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British Columbia Mining

Canada: BCSC Commissioned Report Provides Cold Comfort For Junior Miners And Investors – by Arman Farahani and Cory Kent – McMillan LLP (Mondaq.com – November 23 2013)

http://www.mondaq.com/

On October 17, 2013, the British Columbia Securities Commission (the BCSC) released a report prepared by KPMG entitled “B.C. Junior Mining at a Crossroads: Executive Management’s Perspective” (the Report). The BCSC commissioned the Report in connection with its annual Capital Ideas conference to obtain a better understanding of (i) the downturn in B.C.’s junior mining sector, and (ii) the factors that have impacted the availability of financing for junior mining companies (Juniors) engaged in financing activities in B.C.

The Report is based on interviews with senior executives from 15 British Columbian Juniors, largely in exploration phases across a variety of mineral sectors, including gold, copper, uranium, silver and other base metals.

In short, the participants were of the opinion that most of the root causes that have led to the current state of financing for Juniors were due to the cyclical nature of the mining industry and current economic and market conditions. The general comforting (or discomforting) message from the participants is to “wait it out – the market will come back”, with words of caution that the next one to two years will likely continue to be challenging for Juniors seeking financing.

All participants indicated that current market conditions are not favourable for attracting retail and institutional investment in Juniors.

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B.C. prepared to risk water quality on Elk Valley coal mine – by Mark Hume (Globe and Mail – November 25, 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.

VANCOUVER — When the provincial government issued an environmental certificate to Teck Coal Ltd. this fall it appeared pollution problems associated with a massive new coal mine in the Elk Valley had been resolved.

But background documents show that is far from the case. The British Columbia government has rolled the dice on the project and is hoping that Teck’s money – and experimental water-treatment plants – can save the Elk River.

A document that gives the minister’s reasons for issuing a certificate for the Line Creek mine, states the environmental assessment “was not able to conclude on the magnitude, reversibility and therefore significance” of an array of pollutants. Nor could it determine “the effectiveness” of two planned water-treatment facilities that will use new methods in an attempt to filter out selenium.

In other words, the government knows the new mine is going to pollute but it doesn’t know whether the water-treatment plan will work.

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Mine firm says panel review error outrageous – by Terri Theodore (The Canadian Press/Global News – November 19, 2013)

http://globalnews.ca/toronto/

VANCOUVER – The Canadian Environmental Assessment Agency is reviewing a complaint from the company proposing a $1.5-billion mine in British Columbia’s Interior that a mistake was made in a joint environmental assessment of the project.

Taseko Mines Ltd. (TSX:TKO) said the error is so outrageous it’s nearly unfathomable.

In a letter to the Canadian Environmental Assessment Agency, the company questioned why the panel conducting an environmental review on the proposed New Prosperity mine would use incorrect information for its final assessment.

On Tuesday, the agency confirmed that the information provided by Taseko was being reviewed by officials within the agency.

It didn’t say what action, if any, would be taken if Taseko’s claims are proven correct. Earlier this month, an agency panel released a report saying it didn’t believe Taseko’s design for the proposed copper and gold mine could avoid contaminating nearby Fish Lake. The survival of the lake is at the centre of the dispute.

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‘Balance’ required in Ring of Fire development, says B.C. First Nations leader – by Erica Lenti (The Canadian Press/Canadian Business Magazine – November 12, 2013)

http://www.canadianbusiness.com/

TORONTO – A First Nations leader from B.C. says aboriginal communities in Ontario’s Ring of Fire could benefit from striking a balance between mining development and land preservation.

Annita McPhee is president of the northwestern B.C. First Nations Tahltan Central Committee and says a balanced approach is required in negotiating how the northern Ontario mineral deposit will be developed.

McPhee says while it is important to sustain the mineral-rich land in the James Bay First Nations territory, opening it up to external industries offers potential monetary and employment benefits. In the Tahltan territory of B.C., mining development created tensions between First Nations and mining corporations from as early as 2005.

Led by McPhee, her group has negotiated $2 billion in resource development since 2011 in non-sacred pockets of Tahltan land, and another $11 billion is being considered. In return, the Tahltan have seen increased employment and funding for health care and cultural programs.

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Market conditions the main cause of economic difficulties – by Paul Bourque (Vancouver Sun – November 8, 2013)

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

Paul Bourque is executive director of the B.C. Securities Commission.

Mining: An argument can be made for less regulatory red tape, but there are greater challenges right now

In his letter (Red tape bleeding life from B.C.’s resource opportunities, Oct. 28), Mark Redcliffe argues that regulatory costs and “red tape” are exacerbating the present economic challenges faced by the junior mining industry. While he is correct in stating that the current difficulties in raising capital has left many firms “on the precipice,” it is not correct to attribute the cost of compliance as the primary cause.

For many years, British Columbia has enjoyed an international reputation as a mining centre of excellence. The province is home to more than half of Canada’s mining exploration firms, and has the largest concentration of such firms in the world. With

more than 2,400 companies involved in supplying services to this industry and over 29,000 people employed in mining and its related sectors, it is without doubt a significant contributor to the B.C. economy.

