Gold and Silver – Page 262 – Republic of Mining

NEWS RELEASE: Strong Investor Interest and Industrial Usage Lead to Sturdy Silver Demand in 2014

July 18, 2014

(Washington, D.C. – July 17, 2014) – Investor and industrial consumption of silver has advanced at a healthy pace in 2014, reflected in the silver price increasing 5 percent as of July 15 from the beginning of the year.

Building on an impressive 2013, investors continued to boost silver holdings in the first half of 2014. Silver exchange traded funds (ETF) backed by physical silver added 7.0 million ounces (Moz) of silver bullion through June; in contrast, gold ETF holdings dipped by 1.4 Moz ounces over the same time period. Globally, silver bullion coin sales are up 4.5 percent through the 1st quarter of 2014, according to precious metals consultancy Thomson Reuters GFMS. U.S.

Mint sales of American Eagle Silver Bullion coins maintained near record level sales, totaling 24.1 Moz for the first six months of 2014, just shy of the 25.0 Moz sold in the first half of 2013, threatening to overtake the record sales of 42.7 million American Eagle coins acquired by investors last year. Other silver investment products, such as silver bar consumption, appear to be easing so far this year after a strong showing in 2013.

Industrial demand for silver in critical sectors, such as ethylene oxide production, has increased significantly in the first half of the year and is expected to increase 23 percent this year to 8.0 Moz, according to Thomson Reuters GFMS. Ethylene oxide is a vital building block chemical, critical to production of detergents, solvents, plastics and a broad range of organic chemicals, and is an example of the unmatched importance of silver in industry.

Demand for silver in the photovoltaic industry has been driven by a global increase in renewable energy over the past decade, leading to a proliferation of solar module production.

Barrick Gold CEO Jamie Sokalsky steps down, replaced by co-presidents – by Lisa Wright (Toronto Star – July 17, 2014)

July 17, 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.

Management shakeup puts new board chairman John Thornton’s stamp on miner following recent departure of company founder Peter Munk.Management shakeup puts new board chairman John Thornton’s stamp on miner following recent departure of company founder Peter Munk

After two years spent overhauling ailing Barrick Gold Corp., president and CEO Jamie Sokalsky will step down in September as part of sweeping changes to the miner’s management structure.

The announcement Wednesday that two co-presidents will soon share the helm comes just 10 weeks after the departure of Barrick founder Peter Munk, and is clearly new board chairman John Thornton’s first big stamp on the leadership of the world’s biggest gold miner, analysts say.

“He was brought in to bring change, and he’s bringing change,” said John Ing, president of Maison Placements Canada.
Eliminating the role of CEO may also leave the door open for the resumption of merger talks with Newmont Mining Corp., Barrick’s biggest rival, said TD Securities mining analyst Greg Barnes in a note to clients.

Barrick CEO Jamie Sokalsky to step down in management overhaul – by Peter Koven (National Post – July 16, 2014)

July 16, 2014

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

Barrick Gold Corp. is making sweeping changes to its senior management structure, appointing two presidents and announcing that chief executive Jamie Sokalsky will step down.

Executives Kelvin Dushnisky and Jim Gowans will become co-presidents of the company, while Mr. Sokalsky will leave as of September 15. CFO Ammar Al-Joundi is being given new responsibilities as senior executive vice president, and human resources head Darian Rich will take on a new role as head of talent management.

The surprise shake-up appears to be chairman John Thornton’s first big imprint on the company since Peter Munk retired in April and he assumed the top job on his own. Prior to that, he and Mr. Munk were co-chairmen.

Toronto-based Barrick, the world’s biggest gold producer, said this new management structure will help the company meet the “distinct demands and challenges” of the mining industry in the 21st century.

“These structural changes put an even greater emphasis on operational excellence, and will accelerate our portfolio optimization and cost reduction initiatives, while fostering a partnership culture both inside the company and externally,” Mr. Thornton said in a statement.

“Internally, that means our people will be financially invested for the long-term in Barrick’s success, and personally committed to a culture of teamwork that balances individual and collective responsibility and accountability.

