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Gold and Silver

Barrick transformed under steady hand – by Lisa Wright (Toronto Star – March 14, 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.

CEO Jamie Sokalsky has overseen ‘most radical change’ in gold miner’s history

Jamie Sokalsky is the first to admit he’s not the flashiest guy in the rough and tumble gold mining game. “I’m an accountant, my wife is an accountant, my oldest daughter is an accountant and my youngest daughter is studying to be an accountant,” says the chief executive of Barrick Gold Corp. with a chuckle.

While the mild-mannered 56-year-old likes to downplay his management style as rather dull, Sokalsky has ironically overseen the wildest times in the history of the world’s largest gold miner after taking the helm nearly two years ago.

“Barrick is quite a changed company in the last couple years. We’ve radically changed how we’re running it,” he says in his first sit-down interview since his surprise promotion to CEO in June, 2012.

Indeed, the bullion behemoth – whose mantra for years had been ‘bigger is better’ and growth at all costs – is almost a shadow of itself, having gone from 27 mines across the world to 19 in the last six months alone as it shed almost $1 billion of money-losing assets amid the plummeting gold price.

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Goldcorp founder doesn’t see rival bids for Osisko – by Rachelle Younglai (Globe and Mail – March 13, 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.

Goldcorp Inc. founder Rob McEwen said he believes his former company will not face competition in its quest to own Osisko Mining Corp.

Goldcorp, which Mr. McEwen built into a serious gold player before leaving in 2005, is entangled in a hostile bid for Osisko and its large Canadian Malartic gold mine in Quebec. “The big guys aren’t looking, they are shrinking,” Mr. McEwen said.

Goldcorp’s cash and stock bid is valued at $3-billion and is the biggest deal in the Canadian mining space in more than a year.

Investors are expecting a higher bid to emerge. But there are not many other miners that can save Osisko from Goldcorp, as the major gold producers are hampered by costly acquisitions made during the commodity boom.

Mr. McEwen suggested that more work had to be done at Osisko’s prized mine. The former Goldcorp chairman said he remembers looking at Canadian Malartic’s ore grade and thinking to himself: “Wow, look at Osisko, they have less than a gram and they are going to process all this [rock].”

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COMMENT: Chilean court cancels Pascua-Lama fine, retains suspension – by Marilyn Scales (Canadian Mining Journal – March 10, 2014)

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

As we are used to hearing – there is good news and bad news. This time Toronto’s Barrick Gold is on the receiving end of both, thanks to the environmental court in Chile. At issue is the future of the expensive Pascua-Lama gold project that straddles the Chile/Argentina border.

Last week, Chile’s second environmental court annulled the fines imposed by a local environmental regulator (SMA). The amount is small – $16 million compared to the projected $8.5-billion cost of the project. The higher court cited “errors and illegalities” in the SMA’s resolution, and removed the fines. The SMA will now consider each of 23 charges separately, and readers can expect that the fines will be re-imposed.

That was the good news. Now the bad. At the same time the court upheld the suspension of work order imposed on the Chilean portion of Pascua-Lama. The only project Barrick has been allowed to work on is the water management system.

The Pascua-Lama project has been one of the most difficult any mining company tried to develop.

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NEWS RELEASE: Metals in the modern world – silver

This article was provided by the Ontario Mining Association (OMA), an organization that was established in 1920 to represent the mining industry of the province.

The Ontario Mining Association’s info-graphic “Mining Builds a Better World,” which is available on the website www.oma.on.ca, illustrates how various minerals mined in Ontario contribute to a better world in technology, agriculture, the environment and health. With a little help from the Washington D.C.-based Silver Institute, we would like to show how some recent advances in applications of this metal indeed make our lives better.

Checking in at number 47 on the periodic table of elements sandwiched between palladium and cadmium, silver has many unique characteristics, which do support the OMA info-graphic claim. “Mining’s value is not limited solely to the resources it extracts from the ground. Did you know that minerals and metals are essential, irreplaceable components of modern technology? Mining makes countless products we use everyday possible and it is integral to the next generation technologies that will make our world greener, safer, healthier and more connected.”

