Latin America Mining – Page 108

Codelco Looks to 1st Female Director After CEO Fired – by Matt Craze and Javiera Quiroga (Bloomberg News – June 9, 2014)

June 9, 2014

http://www.bloomberg.com/

The success of a $20 billion plan to revive Codelco, the world’s largest copper producer, may rely increasingly on its first appointed woman director following the firing last week of Chief Executive Officer Thomas Keller.

Laura Albornoz was named in May by Chilean President Michelle Bachelet to defuse a growing feud between executives and workers at the company created in 1971 through the nationalization of foreign-owned mines. She participated in a six-hour board meeting until 2 a.m. on June 6 that decided to fire Keller, a former Anglo American Plc executive.

Consensus-building between workers, executives and the state at Codelco, which has generated $110 billion in profit since its creation, is a top priority as the company looks to maintain its No. 1 ranking in the global copper market, while cutting costs, Albornoz said in an interview in Santiago June 3.

“Codelco has had management issues that isn’t just down to the international price of copper,” Albornoz said. “We can take the company a lot further than where we have got it to now.”

Albornoz will visit next week the century-old Chuquicamata mine in the Atacama Desert where relations between Keller and the workers were at their worst.

UPDATE 2-Board of Chile’s state-run Codelco removes CEO Keller (Reuters India – June 6, 2014)

June 6, 2014

http://in.reuters.com/

SANTIAGO, June 6 (Reuters) – Chilean state-run copper miner Codelco said it was removing Chief Executive Officer Thomas Keller to seek new leadership at a pivotal time for the company, but opponents said the decision was politically motivated.

Keller, a former retail executive, has earned plaudits for his efforts to overhaul old mines and cut costs at the world’s No. 1 copper producer, but his tough style triggered tensions with Codelco’s powerful unions and the new center-left government.

The board stressed the removal of Keller, seen as close to the right, was not politically motivated, while the conservative opposition decried what it said was meddling that could harm the miner in the midst of an ambitious investment plan.

“We asked Thomas Keller to tender his resignation as CEO as a result of the company’s move towards a new phase with new challenges that require new leadership,” new board head Oscar Landerretche told journalists after a more than five-hour meeting that ended early Friday morning.

The board voted 5-3, with one abstention, to remove Keller. “There were no arbitrary political motivations, though there were motivations surrounding the company’s politics, the politics of what Codelco should be in the future,” Landerretche said. ” … There was no single factor that formed board members’ opinion.”

VIOLENCE: MINING CONFLICTS IN GUATEMALA ARE ERUPTING IN VIOLENCE – by Giles Clarke (Vice Magazine – March 27 2014)

June 3, 2014

http://www.vice.com/en_ca

In 2000, engineers from Radius Gold, a Vancouver-based mining company, discovered a belt of gold deep inside the Tambor mountains in southern Guatemala. The Guatemalan government promptly issued the company an exploratory license, and for more than a decade, Radius studied the region as a possible base of operations. The proposed mine lies just a few miles from the village of San José del Golfo and from San Pedro Ayampuc, a small city.

Few locals, most of whom are of indigenous Mayan descent, were consulted before Radius moved in. Few of them knew anything was happening at all. They certainly didn’t know they were living atop what would become a literal gold mine.

It wasn’t until early 2012 that townspeople began to grasp the scope of what was happening just down the road. They watched as truck after truck, loaded with heavy equipment, rumbled down the winding jungle roads that were normally used as routes for colectivo buses and small pickups carrying crates of chickens. In February 2012, Radius obtained final permission from the government to build its mine, which it hoped would pump out as many as 52,000 tons of gold a year.

Fearful of what might happen if a big foreign developer started digging into their soil, the community decided to intervene. They formed a human roadblock, manned in rotating shifts by people sitting on plastic chairs. They held banners, and cooked on-site meals for protesters in a makeshift kitchen under a lush canopy of vegetation.

Barrick reaches deal with indigenous groups over Pascua Lama mine – by Rachelle Younglai (Globe and Mail – May 29, 2014)

May 30, 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.

Barrick Gold Corp. has struck a deal with the indigenous groups that opposed the company’s mothballed Pascua Lama project. But the miner must still overcome huge obstacles before it can resume developing the massive gold and silver deposit in the Andes.

The mountaintop project on the border between Chile and Argentina has been put on hold indefinitely while Toronto-based Barrick waits for market conditions to improve.

The company’s mismanagement of Pascua Lama pushed costs up to $8.5-billion as the gold market soured, forcing Barrick to halt construction late last year in order to conserve cash.

Although Barrick is nowhere close to restarting the South American project, the company said Wednesday that it had reached an initial agreement in April with 15 Diaguita communities in Chile.

Barrick said it will share technical and environmental information about Pascua Lama with the indigenous groups as well as provide funding for any independent analysis.

UPDATE 2-Barrick reaches initial deal with Pascua-Lama mine opponents -lawyer – by Fabian Cambero (Reuters U.S. – May 28, 2014)

May 28, 2014

http://www.reuters.com/

May 28 (Reuters) – Canadian miner Barrick Gold has come to an initial agreement with local indigenous peoples who have opposed its stalled Pascua-Lama mining project on the Chilean-Argentine border, the lawyer for the communities said on Wednesday.

