Twitter

Gold and Silver

Munk, Mulroney leave, new faces slated for Barrick board – by Lisa Wright (Toronto Star – December 5, 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.

Outgoing board co-chairman Peter Munk welcomes former Goldman Sachs executive John Thornton as new board chairman.

A major shakeup on Barrick Gold Corp.’s board of directors Wednesday included the replacement of chairman and legendary founder Peter Munk and the departure of former Prime Minister Brian Mulroney as a longtime director.

The world’s largest gold miner also announced Jim Gowans, the former chief executive of De Beers Canada, is the new chief operating officer and the nominations of veteran Canadian money manager Ned Goodman and three others to the board in moves it hopes will revive the company’s tarnished image and weak share price.

“This has been a stormy year for Barrick,” said Munk, who welcomed co-chairman John Thornton to his new job as sole chairman.

He said he was going to leave in 2012 and sail around the world with his wife, but too many things “hit the fan” at the beleaguered miner — namely cost overruns building its prized Pascua Lama project, soaring debt and the falling gold price, which have helped carve the company’s share price by more than half.

Read more

Exclusive interview: Peter Munk on ‘hubris,’ ‘stupidity’ and the future of Barrick Gold – by Rachelle Younglai (Globe and Mail – December 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.

It was spring 2011, and a frenzy had gripped the mining industry.

As China consumed ever-growing amounts of copper, gold, nickel and other metals, prices were breaking records and mining companies were launching multibillion-dollar deals. The mantra in the resource sector was “growth, growth, growth.”

Barrick Gold Corp. was readying its arsenal. With gold prices flying high, the company earned a record $3.3-billion (U.S.) in 2010. The gold producer had the strongest credit rating among its peers, and everywhere Barrick chairman Peter Munk turned, brokers were offering to lend the company billions of dollars at low financing rates.

At the time, the large Lumwana copper property in Zambia owned by Toronto-listed Equinox Minerals Ltd. was a coveted prize for industry’s big base metals players. As a gold company, Barrick was not seen as a likely bidder.

But when China’s Minmetals Resources Ltd. offered $6.3-billion (Canadian) to acquire Equinox, the situation proved too tempting for Mr. Munk.

Read more

Gold parallels ‘most dramatic stages of human development’, says author Matthew Hart – by Peter Koven (National Post – November 30, 2013)

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

Gold has captivated humanity for roughly 6,000 years. Whether it be Egyptian pharaohs, British royalty or those excitable folks on the goldismoney.com message forum, the collective fascination with the yellow metal is clearly here to stay. It’s a topic Canadian author Matthew Hart digs into in his new book Gold: The Race for the World’s Most Seductive Metal, which will be released Tuesday. He sat down with the Financial Post’s Peter Koven to discuss the colourful and turbulent business of gold mining.

Financial Post: When you look at the gold mining industry from thousands of years ago to modern times, what themes keeps repeating themselves?

Matthew Hart: Gold rushes, first of all. They have always been one of the great drivers of the gold world. Periodically, the world either makes a great discovery or develops an overwhelming desire for gold. The first great gold rush was the discovery of the New World. If you go back to the year 1400, Europe is running out of the gold, so they go looking for it. When the Spanish discovered the New World in their search, their cover story is that they were seeking souls for God. Christopher Columbus mentions God in his journals 26 times. Well, gold is mentioned 116 times. So what were they really looking for?

Read more

Kinross calls for industry to trumpet benefits footprint – by Simon Rees (MiningWeekly.com – December 2, 2013)

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

TORONTO (miningweekly.com) – The mining sector should do more to broadcast its full benefit footprint on local and national economies, Kinross Gold VP corporate responsibility Ed Opitz told delegates at a recent conference in Toronto.

By doing so, the industry will also help debunk much of the “resource curse” thesis, he told the audience at the Mine Latin America conference on November 15.

CURSE OF THE CURSE

Opitz explored the resource curse, first coined by Richard Auty in 1993, and then expanded upon by Jeffery Sachs, in 1995.

