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NEWS RELEASE: New report shows importance of coal to B.C.

http://www.coal.ca/

February 15, 2013

A new report from PwC shines a light on the important the important role coal plays in B.C.’s economy and how it contributes to a better B.C.

Report: Economic impact analysis of the coal mining industry in B.C.: http://www.coal.ca/wp-content/uploads/2013/02/FINAL_Coal-Association-of-Canada_BC-EIA-Feb-15-2013-1.pdf

In 2011, the coal industry generated an estimated $3.2 billion in provincial GDP and approximately $715.2 million in tax revenue for all levels of government including $399 million in tax revenue generated by economic activity and $316.2 million in mineral tax payments to British Columbia. The revenue collected by government helps to pay for government infrastructure including schools, roads and hospitals as well as provincial services and supports.

The majority of the coal mined in British Columbia is metallurgical coal – which is used to make steel and essential competent of modern life. The majority of coal produced in B.C. is exported to Japan and South Korea. It’s in high demand from consumers because of its low sulfur, low ash, and high carbon content which burn more cleanly than other coals.

Coal also creates jobs. Over 26,000 people are directly employed by the coal industry and they earn higher than average wages. For example, the estimated annual wage for those directly employed by coal companies was $95,174, twice the average provincial wage of $43,500!

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HD Mining seeks talks with unions over temporary foreign workers – (CBC News – February 7, 2013)

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

Company wants to work with unions to expedite training of Canadian workers

A B.C. mining company says it wants to end its legal battle with labour unions and resume preliminary work opening up a coal mine in Tumbler Ridge with temporary workers from China.

In a letter to addressed to two B.C. labour unions involved in the dispute, HD Mining Chair Penggui Yan said the company is prepared to continue its legal defence of its decision to import 201 temporary workers from China under a federal program, rather than hire Canadians for the highly specialized job.

But Yan says the company would rather open negotiations with the union with the aim of getting work restarted at the mine while accelerating the training of Canadian workers.

The company proposes starting the work with the Chinese workers for the first two years to determine if the mine is viable, while it opens the negotiations with the unions to expedite the training of Canadian workers for the second phase of the project, if the mine proves viable.

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Teck Resources changes tune on acquisition opportunities – by Peter Koven (National Post – February 8, 2013)

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

When Teck Resources Ltd. holds its quarterly earnings conference calls, chief executive Don Lindsay is always asked about acquisition opportunities. His usual response is that Teck is looking, but price tags are too high.

That changed on Thursday’s call. He acknowledged that values have come down in recent months and more assets have come available. That includes projects in the iron ore sector, an industry that Teck has been eager to break into for years. Mr. Lindsay also speculated more assets could come available as many large mining companies are writing down projects, firing senior management and cleaning up their portfolios.

Teck has not made a major acquisition since 2008, and this would be a reasonable time to do it. In addition to the iron ore opportunities, the Vancouver-based miner is facing declining copper production over the next couple of years. Its key copper growth projects in Chile are being held up by permitting delays, meaning it is unclear when they will reach production.

“Something that might fill the gap would be of interest to us,” Mr. Lindsay said. However, he tempered speculation that Teck will do a deal. He said it remains “pretty tough” to pull off a successful transaction, and pointed out that Teck’s “stay the course” strategy of organic growth is poised to deliver major production increases for shareholders in the years ahead.

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HD Mining chief makes his case for hiring temporary foreign workers – by Wendy Stueck (Globe and Mail – February 5, 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 — In a downtown office, Penggui Yan is sketching on a white board, using pictures to illustrate mining techniques and back his claim that he needs to hire Chinese workers to determine whether the Murray River project near Tumbler Ridge can be a viable mine.

The proposed project would use a technique known as longwall mining, which extracts coal in long seams rather than the so-called room-and-pillar model used in existing coal mines in Canada. To make the method work, you need employees that understand the equipment, methods and dangers – including potentially explosive gases – of working in such an environment, Mr. Yan insists.

