Canadian Media Resource Articles – Page 618

Barrick faces new setback over Zambia mine – by Rachelle Younglai (Globe and Mail – October 31, 2014)

October 31, 2014

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.

Barrick Gold Corp. may idle its Zambian copper mine if the African government imposes a higher royalty, a potential blow to the Canadian company, which has worked hard to turn its fortunes around.

The world’s largest gold producer was in discussions with the government about reducing the proposed 20-per-cent rate when the Zambian president died this week, adding more uncertainty to the negotiations.

“At the end of the day if we are in a position where through a new tax regime the project doesn’t make money, then certainly we would have to consider suspending for a period of time,” Kelvin Dushnisky, Barrick’s co-president, said in an interview. “The copper remains in the ground. It’s not going anywhere. It wouldn’t make sense for us to run the mine just for the purpose of paying royalties and taxes.”

It’s another sign that the challenges are not over for Barrick, which like the rest of the gold industry continues to grapple with the fallout from weaker gold prices and expensive acquisitions gone wrong.

“The gold producers are stuck between a rock and a hard place,” said Pawel Rajszel, analyst with Veritas Investment Research. “There’s just not much the gold producers can do, except hope for a higher gold price.”

[Ian Ball] Out of McEwen’s shadow – by Kip Keen (Mineweb.com – October 31, 2014)

October 31, 2014

http://www.mineweb.com/

Ian Ball, former president of McEwen Mining, opens up. We talk opportunity next to Canada’s largest gold mine through Abitibi Royalties.

HALIFAX, NS (MINEWEB) – Ian Ball made a surprising career choice earlier this year. He left the relative comfort of McEwen Mining – groomed by Rob McEwen, the company’s chairman, controlling shareholder and also the former head of Goldcorp, to the position of president – to join a much smaller junior explorer called Abitibi Royalties. He’d been at McEwen for over a decade.

Or maybe it wasn’t so surprising.

In leaving, Ball, the right hand man of McEwen – who is no conservative in his approach to company building and discovery – showed he too is a risk taker, not just a career seeker.

Ball, now President of Abitibi, says in leaving McEwen he looks to create something according to his own vision, “the best gold company in the world,” he says at one point in a recent interview.

In describing his approach to building companies, and the reason why he wanted to join Abitibi Royalties, he turns to analogies meant to inspire awe, examples that struck him earlier this year and last in the tech sector.

Toronto mining company Sherritt to sell head office – by Lisa Wright (Toronto Star – October 30, 2014)

October 31, 2014

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.

Toronto-based mining company Sherritt International Inc. says it’s cutting the size of its head office workforce by 25 per cent and preparing to sell its Toronto office building.

Amid tumbling commodity prices, Sherritt International Inc. has begun a major restructuring that includes cutting its workforce by 10 per cent and the sale of its head office in Toronto, which will affect one-quarter of its staff.

The downsizing and real estate sales, including the Yonge St.-Summerhill Ave. headquarters and the technology division offices in Fort Saskatchewan, are expected to save the miner $10 million annually, said chief executive David Pathe Wednesday after releasing its third-quarter earnings.

The financial results included a net loss of $51.3 million from continuing operations in the three months ended Sept. 30 compared with a profit of $1.1 million a year earlier, before Sherritt sold its coal operations in Western Canada.

“It feels like the bottom of a bear market. And what are the signposts? Layoffs are one,” said veteran mining industry analyst Barry Allan of Mackie Research Capital Corp.

Ring of Fire ‘zero hope’ comment ‘startles’ mining minister – by Jody Porter (CBC News Thunder Bay – October 31, 2014)

October 31, 2014

http://www.cbc.ca/news/canada/thunder-bay

Michael Gravelle says latest comments from Cliffs only ‘solidify’ province’s commitment

Ontario’s mining minister says the Liberal promise to spend $1 billion dollars in the Ring of Fire still stands, despite dire words from the project’s main proponent.

Cliffs Natural Resources new chief executive officer told the Financial Post on Tuesday that he has ‘zero hope’ that the chromite mining project in Northern Ontario will be developed anytime soon.

“The comments from the CEO of Cliffs were somewhat startling,” said Minister of Northern Development and Mines Michael Gravelle. “What’s interesting about his comments is how quickly they were criticized by other members of the mining ministry who indicated they think he is wrong.”

Gravelle said 20 other mining companies have interests in the Ring of Fire. Many mining analysts believe those companies don’t have the financial backing to develop the project, but Gravelle remains optimistic.