At its heart, the thesis argues that countries richly endowed with natural resources experience the threat of heightened corruption, poorer development strategies and growth-debilitating inflation.

The cure presupposes that governments of resource-rich nations will focus a disproportionate amount of time, effort and money on facilitating the needs of the extractive sectors as opposed to delivering on other economic and civic commitments.

Read more

Dundee’s real-time data innovations are as good as gold – by Eric Reguly (Globe and Mail – December 2, 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.

CHELOPECH, BULGARIA – You would think an iPhone would be an utterly useless gadget in Dundee Precious Metals Inc.’s Bulgarian gold mine for the simple reason that the mine lies nearly a half kilometre below impenetrable rock.

But the underground reception is working well and that makes Mark Gelsomini, information technology director for the Toronto-listed company, smile like he has just tripped over a gold nugget the size of a golf ball.About 400 metres underground, his e-mails arrive without a glitch. Phones are static free.

“You’re coming in clear,” Mr. Gelsomini tells Dundee CEO Rick Howes, who is also deep underground in a dark tunnel that connects the mine’s various operations.

The free-flowing communication at Dundee’s Chelopech mine is thanks to a fully enabled underground WiFi network – a technological leap is attracting international attention.

Read more

Barrick’s Thornton Said to Seek China Deal to Rebuild Min – by Liezel Hill & Matthew Campbell (Bloomberg News – December 2, 2013)

http://www.bloomberg.com/

Peter Munk built Barrick Gold Corp. (ABX) into the world’s largest gold producer by expanding into Africa and South America. Now former Goldman Sachs Group Inc. President John Thornton is betting on China to help revive the beleaguered company’s fortunes.

At a Dec. 4 board meeting, Thornton will be confirmed as Barrick’s next chairman, succeeding Munk, 86, who plans to retire at the Toronto-based company’s next annual shareholders meeting after three decades, according to people familiar with the situation.

Thornton, 59, currently co-chairman, already helps to oversee long-term corporate strategy. As part of that remit, he’s trying to establish partnerships with Chinese companies that may include investment in Barrick and future mining projects, said the people, who asked not to be identified discussing a private matter. China Investment Corp., the country’s largest sovereign wealth fund, is among potential partners Barrick has met with, the people said.

The leadership change at Barrick comes at the end of a difficult year for the company. It has lost 41 percent of its market value in 2013 while debt levels have soared after a slump in gold prices, rising operating expenses and a cost blowout at an $8.5 billion mining project in the Andes.

Read more

Silver State, mining go deep – by Jennifer Robison (Las Vegas Review-Journal – December 1, 2013)

http://www.reviewjournal.com/

Editor’s Note: Nevada 150 is a yearlong series highlighting the people, places and things that make up the history of the Silver State.

Before there was Nevada, there was mining. In the state’s earliest days, mining wasn’t just our key industry. It was “essentially our only industry,” said Jeremy Aguero, a principal in local research firm Applied Analysis, and author of a September report for the Nevada Mining Association on the role of the sector in our economy.

“The mining industry was instrumental in the formation of the state and the governing laws that we still live with today,” Aguero said. “It was, for the vast majority of the history of the state, its largest single employer, and that’s still true in many rural counties today. We are the Silver State in so many ways. Our mining legacy is everywhere in Nevada, and our economic landscape clearly reflects its long history here.”

Added Tim Crowley, president of the Nevada Mining Association: “We really founded the state.”

That’s tough to argue. Mining’s rich history here traces back to 1859, half a decade before statehood.

Read more

Detour Gold founder resigns as miner struggles amid falling gold prices – by Peter Koven (November 26, 2013)

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

For many investors, Gerald Panneton was Detour Gold Corp.

It was Mr. Panneton, a veteran geologist, who saw the potential of the Detour Lake gold property back in 2006, long after most of the industry lost interest in it. He acquired the Ontario-based project for a mere $75-million, incorporated Detour Gold and took it public. Under his leadership, the company identified more than 15 million ounces of reserves at Detour Lake. And earlier this year, it began production at what is now Canada’s biggest gold mine.

