Twitter

Canadian/International Media Resource Articles

Canadian mine giant Barrick fined a record $16.4M in Chile – by Canadian Press/CBC News (May 25, 2013)

http://www.cbc.ca/news/business/

Native population complains of cancerous growths and aching stomachs

The Diaguita Indians live in the foothills of the Andes, just downstream from the world’s highest gold mine, where for as long as anyone can remember they’ve drunk straight from the glacier-fed river that irrigates their orchards and vineyards with its clear water.

Then thousands of mine workers and their huge machines moved in, building a road alongside the river that reaches all the way up to Pascua-Lama, a gold mine being built along both sides of the Chile-Argentine border at a lung-busting 5,000 metres above sea level.

The crews moved mountaintops in preparation for 25 years of gold and silver production, breaking rocks and allowing mineral acids that include arsenic, aluminum and sulfates to flow into the headwaters feeding Atacama desert communities down below.

River levels dropped, the water is murky in places and the Indians now complain of cancerous growths and aching stomachs. There’s no way to prove or disprove it, but villagers are convinced Barrick Gold Corp. is to blame for their health problems.

“We don’t know how much contamination the fruit and vegetables we eat may have,” complained Diaguita leader Yovana Paredes Paez. “They’re drying up the river, our farms aren’t the same. The animals are dying of hunger. Now there’s no cheese or meat. It’s changed completely.”

Read more

Saskatchewan Mining Association predicts mining sector growth – by Robyn Tocker (Regina Leader-Post – May 25, 2013)

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

For L-P Specialty Products

Saskatchewan’s mining industry employs over 30,500 people who work in over 20 different mining operations across Saskatchewan. The province supplies a variety of minerals in Canada and internationally. It is best known for being the world’s leading producer of potash, producing roughly one third of the world’s supply. “Saskatchewan is also the world’s second-leading producer of uranium, supplying roughly 17 per cent,” said Pam Schwann, the executive director of the Saskatchewan Mining Association (SMA).

Saskatchewan’s mining industry also produces minerals such as lignite coal, which supplies over 50 per cent of the province’s baseload power. Gold, salt, sodium sulphate, bentonite and other clays are also mined.

“One of the key advantages Saskatchewan has over other jurisdictions [in producing these minerals] is its geologic framework,” Schwann said. Both the potash-bearing Prairie Evaporite Formation and the uranium-bearing Athabasca Basin host world class deposits in terms of tonnage and grade.

Saskatchewan also has an advantage because of a positive policy environment. Schwann explained the annual Fraser Institute Survey identified that Saskatchewan ranked 13th out of 96 global jurisdictions in terms of offering overall policy attractiveness for investment. Saskatchewan’s postsecondary institutes, including the Apprenticeship and Trade Certification Commission, also lend a hand.

Read more

Barrick Assesses Impact of Chile Resolution on Andes Mine – by Liezel Hill & James Attwood (Bloomberg News – May 24, 2013)

http://www.bloomberg.com/

Barrick Gold Corp. (ABX), the world’s largest producer of the metal, is studying details of a Chilean resolution that imposed a fine and ordered work to safeguard water supplies at its $8.5 billion Pascua-Lama mining project.

Construction work at the site on the border with Argentina can’t resume until measures have been taken to prevent contamination, Chilean environmental agency SMA said in a statement on its website today.

Barrick is “fully committed” to complying with the resolution, the company said in a statement. The shares fell 2.1 percent after trading resumed following an earlier halt.

Construction on the Chilean side of the mine was stopped by a Chilean court last month. Chief Executive Officer Jamie Sokalsky told the Bloomberg Canada Economic Summit on May 21 that Toronto-based Barrick won’t continue making significant investments if there’s uncertainty about the project’s future. He said Barrick has already invested $5 billion in the mine.

“I think Barrick should seriously consider canceling the project,” Pawel Rajszel, a Toronto-based analyst at Veritas Investment Research Corp. who has a buy rating on the stock, said today by phone.