“You have to have that continuity,” Mr. Yan said on Monday. “You have to allow me to prove this mine is mineable. For the time being, I don’t know if it’s mineable. I am taking $150-million out of my own pocket to prove this will be a mine.” Exploration and bulk sampling would amount to $150-million of a projected $300-million cost to build the mine, Mr. Yan said.

For Mr. Yan, the chair of Vancouver-based HD Mining International Ltd., the logic behind hiring foreign workers is unassailable. Others, however, have questioned the company’s rationale. Two unions have launched a court case to challenge the process that cleared the way for HD Mining to hire 200 foreign workers at Murray River.

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Investors look to Teck for clues to China’s path – by Pav Jordan and Brent Jang (Globe and Mail – February 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.

When Don Lindsay talks about China, he can’t help but mention the 200,000 kilometres of power transmission lines the country plans to install over the next five years.

“That’s a lot of copper,” the president and chief executive of Teck Resources Ltd. told mining aficionados packed into a ballroom in Vancouver last week.

Addressing the Association for Mineral Exploration B.C. conference, Mr. Lindsay also predicted that China will enjoy robust economic growth this year, fuelling demand for the metals his company produces, like copper and zinc.

Teck Resources, Canada’s largest diversified miner and a major exporter of coking coal for steel making, reports its fourth quarter and year-end financial results on Thursday.

The results are expected to compare unfavourably against those of the prior year, reflecting one of the most tumultuous periods for the global mining industry since the recession.

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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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Chinese miners sent home in B.C. workers dispute – by CBC News (January 28, 2013)

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

HD Mining says it has also delayed plans to bring more miners from China

The company that brought miners from China to work on a B.C. coal project says it is sending some of the workers back home and is not bringing any more to Canada for the time being due to court delays.

Two unions are challenging the government’s decision to allow HD Mining to bring about 200 Chinese miners to work in northern B.C., rather than hire Canadians. HD Mining announced in a release Monday that its 16 temporary foreign workers on the Murray River project are returning to China.

The workers were to have taken part in the extraction of a 100,000-tonne coal sample to determine the viability of full mine development, the company said.

“This was a difficult decision for us, but we are very concerned about the cost and disruption this litigation brought by the unions has caused to the planning of the project,” said Jody Shimkus, the mine company’s vice-president of environmental and regulatory affairs.

“We have also decided to delay bringing any additional workers to Tumbler Ridge until we have reliable certainty.”

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Coal mine has benefit for Canada regardless of imported workers – Vancouver Sun Editorial (January 25, 2013)

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

The controversy over HD Mining’s plan to bring in Chinese miners has overshadowed what otherwise would have been an entirely good news story. The mines being developed by HD Mining International Ltd. near Tumbler Ridge are bringing new investment and will create new wealth in this province to the benefit of the town, the province and the country.

By its own account, HD Mining has already spent more than $50 million on Canadian goods and services in the Murray River project and it will spend close to that again before it knows for certain that it has a mine that will return its investment.

The money spent so far includes $20 million on exploration, $15 million for surface work and another $15 million for a 92-unit development to house workers in Tumbler Ridge, which until the resurgence of interest in coal mining in the past decade was in danger of becoming a ghost town.

HD Mining is developing a coal deposit that is more than 500 metres underground. It is on a property that was previously owned by other companies that looked at the difficulties involved and gave it a pass.

HD has expertise its parent company uses in coal mines in China that it believes can be used profitably here. Part of it involves a process called long-wall mining, which is a technique commonly used in coal mines in the United States and elsewhere, but has so far never been used in Canada.

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Excerpt from “The History of Mining: The events, technology and people involved in the industry that forged the modern world” – by Michael Coulson

To order a copy of The History of Mining please click here: http://www.harriman-house.com/products/books/23161/business/Michael-Coulson/The-History-of-Mining/

COAL IN THE UK and THOMAS POWELL (1779-1863)

The first nation to fully embrace the Industrial Revolution was Great Britain, the leading military power in the world at the start of the 19th century, and also a leader in industrial innovation. However, coal had been mined in Britain since, and possibly even before, the coming of the Romans in the 1st century. Originally it had been used in fires and forges for working metal, a role that it had held for many centuries in other parts of the world.