How about the glass on the touchscreens of your smartphones and tablet devices? One company is now adding silver ions to this type of glass. The silver ions inhibit the growth of mold, mildew, algae and bacteria. They provide a built-in antimicrobial property. Sounds like safety and health gains.

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Primero takes over Black For mine, mill [Timmins] – by Ron Grech (Timmins Daily Press – March 6, 2014)

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – Black Fox mine employees began meeting with their new owners this week.

On Wednesday, Primero Mining Corp. completed a deal to acquire all assets of Brigus Gold including the Black Fox mine and mill located in Black River-Matheson, as well as the adjacent Grey Fox mine property. The agreement was initially announced in December.

“The company was created about three-and-a-half years ago,” said Joseph Conway, Primero president and chief executive, who was at the Days Inn in Timmins to meet with mine staff. “It was through a buyout of an asset from Goldcorp in Mexico. It was a producing mine and it was running at 90,000 ounces a year but it was under-capitalized and since then we’ve been reinvesting back into that operation and are now producing about 160,000 ounces a year.”

While Primero plans to continue that trend of investing in its assets, Conway admitted they will be a little less bullish about bringing Grey Fox into production. The previous owner, Brigus Gold, had talked last year of pulling Grey Fox into production by the first half of 2015.

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Vancouver-based Goldcorp wins reprieve from Osisko Mining on takeover bid (Canadian Press – March 3, 2014)

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

MONTREAL – Osisko Mining Corp. said Monday it has settled a lawsuit it filed against Vancouver-based Goldcorp Inc. as part of the Montreal-based company’s fight against a hostile takeover by the senior gold miner.

Under the settlement, the offer from Goldcorp has been extended to April 15, from March 10, while Osisko continues its search for an alternative bid. Osisko has also agreed to waive its shareholder rights plan by April 14 and provide Goldcorp with access to due diligence materials starting April 1, or earlier if Osisko signs a deal with another bidder.

“Given the robustness of our process to pursue value maximizing alternatives, the extension to April 15, 2014 provides a meaningful extension to the anticipated time to complete this work,” Osisko president and chief executive Sean Roosen.

“The April 15, 2014 date also provides certainty of timing for those in the process to complete their work and propose executable arrangements to unlock value for all stakeholders.”

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Goldcorp-Osisko battle heats up in Quebec as court case begins Monday – by Peter Koven (National Post – March 2, 2014)

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

The takeover battle between Goldcorp Inc. and Osisko Mining Corp. is heating up. But not for reasons that have anything to with the terms of the actual bid.

The two sides are set to face off in the Quebec Superior Court this week over Osisko’s claim that Goldcorp misused confidential information when it launched the $2.6-billion hostile offer in January.

The court case, which begins Monday in Montreal, centres on whether the two companies had a verbal standstill agreement in place when Osisko disclosed private data in a meeting last year. The trial is set to last for three days and both sides expressed confidence they will win. Not surprisingly, Goldcorp dismissed the lawsuit as a stalling tactic while Osisko said it will shed light on nefarious actions by Goldcorp.

Outside of court, a more complicated battle is brewing as both sides talk up their Quebec credentials in an attempt to win the hearts and minds of the province. Osisko is the largest Quebec-based mining company and owns the giant Canadian Malartic mine in the province. Goldcorp, based in Vancouver, plans to produce first gold from its US$1.8-billion Eleonore mine in Quebec later this year.

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Gold Miners See Looming Output Drop After Cut in Mine Spending – by Liezel Hill (Bloomberg News – March 03, 2014)

http://www.businessweek.com/

The biggest gold producers say global output will fall short of expectations and is poised to decline after the worst price slump in three decades spurred them to cut spending and revise mining plans.