“I think it only serves to solidify our commitment in terms of the one billion,” he said. “We recognize just how vital it is to build the infrastructure to what will be an extraordinary economic development project.”

Alberta pushes for rule change to spur Chinese investment – by Nathan Vanderklippe (Globe and Mail – October 31, 2014)

October 31, 2014

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.

BEIJING — Alberta’s new political leadership is calling on Ottawa to take another look at foreign investment rules blamed for a dramatic drop in energy investments from China.

When the federal government gave its approval of the $15.1-billion (U.S.) takeover of Nexen Energy ULC in late 2012, it came with a caveat: a raft of new policies intended to ensure such a deal would not happen again. Canada is not “for sale to foreign governments,” Prime Minister Stephen Harper said as he effectively blacklisted state-owned companies from further oil-sands takeovers.

The guidelines sparked worry in China, and prompted warnings from the energy industry, bankers and lawyers. The guidelines, some have said, are discriminatory against China, and have blocked a major source of money that could be used to build a new generation of Fort McMurray-area projects.

Now, the Alberta government itself is taking up those concerns with the federal government, in hopes of again prying open the spigots from China. “We are urging a review of some of the quick changes that were done to our Investment Canada Act,” said Ron Hoffmann, the province’s newly named senior representative for the Asia-Pacific Basin.

Report highlights economic impact of gold mining in Ontario – by Henry Lazenby (MiningWeekly.com – October 29, 2014)

October 30, 2014

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

TORONTO (miningweekly.com) – A recent independent report has highlighted the significant economic impact of Ontario’s mineral sector and found that all stakeholders – including miners, Aboriginal and other local communities, governments and supplier industries – benefitted from the sector’s activity.

The University of Toronto’s Rotman School of Management was commissioned by the Ontario Mining Association to assess the impact openpit and underground gold-mining scenarios in a relatively remote part of Northern Ontario would have on gross domestic product (GDP), employment and government revenue.

The school’s Peter Dungan and Steve Murphy of the Policy and Economic Analysis Programme authored the report and considered two hypothetic scenarios.

The first was to investigate the impact of building an openpit mine over three years at a capital cost of $750-million, while the second was to examine the impact on local economies of building an underground mine over the same period at a capital cost of $600-million.

The construction costs used in the study excluded all exploration, planning, permitting and other preconstruction expenditures.

The study found that an openpit mine would generate sales of $300-million a year, potentially for more than 20 years into the future, and employ 440 people on site with total compensation of $142 200 a worker.

Barrick Gold Trims Cost Forecast After Expenses Drop – by Liezel Hill (Bloomberg News – October 30, 2014)

October 30, 2014

http://www.bloomberg.com/

Barrick Gold Corp. (ABX), the largest producer of the precious metal, reduced its forecast for operating costs this year after reporting third-quarter expenses that beat analysts’ estimates.

So-called all-in sustaining costs will be $880 to $920 an ounce, compared with a previous range of $900 to $940, Toronto-based Barrick said yesterday in its third-quarter earnings statement.

Barrick is among gold producers that have reined in spending and delayed growth plans after the metal’s 28 percent decline last year. Third-quarter costs fell 8.8 percent to $834 an ounce, compared with the $916 average of three estimates.

“Their earnings look reasonably good, the cash costs are good, the guidance looks good,” David Christensen, chief executive officer of San Mateo, California-based ASA Gold & Precious Metals Ltd., said in a phone interview. His company manages $250 million including Barrick shares. “All in all, it looks like they’ve done a good job.”

Earnings excluding one-time items were 19 cents a share, topping the 17-cent average of 23 estimates compiled by Bloomberg. Sales declined 13 percent to $2.6 billion, exceeding the $2.49 billion average estimate.

Minister promotes N.L. iron ore in China – by Ashley Fitzpatrick (St. John’s Telegram – October 30, 2014)

October 30, 2014

http://www.thetelegram.com/

Lab West waiting as Derrick Dalley presses mining sector investment

Eight months after the idling of the Scully Mine in Wabush, less than a month after putting a pin in construction of a mine-fuelling power line and facing continued, dismal pricing for iron ore, the Government of Newfoundland and Labrador is actively promoting iron mining in Labrador West.

Natural Resources Minister Derrick Dalley told The Telegram Wednesday the potential in iron ore was key to his presentations and conversations during a 10-day mission to China earlier this month.

