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Chinese Investment in Canada to Stay Strong, says Ambassador – by Sean Benson (ProEdge Wire – February 12, 2013)

http://www.proedgewire.com/

February 12, 2013 (Source: CBC News) — Canada’s ambassador to China says money from the Asian country is likely to keep pouring into Canadian resource projects.

But Guy Saint-Jacques also says he thinks those dollars will increasingly flow into mining and forestry as well as energy development.

“I expect that the interest will increase on the mining side,” he said in an interview with The Canadian Press after speaking to an audience at the University of Alberta on Monday.

“What I expect also is maybe they will start to get interested in the forestry sector. There’s already investment in pulp manufacturing. I think they are starting to look at potential minority participation in a number of companies.”

Chinese state-owned companies have already staked out a significant foothold in Alberta’s oilpatch — especially in the oilsands after the federal government approved a $15-billion takeover of Calgary-based Nexen by China National Offshore Oil Corp. late last year. PetroChina has also expressed interest in owning a share of the proposed Northern Gateway, which would ship oilsands bitumen to waiting tankers on Canada’s West Coast.

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Barrick has done its best to improve human rights at mine in Papua New Guinea – Globe and Mail Editorial (February 13, 2013)

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.

Change hasn’t happened quickly enough in the global mining sector, despite prodding from advocacy groups concerned about environmental sustainability and human rights abuses. But when a mining company responds to pressure and makes changes for the better, that should be acknowledged, not dismissed as an empty public relations gesture.

Recent criticism by Mining Watch of Barrick Gold’s initiative to assist the women who were raped by local employees of its mine in Papua New Guinea is short-sighted. It has accused the company of “rushing” the women through the claims process, and of forcing them to sign away their legal rights.

That is stretching the truth. In fact, Barrick, the world’s largest gold-mining company, has done its best to clean up the mess at the Porgera gold mine. Since 2011, it has spent 18 months consulting with human-rights advocates and developed an opt-in program of remediation for the victims, offering them counselling, access to micro-credit and medical care. The program is administered by an independent team, including the former chief magistrate of Papua New Guinea.

The women are free to pursue action against any individuals involved but once they settle the grievance procedure with the company, they cannot make further legal claims against it. This seems fair.

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Eramet to kick off $5.5 billion smelting project mid-2013 – by Linda Yulisman (The Jakarta Post – February 09 2013)

http://www.thejakartapost.com/

French mining and metals group Eramet SA, which runs the world’s biggest ferronickel plant, is scheduled to start its US$5.5 billion nickel smelting project in Maluku in the middle of this year.

Executives of Weda Bay Nickel, a subsidiary of the group that will execute the project, revealed the plan after meeting with Industry Minister MS Hidayat and industry officials in Jakarta on Friday, discussing, among other things, a proposed tax holiday and regulations regarding the investment.

The Industry Ministry’s director general for manufacturing-based industry, Panggah Susanto, said the planned smelter on Halmahera Island, North Maluku, was scheduled to begin commercial operations in the middle of 2018.

“The initial investment will amount to $3.3 billion, and later it will likely expand to complete the project to reach $5.5 billion,” Panggah announced after the meeting. About 20 percent of the total investment will be used to finance mining operations.

In the first phase, the smelter is expected to annually produce 35,000 tons of ferronickel and 1,300 tons of cobalt in 2018, while in the second phase it will boost output to 65,000 tons of ferronickel and 3,000 tons of cobalt, according to Panggah.

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Unfeasible deadline for [Indonesian] miners – The Jakarta Post Editorial (February 06 2013)

http://www.thejakartapost.com/

The general mining and coal director general, Thamrin Sihite, has warned mining firms that the government will not reschedule the enforcement of the total ban on exports of unrefined ores due in 2014 although many analysts and investors have argued the deadline is unfeasible.

Anticipating overextraction (overexploitation) of the country’s mineral resources in the run-up to the total ban on unrefined ore exports, the government decided last May to impose an export tax at the flat rate of 20 percent on more than 60 mineral ores in a bid to curb excessive increases in exports.

