pays the price for mine delays in West Africa – by Sean Silcoff (Globe and Mail – January 18, 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— Kinross Gold Corp.’s drubbing by investors over delays at its trophy gold mine in West Africa is a fresh reminder of the gulf between the fortunes of those who dig for gold, and the metal itself.

While gold continues to trade at historically high levels – closing up $24.80 at $1,655.60 an ounce Tuesday – gold miners are contending with market antipathy due to rising costs and a string of unpopular and costly acquisitions. In such an environment, tolerance for bad news is low.

Kinross discovered that the hard way Tuesday, after saying it would take six to nine months more than expected to study and plan its Tasiast mine in Mauritania, delaying development and possibly negatively affecting production.

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In New Control Over Diamonds, Smugglers Pay in Mozambique – by John Eligon (New York Times – January 6, 2012)

ESPUNGABERA, Mozambique — The last time Mike Phiri was on his hands and knees, clawing through the rough rock of the diamond fields just across the border in Zimbabwe, he dared a soldier to shoot him.

Mr. Phiri and his fellow diamond smugglers had gotten into an argument with the soldier because, for the second consecutive night, he had directed them to a patch of the rich fields where there were no diamonds to be mined. And so they refused to pay him a bribe for allowing them onto the fields, in an area known as Marange. The soldier threatened force.

“If you want to shoot, shoot,” Mr. Phiri recalled barking at the soldier. “But I’m not paying.”

Mr. Phiri and his comrades walked away unharmed, but in more than three months he has not dared return to the fields, an acknowledgment of the increasing dangers for the black-market miners who once dominated an area that may be one of the world’s most lucrative diamond troves.

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First Quantum exits DRC with $1.25-billion settlement – by Brenda Bouw (Globe and Mail – January 6, 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.

First Quantum Minerals Ltd. (FM-T22.220.241.09%) is closing a painful chapter of its history in Democratic Republic of the Congo (DRC) by selling its mines and settling all legal claims for $1.25-billion (U.S.), years after its operations were nationalized by the government.

Vancouver-based First Quantum will sell the controversial Kolwezi copper-cobalt project, as well as its Frontier and Lonshi mines, to Kazakh miner Eurasian Natural Resources Corp. PLC, also known as ENRC, the same company it has been battling in international courts over its properties in DRC, one of the world’s most attractive copper regions.

The settlement comes as copper prices (HG-FT3.40-0.03-0.80%) are struggling to rebound from a 20-per-cent drop last year, amid worries that debt concerns in Europe and a slowdown in China’s rapidly growing economy could curb demand for the metal used in everything from cars to construction.

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Millions From Diamonds Go to Mugabe, Observers Say – by John Eligon (New York Time – December 16, 2011)

JOHANNESBURG — Tens of millions of dollars in diamond profits — perhaps more — are being secretly extracted from state-owned mines in eastern Zimbabwe, bypassing the nation’s treasury and raising fears that President Robert Mugabe is amassing wealth to help extend his 31-year reign, according to monitoring groups, diplomats, lawmakers and analysts.

Even if Mr. Mugabe’s allies in the mining ministry are telling the truth about the number of diamonds produced, the treasury was still shortchanged by at least $60 million last year, according to a budget report by the finance minister, one of the president’s chief opponents.

But the amount of money being withheld from the nation’s coffers may be much larger than that. Experts, and even some members of Mr. Mugabe’s own party, say the president’s allies are lowballing the nation’s diamond figures by millions of dollars, hoping to hide the fact that profits are being diverted for personal and political ends.

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