Gold Has Biggest Loss of 2014 as Portugal Concerns Ease – by Luzi Ann Javier (Bloomberg News – July 14, 2014)

July 14, 2014

http://www.bloomberg.com/

Gold futures posted the biggest decline in almost seven months as Portuguese banking concerns eased and equities gained, diminishing demand for haven assets.

Portuguese 10-year government bonds were set for the biggest two-day advance in a month on speculation that Portugal would contain financial woes at one of its banking groups. The Standard & Poor’s 500 Index added as much as 0.6 percent after Citigroup Inc. reported profit that topped analysts’ estimates.

The drop comes after gold capped the longest run of weekly gains since 2011, partly as missed payments on notes by a parent company of Portugal’s second-biggest bank renewed concern that Europe hasn’t resolved its debt crisis. EU spokesman Simon O’Connor said July 11 that the country has taken steps to shore up its financial system. Goldman Sachs Group Inc.’s Jeffrey Currie reiterated his outlook for lower bullion prices as confidence increases in the economic recovery and inflation remains tame.

“A strong stock market and some stability in the EU” are pressuring gold, Peter Thomas, a senior vice president at Zaner Group LLC in Chicago, said in a telephone interview. “A lot of people were looking at Portugal as a domino effect, and as we saw, O’Connor prevailed and it didn’t have a significant impact.”

Newmont Gives Glittering Opportunities for Ghana’s Talent – by Joe Kirschke (Engineering and Mining Journal – July 3, 2014)

July 14, 2014

http://www.e-mj.com/

Since Portuguese navigators first arrived in the 15th century, mining, production and export of gold have been integral to Ghana’s history. Through the later christening of a “Gold Coast” by British colonialists and the emergence of sub-Saharan Africa’s first sovereign nation in 1957, Ghana today also hosts the continent’s No. 2 reserves of the ore.

Yet as in all too many developing nations, Ghana’s gold mining business, representing 90% of 2011 mineral exports—and $2.7 billion by Q3 2013—is not always a kind one. Fatalities from artisanal mining have been toxic as its mercury, while unrest involving illegal Chinese miners culminated in 169 deportations to their mainland last year. “Gold is a curse to this nation!” thundered a columnist in The Chronicle, a local newspaper, shortly thereafter.

But many elements of Ghana’s mining culture—in particular Accra’s ratification of U.N. International Labor Organization (ILO) standards—reflect positive clarity, too. Others include worker apprenticeship programs at Newmont Mining Corp.’s Ahafo and Akyem projects—samples of how, via smart Corporate Social Responsibility (CSR), profits and prosperity are sparkling hand-in-hand in one of Africa’s most mature democracies.

The apprenticeships date back to 2004 when 722 local men and women joined the construction phase of the Ahafo mine ahead of Q3 2006’s first production, said Adiki Ayitevie, communications director for Newmont Africa. The program was soon upgraded to a “Semi-Skilled Metals Construction Labor Program,” wherein 324 young men and women were trained in metal working and safety; the World Bank’s International Finance Corp. (IFC) investment wing noted Ahafo was already ahead of schedule, given strong community engagement.

In search of yield – by Allan Seccombe (Miningmx.com – July 14, 2014)

July 14, 2014

http://www.miningmx.com/

[miningmx.com] – NEAL Froneman can always be relied upon to spring a surprise. Whilst head of Uranium One in 2007, he took the company into a partnership with former Soviet assets owned by Kazakhstan. It’s what you might call ballsy.

Now, as the leader of Sibanye Gold, South Africa’s largest gold producer, he is considering a foray into platinum – a move his critics think is full of potential potholes. At Uranium One, the goal was market share; at Sibanye Gold, it’s dividends, or in investment-speak, yield.

Froneman has the backing of key shareholders for such a strategy, but it could be risky, especially if he doesn’t get exactly the right project. Yet, if the gamble pays off it will cement Sibanye as a must-have share for investors attracted to dividend flows.