Barrick Gold Corp., Goldcorp Inc. and Newmont Mining Corp., the three biggest producers by market value, say the industry has changed after gold plunged 28 percent last year. The decline forced miners to take at least $30 billion of writedowns.

“The industry has gotten more disciplined,” Barrick Chief Executive Officer Jamie Sokalsky said in a Feb. 24 interview. “We are in an inflection point now where I think ultimately gold production in the industry could start to decline more than people think.”

Sokalsky said lower mine output may support gold prices. Demand for physical metal is growing in China, according to Sean Boyd, the CEO of Canada’s Agnico Eagle Mines Ltd. Central banks, net purchasers for four straight years, will keep buying, he said in an interview. The outlook for gold will be on the minds of many at the annual Prospectors & Developers Associated of Canada convention which began yesterday in Toronto.

Gold fell 0.4 percent to $1,326.39 an ounce on Feb. 28 in London. After posting its biggest annual loss in 32 years, the metal is up 10 percent in 2014.

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Residents anxious for redeveloped mine property – by Ron Grech (Timmins Daily Press – February 28, 2014)

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – As a neighbouring property owner, Luc Murray has a vested interest in the long-term plans for the Hollinger mine pit site.

“This is a piece of land that nobody can use right now,” said Murray, whose business, OK Tire and Auto Service, sits directly adjacent to the mine pit property. “It’s land that is right in the middle of the city. It’s a big blank spot there.”

For Goldcorp Porcupine Gold Mines, the open-pit project represents an opportunity to profit from some of the residual lower grade ore that is still buried there. Murray sees a longer-term benefit with some old hazards being removed and the land being converted into a greenspace the whole community could enjoy.

“The way they are doing it right now, it’s going to be beneficial for everybody,” said Murray, who was among the members of the public who attended an open house hosted by Goldcorp at the McIntyre Ballroom Thursday.

Trish Buttineau, co-ordinator of communications and corporate social responsibility, explained, “Even though we’ve just started mining, we’re already starting the planning for closure and the hope is the community will get together and give us their ideas and tell us what they’d like to see.

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Gold diggers: Yukon adventurers pull money from the ground in hit docu-series – by Ruth Myles (Vancouver Sun – February 25, 2014)

 

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

Popcorn bowls, Tupperware containers, cereal bowls — you name it, the miners on Yukon Gold use it to store the riches they pull out of the ground.

Janine Johnson is particular to an empty Kraft peanut-butter jar, the plastic kind with the green twist-off lid. On the second episode of the series, she and her husband Cam use it to tote their latest findings into Dawson City to have it weighed. The gold — which takes up about a quarter of the jar — comes in at just a hair under 70 oz (almost 2 kg), netting them a cool $90,000.

“We use everything to hold our gold, as long as we feel safe. We have it in old tobacco cans, in snuff cans, whatever works,” Cam Johnson says. “You’ll go see the banker in the Dawson and he’ll say, ‘Only you gold miners would walk down the street with $150,000 worth of gold but not even think about it.’”

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Goldcorp prepared to walk away from Osisko bid, CEO says – by Rachelle Younglai and Sophie Cousineau (Globe and Mail – February 26, 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.

Goldcorp Inc.’s chief executive says he is prepared to kill his hostile bid for Canadian rival Osisko Mining Corp. if it becomes too complicated or expensive.

“This is not the only opportunity in the world,” Goldcorp CEO Chuck Jeannes said in an interview Wednesday. “It may be the case that if this becomes too complicated that we go look at something else. That would be a very bad day for Osisko shareholders. They would probably see their stock drop by 20 per cent overnight,” he said.

Mr. Jeannes would not provide detail on his company’s other options. The unsolicited cash and stock bid is currently on hold because Osisko sued Goldcorp for allegedly breaching a confidentiality agreement between the two Canadian miners. A Quebec court will make a decision on the lawsuit next week, which could further delay Goldcorp’s bid.