There is actually nothing wrong nor strange with the regulation. First of all, the ban was stipulated in the 2009 General Mining Law that says that mining companies shall build refining plants (smelters) because they can no longer export unprocessed minerals starting from 2014.

The regulation supports the government policy designed to move mineral commodities higher up the value chain, generating more jobs and maximizing profits from the mining sector without excessively exploiting natural resources. The biggest problem with the enforcement of the mining law is the confusion and uncertainty surrounding the timing and manner of the policy.

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Mongolia’s “ninja” miners help sate China lust for gold – by David Stanway (Reuters.com – April 19, 2012)

http://www.reuters.com/

Please note April, 2012 date, but a great read!

(Reuters) – In a hot, concrete hut filled with acetylene fumes, an elderly Mongolian miner struggles to contain her excitement as she plucks a sizzling inch-long nugget of gold from a grubby cooling pot and raises it to the light.

Khorloo, 65, and her sons spent the day scrutinizing half a dozen CCTV screens as workers at the Bornuur gold processing plant whittled 1.2 metric metric tonnes of ore down to 123 grams of pure gold that could earn the family as much as $6,000.

Near the plant, separated from Mongolia’s capital, Ulan Bator, by 100 km of rocky pasture and mostly unpaved road, life has remained largely unchanged since Genghis Khan’s “golden horde” rampaged across Asia nine centuries ago.

But Khorloo is a member of a new horde of at least 60,000 herders, farmers and urban unemployed trying to extract the riches buried in the vast steppe with metal detectors, shovels and home-made smelters.

In the last five years, dwindling legal gold supplies and a spike in black market demand from China have made work much more lucrative for Mongolia’s “ninja miners” – so named because of the large green pans carried on their backs that look like turtle shells. For thousands of dirt-poor herders, the soaring prices alone are enough to justify years of harassment, abuse and hard labor.

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President Says Mongolia Should Get More Control of Mine – by Michael Kohn & Yuriy Humber (Bloomberg.com – February 5, 2013)

http://www.bloomberg.com/

Mongolia’s President Tsakhia Elbegdorj said the nation should have more control of Rio Tinto Group (RIO)’s Oyu Tolgoi copper and gold project after the government said costs had increased.

The total cost of the Rio Tinto-operated development in southern Mongolia has jumped to $24.4 billion, according to an e-mailed statement from the government, which gave a summary of a Feb. 1 parliamentary discussion attended by the president. London-based Rio had earlier estimated total costs at $14.6 billion, according to the statement.

“It’s time for Mongolia to have Mongolian representation on the management team,” Elbegdorj said at the session on Feb. 1, according to his website. “It’s important that the government takes the Oyu Tolgoi matter into its own hands.”

The president’s comments heighten tension with the second- biggest mining company over the ownership and future development of the project, which is currently the world’s biggest copper mine under construction. Rio is considering a temporary halt to work to protest government demands for a greater share of profit, two people familiar with the plans said last week.

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Document reveals experience of Canadian mine applicants – by Michael Smyth (Vancouver Province – February 3, 2013)

http://www.theprovince.com/news/index.html

Chinese-owned Tumbler Ridge operation received about 300 resumés

The Chinese company that wants to set up an underground coal mine near Tumbler Ridge said it tried – and failed – to find qualified Canadians to work in the mine. But after the company was forced in court to produce about 300 resumés submitted by “unqualified” Canadian job applicants, critics are scoffing at the claim.

“There were obviously qualified Canadians who applied for these jobs, and they were simply rejected,” Brian Cochrane of the Union of Operating Engineers told me Saturday. “Qualified Canadians are being denied jobs developing Canada’s own resources,” Cochrane said.

“It’s outrageous.” HD Mining International received approval from the federal government to bring hundreds of Chinese coal miners to B.C., after Ottawa accepted the company’s argument that no Canadians could do the work.

The Operating Engineers and another union, the Construction and Specialized Workers, challenged the company and the government in court. Last month, the company turned over to the unions hundreds of resumés from rejected Canadian job applicants.

Now, in a document filed last week in federal court, the public is getting its first glimpse at the qualifications of Canadians who applied for jobs with the Chinese company. “There were trained and certified underground miners who applied for these jobs,” said Cochrane.

