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NEWS RELEASE: Foundation Signs Agreement with Wahgoshig First Nation

Vancouver, B.C. January, 8, 2013; Foundation Resources Inc. (TSX.V:FDN: “Foundation” or “the Company”) is pleased to announce that further to the Company’s press release dated November, 14, 2012, the Waghoshig First Nation (“WFN”) has agreed to amend its Memorandum of Understanding (MOU) with Sheltered Oak Resources Corp. allowing Foundation to become a party to the agreement upon the completion of the acquisition of OAK. The agreement is limited to the Kerrs Property, which is also in Lake Abitibi area of Ontario, but does serve as a basic starting point for future negotiations between the parties.

“While this is agreement relates to the Kerrs Property, it contains what most knowledgeable industry participants would consider standard terms, and we believe it demonstrates a desire by WFN to work with mineral exploration companies on mutually respectful terms,” stated Barry Girling Interim CEO of Foundation. “Robert Hanson, Chairman of OAK and I had what can only be described as a very productive meeting with Chief David Babin and we look forward to continuing the strong relationship that has existed between OAK and WFN.”

The Company has also increased its offer to acquire 100% of the outstanding shares Solid Gold Resources Inc (TSX.V:SLD: “SLD”) on the basis of one share of Foundation for each share of SLD (the “FDN Offer”) up from its previous offer of 0.8333 shares of Foundation for each share of SLD (see press release dated November 27, 2012). The proposed terms of the FDN Offer represents a premium of approximately 45% to the 10 day SLD VWAP price of 0.031 per share for the period December 20, 2012 through January 7, 2013. MGI Securities Inc. (“MGI”) is acting as financial advisor to the Company with respect to the FDN Offer.

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African Barrick Gold/China National Gold deal dead in the water – by Lawrence Williams (Mineweb.com – January 8, 2013)

http://www.mineweb.com/

The long running negotiations between Barrick Gold and China National Gold over the former’s African Barrick Gold (ABG) subsidiary have fallen through and ABG’s share price has dived as a result.

LONDON (MINEWEB) – Discussions on the sale of African Barrick Gold (ABG) to China National Gold Group Corporation (CNG) appear to have come to nothing after a rigorous examination of ABG’s operations by the Chinese state-owned gold mining company. London-quoted African Barrick’s share price initially dropped sharply on receipt of a statement from ABG confirming its 73.9% owner, Canada’s Barrick Gold, has now ended its discussions with CNG which means that ABG is ‘no longer in an offer period under the Takeover Code’.

The Barrick announcement went on to say “Given the direct nature of the discussions between Barrick and CNG, this has meant an extended period of uncertainty for ABG as well as significant extra work. Throughout this period, our focus has been on ensuring the ongoing integrity and stability of our operations, and our employees have made an important contribution towards achieving this. At the same time, Barrick has made it clear that it sees considerable long-term value in the ABG asset base. Barrick remains committed to supporting ABG in fully realising the potential of the business.”

This has not been a great day for Barrick with the news also coming through that its plans to develop the huge Reko Diq copper/gold project in Pakistan’s Balochistan province have been declared invalid by the Pakistani high court, although given the company’s recent rethinking on its major project programme, coupled with the location of Reko Diq close in a far from stable part of the world, this may actually be perceived as a positive in some eyes!

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Cutifani Said to Be Leading Candidate for Anglo CEO Post – by Matthew Campbell & Firat Kayakiran (Bloomberg.com – January 5, 2013)

http://www.bloomberg.com/

AngloGold Ashanti Ltd. (ANG) Chief Executive Officer Mark Cutifani is the leading contender to replace Cynthia Carroll at the helm of mining company Anglo American Plc (AAL), according to people familiar with the situation.

Cutifani has emerged at the top of a list of candidates that has included former BHP Billiton Ltd. (BHP) CEO Chip Goodyear and Chris Griffith, the head of Anglo American’s platinum unit, said the people, who asked not to identified because the matter is private. The decision isn’t yet final on a replacement for Carroll, who said in October she would resign as CEO of the London-based miner after a $14 billion drop in market value.

Carroll’s successor may be announced within two weeks, the people said. The new CEO will face the challenge of increasing growth at Anglo American, which has struggled with cost overruns at projects, including the Minas-Rio iron ore mine in Brazil, and sparred with Chilean state mining company Codelco.

“Mark is a pretty energetic guy,” said Caesar Bryan, a portfolio manager at Gabelli & Co. in Rye, New York, which owns Anglo American and AngloGold shares. “He’s someone that’s very focused on return on invested capital and he seems to have an open mind to doing things differently.”

