Canadian/International Media Resource Articles – Page 33

UPDATE 2-Gloom hits services firms as Australia’s mining boom peaks – by Sonali Paul (Reuters India – Mary 21, 2013)

May 21, 2013

http://in.reuters.com/

MELBOURNE, May 21 (Reuters) – A spate of profit warnings from Australian mining services firms suggests the country’s “once-in-a-century” resources spending boom may have peaked sooner than companies, economists and policymakers had expected.

Australia has been bracing for a slowdown in its massive pipeline of investment for resource projects – liquefied natural gas, iron ore and coal in particular – as developments come on stream and as signs of a slowdown in demand from top commodities consumer China weigh on prices.

“The extent of the slowdown and just how fast the turnaround has been is a surprise,” said Savanth Sebastian, an economist at Commsec, noting the potential for more projects to be pushed back or mothballed. “It seems to have taken place in a very narrow window.”

With miners from BHP Billiton Ltd down shelving projects and slashing costs that grew out of control during the boom, they have turned the screws on contractors, in some cases dumping firms that are unwilling to cut prices. “They got carried away using too many contractors to get that extra tonne, almost like a credit-card mentality,” Tony Maher, mining division president of the Construction, Forestry, Mining and Energy Union, told Reuters.

Freeport Death Toll Reaches 28 as Indonesia Reviews Mines – by Madelene Pearson & Yoga Rusmana (Bloomberg News – May 21, 2013)

May 21, 2013

http://www.bloomberg.com/

The death toll from a collapsed tunnel at Freeport-McMoRan Copper & Gold Inc.’s (FCX) Grasberg complex reached 28 as Indonesia said it would review all mining operations following one of its worst mining accidents.

The rescue team recovered the remaining bodies that were buried at the accident site of the world’s second-largest copper mine, Thamrin Sihite, director general of coal and minerals at the Energy and Mineral Resources Ministry, told reporters today in Jakarta. Operations at the mine in Mimika, Papua province, about 3,120 kilometers (1,940 miles) east of Jakarta, will remain suspended until after an investigation is concluded, the government said.

President Susilo Bambang Yudhoyono ordered related ministries to review safety at all mines in Indonesia, Sihite said earlier. Phoenix, Arizona-based Freeport, which got 20 percent of its operating income from Indonesia last year, was still shipping material produced from the mine as of May 17, its local unit said last week.

Ten workers have been rescued from the site, Freeport said today. The “Freeport accident is one of the worst mining accidents in Indonesia,” Sihite told reporters in Jakarta today. “I don’t want this to happen again.”

James Passin, the American Who Bought Mongolia – by Brett Forrest (Bloomberg Business Week – May 16, 2013)

May 21, 2013

http://www.businessweek.com/

The Mongolian Stock Exchange occupies a single room inside a gray building that once housed a children’s movie theater, just off Sükhbaatar Square in the capital city of Ulaanbaatar. On any given day, it’s quieter than the nearby National Library, as 20 or so traders in cubicles click away softly on their laptops.

This muted bourse hardly seems a place to make a fortune, but James Passin, who needs no prompting to declare that he’s “super bullish on Mongolia,” swears it is. Passin, who’s just flown across 12 time zones from New York City, has as much reason to promote Mongolia’s potential as any foreign investor in the country. His future is riding on it.

Passin, 41, has at least $130 million in three funds that he oversees for his employer, Firebird Management, a Manhattan firm that specializes in emerging markets. Passin controls four companies listed on the Mongolian Stock Exchange—in coal, fluorite, and real estate—as well as an undisclosed number of private enterprises. His placements make Firebird one of Mongolia’s largest and most diversified foreign private equity funds.

Until a few months ago, many other international investors shared Passin’s enthusiasm for the Mongolian market. The country, with a 17.3 percent growth rate in 2011, had the fastest-growing economy in the world. A sparsely populated nation of 3.2 million run by communists until 1990, Mongolia has discovered a bounty of natural resources.

Ghana hopes to shield economy from African oil curse – by Matthew Mpoke Bigg and Kwasi Kpodo (Reuters India – Mary 21, 2013)

May 21, 2013

http://in.reuters.com/

ACCRA, May 21 (Reuters) – Oil brought riches to Nigeria but also ravaged its economy and fuelled corruption and conflict. Now nearby Ghana has begun production and wants to take the wealth but dodge the oil curse.