For more than five years, Mr. Jeannes has tried to acquire Osisko for its massive Canadian Malartic mine in Quebec. The mine would add an additional 10 million ounces of gold reserves to Goldcorp’s portfolio of mines and projects in the Americas and Mexico.

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Gold market breaches ‘covered up’ – by Andy Verity (BBC Newsnight – February 25, 2014)

http://www.bbc.com/news/

Dubai’s biggest gold refiner committed serious breaches of the rules designed to stop gold mined in conflict zones from entering the global supply chain, a whistleblower has revealed.

Amjad Rihan led an Ernst & Young team that audited Kaloti and found it was failing to carry out the proper checks. But after he told the Dubai regulator, it changed its audit procedures. He said that allowed details of the most serious findings to be covered up, with Ernst & Young turning a blind eye.

The regulator, Ernst & Young and Kaloti all say they acted properly. Mr Rihan told BBC Newsnight: “The risk of conflict gold entering Dubai and entering the global supply chain is extremely high.”

The audit team, which visited Kaloti last year, alerted the Dubai Multi Commodities Centre (DMCC) and also urged superiors at Ernst & Young to notify other regulators and the gold-buying public.

In May the DMCC’s guidance required the audit team’s initial findings to be made public but by November that requirement had disappeared.

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Prospectors Say Drought Has Created California’s 2nd Gold Rush – by Art Barron (CBS Los Angeles – February 24, 2014) February 24, 2014

http://losangeles.cbslocal.com/

LYTLE CREEK (CBSLA.com) — Is 2014 a repeat of the great Gold Rush of 1849?

Prospectors in Southern California are heading to the hills, saying the severe drought has exposed gold that has never been touched by human hands. As water levels continue to drop more nooks and crannies are easier for these gold hunters to access.

“A lot of time you would just see a husband. Now you’re seeing the whole family out,” said Kevin Hoagland, of the Gold Prospectors Association of America.

Prospectors at Lytle Creek, 60 miles from Los Angeles in San Bernardino County, pan for gold, using metal detectors and sluice boxes. CBS2/KCAL9 reporter Art Barron witnessed veteran prospector Jack Barber pull up large pieces of the precious metal.

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NEWS RELEASE: Revealed: Why Dubai’s first conflict gold audit never saw the light of day

http://www.globalwitness.org/

Download the Global Witness report City of Gold here: http://www.globalwitness.org/sites/default/files/library/dubai_gold_layout_lr.pdf

25th February 2014 – According to a former partner at Ernst & Young, the global accountancy firm turned a blind eye when a report of major audit failures at Dubai’s biggest gold refinery went unpublished. A Global Witness report released today, City of Gold, considers the implications.

Documents seen by Global Witness suggest that the local metals regulator, the Dubai Multi Commodities Centre (DMCC), changed its audit guidelines after becoming aware of negative findings in Ernst & Young’s report, with the effect that damaging results were not released.

Dubai is a key market – trading more than 20% of the world’s gold, worth $70 billion in 2012 – and Global Witness research indicates that it’s the main destination for Congolese conflict gold.

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Mechanized mining could revive output in South Africa – by Geoffrey York (Globe and Mail – February 24, 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.

WESTONARIA, SOUTH AFRICA — With a great clanking and an occasional dripping of water, the dimly lit elevator cage gathers speed and then plunges 2.4 kilometres below the earth’s surface in an ear-popping four minutes.

It’s one of the biggest and fastest vertical drops in the world, and it opens up an era of mechanized mining that could be the saviour of South Africa’s struggling gold and platinum sectors.

South Deep, once the property of Barrick Gold Corp. and now owned by Gold Fields Ltd., has been the future of South African mining for a long time – perhaps too long, according to analysts who question its persistent delays.

With more than $4-billion (U.S.) invested in it so far, South Deep boasts a huge reserve of 40 million ounces that could keep it in operation for 60 years or more, with its drills blasting up to three kilometres underground. It has been long viewed as the last great gold mine in South Africa, and potentially one of the lowest-cost producers in the world.

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