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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/

BRAZIL and MARRO VEHLO

At least one of the companies that Disraeli was pushing, Imperial Brazilian, established a profitable mining business in the state of Minas Gerais in Brazil at the old and rich Gongo Soco mine, which lasted from 1826 until 1856 when flooding led to the mine’s collapse. Over 30 years it produced more than 400,000 ozs of gold, the revenue generated being divided 60% to costs, 20% to shareholder dividends and 20% to the Brazilian government in taxes, making it one of the few profitable companies to come under Disraeli’s gaze.

Brazil had been a major gold producer since gold was first discovered in Minas Gerais at the end of the 17th century. Gold production is thought to have been around 1,200 tonnes between 1700 and 1820, at which time British capital was allowed in, following independence from Portugal, to revive the ageing mines of the region. The British had in fact benefited for decades from the growth of gold mining in the pre-independence era as Portugal ran a permanent trade deficit with Britain which was plugged by gold deliveries from Brazil.

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Are You a Base Metal Growth Bull or a Gold Gloom-and-Doomer? – by Brian Sylvester (The Gold Report – January 2, 2013)

http://www.theaureport.com/

Gold bugs say the global economy could collapse any day now. But what about investors who see continued growth in emerging economies and a steady, if slow, U.S. recovery? Look to base metals, recommends Haywood Analyst Stefan Ioannou. He expects price runs for 2013–2015, especially for zinc, which is facing a serious supply squeeze. Do your homework now to get positioned as soon as the uptick begins. Ioannou shares his favorites in this Gold Report interview.

The Gold Report: Stefan, what is your 2013 outlook for copper?

Stefan Ioannou: Strong fundamentals underpin the copper price going into 2013. Despite a tough copper equity market in 2012, the metal price itself has been pretty solid, averaging around $3.60 per pound ($3.60/lb). Improving automobile numbers out of the U.S. and stronger manufacturing numbers out of China will both have a positive near-term impact on the copper price. We expect copper prices to move a bit higher in 2013.

TGR: How far off is a return to $4/lb copper?

SI: I think 2013 is too soon for a sustained $4/lb price, but it will likely test that mark a few times in the coming year. There is a stronger argument for a long-term $4/lb copper price.

TGR: Many of the copper companies you cover also have a zinc component. Zinc started 2012 near $2,200 per metric ton ($2,200/mt), dipped to $1,750/mt at midyear and now hovers around $2,000/mt. What is behind the volatility?

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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/

PADDY HANNAN (1840-1925)

The history of gold prospecting in Australia is populated by countless thousands of mostly unlucky and long forgotten men. One of the few whose name still survives is Paddy Hannan, who found the fabulous Kalgoorlie gold field in Western Australia in 1893 and whose statue is still to be seen in the centre of Kalgoorlie today.

Hannan was born in Ireland in 1840, one of five brothers and six sisters. He travelled to Australia in 1862 and worked for several years as a miner in the gold fields of Ballarat in Victoria where his uncle, William Lynch, was a miner. After that he went to work in the gold fields of New Zealand for several years and returned to prospect in New South Wales and then South Australia. He later crossed Australia to prospect for gold in Western Australia around Southern Cross. Hannan was a careful man with an ability to find water as well as gold, something that stood him in good stead in parched Western Australia. It was this skill at finding water that led to Hannan’s discovery of the famous Kalgoorlie gold field in 1892, for it was while he was looking for sources to fill his waterbags that he stumbled over surface gold.

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2012: A year for calling leaders to account – by Geoff Candy (Mineweb.com – January 2, 2013)

http://www.mineweb.com/

Tragedy, firings and calls for leadership were at the heart of the mining sector’s big stories of 2012.

GRONINGEN (MINEWEB) – 2012 was a big year for leadership. A host of countries, including France and China elected new leaders, others, like the US, chose more of the same. But, all around the world, leaders were being forced to work a little harder to win votes – unsurprising really, when one considers the parlous state of the global economy.

But, it was not just in the political sphere that leadership was being questioned. Mining leaders, at both a government and a company level were put on the spot. Indeed, one could argue that leadership (or a lack thereof) was at the heart of many of the sector’s largest stories in 2012.

The biggest and most tragic story of the year was the unrest on South Africa’s gold and platinum mines – unrest that led to the massacre at Marikana and a wave of strikes almost unprecedented in the industry.

While the full extent of the changes wrought in that crucible are yet to be seen, it is certain that the sector has undergone profound change and will have to see much more before it can begin to recover.

The judicial commission of inquiry into the massacre being Chaired by former judge Ian Farlam, has yet to reach a verdict but it has already raised a number of questions about leadership on all sides of the issue.

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Gold in 2013: climb, consolidate or collapse? – by Lawrence Williams (Mineweb.com – December 31, 2012)

http://www.mineweb.com/

While fundamentals seem to favour much stronger gold and silver prices this year, strange goings-on in the markets, should they continue, could see price rises fall short of expectations.

