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Gold and Silver

Miner Solid Gold sues Ontario over court ruling halting its operations – by Romina Maurino (Canadian Business – January 25, 2012)

This article came from the Canadian Business website: http://www.canadianbusiness.com/

The Canadian Press

TORONTO – Solid Gold Resources Corp. (TSXV:SLD) says it plans to sue the Ontario government for $100 million over a ruling that temporarily prevents the junior mining company from drilling on Crown land near traditional First Nation territory.

The company alleges the province is liable for losses it suffered after a ruling earlier this month sided with the Wahgoshig First Nation in saying Solid Gold failed to consult before beginning its exploration.

Solid Gold has said any duty to consult with First Nations falls to the government, not the mining company, and it’s not something the province can delegate.

Solid Gold president Darryl Stretch, who is appealing the injunction, said the ruling has far-reaching implications because it means it would now be up to companies to get consent from First Nations on any project that runs near their traditional land.

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Canadian mining company denies link to shooting death of protester in Mexico – by Peter O’Neil (National Post – Janurary 26, 2012)

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

OTTAWA — Vancouver-based mining company Fortuna Silver says it has nothing to do with the shooting death of a protester in a town near the company’s mine site in Mexico.

Police have arrested the alleged shooter implicated in the death of Bernardo Mendez Vazquez, who was shot last week during a protest that news reports have linked to opposition to the gold and silver mine.

The shooting took place in the town of San Jose del Progreso, where the mine is the chief employer. The town and mine in the southwestern state of Oaxaca have been the sites of past conflicts involving groups who say the mine is an environmental threat to the arid region’s scarce water supply.

But Fortuna Silver president Jorge Ganoza said “misinformation” is behind media reports tying his company to the violence, which also left another protester with a leg wound.

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Gold junior [Solid Gold Resources] sues Ontario govt for C$100m over ‘precedent-setting’ ruling – by Matthew Hill (Miningweekly.com – Janaury 24, 2012)

Mining Weekly is South Africa’s premier source of weekly news on mining developments in Africa’s most important industry. Mining Weekly provides in-depth coverage of mining projects and the personalities reshaping the mining industry.

TORONTO (miningweekly.com) – Solid Gold Resources, a Toronto-based junior with precious-metals prospects in Ontario, said on Tuesday it is suing the Ontario government for C$100-million, and possibly more.

The company is seeking damages sustained as a result of a January 3 Superior Court of Ontario ruling that prevents it from drilling at its Lake Abitibi property, located east of Timmins in northern Ontario, for 120 days while the TSX-V-listed company consults with the Wahgoshig First Nation.

Judge Carol Brown’s judgement “squarely conflicts with the decision of the Supreme Court of Canada in Haida Nation v. British Columbia, which held that third parties cannot be held liable for failing to discharge the Crown’s duty to consult and accommodate,” Solid Gold said in a statement on January 19.

It said it would appeal the decision.

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Pan American Silver buys Minefinders Corp. – by Brenda Bouw (Globe and Mail – January 24, 2012)

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 – Pan American Silver Corp. plans to create a silver-producing powerhouse with the proposed $1.5-billion acquisition of Mexico-focused Minefinders Corp. But investors weren’t impressed, driving down Pan American shares 10 per cent on Monday.

Pan American is offering cash or shares – or both – for fellow Vancouver-based company Minefinders, owner of the Dolores silver and gold mine in northern Mexico and the nearby La Bolsa property set to begin production later this year.

The deal will create a combined company valued at $4-billion and double Pan American’s silver production to 50 million ounces by 2015, with eight mines across Latin America. Still, Pan American shareholders showed concern about the dilution of their shares as a result of the transaction.

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5 Gold Miners Become Takeover Targets – by Marc Courtenay (Seeking Alpha.com – January 22, 2012)

This commentary came from: http://seekingalpha.com/

What investors really get paid for is holding ‘dogs’. Small stocks tend to have higher average returns than big stocks, and value stocks tend to have higher average returns than growth stocks. – Kenneth R. French–Dartmouth Economist NBER

Like an old familiar song, it seems that as soon as a company which is making money announces some bad news and disappointing “guidance”, the stock price craters. Like “blood-to-hungry sharks”, this brings the company to the attention of larger “fish” who may gobble it up for its cash and holdings. This is exactly what has happened to Kinross Gold (KGC). The company had disappointing news released on Monday and Tuesday, January 16 and 17th that caused its shares to plunge to a new 52-week low of $9.96. This was a 24% drop from its January 12th high of $13.11.

The Canadian gold producer said Tuesday that it expects production to be flat to slightly higher this year, while production costs will rise between 12% and 19% due to higher labor and mine expenses. Kinross also said it expects to record an accounting charge, mostly related to a decline in the value of one of its mines.