But for Mr. Panneton, it is all over. Toronto-based Detour stunned the street by announcing his resignation on Monday. The stock dropped 12% on the day (after falling as much as 33% at one stage), as investors worried about the future of the company without its chief executive and visionary.

“Investors are obviously shocked by the news, the suddenness of it,” interim CEO Paul Martin said in an interview. “And they’re wondering if it has anything to do with the operational performance of the mine, which we confirmed that it does not.”

Read more

Pebble problems reveal issue facing U.S. mining investment – by Rebecca Logan (Fairbanks Daily News Miner – November 24, 2013)

http://www.newsminer.com/

Anglo American’s recent departure from the Pebble Mine project has generated contentious debate throughout the state and in our nation’s capital about the future of domestic mining. This withdrawal of capital from a promising venture is just one among many in recent years, as the United States’ uncertain regulatory structure around minerals mining deters major investment. It’s a hard pill to swallow considering that our nation’s $6.2 trillion worth of mineral resources could be developed responsibly, generate economic growth, support new high-paying jobs and strengthen domestic industries.

The proof is in the pudding — just look at the more than 9,500 Alaskan jobs the mining industry supported last year alone. These jobs are among the highest paying in the state with an estimated average annual salary of $100,000 — more than twice the state average. Mining not only creates jobs at mine sites, but also supports local businesses, generating employment at grocery and supply stores, auto dealerships and hotels.

Beyond Alaska, mining continues to bring economic opportunity to communities across the country despite trying economic conditions. Mining supported nearly 2.2 million American jobs and contributed $232 billion to the nation’s GDP in 2011 alone.

Read more

Detour Gold CEO steps down, stock plummets – by Rachelle Younglai (Globe and Mail – November 25, 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.

Detour Gold Corp.’s chief executive and founder Gerald Panneton has resigned, the Canadian company said in a surprise announcement that sent its stock tumbling and fuelled speculation that the miner would soon take steps to bolster its financial position.

Shares of Detour Gold dropped 30 per cent to $2.97 on the Toronto Stock Exchange, a level not seen since the rocky days of the financial crisis and lower than the $3.50 share price the company set when it went public in 2007.

The company’s chief financial officer, Paul Martin, will serve as interim CEO and Detour Gold’s vice president of finance, James Mavor, will serve as interim CFO, as the miner searches for a new chief executive.

The abrupt departure of Mr. Panneton, a geologist with decades of experience in the mining industry, comes one day after he had a discussion with Detour Gold’s board of directors that resulted in him tendering his resignation, according to the company.

Read more

NEWS RELEASE: Detour Gold Announces Management Changes

TORONTO, ONTARIO–(Marketwired – Nov. 25, 2013) – Detour Gold Corporation (TSX:DGC) (“Detour Gold” or the “Company”) announced today that, effective immediately, Gerald Panneton, Detour Gold’s President and Chief Executive Officer, has resigned.

The Board of Directors has appointed Paul Martin, Chief Financial Officer, as interim Chief Executive Officer. Mr. Martin will serve in this capacity while the Company conducts a search for a new chief executive officer. James Mavor, Vice President, Finance, has been appointed interim Chief Financial Officer during this period.

Michael Kenyon, Executive Chair, commented on behalf of the Board “we all recognize the immense contribution Gerald has made to Detour Gold since 2006. On behalf of the Board, I wish to extend our genuine appreciation for his dedicated service which has been instrumental in bringing Detour Gold from its early years as an exploration company, through the development of the Detour Lake gold mine and, ultimately, its achievement of commercial production on September 1st. The Board wishes Gerald well in his future endeavours.”

While acknowledging the near-term challenges, Mr. Kenyon added that “the Board has full confidence in the Company’s management team to take Detour Gold forward under the direction of Mr. Martin and Mr. Beaudoin, COO.”