Barrick, the world’s largest gold miner, halted the gold and copper project last year after investing $5 billion in it.

Development of the mine, which the local Diaguita people have strongly opposed, had been frozen by environmental regulators in Chile who demanded that infrastructure to prevent water pollution be built.

The memorandum of understanding that has now been struck between 15 of the 18 communities and Barrick is an initial step towards bringing the two sides together, Lorenzo Soto, the lawyer for the Diaguita, said on Wednesday.

“This is historical, never seen in Chile’s mining history,” Soto told Reuters in an interview. The “traditional model” of concession and environmental permits “that could go ahead even if it trod all over the rights of the local communities” has now changed, he said.

Barrick named in class action suit over troubled Pascua-Lama project – by David Paddon (Globe and Mail – May 22, 2014)

May 22, 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.

TORONTO — The Canadian Press – Several Canadian law firms are pursuing a class action against Barrick Gold Corp. (TSX:ABX) and some of its current and former senior officers, alleging they misrepresented how much risk the company faced when it undertook construction of the multibillion-dollar Pascua-Lama mine project in South America.

The project involves one of world’s largest deposits of gold, estimated at nearly 18 million ounces, but the company missed its original target of starting production in early 2013 due to opposition from local groups and Chilean authorities.

The suit, filed Wednesday with the Ontario Superior Court of Justice, alleges Barrick described Pascua-Lama as a feasible and highly economic project due to the low cost to construct the mine and to produce gold and silver from it, adding that the company knew or should have known that it would have to overcome significant obstacles.

“The mine is located underneath glaciers in the Andes mountains and the environment is subject to extreme temperature and weather changes. Barrick is a sophisticated mining company that has constructed and operated mines all over the world.

Junior miners Rio Alto and Sulliden strike friendly deal to merge – by Peter Koven (National Post – May 22, 2014)

May 22, 2014

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

M&A activity continues to pick up in the mining space, as small miners Rio Alto Mining Ltd. and Sulliden Gold Corp. Ltd. are teaming up in an all-stock deal that combines similar assets located next door to each other. It is a sensible deal from a strategic standpoint. But for Rio Alto, it did not come particularly cheap.

Vancouver-based Rio Alto agreed to pay a 43% premium for Sulliden, which values the company at roughly $300-million and is well above its net present value, according to analysts. But Rio chief executive Alex Black promised investors he would create value out of the transaction “by performing.”

“A big proportion of my net worth is in Rio Alto,” he said on a conference call. “I’m not going to screw around with my investment and put that at jeopardy by making stupid decisions. This is a great decision for me as a shareholder, and therefore for every shareholder.”

Rio Alto owns the La Arena gold mine in Peru, where it has proven to be a highly capable operator. Just 30 kilometres away, Sulliden is trying to develop the Shahuindo project. Mr. Black claimed the two projects are virtually carbon copies of each other, as they have similar geology and use similar mining and processing methods. That means there should be plenty of synergies.

Barrick Gold seeks to restart suspended Pascua-Lama project after meeting with top Chilean officials – by Alexandra Ulmer and Fabian Cambero (National Post – May 20, 2014)

May 20, 2014

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

Reuters – SANTIAGO — Barrick Gold Corp, the world’s No. 1 gold miner, has met with Chilean officials and is keen to move forward with its suspended Pascua-Lama gold and copper project, in which it has already invested more than US$5 billion, Chile’s new mining minister told Reuters.

Aurora Williams, who became minister in March after President Michele Bachelet assumed power, said in an interview on Friday the Toronto-based company wanted to resolve outstanding problems so it could continue with Pascua-Lama, which straddles the Chilean and Argentine border.

Barrick surprised financial markets in October, when it shelved the massive mine over problems, including political opposition, environmental permitting, labor unrest, cost overruns and a sharp drop in bullion prices.

“We received Barrick a few days ago,” Williams said in her first interview with a foreign news organization. “They’ve showed us their interest in solving (Pascua-Lama’s) problems and doing community work, which to us appears correct … What I understand is that there’s interest that the project continue.”

In The Amazon, A New Mining Frontier For Iron Ore – by Marina Amaral (Huffington Post/Angencia Publica – March 4, 2014)

May 16, 2014

http://www.huffingtonpost.com/theworldpost/

Meet Canaã dos Carajás, the new frontier of iron ore mining. It’s in the South of Brazil’s Para, where jobs and mining royalties did not bring as much progress as expected.

Between 1982 and 1985, Brazil’s last military ruler, João Figueiredo, settled 1,551 families through colonization projects around the mining area of the Carajás Forest, in the south of Para state in the Amazon. The project to exploit the world’s biggest high-grade iron ore, discovered in 1967, started to get momentum after the first mine in Serra de Carajás (Carajas Hills) was opened. Today it is a complex that produces about $13 billion worth of iron ore per year, most of which is exported.

The early settlers, however, had no idea that they were going to live on top of the “biggest project ever” of Vale — the world’s second mining corporation.