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Kinross Gold Could Be a Takeover Target – by Charles Mead, Liezel Hill and Rita Nazareth (Bloomberg.com – January 20, 2012)

http://www.bloomberg.com/

By paying too much for acquisitions in western Africa, Kinross Gold Corp. (K) is now turning itself into the cheapest gold-mining target in the world.

Kinross, Canada’s third-largest gold producer, fell the most in almost two decades after saying this week it will write down the value of its Tasiast mine in Mauritania. The company sold for 76 cents per dollar of net assets yesterday, versus the industry median of 2.5 times, according to data compiled by Bloomberg. Writing off the excess $4.6 billion it spent on Tasiast would still leave Kinross at a 50 percent discount to its competitors, the data show.

While Kinross bought the Mauritanian mine for almost three times what the gold deposit is worth, the company is facing rising labor and raw material costs that may delay production at some of its projects. After more than quadrupling revenue in the past five years as gold prices reached a record, Kinross may now attract interest from Newmont Mining Corp. or Polyus Gold International Ltd. (PLGL) as they try to boost capacity to meet demand, said Stifel Nicolaus & Co. On its own, analysts say Kinross is worth 50 percent more than its current price.

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The War Against Us [Coeur d’Alene silver region] – by David Bond (Silverminers.com – January 16, 2012)

http://silverminers.com/

This commentary is by Silverminer.com editor David Bond

Wallace, Idaho – Just when was it that the United Snakes of America declared war on the Coeur d’Alene Mining District, and why?

We were ruminating, fulminating on these weighty questions last week. Pretty clearly, the opening salvo was fired in the final decade of the 19th Century, when Federal troops were dispatched under a declaration of martial law to lock up 600 miners here who were striking for decent wages.

Then of course during World War II there was the undeclared conscription of lead and zinc miners here who were prevented from taking better paying jobs in the shipyards of Puget Sound to keep wresting rocks from our earth that could be smelted into bullets and cartridges to kill Germans and Japanese.

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Kinross pays the price for mine delays in West Africa – by Sean Silcoff (Globe and Mail – January 18, 2012)

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.

OTTAWA— Kinross Gold Corp.’s drubbing by investors over delays at its trophy gold mine in West Africa is a fresh reminder of the gulf between the fortunes of those who dig for gold, and the metal itself.

While gold continues to trade at historically high levels – closing up $24.80 at $1,655.60 an ounce Tuesday – gold miners are contending with market antipathy due to rising costs and a string of unpopular and costly acquisitions. In such an environment, tolerance for bad news is low.

Kinross discovered that the hard way Tuesday, after saying it would take six to nine months more than expected to study and plan its Tasiast mine in Mauritania, delaying development and possibly negatively affecting production.

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PwC 2012 GOLD PRICE REPORT: Keeping up with the price of gold

Click Here: 2012 Gold Price Report

PwC’s 2012 Gold Price Report assesses gold companies globally, with companies surveyed representing 26.5 million ounces of gold mined in 2011, and 37.75 million ounces to be mined in 2012.

Eighty percent of the mining executives surveyed expect the price of gold to continue to increase in 2012, with the majority of respondents expecting gold to peak at $2,000 in 2012.  Sixty-two per cent of respondents reported the price of gold was positively impacting their stock price, yet the impact was less than expected. Gold has risen 23.4% so far this year, but the S&P/TSX Global Gold Index increased only 3.9% through November 30, 2011.

One main driver behind this unprecedented disparity between the price of gold and gold stocks is the recent popularity of ETFs. This disparity is having an impact on how executives plan to spend their increased cash flow:

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MINERS AT WORK, A HISTORY OF BRITISH COLUMBIA’S GOLD RUSHES – by B. Griffin (Royal British Columbia Museum, Victoria, B.C.)

ABSTRACT
 
The search for gold is the single most dramatic event of British Columbia’s early history. Although European settlement originally was founded on furs, it was the gold rushes of 1858 through the 1860s that changed the direction of development in this province for considerable time. These gold rushes not only brought a sharp increase in population and wealth but also initiated development of an early infrastructure of roads and services and directly influenced the shape of British Columbia’s politics.

It has been estimated that between 1860 and 1880 about $35 000 000 worth of gold was extracted from the 130 square kilometres (50 square miles) surrounding Barkerville. Although the later gold rushes were smaller, they also played an important role in our history. 

The rush to British Columbia was only one of a series of sudden shifts in population and wealth that resulted from the search for placer gold. California and Australia both attracted hordes of miners in search of riches. This paper places the British Columbia gold rush in a world context; it drew less world attention and was smaller than either the Californian or Australian rushes.

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[Timmins] Mine shops aid war effort – by Karen Bachmann (Timmins Daily Press – January 14, 2012)

The Daily Press is the city of Timmins broadsheet newspaper

Karen Bachmann is the director/curator of the Timmins Museum and a local author.