Read more

Well intentioned ‘blood mineral’ provision backfires – by Lauren Cook (Medill News Service/UPI.com – May 24, 2013)

http://www.upi.com/

A U.S. law that imposed an embargo on mineral trade used to finance Congolese armed groups has backfired, affecting the region’s poorest artisanal miners.

WASHINGTON, May 24 — A provision in the Dodd-Frank financial reform law aimed at reducing money to militia groups in the Democratic Republic of the Congo by imposing rules on buying minerals from the region has backfired, exacerbating and depriving at least 1 million subsistence miners of their livelihood, several experts told a congressional committee Tuesday.

“Dodd-Frank 1502, the conflict minerals provision … is a case study in how good intentions can go awry,” said David Aronson, panel member and editor of CongoResources.org. “The law imposed a de facto embargo on mineral production that impoverished the region’s million or so artisanal miners; it also drove the trade into the hands of militia and predatory Congolese army units.”

The original intent of the conflict mineral provision, or Section 1502, was to reduce financing opportunities for the militia groups in the Congo’s mineral market by establishing disclosure requirements for companies that use minerals like gold, wolframite, casserite, columbite-tantalite and their derivative metals (tin, tungsten and tantalum) to make their products.

The companies are required to report the particular mineral’s origin. If the material is determined to be from the DRC — or if its source is unknown — they must notify the Securities and Exchange Commission.

Read more

Canada Travel: Britannia Mine Museum a fine family spot in British Columbia – by Camille Bains (Canadian Press/Toronto Star – May 23, 2013)

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.

Kids can pan for gold and explore the history of gold mining at this museum on the Sea to Sky Highway between Vancouver and Whistler, B.C.

BRITANNIA BEACH, B.C.—A big yellow dump truck along the Sea to Sky highway is no match for the mountains-and-ocean view between Vancouver and Whistler, but curious travellers would be in for a treat if they stopped at an adjoining museum that holds the secrets of a bygone era.

The Britannia Mine Museum features the history of the copper mine that was once the largest in the British Empire and employed 60,000 workers between 1904 and 1974, when it was closed.

The museum that made its debut the following year and is a national historic site has been steadily expanding since then.
Besides a kids’ play area and a gold-panning station that’s a huge hit, the museum includes a guided train tour of a former service tunnel, similar to the 210-kilometre tunnels where workers toiled six days a week.

Guide Isabelle Akerhielm warns visitors in hard hats that the tunnel will go dark for a few seconds “and you won’t be able to see your hand in front of your face, guaranteed.”

Read more

Minnesota lawmakers raise taconite tax to help pay for Iron Range school construction – by John Myers (Duluth News Tribune – May 24, 2013)

http://www.duluthnewstribune.com/

Minnesota’s per-ton tax on taconite iron ore produced in the state will increase a dime this year, and the extra money will be dedicated to help rebuild and retool Iron Range schools.

The taconite provision was included in the 2013 Legislature’s final omnibus tax bill, which Gov. Mark Dayton signed into law Thursday.

The per-ton tax on taconite will increase to $2.56. Half the increase is part of an annual inflationary increase — this year, about 5.3 cents per ton produced. But there’s also an additional increase of a nickel per ton.

“We’re capturing that 10.3 cents to build and rebuild facilities for schools within the taconite tax relief area,” said state Rep. Tom Anzelc, DFL-Balsam Township, who served on the House Tax Committee and helped craft the taconite tax changes. “It’s something that’s long overdue and the school districts simply can’t handle on their own.”

That money will be made available for school construction and improvement projects through bonds issued by the Iron Range Resources and Rehabilitation Board. The extra money for school construction projects won’t affect other recipients of taconite tax revenue, such as homeowners, counties, towns and city governments and the Iron Range Resources and Rehabilitation Board. They all should get about the same amount as last year out of the taconite tax pool.