Ghana is used to resource riches: it is already the world’s number two cocoa producer and Africa’s second-largest gold miner. But there are signs it is struggling to manage the new oil money and some people are disappointed.

A budget deficit last year which soared to 12 percent of gross domestic product (GDP), nearly twice the targeted level, raised fears among economists of fiscal laxity, a classic symptom of the resource curse that often feeds corruption.

Investors are also watching the strengthening cedi currency . An inflation-adjusted rise due to an influx of petro-dollars can signal “Dutch disease”, where the competitiveness of farming and manufacturing is eroded, as in Holland in the 1960s.

“The government seems to be very much wary of the dangers of Dutch Disease,” central bank governor Henry Kofi Wampah said. “Oil will continue to attract attention but not at the expense of cocoa or gold.”

B.C. election sets stage for battle over jobs vs. eco-justice – by Gillian Steward (Toronto Star – May 21, 2013)

May 21, 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.

CALGARY—Politics in British Columbia has always been volatile and unpredictable, as last week’s election again proved. But it also was instructive in another way.

It was the first major election campaign in Canada to feature both the economy and the environment as key issues. That is surely a sign of the times. And even though Premier Christy Clark and her intense focus on the economy garnered the most seats for the Liberals, the popular vote tells another story.

The Liberals raked in 44 per cent of the popular vote but the combined vote of Adrian Dix’s NDP (39) and the Green party (8) totals 47 per cent. B.C. voters rendered a split decision when trying to decide whether they favour protecting the environment or protecting their province’s prosperity.

So the question remains: how will British Columbians reconcile these two competing interests? And how will that affect the rest of the Canada? Of most interest to Albertans is whether or not two proposed pipelines crucial to the Alberta economy will proceed through B.C. and under what conditions. During the election campaign, those pipelines came to symbolize the choice between economic growth and environmental protection.

New political battle lines emerge in Arctic – by Stephen Bede Scharper (Toronto Star – May 20, 2013)

May 21, 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.

Disputes over Arctic development are not ultimately a ‘clash of civilizations’ but a clash of world views.

In the summer of 2010, while I was visiting an ecological research station near Tobermory, Ont., the British Petroleum (BP) Deepwater Horizon oil rig was gushing out of control approximately 1,500 miles due south in the Gulf of Mexico.

Gazing across the turquoise waters of Georgian Bay, I wondered how I would feel if a collapsed oil rig were fouling this clear, remarkably beautiful expanse of the Great Lakes. I winced internally imagining the waters and arresting vistas that had become so meaningful to me becoming blackened by such a tragedy.

Perhaps such thoughts also crossed the minds of native groups in the Arctic last week as they called for a moratorium on oil extraction in their homelands, which are now rapidly opening up to mining and development owing to a warming North.

In a statement released in Kiruna, Sweden, May 13 shortly before a meeting of the eight-nation Arctic Council, 42 aboriginal signatories from Scandinavia, Russia, Canada and the U.S. called for a halt to offshore oil drilling and a hold placed on northern energy projects until local native groups have consented to such interventions.

Julia Gillard dismisses Gina Rinehart warning of Europe-style collapse (APP-The Australian – May 17, 2013)

May 17, 2013

http://www.theaustralian.com.au/business

JULIA Gillard has dismissed claims by Gina Rinehart that Australia’s economy is heading for a collapse like those seen in European nations.

In a recorded video speech delivered at the Australian Mines and Metals Association conference in Melbourne today, Ms Rinehart warned that Australia had to take action to avoid following Europe into economic misery. “It is as if Spain, Greece, Britain, Italy and Portugal had no warnings to give us about the similar path we are now taking,” Australa’s richest person said.

Critical alternative rare earths sources still not secured since China’s 2010 export restrictions – by Henry Lazenby (MiningWeekly.com – May 17, 2013)

May 17, 2013

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

TORONTO (miningweekly.com) – Following the global economic downturn of 2008/9 and a series of events and press reports in 2010 that coined what some referred to as the “rare-earths crisis”, there has been a glut of new rare earths projects starting out, yet few have progressed up the value curve, and rare earths supplies in the West still largely depend on Chinese production.