Second World War impacted everyday life in the Porcupine Camp during 1942

A few local news briefs from 1942, courtesy of the Porcupine Advance newspaper. Jan. 25 was the date that was finally set for the official opening of the brand new United Church in Timmins. Located at the corner of Mountjoy Street and First Avenue, only the basement had been built at the time. Construction of the rest of the church was to move ahead in the spring with the help of both regular and volunteer workers.

Rev. J.C. Cochrane, D.D., superintendent of northern missions was secured as the guest speaker. A newly formed choir under the auspices of Mr. Wallace Young was prepared to sing special anthems and other musical numbers during the dedication service.

At that time, the charter roll of membership was to be presented as the basis of the organization, and the keys were to be turned over to the new church minister.

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Queenston rejuvenating gold-rich Kirkland Lake Mining Camp-Scotia Capital – by Dorothy Kosich (Mineweb.com – January 05, 2012)

http://www.mineweb.com

Citing its assembled land package in the Kirkland Lake Gold Camp, as well as the company’s attraction as an acquisition target, Scotia Capital has initiated coverage on Queenston Mining.

RENO – Scotia Capital Wednesday initiated coverage of Queenston Mining (TSX: QMI) suggesting its Kirkland Lake gold project is an attractive acquisition target to both JV partner, Kirkland Lake Gold (TSX: KGI) and Kirkland’s majority shareholder Agnico-Eagle Mines.

“The company holds the largest assembled land package in the prolific Kirkland Lake Gold Camp in Ontario, which has produced over 40 Moz of gold, and two projects in Quebec, located adjacent to Agnico-Eagle Mines Limited’s…Lapa deposit,” said Scotia Capital analysts Ovais Habib and Mike Hocking.

Located in Ontario along the border with Quebec, the Kirkland Lake Gold Camp is believed to host nine greater than one-million-ounce gold deposits.

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Éléonore could be the next Val d’Or [Quebec mining] – by Kevin Dougherty (Montreal Gazette – January 11, 2012)

http://www.montrealgazette.com/

The prospecting mission led by Premier Jean Charest and Quebec City Mayor Régis Labeaume to promote Charest’s Plan Nord struck gold Tuesday in the wilderness of northern Quebec, visiting the site of the Goldcorp Inc.’s Éléonore gold mine.
 
Labeaume, who led a delegation of about 25 Quebec City-area business people and who made his personal fortune in the mining business, said Éléonore is “opening up a new mining region in Canada.”
 
“It is major, major, major,” he said. Guy Belleau, director of the $2.2-billion mining project, set to begin production of 600,000 ounces of gold yearly in 2017, went further.
 
“The Plan Nord is Éléonore,” he said in a presentation to the business delegation, political leaders and representatives of the Cree First Nations who count on landing about half the 700 construction jobs and 400 mining jobs Éléonore will generate.

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[Timmins Goldcorp] Mine ramping up – by Chris Ribau (Timmins Daily Press – January 10, 2012)

The Daily Press is the city of Timmins broadsheet newspaper

Blasting for open pit begins this summer

Corporate approval is all that stands in the way.

Representatives from Goldcorp Porcupine Gold Mines announced on Monday that it will commence development of the Hollinger Open Pit Mine Project following corporate approval to fund the project.

Construction is planned for the next 12 to 18 months at a cost of $75 million. Blasting is expected to start sometime this summer. The reasoning behind the 12 to 18 month timeframe is because the berm is the longest part of the construction. Construction of the haul road will start immediately.

The initial focus will be on equipment procurement, installation of the dewatering system, site clearing and stripping and the development of a five-kilometre haulage road between the Hollinger site and the Dome Mill.

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Lots to celebrate in [Timmins] 1912 – by Karen Bachmann (Timmins Daily Press – January 7, 2012)

The Daily Press is the city of Timmins broadsheet newspaper.

Karen Bachmann is the director/curator of the Timmins Museum and a local author.

HISTORY: Newspaper articles highlight the unbridled enthusiasm seen in the early days of the Porcupine Camp 

OK, I’m feeling the pressure. This is the first article I get to pen for Timmins’ 100th anniversary, and it has to be special – so, of course, I’m frozen at my keyboard, awaiting Divine Intervention (or a third cup of coffee).

How to begin? What is there to be said?

Sadly, the stuff I should be writing about I am afraid to say, I have already written – the beginnings of the camp, the development of Northern Ontario, etc. … So, I pray your indulgence as I present to you a small piece based on the items from the front page from the very first Porcupine Advance newspaper, published on March 28, 1912 (Vol. 1, No. 1).

I have chosen to do this because the tone of that first newspaper and the articles presented back then really do illustrate the unbridled enthusiasm that was rampant in those early days of the Porcupine, and of the Town of Timmins.

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