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Rio Tinto faces tough talks in Mongolia over giant mine – by Terrence Edwards and Sonali Paul (Reuters.com – February 1, 2013)

http://www.reuters.com/

ULAN BATOR/MELBOURNE, Feb 1 (Reuters) – Rio Tinto faces tough negotiations next week in Mongolia, where the government is under pressure to plug a budget deficit and increase its share of the wealth from the $6.2 billion Oyu Tolgoi copper and gold mine.

Oyu Tolgoi, 34 percent owned by Mongolia and controlled by Rio Tinto, produced its first concentrate this week and is on track to start supplying metal and paying royalties by June.

The success of the mine is crucial for both sides as, at full tilt, Oyu Tolgoi will account for nearly a third of Mongolia’s economy, while Rio Tinto is depending on the mine to drive growth beyond its powerhouse iron ore business.

Rio Tinto is not expected to have to give up a bigger share of the mine, but some analysts say it could end up agreeing to provide more funding in areas like infrastructure to remove uncertainty over a project that is expected to produce 425,000 tonnes of copper and 460,000 ounces of gold a year. Rio Tinto and its subsidiary, Turquoise Hill Resources Ltd , last year fended off an attempt by Mongolia to renegotiate their 2009 investment agreement on Oyu Tolgoi.

The government is drafting a law that would require Mongolians to hold at least a 34 percent stake in mines, however talk that this would apply to Oyu Tolgoi has died down.

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Rio Tinto considering halting work at Oyu Tolgoi mine over dispute – by Christopher Donville, Todd Baer and Yuriy Humber (Bloomberg News/National Post – January 31, 2013)

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

Rio Tinto Group, the second-biggest mining company, is considering a temporary halt to construction work at its US$6.2-billion Oyu Tolgoi copper and gold project in Mongolia as the government demands a greater share of profit from the mine, according to two people familiar with the plans.

The London-based company is discussing the suspension to protest the central Asian nation’s demands for a bigger stake in the project and new mining royalty rates, said the people, who asked not to be identified because they aren’t authorized to comment publicly. A suspension of work, which may halt mining and processing, isn’t certain and is among options that managers are discussing in London, one of the people said.

“We continue to work together with all stakeholders including the government of Mongolia to bring the benefits of Oyu Tolgoi to all parties,” said Bruce Tobin, a spokesman for Rio in Melbourne. He declined to comment on whether it’s considering a temporary halt.

The dispute comes as Mongolian Prime Minister Norovyn Altankhuyag’s government tries to maintain support for foreign investment amid growing nationalism and wealth disparity. In October, Rio rejected a second move by Mongolia to renegotiate a 2009 investment agreement for the development of Oyu Tolgoi, which is currently the world’s biggest copper project under construction.

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India tries to temper the hunger for gold – by Stephanie Nolen (Globe and Mail – January 24, 2013)

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.

NEW DELHI — In the glinting showroom of the Gem Palace in the city of Jaipur, Sanjay Kasliwal surveys his family business: strings of rubies, pearls the size of grapes, collars of emeralds and, everywhere, bright yellow gold.

The Gem Palace has supplied princes, prime ministers, socialites and no small number of families preparing for weddings, for hundreds of years. But in the past decade, the price of gold has surged to unprecedented heights – fetching close to $1,700 (U.S.) an ounce on Wednesday. Yet Mr. Kasliwal’s business has not faltered.

“People have a budget, but they’ll still put it in gold,” the jeweller said. “If the price goes up, they buy 490 grams instead of 500 grams, that’s all. The Indian hunger for gold, you can’t change that.”

That hunger for gold has also warped the country’s economy. The Indian government is growing increasingly alarmed about a current account deficit in the July-to-September quarter that accounted for a record 5.4 per cent of gross domestic product. This week it raised taxes on gold imports in an attempt to curb a shopping habit that goes back centuries.

That will be no easy task. Gold purchases make a lot of sense for Indians. Inflation has run at or near 10 per cent annually, while the best rate on a savings product from a bank returns 8 per cent. The stock market has had returns far below that in recent years.