During 2010, there was global concern when China cut its rare earths exports and appeared to be restricting the world’s access to rare earths, sending the rare earths market into a flurry of action and rare earths prices sky high. This led to a growing realisation that an almost total US dependence on China for rare-earths elements, including oxides, phosphors, metals, alloys and magnets, was a matter of national security.

Some policymakers also expressed concern that the US had lost its domestic capacity to produce strategic and critical materials, and queried what implications this had for US national security.

Strategic management consultancy Cansource International president and CEO Ron MacDonald recently told Mining Weekly that solving rare earths supply security still remained an issue.

Ecuador pushing ahead with reforms to lure mining investors (Reuters India – May 17, 2013)

May 17, 2013

http://in.reuters.com/

May 16 (Reuters) – Ecuador’s government on Thursday presented a mining bill to Congress that should pave the way for the signing of contracts with several investors, including Canada’s Kinross Gold Corp.

Ecuador does not have a large-scale mining industry, but the country is largely unexplored and could potentially have big copper, gold and silver deposits. Socialist President Rafael Correa, who won a sweeping re-election victory in February, is eager to attract investment to reduce the economy’s dependence on oil exports.

“We’ve sent a bill labeled as urgent … it contains the reforms to the mining law. Our mining law is very good, but we made some mistakes and it was too strong in some aspects and there were not as many investments as we expected,” Correa told reporters.

Negotiations with Kinross Gold over its $1.3 billion Fruta del Norte gold project are well behind schedule, in part because OPEC-member Ecuador is trying to reap high benefits from the nascent sector.

“Investors asked for some reasonable things and that’s why we’re changing the law,” said Correa. Lawmakers are likely to pass the bill promptly, since the ruling Alianza Pais political party has nearly three-quarters of the seats in Congress.

Glencore Xstrata shareholders sweep the deck clean – by Eric Reguly (Globe and Mail – May 17, 2013)

May 17, 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.

ROME — A vicious boardroom cull at Glencore Xstrata PLC, the world’s fourth-largest mining company, simultaneously ended the career of one of Britain’s most famous directors and revived the career of one of its most infamous.

At the newly formed company’s first annual general meeting, in Switzerland, a shareholder vote sent chairman Sir John Bond packing.

He was replaced on an interim basis by Tony Hayward, the deputy chairman whose career as chief executive officer of BP PLC was wrecked in 2010, when he took the fall for the disastrous Macondo oil well blowout in the Gulf of Mexico, also known as the Deepwater Horizon spill.

Sir John’s ouster was the result of his support for an extraordinarily lavish executive pay package for the senior executives of Xstrata, among them former CEO Mick Davis. The Anglo-Swiss mining company officially merged with Glencore only last week to create a mining and trading giant with a market value of £44-billion ($68.4-billion) and deep links to Canada, where it owns grain handler Viterra Inc. and nickel miner Falconbridge Ltd.

Alcoa and Alcan postpone Quebec smelter upgrades – by Sophie Cousineau (Globe and Mail – May 17, 2013)

May 17, 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.

MONTREAL — With an aluminum market weighed down by surpluses, Alcoa Inc. and Rio Tinto Alcan are postponing billions in upgrade and expansion plans to their smelters in Quebec.

While some 750 Rio Tinto Alcan employees will get to keep their jobs longer, 500 Alcoa workers will be pushed into early retirement.

Alcoa is deferring by three years the $1.2-billion modernization of its Baie-Comeau smelter. But the aluminum producer is still going ahead with plans to shut down two of the plant’s old potlines. The dismantling of those Soderberg potlines, which will take place over the next two years, will eliminate 500 positions, or about a third of the smelter’s 1,400-employee work force.

This is the second time the American producer has reviewed its plans for the upgrade of the Baie-Comeau smelter, which was built in 1957. The Pittsburgh-based company first unveiled plans to modernize the smelter in 2008, but gave the final go-ahead on Nov. 7, 2011, after securing a 25-year electricity procurement deal with the Quebec government.

For its part, Rio Tinto Alcan is also pushing back, by three years to 2019, completion of the $2.1-billion investment plan it unveiled in 2006.

‘All the facts’ support Keystone pipeline, Harper tells U.S. audience – by Joanna Slater (Globe and Mail – May 17, 2013)

May 17, 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.