He took to the microphone at industry gatherings in Shanghai and Beijing, at the Canada Natural Resources Forum and Canada Mineral Investment Forum. He met with the Canadian Ambassador to China, representatives for China’s National Development and Reform Commission, and Ministry of Land and Resources, and steel producers from companies including Wisco and Hebei Iron and Steel.

“From my perspective, it was a great opportunity to reinforce the relationship that we had forged in recent years, to understand the China economy, but as well to present on behalf of the province some opportunities and to encourage Chinese investment,” he said.

The province, it was noted in a statement issued earlier this month, provided $13,900 to help Mining Industry NL representatives make the trip and maintain a trade show booth at China Mining, the continent’s largest mining conference.

How green energy is fleecing Ontario electricity consumers – by Ross McKitrick and Tom Adams (National Post -October 30, 2014

October 30, 2014

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

Adding renewable generating capacity triggers changes throughout the system that multiply costs for consumers

Ontario’s green energy transformation – initiated a decade ago under then-Premier Dalton McGuinty – is now hitting consumers. The Nov 1 increase for households is the next twist of that screw. As Ontario consumers know all too well, the province has gone from having affordable electricity to having some of the highest and fastest-increasing rates in Canada.

Last year, in a report for the Fraser Institute called “Environmental and Economic Consequences of Ontario’s Green Energy Act,” one of us (McKitrick) explained how the Green Energy Act, passed in 2009, yielded at best tiny environmental benefits that cost at least ten times more than conventional pollution control methods, and was directly harming growth by driving down rates of return in key sectors like manufacturing.

But complex financial structures and a lack of official disclosure around large embedded costs have let supporters of the green energy act deny that green power is responsible for the price hikes. Green industry advocates, including the consulting firm Power Advisory and advocacy group Environmental Defense, have added up the direct payments to new renewable generators, and concluded that since those costs are relatively small, the impact of renewables on the total cost of power is likewise small.

However, such analyses ignore the indirect costs that arise from the way renewables interact with the rest of the power system.

Teck Resources water-treatment plant shut after dead fish found – by Mark Hume (Globe and Mail – October 28, 2014)

October 29, 2014

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 $100-million treatment plant that is a key piece of Teck Resources Ltd.’s plan to address a selenium pollution problem in British Columbia’s Elk Valley has been taken off line because of a fish kill.

In a statement, Teck says the Line Creek plant, which went into operation in July, temporarily shut down “as a precautionary measure” while technicians try to figure out what went wrong. Teck states a problem was first noticed Oct. 16 when “fish were found deceased in the area of the water-treatment facility.”

A total of 45 fish were found dead near the plant, which was built as part of a $600-million, five-year plan to address the pollution threat to westslope cutthroat trout and other aquatic life in the Elk Valley.

Environment Canada recently reported selenium levels are so high in the Fording River that trout are hatching with deformed gills, fins, jaws, spines and craniums. Teck’s statement says the cause of the Line Creek fish kill isn’t known at this time.

Sudbury mines given hundreds of health and safety work orders (CBC News Sudbury – October 29, 2014)

October 29, 2014

http://www.cbc.ca/news/canada/sudbury

Orders cover such areas as hoist maintenance, ventilation, and preventing water accumulation

Details of health and safety orders issued to Sudbury-area mines hint at the dangers of working underground.

The Ministry of Labour provided CBC News a breakdown of orders that have been given to First Nickel’s Lockerby Mine, Vale’s Stobie and Creighton Mines, Xstrata’s Nickel Rim South and Quadra FNX/KGMH International’s Levack mine over the past three years.

The orders cover such areas as hoist maintenance, ventilation, and preventing water accumulation. Out of the five, Lockerby Mine had the most orders, totalling more than 200. Stobie had the second highest number, at more than 180. The other three had fewer than 100 each.

NDP mining critic and Timmins-James Bay MPP Gilles Bisson speculated on the varying number of work orders issued to the mines.

“Is it the style of management? Is it what is going on with the workers? But clearly, we need to make sure that whatever is going on there is properly dealt with,” he said. Bisson said the number and types of orders don’t provide a clear enough picture to make any quick judgments.

Gold Mining Stocks Diverge in Wake of Metal’s Decline – by Liezel Hill (Bloomberg News – October 28, 2014)

October 29, 2014

http://www.businessweek.com/

A chasm is opening up between the best- and worst-performing gold mining stocks as the price of the metal languishes near a four-year low.