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African Barrick Gold/China National Gold deal dead in the water – by Lawrence Williams (Mineweb.com – January 8, 2013)

http://www.mineweb.com/

The long running negotiations between Barrick Gold and China National Gold over the former’s African Barrick Gold (ABG) subsidiary have fallen through and ABG’s share price has dived as a result.

LONDON (MINEWEB) – Discussions on the sale of African Barrick Gold (ABG) to China National Gold Group Corporation (CNG) appear to have come to nothing after a rigorous examination of ABG’s operations by the Chinese state-owned gold mining company. London-quoted African Barrick’s share price initially dropped sharply on receipt of a statement from ABG confirming its 73.9% owner, Canada’s Barrick Gold, has now ended its discussions with CNG which means that ABG is ‘no longer in an offer period under the Takeover Code’.

The Barrick announcement went on to say “Given the direct nature of the discussions between Barrick and CNG, this has meant an extended period of uncertainty for ABG as well as significant extra work. Throughout this period, our focus has been on ensuring the ongoing integrity and stability of our operations, and our employees have made an important contribution towards achieving this. At the same time, Barrick has made it clear that it sees considerable long-term value in the ABG asset base. Barrick remains committed to supporting ABG in fully realising the potential of the business.”

This has not been a great day for Barrick with the news also coming through that its plans to develop the huge Reko Diq copper/gold project in Pakistan’s Balochistan province have been declared invalid by the Pakistani high court, although given the company’s recent rethinking on its major project programme, coupled with the location of Reko Diq close in a far from stable part of the world, this may actually be perceived as a positive in some eyes!

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India continuing to drive steel production – by Shivom Seth (December 24, 2012)

http://www.mineweb.com/

If all planned capacity expansion projects become operational in India, the country could become the world’s second largest steel producer by 2015

MUMBAI (MINEWEB) – Demand for steel in India is rising. Global steel production grew by 5.1% in November to 121.6 million tonnes. India’s contribution was 6.4 million tonnes, with most experts insisting that the country’s steel demand is set to rise in the new year.

Though China tends to be the focus of the steel market given its status as the world’s largest producer, India could soon take over the mantle as the fastest growing producer of the metal within the next few years, if one goes by the opinion of its steel producers.

Somdeb Banerjee, Tata Steel’s executive for South Africa said India’s steel capacity could almost triple between 2010 and 2020 to reach 179 million tonnes a year. He was speaking at the Coaltrans Mozambique conference in Maputo.

In 2011, India became the fourth largest steel producing nation in the world with production of over 74 million tonnes. However, the country has a very low per capita consumption of steel of around 59 kilos as against an average of 215 kilos in the world. This wide gap in relative steel consumption indicates the potential ahead for India to raise its steel consumption, maintain experts.

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Russia’s Klondike? Not yet – by Clara Ferreira-Marques (Reuters.com – 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.

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Potanin comes out as CEO in Norilsk Nickel boardroom war deal – by Polina Devitt (Mineweb.com – December 17, 2012)

http://www.mineweb.com/

As the Norilsk Nickel boardroom war comes to a Kremlin/Abramovich–enforced understanding, long-time co-owner, Vladimir Potanin has emerged as the incoming CEO.

MOSCOW (REUTERS) – Norilsk Nickel named longtime co-owner Vladimir Potanin as its chief executive on Monday under a deal to end a boardroom war at the world’s top nickel and palladium producer.

Kremlin-backed oligarch Roman Abramovich will take control of a 20 percent voting stake to act as a buffer between Potanin and rival Oleg Deripaska, who owns a share in Norilsk through UC RUSAL, the world’s largest aluminium producer.

Speaking after his unanimous election by the Norilsk board, Potanin said he planned to stay in the job for between 18 months and two years. The peace deal will last for 10 years, with the core shareholders agreeing to keep their stakes for five.

Abramovich, the billionaire owner of Chelsea soccer club, could also act as a conduit for the Kremlin at the cash-rich company that mines the vast mineral deposits of Russia’s far north.

Having brought an end to the four-year feud between Potanin and Deripaska, he could potentially end up sidelining them as President Vladimir Putin seeks to restore order at the $30 billion miner that was privatised in the mid-1990s.

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