Mining in these earlier times was quite crude, favouring surface accumulations of coal, and when these were exhausted shallow drifts would be driven into the coal to allow mineworkers to mine it at shallow depth. As long as the British economy remained primarily agrarian, the use of coal was not widespread. Gradually, a number of significant engineering advances stimulated interest in coal mining and provided the Industrial Revolution with the means to materially quicken the pace of development.

Coal and the invention of machines, to both improve coal mining and to utilise the power that coal could generate, drove the early decades of the Industrial Revolution. Thomas Savery and Thomas Newcomen were credited with inventing the steam engine in the 18th century, which allowed pumping to take place in the mines to remove water as coal mining moved to new depths.

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Rio reviews Mozambique as miners retreat from big plans – by Agnieszka Flak and Clara Ferreira-Marques (Reuters.com – January 22, 2013)

http://www.reuters.com/

JOHANNESBURG/LONDON, Jan 22 (Reuters) – Rio Tinto has begun a review of its Mozambique coal mining operations which cost it a $3 billion write-off, reconsidering development plans, partners and its options for getting the coal from pit to port.

Rio’s troubles in Mozambique offer a cautionary tale on big projects in new areas, which have become increasingly unattractive for miners under pressure from shareholders to control spending and improve returns.

A source familiar with the project said the review was underway. “The reality is that Rio has to look at what it has, and at what options there are,” said the source. The focus is not currently on a sale, although a new project partner could help Rio to share the infrastructure and development costs.

Rio sacked chief executive Tom Albanese last week when it wrote off $14 billion on the value of its aluminium arm and the Mozambique coal assets it bought in 2011. Mozambique’s infrastructure had proved more challenging than expected, Rio said, and estimates of recoverable coking coal used in steel production were lower than expected.

Benga mine, in which India’s Tata Steel owns a minority stake, began exporting last year but the amounts remain a small fraction of the eventual estimated capacity of Rio’s total Mozambique coal assets.

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‘With tourism, you need local buy-in to succeed’: Why Shania Twain’s shrine died, but Anne Murray’s lives on – by Tristin Hopper (National Post – January 10, 2013)

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

Last week, Timmins city council announced the Shania Twain Centre, the city’s 11-year, multi-million-dollar bid to lure tourists to the heart of Northern Ontario, was coming to an ignominious end.

Responding to Timmins’s entreaties, Vancouver-based Goldcorp bought the property for an undisclosed sum and, within a few years, the site of the 12,000-square-foot centre will be part of a new mining project. “I think they probably are going to take the buildings down,” said Tom Laughren, Timmins mayor.

Two small Canadian mining towns, both of whom spawned famous singers, yet one attraction lives while the other dies. The reason, it turns out, may be a fable of nostalgia versus modernity, grassroots gumption versus government bungling and the cruel twists of highway geography.

“She’s our hometown girl,” said Maxwell Snow, Springhill’s mayor. Until their favourite daughter became the CanCon selection of choice in the mid-1960s, Springhill was mostly known to Canadians as the site of two devastating mine disasters.

Describing the Anne Murray Centre’s late-1980s origins as “grassroots,” employee Marcie Meekins said it was spawned by some volunteers with the Springhill Industrial Commission who teamed up with her mother Marion.

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Ontario coal-burning power plants to close this year – by John Spears (Toronto Star – January 10, 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.

Ontario’s last coal-burning power plants will close by the end of this year, Premier Dalton McGuinty is expected to announce Thursday. The closure is either one year earlier than scheduled, or six years late, depending on your perspective.

The current deadline for closing the coal plants is Dec. 31, 2014 — which makes the new deadline a year early. But the McGuinty government had ridden into office in 2003 promising to close the coal plants by the end of 2007.