Read more

Northern Dynasty CEO says Pebble has bright future, but no imminent permit application – by Yereth Rosen (Alaska Dispatch – November 21, 2013)

http://www.alaskadispatch.com/

When the president of the sole remaining partner in the beleaguered Pebble Limited Partnership launched into a sales pitch on Thursday for the huge and controversial copper mine planned for southwestern Alaska’s Bristol Bay region, he acknowledged the “elephant in the room.”

Everyone wants to know what will happen to the project now that mining giant Anglo American has dropped out of the partnership, said Ron Thiessen, president and chief executive of Northern Dynasty Minerals Ltd., the Vancouver-based junior company still pushing the Pebble Mine.

“It’s the day after Anglo. What’s next?” Thiessen, a keynote speaker at the Resource Development Council’s annual conference in Anchorage, said in his speech.

Northern Dynasty will keep pushing for the mine, he assured the audience. “We have the resources and the expertise and the will to advance Pebble or without a partner and that is what we intend and will do,” he said.

Read more

All that glitters is not enriched uranium – by Matthew Hart (Globe and Mail – November 21, 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.

As Iran’s Supreme Leader talked about “red lines” and U.S. President Barack Obama struggled to head off tougher sanctions that could derail his diplomacy, a powerful subtext rippled beneath the surface of Iranian negotiations with the West when they resumed Wednesday: Which metal does Iran want most, at least in the short term – enriched uranium or gold?

Until this summer, the gold trade with Turkey provided a loophole through which much-needed Western currencies flowed into Iran. Tehran urgently wants that loophole opened up again. Here’s how it worked.

Iran sold oil and gas to Turkey. The buyer paid in Turkish lira deposited to an Iranian account in Turkey’s state-owned Halkbank. Iranian gold dealers had access to the Halkbank money, and used it to buy gold in Turkey. The gold was then hand-carried from Turkey to Dubai and sold to traders for the dollars and euros Iran so desperately needs.

Turkey can openly buy oil and gas from Iran because it has a waiver under the sanctions protocols that prohibit other countries from doing so. However, the gold flow to Iran enabled a more robust exception to the sanctions than envisaged by the waiver.

Read more

Gold mine output set to reach record, disappoint bulls – by Jan Harvey and Clara Ferreira-Marques (Reuters U.S. – November 20, 2013)

http://www.reuters.com/

LONDON, Nov 20 (Reuters) – Output from the world’s gold mines is set to hit record highs this year, disappointing bulls who are impatiently waiting for production cuts following this year’s 24 percent plunge in prices.

Some gold miners have felt the squeeze of lower prices this year, and a number, including Canada’s Kinross and Russia’s Polymetal, suspended marginal mines and projects after a dramatic first-half price drop.

But as prices fall, others are actually increasing output to maintain revenue and profit levels. In some cases, they are targeting higher grade ore to keep marginal mines operating and generating cash, at the expense of future production.

Furthermore, several large projects put into motion during gold’s 12-year rally, which took it as high as $1,920 an ounce in 2011, are coming to fruition. “Our expectation is that we’re going to see a fresh record high in gold mining output this year,” GFMS analyst William Tankard said.

Read more

COLUMN-China’s single-handed gold support act may not last – by Clyde Russell (Reuters U.S. – November 19, 2013)

http://www.reuters.com/

Clyde Russell is a Reuters market analyst. The views expressed are his own.

LAUNCESTON, Australia, Nov 19 (Reuters) – The most frightening concept for a gold miner or trader currently would be to contemplate a world without China.

Global gold demand fell to the lowest in four years in the third quarter, according to the World Gold Council, and the 21 percent drop from the same quarter in 2012 would have been far worse if it wasn’t for China. China is set to overtake India as the top gold consumer this year, and is already ahead on a rolling four-quarter basis.

Demand in China rose to 209.6 tonnes in the third quarter, up from 177 tonnes in the same quarter last year, largely driven by a 29 percent jump in jewellery demand.

In contrast, India’s consumption slumped 32 percent to 148.2 tonnes in the third quarter from the same period in 2012, as the government’s efforts to restrict imports became more effective.

Read more