“When you are a yield player, the sustainability of your yield is actually very important from a valuation point of view,” Froneman said in an interview at his offices, formerly a hospital for Libanon mine, the west Rand mine Sibanye Gold owns.

“We’ve been engaging our shareholders on a very high level on the strategy of the company. We’ve brought them into the company based on free cash and dividend yield.

They’ve made it very clear that provided as it’s along the lines we discussed earlier, they would be supportive in principle, but it will depend on the particular transaction.

Are we due for another massive gold and silver price smash? – by Lawrence Williams (Mineweb.com – July 14, 2014)

July 14, 2014

http://www.mineweb.com/

A big rise in gold and silver shorts held by the big commercial banks not seen since the 2013 gold price smashdown, could suggest a repeat is in the offing.

LONDON (MINEWEB) – The signs are all there. The big investment banks – JPMorgan in particular – which have the financial clout to move the markets on their own through massive paper sales in the futures markets have, it is reported, been building short positions in gold and silver to a level not seen since just ahead of the big gold price smashdown of April last year.

Is history about to repeat itself? If we get another high profile bank analyst issuing a strong ‘sell short, or ‘slam dunk sell’ gold recommendation in the next few days then it may presage another attempt to knock the gold price, and the silver price, down very sharply. As was shown last April, such a move could negate any gold price gains so far this year – and more.

As Ed Steer commented in his most recent newsletter in an analysis of the latest COT report which showed that the Commercial net short position on COMEX increased by 5,548 contracts, or 554,800 troy ounces. The Commercial net short position now stands at 16.6 million troy ounces. “You’d have to go back to March of 2013 to see the Commercials holding this big a net short position in gold.

It was from that point in March of last year where gold got clocked for $400 the ounce by the end of July.

PRECIOUS-Gold steadies near 3-1/2-month high, set for 6th weekly gain – by Jan Harvey (Reuters U.S. – July 11, 2014)

July 11, 2014

http://www.reuters.com/

LONDON, July 11 (Reuters) – Gold steadied near 3-1/2-month highs on Friday as stock markets recovered from the selloff seen in the previous session on concerns over the health of Portugal’s biggest bank, with the metal still on track for a sixth week of gains.

European shares recovered following Thursday’s slide, taking some upward pressure off gold, but investors remained cautious as Banco Espirito Santo attempted to reassure the market after trading in its shares was suspended.

Concerns over the financial stability of the euro zone have driven gold prices sharply higher in previous years, as investors bought the metal as a safe store of value.

Spot gold was at $1,337.50 an ounce by 1204 GMT, up 0.2 percent but off the previous day’s peak of $1,345, its highest since mid-March. U.S. gold futures for August delivery were down 20 cents an ounce at $1,339.00.

“Geopolitical uncertainty and concerns of any potential contagion into Portugal’s wider banking sector and indeed the euro zone’s wider banking sector were clearly supporting gold yesterday,” Mitsubishi analyst Jonathan Butler said.

“The longer-term trend since early June shows that there is still underlying strength in gold.”

PRESS RELEASE: First gold bar poured at Dufferin Mine [Nova Scotia]

July 11, 2014

Rimouski, July, 10 2014 – Ressources Appalaches (APP – TSXV and OU3 – FWB) is pleased to announce the first gold bar poured at the Dufferin Mine in Nova Scotia. Final gold recovery is being optimized at the mine. A first dore (bullion) was poured and delivered to Johnson Matthey refinery in Ontario for final refining. Production results will be published after the commissioning period when the mine reaches full capacity.

Entire production circuit is in operation: mining, milling and concentration. Commissioning and optimization of the production is continuing as planned to reach full production capacity of 300 tons per day in August. The average plant production in June was more than 50% with peaks in excess of 200 tons per day. Recent upgrading on the grinding system: ball mill and cone crusher have been made to improve productivity.