Read more

Children as young as 8 working in Congo copper mines in Democratic Republic of Congo – by Tanya Talaga (Toronto Star – May 24, 2013)

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.

World Vision has documented the voices of children kept out of school to work in a copper and cobalt artisanal mine in the southern Democratic Republic of Congo and has found that “this type of hard labour is robbing children of their childhood.”

Child labour in developing world garment factories is a tragic, known occurrence but a new report on children as young as eight toiling away in African mines sheds light on a forgotten group. World Vision, a Christian relief organization, documented the voices of children kept out of school in order to work in a copper and cobalt artisanal mine in the southern Democratic Republic of Congo.

The key goal of this project, entitled “Child Miners Speak,” was to build trust and talk specifically to children to ask them how they feel about working in the harsh conditions of the mines, said Harry Kits, World Vision’s senior policy adviser for economic justice.

“This type of hard labour is robbing children of their childhood,” Kits said in an interview Thursday.

After speaking with 50 children in Kambove, aged eight to 17, World Vision documented children ill with various infections from working in polluted water or being exposed to mercury or uranium.

Read more

Australia coal firms dig in for years of mine closures, job cuts – by Rebekah Kebede (Reuters U.K. – May 24, 2013)

http://uk.reuters.com/

PERTH, May 24 (Reuters) – Australian coal miners are steeling themselves for years of production cuts, job reductions and asset sales as swelling shipments from international rivals lower hopes of a recovery in prices for coal.

Prices have slumped around 30 percent since their peak two years ago as coal flooded global markets, especially from the United States where cheap gas has cut domestic demand and led to a nearly 50 percent jump in thermal coal exports last year. Even robust Chinese and Indian demand growth is failing to soak up the plentiful supply.

To boost their thinning margins, miners in Australia such as BHP Billiton, Rio Tinto, Glencore Xstrata and Peabody have trimmed output and laid off thousands. Clinging to barely profitable operations, coal producers now face the prospect of further cost-cutting, which they fear could benefit rivals when the market recovers.

“Everyone is waiting to see who blinks first,” said Tom Sartor, an analyst with Morgans Stockbroking in Brisbane. “You don’t want to be the one curtailing production knowing that it’s going to benefit your competitor.” Australia’s coal industry has become a victim of its own success. In its rush to meet growing Chinese demand, producers churned out more and more coal, and miners are now stuck with more than they can sell.

Read more

Saskatchewan finds small solutions to big pipeline problems – by Yadullah Hussain (National Post – May 24, 2013)

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

Stunned by Enbridge Inc.’s Kalamazoo River oil spill in 2010 that disrupted its sole market access in Saskatchewan, Crescent Point Energy Corp. found an unlikely ally: an agriculture company.

Toronto-based Ceres Global Ag. Corp owns a stake in Southern Stewart Railway set up to transport grain from Stoughton, Sask., to Regina, from where it connects to other lines. But floods over the past two years had wrecked its agriculture business, and the province’s burgeoning oil production seemed like a good way to bring its trains back into active duty.

The arrangement took off. Within the space of a year, SSR was shipping nearly 30,000 bpd of oil out of Saskatchewan, helping Crescent Point and others escape the heavy oil discounts plaguing Canadian producers.

“The Kalamazoo river leak was a bit of an eye opener as a lot of our production is in Saskatchewan and we are not blessed with the number of pipeline alternatives they have in Alberta, so we really had one way of getting our crude to the market, and that’s the Enbridge mainline system,” said Trent Stangl, vice-president at Crescent. “The SSR has been a key part of our rail plan for southeast Saskatchewan.”

Read more

Oil sands deals lose traction – by Jeffrey Jones (Globe and Mail – May 24, 2013)

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 — There’s a buyers’ strike in the oil sands. At least a half dozen energy companies have come up dry in efforts to attract the rich bids they envisaged when they put oil sands assets on the auction block in the past year, showing downward pricing pressure on a sector touted as the cornerstone of Canada’s economic growth.