Prime Minister Stephen Harper made a stark case for the Keystone XL pipeline to an influential New York audience, saying no further debate is necessary and an increasing supply of oil from Canada is inevitable.

“This absolutely needs to go ahead,” Mr. Harper said during a packed session at the Council on Foreign Relations in Manhattan. “All the facts are overwhelmingly on the side of approval.”

The only “real immediate environmental issue here,” he added, “is do we want to increase the flow of oil from Canada via pipeline or via rail.”

Mr. Harper’s trip marks a new tactic in an all-out effort by the Canadian government to counteract the project’s opponents and ensure that the pipeline moves forward. The push includes an ad campaign launched this week and rotating visits to the U.S. by a parade of cabinet ministers.

On Thursday, however, Mr. Harper did the selling himself. His destination is a stronghold of Democratic voters, some of whom oppose the Keystone project.

Gold’s dichotomy: Investment demand plunges, but consumers keep buying (National Post – May 17, 2013)

May 17, 2013

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

Today’s gold market is being defined by two trends: aggressive selling by investors in North America through exchange-traded funds, and aggressive buying by consumers in Asia. But for now, the ETF investors are overwhelming everyone else.

Gold prices settled below US$1,390 an ounce on Thursday, and after five rough trading days in a row, they are approaching the lows that were reached during last month’s dramatic collapse.

Amid that turmoil, the World Gold Council (WGC) issued a report that shines a light on how rapidly investors are dumping their holdings.

The report shows that overall gold demand fell 13% in the first quarter of 2013 compared to the same period a year ago. While that is not too bad on the surface, investment demand fell an astounding 49%. Investors sold a net 176.9 tonnes of gold through ETFs in the quarter, or roughly US$9.3-billion worth of the yellow metal.

The gold market is very small, with total demand of about 1,000 tonnes per quarter, according to the council. That means fluctuations in ETF holdings can have an outsized effect on the paper price.

Can Big Oil handle the Arctic? – by Claudia Cattaneo (National Post – May 17, 2013)

May 17, 2013

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

CALGARY – With the public increasingly worried about oil spills, some aboriginal groups calling for an Arctic drilling moratorium, and the oil industry as keen as ever to tap Northern deposits, oil spill response preparedness was a big topic of discussion at the Arctic Council meeting in Sweden this week.

As Canada, which has large untapped deposits under the Beaufort Sea, assumed its chairmanship on Wednesday, the group of the eight nations that surround the North Pole signed a pact on oil spill prevention in Kiruna, Sweden’s most northern city.

Coinciding with the meeting, the London-based International Association of Oil & Gas Producers (OGP), whose member companies produce more than half of the world’s oil, was eager to talk about industry efforts to improve handling of oil spills in Arctic environments, which it says have advanced significantly in recent years.

Non-governmental organizations such as the OGP and Greenpeace requested observer status at the council but their requests were denied. The OGP, which had hoped to use the platform to engage and collaborate with those with an interest in Arctic oil-spill response, said much progress was made in the past year as a result of the establishment of a joint industry program (JIP) focusing on key areas of research.

Neskantaga First Nation finds hope after suicide crisis – by Jody Porter (CBC News Thunder Bay – May 17, 2013)

May 17, 2013

http://www.cbc.ca/thunderbay/

North-South Partnership helps Neskantaga youth express themselves through art

Artwork created by young people in Neskantaga First Nation will soon be on display in Toronto as part of an effort to help the community recover from a suicide crisis.

The fly-in community, located about 480 kilometres northeast of Thunder Bay, declared a state of emergency April 17 after two young men killed themselves in less than a week. “In our community it was very devastating. It still is,” said First Nation counsellor Kelvin Moonias. “The tremendous loss we had.”

Moonias said he had felt overwhelmed by the grief in the tiny First Nation, home to about 300 people, and was grateful to see a team of helpers arrive from Toronto. “After seeing first-hand what these people can do and that they truly care, it really touched my heart,” he said.

The North-South Partnership for Children sent 17 people into the community, partly in response to the crisis. The agency brings together philanthropists in southern Ontario with northern First Nations. When the southerners arrived, young people in Neskantaga asked them to help organize an art and music festival.