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Editorial: Is Pretium petering out? – by John Cumming (Northern Miner – November 6, 2013)

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry. Editor John Cumming MSc (Geol) is one of the country’s most well respected mining journalists. jcumming@northernminer.com

The Pretium saga brings to mind the old joke about the ever-optimistic geologist seeing that the glass is half full, while the mining engineer sees only that the glass should be reduced in size by 50%.

In 2010, Pretium had its initial public offering at $6 and bought its flagship Brucejack gold-silver project in remote, northwestern B.C. from Silver Standard for a cool $450 million in cash and shares.

Since then, the Vancouver-based junior, led by veteran geologist and former Silver Standard exec Robert Quartermain (Qvartermain?), has pushed the project forward at breakneck speed. It has so far brought drilling in the Valley of the Kings deposit to 200,000 metres; defined a probable reserve of 6.6 million oz. gold in 15.1 million tonnes grading 13.6 grams gold; completed a feasibility study showing potential to mine 321,500 oz. gold annually over a 22-year mine life, starting in 2016; and picked up the prestigious Bill Dennis discovery award from the Prospectors & Developers Association of Canada.

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Taseko’s New Prosperity mine in BC could still be approved – by Henry Lazenby (MiningWeekly.com – November 6, 2013)

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

TORONTO (miningweekly.com) – In a surprising twist to the permitting saga surrounding base metals miner Taseko Mines’ proposed New Prosperity mine, in British Columbia, lead consulting engineer Knight Piesold has determined that it appeared that Natural Resources Canada (NRCan), and subsequently the federal review panel, had used the wrong design in their analysis of seepage rates from the tailings storage facility.

Taseko said the panel relied heavily on modelling undertaken by NRCan, which had indicated that there would be significant seepage from the tailings storage facility into Fish Lake. The panel’s findings regarding the expected seepage, and the related impacts on Fish Lake, were integral to the panel’s conclusion that the project was likely to cause significant adverse effects on fish and fish habitat, wetlands and aboriginal interest in the Fish Lake area.

The design proposed by Taseko for the tailings storage facility included a continuous low-permeability compact soil liner to restrict seepage losses. This was a common and acceptable practice for modern facilities that had been recently permitted and developed in British Columbia and elsewhere in the world.

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Taseko fires back at federal report claiming B.C. mine poses environmental threat – by Peter Koven (National Post – November 6, 2013)

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

Taseko Mines Ltd. has a blunt message for Natural Resources Canada: you got it wrong.

But it is unclear what the federal government thinks of that message, or how it will impact Taseko’s efforts to build the New Prosperity mine in British Columbia.

Taseko’s statement came less than a week after a Federal Review Panel issued a damning report on New Prosperity. According to the panel, the proposed mine could create “significant adverse environmental effects” on local fish habitats and First Nations interests because of potential seepage from a tailings facility into nearby Fish Lake.

The panel report is important, as the government will review it before ruling on whether New Prosperity should go ahead. A highly negative report can swing Ottawa’s decision. According to Taseko, the report is badly flawed.

The company said it appears that Natural Resources Canada (NRC), a federal agency, studied the wrong tailings design when it evaluated New Prosperity.

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Ottawa is in a box over New Prosperity mine – by Justine Hunter (Globe and Mail – November 4, 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.

VICTORIA — The B.C. government has not been subtle in pushing Ottawa to approve the New Prosperity mine.

In a case of gold fever, the province has shrugged off two damning federal environment reviews in the pursuit of what is believed to be one of the largest undeveloped copper-gold deposits in Canada.

The province’s environmental review gave Prosperity the go-ahead. When the first federal review concluded the mine would have a “high-magnitude, long-term and irreversible effect” on the environment, B.C. Mines Minister Bill Bennett dismissed the impact on a “tiny little pothole of a lake.” And when Ottawa rejected the original project, Premier Christy Clark set it at the top of her federal-provincial agenda when she advocated for New Prosperity at her first meeting with Prime Minister Stephen Harper.

All of this political pressure from British Columbia still may not be enough for the federal government to say “yes”. Like Ms. Clark’s B.C. Liberals, the federal Conservative government is keen on resource extraction, and this proposal would live up to its name for those in line to profit.

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Taseko Prosperity Mine Environmental Study Predicts Death Of Fish Lake – by Vivian Luk (Canadian Press/Huffington Post – November 1, 2013)

http://www.huffingtonpost.ca/

VANCOUVER – Those for and against the controversial proposal for the billion-dollar New Prosperity Mine in British Columbia are drawing much different conclusions from their interpretation of a federal environmental review for the site.

The study by the Canadian Environmental Assessment Agency, released late Thursday, concluded the open pit gold and copper mine proposed by Taseko (TSX:TKO) in B.C.’s central Interior would pose “several severely adverse environmental effects” on water quality, fish and fish habitat in a lake considered sacred by the area’s First Nations.

The project would likely pollute Fish Lake, known as Teztan Biny to First Nations, and endanger the aboriginal way of life and cultural identity, the report said.