Would-be buyers and joint venture partners are balking at deals amid a combination of wildly volatile Canadian crude prices, rising development costs and weakening returns, a situation that could force the industry to temper heady expectations for long-term oil sands production growth.

Marathon Oil Corp., Murphy Oil Corp. and Athabasca Oil Corp. had sought buyers and partners in the Northern Alberta oil sands, but now have changed their minds – or in Athabasca’s case, have told investors to hang tight after the company failed to clinch deals that had once appeared imminent.

Those companies join ConocoPhillips Co., Koch Industries Inc. and Royal Dutch Shell PLC in being disappointed after putting properties up for sale that may have once attracted bids totalling in the billions of dollars. Those three say they have rethought their plans after offers failed to meet expectations.

Read more

Liberal win in B.C. provides ‘greater clarity’ on pipeline: Kinder Morgan – by Kelly Cryderman (Globe and Mail – May 23, 2013)

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 — The pipeline company behind the proposed Trans Mountain expansion from Alberta to the West Coast says the B.C. Liberals’ electoral victory this month is a “pro-economy, jobs and investment” result, and provides greater clarity as to what conditions the company must meet in order to get shovels in the ground.

Kinder Morgan Canada president Ian Anderson said when he heard the Clark Liberals had won on May 14, “what I felt is we had a greater clarity of what those conditions were and what the interests were that we were facing in British Columbia.”

Speaking to reporters after a panel discussion with Mr. Anderson in Calgary on Thursday, Vern Yu of Enbridge Inc. – the proponent of the proposed Northern Gateway pipeline project – also said he believes the B.C. Liberals under Christy Clark have a more firm idea “of what’s necessary to get the project across the finish line” than their NDP challengers.

Both pipeline companies are keen to take advantage of what is burgeoning demand to ship growing volumes of Alberta bitumen to foreign buyers. But the rush to markets from the West Coast has been impeded by concerns about the environmental consequences of spills or an increased number of supertankers travelling from B.C. ports.

Read more

Sweden’s LKAB Doubles Spending to Find ‘Elephant’ Iron Mine – by Niklas Magnusson (Bloomberg News – May 22, 2013)

http://www.bloomberg.com/

LKAB is doubling spending on exploration in Sweden’s Arctic as the state-owned company targets finding a deposit to match its Kiirunavaara mine, the world’s largest contiguous body of iron ore.

LKAB will boost its exploration spending to 200 million kronor ($30 million) annually from 100 million kronor and is hiring more geologists to guide it to potential deposits, Chief Executive Officer Lars-Eric Aaro said in a May 20 interview.

“There’s a saying in mining, especially when you’re looking for big volume bodies, that if you’re looking for elephants you have to go to elephant land — and our part of the world is elephant land,” he said. “We now have the equipment to look at rocks deeper down but what’s under there is so far totally unknown. But, the geology is there and there could be a new Kiirunavaara mine — it will just be deeper underground.”

Sweden sits on 60 percent of Europe’s known iron ore and 2 percent of the global total. Prime Minister Fredrik Reinfeldt has said that the resource ore is equivalent to what oil has meant for Norway since it was discovered in the 1960s.
LKAB, which is moving parts of the towns of Kiruna and Malmberget to ensure it can continue production in those two locations, had sales of 27 billion kronor and a profit of 8.8 billion kronor last year.

LKAB paid a dividend of 5 billion kronor to the Swedish state for 2012, equivalent to 0.6 percent of the government’s forecast income in 2013, as well as taxes of 3.77 billion kronor. Those contributions to Sweden’s budget are likely to increase as LKAB opens new mines and expands.

Read more

Conflict Minerals Law Is Heavy Burden On Business, House Republicans Argue – by Christina Wilkie (Huffington Post – May 22, 2013)


 

http://www.huffingtonpost.com/politics/

WASHINGTON — Republicans at a House subcommittee hearing this week objected to a 2010 law that targets conflict minerals from Central Africa, saying it places too many regulations on U.S. businesses and hasn’t accomplished enough since it went into effect.