Work is currently concentrated on optimization of the dore smelting furnace, on the adjustment of the laboratory and the installation of new equipment to optimize the concentration of gold. At the beginning of the circuit, a new recovery system (sluice) for coarse gold of more than 3 mm in diameter will be installed and at the end of the circuit, a small mill (rod mill) to facilitate uniform particle size for separation of gold from sulfides.

Hiring staff is now complete with 80 full-time employees hired including 20 miners and 15 plant operators and teams of geologists, engineers, mechanics and electricians.

Gold Shines Again as Hedge Funds Boost Wagers on Advance – by Marvin G. Perez (Bloomberg News – July 8, 2014)

July 8, 2014

http://www.bloomberg.com/

Gold is precious again. After investors sent bullion tumbling in 2013 by the most in three decades and kept dumping the metal earlier this year, demand is now up and prices are defying bearish forecasts. Money managers increased net-long positions for a fourth straight week through July 1 and holdings in exchange-traded products are climbing at the fastest pace since 2012.

“Gold’s performance has proven the bears wrong so far this year,” John Kinsey, who helps manage about C$1 billion ($935 million) at Caldwell Securities Ltd. in Toronto, said in a telephone interview yesterday. “We look for further strength through the balance of the year.”

While the latest government data point to an improved U.S. economy and Goldman Sachs Group Inc. and Societe Generale SA predict prices will retreat by year-end, inflation concerns and pockets of unrest are sending investors into gold as a haven. Prices extended gains after the Federal Reserve signaled earlier this month that it will keep interest rates near record lows and violence spread in Iraq and Ukraine.

The bulls are being rewarded. The value of the gold funds rose by $4.6 billion this year as prices rallied 9.5 percent. The metal has rebounded from last year’s 28 percent plunge that was triggered by muted inflation and as investors shunned the metal in favor of equities.

Why gold looks set to lose its shine – by Scott Barlow (Globe and Mail – July 8, 2014)

July 8, 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.

The price of gold, the value of the U.S. dollar and inflation are all closely tied, and this can make it difficult to figure out whether the current bullion price is high or low based on history.

The good news is that this problem can be solved by adjusting the gold price for inflation. The bad news is that once this is done, the future does not look bright for gold investors.

Monday’s closing gold spot price was $1,317.11 (U.S.) per ounce. To pick an example from history, the closing gold price for July 7, 1980, was $667.50. The nominal dollar difference is big, but that doesn’t mean much until we adjust for the difference in spending power of the U.S. dollar caused by rising prices.

Because of inflation, the spending power of one U.S. dollar has been more than halved since 1980. So just comparing the nominal price of gold then and now makes no sense. In effect, these are different currencies.

To assess whether gold is more or less expensive now, it is necessary to calculate an inflation-adjusted gold price using the same currency.

Kyrgyzstan’s Centerra Gold shares vulnerable to possible seizure after key court ruling – by Peter Koven (National Post – July 4, 2014)

July 4, 2014

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

TORONTO – The government of Kyrgyzstan has lobbed many nationalization threats at Centerra Gold Inc. over the past 17 years. But a court ruling has turned the tables and made a large chunk of the government’s own Centerra shares vulnerable to potential seizure.

The strange turn of events is tied to Canadian junior miner Stans Energy Corp., which is also active in Kyrgyzstan. In 2012, a parliamentary committee revoked Stans’ licence for a rare earths project under highly suspicious circumstances, and the company launched legal action to protect its rights.

Those efforts culminated in a key ruling this week, as an arbitration court in Moscow ordered Kyrgyzstan to pay US$118.2-million to Toronto-based Stans.

It is highly unlikely that Kyrgyzstan will respect the ruling and pay out any cash. That leaves Stans the option of securing verdicts against one or more of the state’s foreign assets. And a logical one to go after would be Kyrgyzstan’s 32.7% stake in Centerra, currently worth almost $500-million.

David Vinokurov, vice-president of corporate development at Stans, declined to comment on whether the company would target Centerra, also based in Toronto, shares for payment. But he acknowledged that it would be a logical place to look.