This is the second time the federal review panel has rejected the project. The original proposal for the site southwest of Williams Lake was approved by the provincial government, but rejected by the federal government in 2010 because the plan was to drain the lake for use as a tailings pond.

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New environmental review offers critical view of Taseko mine proposal – by Canadian Press (Globe and Mail – November 1, 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.

VANCOUVER — A new environmental study into Taseko Mines Ltd. billion-dollar New Prosperity mine proposal in British Columbia says it would pose “several significant adverse environmental effects“

Taseko’s proposal received provincial approval in 2010 but the federal government rejected the original plan, which would have drained a lake of cultural significance to First Nations for use as a tailings pond.

Taseko then submitted a new plan for the site in the Chilcotin region 550 kilometres northeast of Vancouver and said it would save Fish Lake and prevent contamination from groundwater seepage from a tailings pond that it would instead locate several kilometres away.

The Canadian Environmental Assessment Agency report released Thursday said Taseko has underestimated the volume of water that would leave a tailings storage facility and there was “considerable uncertainty” regarding Taseko’s contingency plan for water treatment.

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NEWS RELEASE: TASEKO ISSUES STATEMENT ON REVIEW PANEL REPORT

November 1, 2013, Vancouver BC – Taseko (TSX: TKO; NYSE MKT: TGB) today issued the following statement in response to the Canadian Environmental Assessment Agency federal Review Panel report on the proposed New Prosperity Gold-Copper project in the Cariboo-Chilcotin region of British Columbia:

The 323 page Review Panel report is detailed and we will be examining and considering its full content over the coming days.

Taseko is committed to protecting Fish Lake, and fish habitat, and we strongly disagree with the panel’s findings related to the potential impact on the water quality, fish and fish habitat of Fish Lake. Taseko will challenge these findings as they contradict best practices in place around the world today and expert opinion and analysis.

The report in most respects agrees with our assessment that there would not be significant adverse effects. The risks are modest and the social and economic benefits are enormous. The local governments and many citizens of the region made this very clear throughout the panel process.

With any major project there will be different views and some trade-offs, but we are confident the federal government can and will approve this project.

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New Prosperity mine would have ‘adverse environmental effects,’ panel finds – CBC News British Columbia (October 31, 2013)

http://www.cbc.ca/bc/

Review Board panel says mine would negatively impact water quality, fish habitat and local First Nations 

The Federal Review Panel released its long-anticipated report on the proposed New Prosperity copper-gold mine on Thursday night, concluding the mine “would result in several significant adverse environmental effects.”

The report specifically says that the mine would negatively impact water quality, fish and fish habitat in Fish Lake, land and resource use, and the cultural heritage of two First Nations directly impacted by the proposal.

Additionally, the panel found that the mine would have a “significant adverse cumulative effect” on the south Chilcotin grizzly bear population without considerable mitigation measures in place.

This is the second time the project has been reviewed by a federal panel. In 2010, the original proposal from Taseko Mines Ltd was found to have significant environmental shortfalls and was rejected by the Ministry of Environment.

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Opinion: Red tape bleeding life from B.C.’s resource opportunities – by Mark Redcliffe (Vancouver Sun – October 27, 2013)

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

Cost of compliance: Growing regulatory burden is moving the industry unnecessarily toward a bleak future

Costlier and additional regulatory requirements are exacerbating harsh economic realities for B.C.’s resource sector and independent brokerage business. With junior companies on the precipice, Canada’s growing regulatory burden is moving the industry unnecessarily toward a future far more bleak than 2008’s notorious global market free-fall.

The fallout several years ago was as severe as it was quick. Junior exploration companies and senior producers were soon lifted by strong bull markets for commodities, including gold and silver, copper, uranium preceding Fukushima, and oil. However, due to slow economic growth and global financial issues during the last two years, investors don’t want to risk their capital. As a result, share prices have bottomed out, and there are no immediate lifelines on the horizon.

This scenario has acutely impacted the long, mutually beneficial and dependent relationship between B.C.’s junior companies and independent brokerages — venture companies have no operating revenues and rely on equity financings for their operational needs; we historically underwrite these essential transactions.

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The Pretium gold resource controversy in context and a letter from the frontline – by Lawrence Williams (Mineweb.com – October 25, 2013)

http://www.mineweb.com/

The disagreement between two respected engineering companies over the Pretium resource in BC, Canada has generated much controversy but should not detract from a still exciting project.

LONDON (MINEWEB) – The Canadian resource sector has been abuzz with people taking sides on the Pretium controversy over the Brucejack resource estimation and whether Strathcona, or Snowden, both highly respected engineering companies, are correct in their different handling of samples and results.

Personally, as a mining engineer by background, I suspect with a deposit of this type with a very large number of ultra-high grade gold intersections in its Valley of the Kings section, within a much lower grade more disseminated orebody, that neither will accurately represent ultimate mining grade terms and, if, and when, a mine is developed at Brucejack, selective mining methods could enable the orebody to be mined to a far higher grade than the bulk sampling would suggest, should economics suggest that is the most profitable long term route for shareholders.

Do I have an interest in Pretium? From a technical point of view perhaps yes – it looks to be one of the most exciting recent gold discoveries in Canada.

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