“Some of us may pat ourselves on the back and say, ‘Well, we’re making sure we’re not using their minerals,’ but we’re only hurting the people of the Congo,” said Rep. Marlin Stutzman (R-Ind.), who called the law “a massive paperwork burden on U.S. companies.”

Profits from mining of lucrative minerals in the Democratic Republic of the Congo (DRC) have helped fund a brutal conflict between rebel militias and government troops that has claimed more than 5 million lives since 1998. For those who live in the conflict areas of eastern Congo, the threat of rape and mutilation is constant; both are used as weapons of war. In the isolated mining camps of the region, men and boys often work in debt bondage or outright slavery. Above ground, women and girls are even more vulnerable to the violence, and desperation forces many of them into the commercial sex trade.

The conflict minerals law originated with then-Sen. Sam Brownback, now the Republican governor of Kansas, who argued in 2008 that “with 1,500 people dying a day [in the Congo’s civil war], there is no room for turning a blind eye on this matter.” Bolstered by the support of United Nations experts and human rights groups, Brownback’s plan became law two years later, as Section 1502 of the Dodd-Frank financial reform legislation.

Read more

The Commodity Supercycle Decelerates – by Ari Charney (Investing Daily – May 22, 2013)

http://www.investingdaily.com/

This week offered a flurry of news signifying the end of Australia’s resource boom. Of course, that doesn’t mean the mining space won’t rebound in the years ahead. Commodities are famously volatile, and the steep correction that inevitably results from overinvestment and a glut of production will itself eventually correct.

But in the near term, the sector is definitely contracting. Even the uber-wealthy are hurting. Pundits have delighted as porcine plutocrats Nathan Tinkler and Gina Rinehart watched their fortunes drop precipitously over the past year. Tinkler is now merely a former billionaire, while Rinehart’s wealth declined by a staggering AUD7 billion, to AUD22 billion, over the past 12 months.

Their plight might be more entertaining if Australia’s economy weren’t so dependent on the mining industry. The Bureau of Resources and Energy Economics (BREE) recently detailed a significant increase in projects being deferred or cancelled, as well as a decline in investment for exploration. Altogether, roughly AUD150 billion in projects have been delayed or cancelled over the past year.

However, there are still AUD268 billion in projects at the committed stage, which is near record-high levels. Of course, the BREE notes that 11 percent of that figure is due to cost increases. Even so, the agency projects that committed investment will fall by just AUD8 billion next year, a number that supports the Reserve Bank of Australia’s forecast that resource investment would peak this year, but that the peak would be sustained over a number of months.

Read more

Vale’s vale of tears in Mozambique (MSN Money Canada – May 22, 2013)

http://ca.msn.com/?rd=1&ucc=CA&dcc=CA&opt=0

Labor disruptions, flooding and infrastructure problems will mean a substantial reduction in coal exports.

Vale has announced a 30% reduction in its 2013 target for coal exports out of its Moatize mine in Mozambique. The target has been reduced from 4.9 million tonnes planned earlier to 3.4 million tonnes. The revision follows incidents of labor disruptions and heavy flooding, which rendered its railway line temporarily unusable. Infrastructural limitations in Mozambique continue to pose a challenge to Vale, hampering its ability to get the coal produced from pit to port.

The reduction in export volumes, combined with falling coking coal prices in the international market, will impact revenues negatively. However, since the coal division constitutes just 2% to 2.5% of the company’s total gross operating revenues, the overall impact is expected to be muted. On the other hand, the news exposes the fragility of Vale’s Mozambican business and the significant challenges it faces to diversify away from its iron ore business.

Infrastructure bottlenecks are the topmost concern of coal miners operating in Mozambique. Both the government and the private sector have been executing various projects to expand and build new railway lines and ports, but infrastructure will take time to reach satisfactory levels. In 2012, Vale had to cut down its initial export targets by half due to infrastructure issues.

Read more