LONDON (MINEWEB) – Yes – its annual stick your neck out time for precious metals commentators as we try and foretell what will happen in the markets over the coming year – and precious metals price forecasting is an invidious business.

Once you go on record with a prediction it’s there for all to see – and, if you’re unlucky, to refer back to should your crystal ball prove to be wildly incorrect. So, firstly, what is this writer’s track record in predicting the gold price? Well, in 2012 not great, although far less inaccurate than most.

My prediction for the year-end gold price was $1875 – well above the final London close for the year of $1664, indeed a little more than $200 (or 12%) out. Perhaps not too bad, when one considers that in January, $2,000 was a fairly common year-end target and even the more conservative analysts were mostly predicting better things for the gold price.

For 2011, I was also rather over-optimistic with a year-end price prediction of $1760 against a final London close of $1574, despite gold soaring to well above this predicted level earlier in the year. Timing is everything in the gold price prediction game. This was 10.6% above the final figure – and even so, far closer than many were predicting.

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[Timmins] City boom continues in 2013 – by Benjamin Aubé (Timmins Daily Press – December 28, 2012)

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – For the past few years, the City of Timmins has focused on both increasing industry in the traditional sectors of mining and forestry, as well as seeking out new economic and industrial opportunity.

With a new airline (Porter) coming to town in 2012, along with the development of a diversified economy, Mayor Tom Laughren and city council will be looking to keep up with a city that is growing in more ways than one.

“I think Timmins will continue to see the building boom happening for the next couple of years,” said Laughren, previewing the challenges and opportunities 2013 is promising to offer. “I think it will still be a very much the mix we have out there right now, which is industrial, commercial and residential.

“The numbers are way up there, (construction) has been climbing, and with the price of gold, that’s going to continue.

“Having said that, one of the big challenges around that is going to be housing. The two biggest challenges I hear from local businesses when I visit them to talk about economic development are attracting workers, and then finding a place for them to live.”

With parts of Southwestern Ontario being hit hard by job losses, Laughren said that one of council’s priorities will be developing a housing strategy. The mayor said it “is easy to say, but will be tougher to do.

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Wooing shareholders back to gold mining [AuRico Gold] – by Pav Jordan (Globe and Mail – December 27, 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.

Barely four months into his job, AuRico Gold Inc. chief executive officer Scott Perry has had one message to investors: It’s time to get boring. Odd as that may sound, especially from a youthful CEO such as Mr. Perry, it echoes the new mantra of a gold industry that is recovering from a massive shareholder exodus that slashed values at companies large and small.

It is still more understandable given AuRico’s checkered past performances as Gammon Gold Inc. – it changed its name in June – and a stock market that is punishing gold producers who pursue growth for growth’s sake, and at the expense of shareholder value.

“The big thing I keep talking about with shareholders is we just want a portfolio that is deemed reliable, stable, consistent,” Mr. Perry said in an interview last week from offices in downtown Toronto. “So, if I was to speak crudely, it’s ‘let’s just get boring.”

AuRico’s stock price has oscillated like a yo-yo over the past four years, from lows of $2.95 a share in November, 2008, to highs of nearly $14 a share in August, 2011. These days, its shares are trading in the $7 to $8 range (they closed Dec. 24 at $7.67 a share), stabilizing after the company embarked on a radical redesign over the past year or so, from changing its name to stripping itself of underperforming assets.

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Crown has to respect treaty rights: Wabauskang Chief Leslie Cameron – by Jon Thompson (Kenora Daily Miner & News – December 24, 2012)

http://www.kenoradailyminerandnews.com/

Facing a lawsuit that could threaten its Phoenix Mine at Red Lake, Rubicon Minerals is not only vowing to fight back in court but to work with Wabauskang First Nation, who launched the suit on Thursday.

Based on an Ontario Superior Court of Justice decision that could redefine harvesting rights in the province, Wabauskang has asked a provincial court to either suspend or entirely cancel the approval of Rubicon’s closure plan, the primary authorization that will allow the company to begin production. The case, known as the Grassy Narrows Trappers’ Decision, found only the federal government can alter treaty agreements. The province has appealed that decision.

“We would rather not go to court, but until Canada and Ontario fulfill their responsibilities to us, we have no choice,” said Wabauskang Chief Leslie Cameron, arguing the province has unlawfully delegated its consultation responsibilities to the company. “Rubicon talks about their consultation, but where’s the government’s consultation? Ontario relied on Rubicon. That’s not right.”

Cameron compared her community’s case to that of Wahogshig First Nation’s case against Solid Gold Resources, which that First Nation argued in court on the same day Wabauskang filed its suit. She said Wabauskang will be closely watching the decision on Wahogshig, which is expected in mid-January 2013.