Randgold CEO Bristow Hunts One Last Big African Discovery – by Kevin Crowley (Bloomberg News – July 3, 2014)

July 4, 2014

http://www.bloomberg.com/

Mark Bristow, the chief executive officer of Randgold Resources Ltd. (RRS), said he’s hunting one last major discovery to cap his career before retiring.

The 55-year-old South African has overseen Randgold’s development from a junior mining-exploration company into a gold producer with assets across sub-Saharan Africa including Mali, the Democratic Republic of Congo and Senegal. The next big find could be in Ivory Coast, he told reporters.

“I’d like to find one more asset, for me it would be a perfect finish to my career,” he said in Johannesburg yesterday. “We pour the gold and I’m out of here. I don’t want to hang around. I don’t want to be the chairman or anything like that. I’ve got other things to do.”

Bristow, a geologist by training, led the discoveries of three gold mines in Mali holding 20 million ounces in deposits, over the course of his 30-year career at Randgold. The stock’s return has averaged the equivalent of 27 percent annually in the past decade, compared with the 0.4 percent gain by Barrick Gold Corp. (ABX), the largest producer, and the 2.7 percent decline by Newmont Mining Corp. (NEM), the second biggest, according to data compiled by Bloomberg.

With the Kibali mine in Congo that went online at the end of 2013, Randgold can produce gold profitably across its operations even if the price of bullion falls to $1,000 an ounce, 32 percent lower than the current spot price, for the next five years, Bristow said. The challenge is the five years beyond that.

Remembering Bre-X: Suicide and the gold ‘find of the century’ – by Douglas Goold (Globe and Mail – June 24, 2014)

July 4, 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.

With its wood carvings, objets d’art and pool surrounded by palm trees, it was hard to imagine a more luxurious hotel than the Shangri-La in Jakarta. When I knocked on the door of Suite 1234, a gruff John Felderhof greeted me. It was Feb. 28, 1997, and I was on assignment for The Globe and Mail. What neither of us knew was that this would be the last interview the controversial vice-president of exploration for Bre-X Minerals Ltd. would give before the whole Bre-X fable unravelled.

Bre-X had grown from a Calgary-based penny gold stock to a $6-billion company based on its claim to have discovered one of the world’s largest gold finds in the jungles of Busang, Borneo. The story was so compelling and well-known that I was frequently stopped in the street by people who recognized me eagerly asking whether I thought the estimates would continue to grow.

It was hard to imagine they could. On a conference call a few weeks earlier, Felderhof had famously suggested the find could be as much as 200 million ounces, with a value of $70-billion (U.S.), then the equivalent to the GDP of the Philippines. Regulators were looking into the claim.

Felderhof was born in Holland but grew up in Nova Scotia, and was an old-fashioned explorer with a major discovery to his credit. But the Bre-X phenomenon was increasingly looking too good to be true.

UPDATE 1-Brazil court revokes license for Canadian gold mine in Amazon – by Anthony Boadle and Nicole Mordant (Reuters India – June 27, 2014)

June 26, 2014

http://in.reuters.com/

(Reuters) – A federal court has revoked the environmental license for a large gold mine planned by Belo Sun Mining Corp on the Xingu River in the Amazon, ruling that the company had failed to assess the impact on local indigenous communities.

The ruling published on Tuesday can be appealed. Belo Sun’s stock fell 7 percent on the Toronto Stock Exchange to 19 Canadian cents.

“This is an important victory for justice. It can still go to an appeals court, but we think it will be difficult to overturn,” said Helena Palmquist, a spokeswoman for the federal prosecutors office in the northern state of Para.

The Volta Grande, or Big Bend, open-pit project is slated to start operating in 2016 and become Brazil’s largest gold mine. It is next to another controversial project, Belo Monte, which is designed to become the worlds third largest hydroelectric dam and has also been the target of lawsuits by prosecutors.

Belo Sun could not immediately be reached for comment, but the Toronto-based company said in a news release that a federal judge in Para had ruled that the company needed to complete an indigenous study for its preliminary license to be valid.