By that measure, the closure comes six years late. Closing the coal plants had been one of the Ontario Liberals’ signature promises, which they used to differentiate themselves from the Progressive Conservatives in the 2003 election.

“We’ll replace our dirty, outdated coal-fired electricity plants — the biggest source of air pollution in Canada — with cleaner burning natural gas, and renewable energy such as wind and solar,” McGuinty had vowed during the campaign.

Once in office, McGuinty found he couldn’t meet his 2007 deadline, as demand for power grew and Ontario struggled to keep the lights on.

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Steelworkers suggest B.C. coal mines controlled by Chinese government – by Dirk Meissner (iPolitics – December 19, 2012)

 http://www.ipolitics.ca/

The Canadian Press – VICTORIA – The United Steelworkers says it has dug up what it calls close ties between the Chinese government and the reportedly privately-run coal mine in northeastern British Columbia embroiled in a foreign-worker controversy.

The union released a report Wednesday that suggests HD Mining International Ltd. — the firm developing the proposed Murray River mine near Tumbler Ridge — has ownership links to the government in China, where workers receive low wages in unsafe conditions.

A union report titled “Who Owns Huiyong Holdings and other Questions on Planned Chinese-Owned Coal Mines in B.C. ” examines the ownership of Huiyong Holdings Group, which owns Huiyong Holdings (BC) Ltd., and holds 55 per cent of HD Mining.

Steve Hunt, Western Canada director for the Steelworkers’ union, said Wednesday the union found little evidence of the company’s mining operations in China.

“We employed an investigator in China who has some knowledge of what goes on in China and we just searched the best we could possibly search and we couldn’t find very much detail on the company at all, other than some of the players,” he said. “We’re trying to find out something about the mines that they have. . .What are they experts in? It’s hard to do because we can’t find anything about them.”

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Coal to rival oil as dominant energy source by 2017: IEA – by John McGarrity (Reuters/National Post – December 19, 2012)

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

Coal will nearly overtake oil as the dominant energy source by 2017, and only a drop in world gas prices could curb the use of the dirtier fossil fuel in the absence of high carbon prices, the International Energy Agency said.

The IEA, the energy agency for developed countries, said earlier this year that without a major shift away from coal, average global temperatures could rise by 6 degrees Celsius by 2050, leading to devastating climate change.

China will use more coal than the rest of the world put together, while India will overtake the United States as the world’s second-largest consumer and become the biggest global importer, the Paris-based IEA forecast in its annual Medium-Term Coal Market Report, released on Tuesday.

“Coal’s share of the global energy mix continues to grow each year, and if no changes are made to current policies, coal will catch oil within a decade,” IEA Executive Director Maria van der Hoeven said in a statement.

Use of the highly-polluting fossil fuel has surged in the past decade, mainly because of stronger demand from China and India, where cheap coal-fired electricity has helped to drive breakneck economic growth.

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Why training workers in Canada beats importing them from abroad – by Barrie McKenna (Globe and Mail – December 17, 2012)

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 — Fast-tracking the entry of foreign workers to toil in Canada’s mines, oil fields and construction sites is certainly expedient. The work is there. So bring them in and get it done, for the sake of the economy. But a rented foreign work force is hardly an enduring solution to a skills shortage that Prime Minister Stephen Harper has called “the biggest challenge our country faces.” At best, it’s a stop-gap.

Labour shortages are now a permanent feature of Canada’s labour landscape. The country is staring at a decade or more of critical labour scarcities as the massive baby boom generation retires and the economy grows. Hundreds of thousands of jobs will go begging for electricians, welders, pipe fitters, heavy equipment mechanics and many other trades.

The federal government’s recent announcement that it intends to bring in an extra 3,000 skilled tradespeople next year may be welcome news for employers.

It’s one thing to bring in foreigners to do jobs Canadians can’t or won’t do. Farmers have been doing it for years to harvest crops. But the program betrays the national interest if it is being used as a cover to import workers whose only asset is a willingness to work for a lot less than Canadians.

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