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First Nation clashes with Red Lake gold miner – by Ian Ross (Northern Ontario Business – December 21, 2012)

Established in 1980, Northern Ontario Business provides Canadians and international investors with relevant, current and insightful editorial content and business news information about Ontario’s vibrant and resource-rich North. Ian Ross is the editor of Northern Ontario Business ianross@nob.on.ca.

A small northwestern Ontario First Nation community is threatening legal action against a Red Lake gold miner which is advancing a high-grade deposit toward an early 2014 startup.

Wabauskang First Nation Chief Leslie Cameron said negotiations for a benefits agreement are not going well between his community of 300 and Rubicon Minerals over its Phoenix Gold project.

The band has instructed its lawyers to file a lawsuit at the Ontario Superior Court opposing Rubicon’s project. While the band is frustrated with the pace of development by the Vancouver-based miner, it has an even bigger bone to pick with the federal and provincial governments.

In a Dec. 17 news release, the band said it has repeatedly reminded and complained to Queen’s Park and Ottawa of its “constitutional obligations to consult and accommodate,” with First Nations on mining and exploration projects. But the band said both levels of government have ignored them and foisted those duties onto the mining companies.

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NEWS RELEASE: Wabauskang First Nation Files Lawsuit Against Ontario and Rubicon

Wabauskang First Nation
Treaty 3
December 20, 2012

Wabauskang First Nation’s lawsuit opposing Rubicon Mineral’s proposed Phoenix Mine at Red Lake, Ontario has been filed at the Ontario Superior Court of Justice.

“We will oppose Rubicon’s mine until our Treaty rights are respected,” said Wabauskang Chief Leslie Cameron. “We would rather not go to court, but until Canada and Ontario fulfill their responsibilities to us, we have no choice.”

Wabauskang’s lawsuit asks the court to either suspend or entirely cancel the approval of the closure plan, which is the primary authorization that will let Rubicon go into production. The lawsuit relies on last year’s court win by Grassy Narrrows First Nation in Keewatin, where the court found that only the federal government can justify an infringement of Treaty rights.

“We know that Ontario has been informing companies that any authorizations they get in the Keewatin lands may not be valid because the court has found that Ontario doesn’t have jurisdiction to issue authorizations. We think Rubicon’s closure plan is an example of an authorization that will ultimately be cancelled by the court.”

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Gold market seen moving forward in 2013 – by Henry Lazenby (MiningWeekly.com – December 20, 2012)

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

TORONTO (miningweekly.com) – A new report by auditing house PricewaterhouseCoopers (PwC) has found the gold price is expected to increase in 2013, driving increased spending on exploration and merger and acquisitions (M&A).

The ‘2013 global gold price report’ found more than 80% of gold executives expect to see a rise in the price of gold, and an analysis of the 46 largest TSX- listed gold mining companies pointed to more than 20 of these gold companies having cash reserves greater than $500-million.

“Gold miners are adamant about proving to the market that they’re once again a good investment – not just for the interim, but for the long-term. Receiving investors’ approval will involve establishing cost-effective management strategies, increasing dividend payments and responsibly investing in production growth – all on the back of a strong gold price,” PwC mining leader for Canada and the Americas John Gravelle said.

He added there has been a shift in focus with gold executives concentrating on the bottom line – specifically focusing on the rate of return for every ounce produced. According to the report, the long-term price of gold used by gold miners has increased by 6% from last year and 29% from two years ago, to $1 400/oz.

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Russia’s Klondike? Not yet – by Clara Ferreira-Marques (Reuters.com – December 20, 2012)

http://www.reuters.com/

(Reuters) – It looks like any one of remote eastern Siberia’s low-lying, peat-colored hills: only the thin trenches that scar Sukhoi Log hint at the work of generations of geologists to measure the riches beneath.

This bleak expanse, uninviting against a steel grey sky, is probably the world’s largest virgin gold deposit, with mineral wealth to rival the world’s largest, at Grasberg in Indonesia.

Yet it has remained untapped for half a century, held back by its remoteness, state restrictions and, in recent years, a lack of interest on the part of a Moscow government riding the wave of energy profits and holding out for higher gold prices.

“(The government) would love more gold, but they have no time to think about these issues at the top level,” said Sergei Guriev, rector of the New Economic School in Moscow.

“At the lower level, people are happy with the status quo.” Soviet geologists surveyed Sukhoi Log intensively in the 1970s yet little came of it. But now the Russian government has stirred long-dormant interest, suggesting it might invite bids to mine the gold. While such talk has come and gone in the past – and no details of any tender have been given – there is new debate on how, and at what cost, the ore might be exploited.

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