Companies with low-cost mines and little or no net debt, including Eldorado Gold Corp. (ELD) and Randgold Resources Ltd. (RRS), have beaten gold’s 2.5 percent rise this year. More indebted rivals including Toronto-based Barrick Gold Corp. (ABX), the world’s largest producer, and Yamana Gold Inc. (YRI) have declined more than 15 percent.

There were 115 percentage points separating the average of the five best and five worst performers this year through yesterday in the Standard & Poor’s/TSX Global Gold Sector Index, almost double the spread in the same period last year, according to data compiled by Bloomberg.

“There’s been a very big divergence between the performance of gold equities globally,” Neil Gregson, a London-based natural-resources equities fund manager at JPMorgan Chase & Co., said in a phone interview. Last year, gold stocks fell more or less across the board as the metal plunged the most in three decades. In contrast, this year “it’s very, very stock-specific,” Gregson said.

Gold miners as a group are trading at their cheapest relative to the price of the metal in at least 30 years, according to data compiled by Bloomberg. Gold futures, which are wallowing about $50 above a four-year low, rose 0.2 percent to $1,231.20 an ounce at 9:34 a.m. in New York.

New Cliffs CEO sees ‘zero hope,’ no asset sale in Ontario’s Ring of Fire – by Peter Koven (National Post – October 29, 2014)

October 29, 2014

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

The new chief executive of Cliffs Natural Resources Inc. doubts that Ontario’s “Ring of Fire” will be developed for decades to come, or that anyone will buy his company’s rich chromite assets in the region in the near future.

Lourenco Goncalves, 55, said in an interview Tuesday that he has “zero hope” that a solution will be reached to spur on development in the region anytime soon.

“I don’t believe under my watch, and I plan to stay [alive] for the next 50 years… that the Ring of Fire will be developed,” he said.

A handful of junior mining companies, including KWG Resources Inc. and Noront Resources Ltd., are more optimistic and are interested in buying Cliffs’ Ring of Fire properties. But according to Mr. Goncalves, they all have the same problem: “They do not have any money.”

His comments have to be discouraging for the Ontario government, which made the Ring of Fire the centerpiece of its northern development plans. To date, Cleveland-based Cliffs is the only large mining company to take a serious interest in the area.

The Ring of Fire, located in the remote James Bay Lowlands, was discovered amid much fanfare in 2007. It is thought to hold about $60-billion of chromite, base metals and other minerals.

Botswana, Africa’s diamond, risks losing its sparkle – by Tiisetso Motsoeneng and Joe Brock (Globe and Mail – October 27, 2014)

October 28, 2014

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.

Reuters – When environmental scientist Bakang Bogopa graduated first in his class from the University of Botswana two years ago he did not expect that his first job would be moving furniture or that he would still be living off handouts from his mother.

Bogopa, who studied on a government scholarship, is among thousands of unemployed graduates in Botswana who exemplify both the country’s swift economic progress in the five decades since independence from Britain, and the challenges it now faces.

One of the world’s poorest countries in the 1970s, Botswana transformed into one of its fastest-growing economies by harnessing around $3-billion a year in diamond sales, to become the world’s biggest producer, and gained middle-income status.

The landlocked country of just two million has also been heralded as a beacon for African democracy, avoiding the conflict and corruption that has ravaged resource-rich countries across the continent.

But dependence on its wealth from the diamond industry is catching up with the southern African country.

Crude prices dive on Goldman Sachs forecast of $70 oil – by Shawn McCarthy, Carrie Tait and Jeffrey Jones (Globe and Mail – October 28, 2014)

October 28, 2014

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 and CALGARY — Crude prices dove below $80 (U.S.) a barrel in trading Monday after Goldman Sachs Group Inc. released a grim forecast that argued prices have further to fall and won’t recover until some U.S. unconventional oil producers are squeezed out of the market.

The United States has been the world’s fastest growing crude producer thanks to the shale oil boom on North Dakota and Texas, but Goldman said the pace will slow as North American crude prices plunge as low as $70 a barrel by next spring. They forecast West Texas Intermediate will average $75 a barrel in the second half of 2015, and $80 in 2016.

“We are lowering our oil price forecast to reflect the required slowdown in U.S. production growth,” Goldman analysts wrote. They rejected any suggestion that top producers from the Organization of Petroleum Exporting Countries, led by Saudi Arabia, would come to the rescue of global producers.

“We believe that OPEC will no longer act as the first-mover swing producer and that U.S. shale oil output will be called upon to fill this role,” they said.