The goal of the military government was to reduce land conflicts in the Bico de Papagaio (“Parrot’s Beak”) region. The region was the center of the Araguaia guerrilla in the 1970s and is mainly situated around reserves holding an estimated 18 billion tons of iron ore, as well as deposits of manganese, copper, nickel, and gold.

Today, Vale digs 110 million tons of iron ore from the North Hills of Carajás. With the new project, called S11D, the company aims to double the production by exploring the South Hills of Serra dos Carajás until 2016.

Goldcorp sees year of ‘significant growth’. No regrets on Osisko – by Dorothy Kosich (Mineweb.com – May 2, 2013)

May 2, 2014

http://www.mineweb.com/

Goldcorp reported increased gold production and lower all-in sustaining costs for the first quarter. More significant forecast growth is to come this year, says CEO Chuck Jeannes.

RENO (MINEWEB) – Goldcorp CEO Chuck Jeannes says in an interview with Reuters he doesn’t feel pressured to make another acquisition, after losing Osisko Mining to Yamana Gold and Agnico Eagle, but continues to believe “quality growth is the best way to add value to our shareholders.”

During a conference call with analysts Thursday, Jeannes said, “While I’m disappointed that we didn’t get to the finish line on the Osisko deal, I am absolutely convinced that we did the right thing in not increasing our offer to a level that will leave us unable to deliver appropriate returns for our shareholders.” “We have an outstanding portfolio of existing assets and we’ll continue to be disciplined in the way we seek to enhance the portfolio going forward,” he stressed.

Meanwhile, Jeannes told analysts, “We’re pleased to confirm this morning that we’re on track to meet our 2014 production guidance of between 2.95 million and 3.1 million ounces this year, which now excludes the forecast of the Marigold production [The Marigold joint venture has been sold to Silver Standard].

Nickel bolsters Vale’s bottom line – by Jeb Blount (Reuters/Sudbury Star – May 1, 2014)

May 1, 2014

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

Brazilian miner Vale SA said on Wednesday that first-quarter profit fell by nearly a fifth, a result in line with expectations, after the price of iron ore, its main product, fell sharply.

Net income fell 19% to $2.52 billion, compared with $3.11 billion in the same quarter of 2013, according to a securities filing. The result was near the $2.59 billion average estimate in a Reuters survey of 13 analysts and comes after a $6.54 billion fourth-quarter loss.

Vale Chief Executive Officer Murilo Ferreira has been working to slash costs and unload unprofitable businesses for more than a year as a slowdown in Chinese growth limits demand for iron ore and other metals. China, the world’s largest steel producer, is the biggest market for iron ore, the main ingredient in steel.

Vale is the world’s largest iron ore producer and a major miner of nickel, copper and fertilizers. In Sudbury, Vale is the city’s largest employer and runs mines, mills and a smelter. Nickel and copper are the main minerals produced in Sudbury.

Copper miners grapple with arsenic problem – by Xan Rice (Financial Times – April 30, 2014)

May 1, 2014

http://www.ft.com/intl/commodities-note

New flow of ‘dirty’ copper pushing up treatment costs

In the world’s driest desert in Chile, arsenic has long been a hazard. Research published this month revealed that a 1,000-1,500-year-old mummy found in the Atacama region, north of the country, died from drinking water laced with the poisonous element. Today, the threat is less to human life than to the profitability of copper miners.

Arsenic is often found alongside the red metal on the west coast of South America, home to the world’s largest copper reserves. Until recently, mining companies there chose not to develop copper deposits containing high amounts of arsenic, in favour of the abundant cleaner operations.

But as the large, old mines have become depleted, some arsenic-rich sites are now being exploited. They include Toromocho in Peru, which is owned by the Chinese state-owned group Chinalco, and Codelco’s Ministro Hales project in northern Chile. Both are important sources of new global greenfield copper supply.

The new flow of “dirty” copper concentrate is a sign of the declining ore grades globally, and presents fresh challenges for the industry since the material cannot be sent directly to smelters. Delays in processing this concentrate has resulted in stocks increasing and a rise in treatment and refining charges.

New calls for Canadian mining ombudsman so far unanswered – by Marion Warnica (CBC News Edmonton – April 28, 2014)

April 29, 2014

http://www.cbc.ca/edmonton/

Federal mining watchdog spot empty for seven months

A group of South American advocates wants Canada to appoint an ombudsman to regulate its mining activities outside its borders.

The group says the federal government, which has yet to release the results of its long-awaited review into its foreign mining policies, should be more involved in the monitoring and management of its foreign operations.

“A great deal of economic development that Canada enjoys, a lot of that results in human rights violations that we cannot tolerate,” said Archbishop Pedro Barreto, the president of the Solidarity and Justice Department in the Latin American Episcopal Council based in Huancayo, Peru.

Barreto spoke to CBC News as part of a larger investigation into water stress in Peru. He has joined a growing number of advocates and NGOs who want Canada to appoint a legislated mining ombudsman to oversee Canadian extraction activities around the world.

“The government of Canada is decisively supporting mining enterprises, without caring for lives or their social responsibility – and we are severely concerned about this,” said Barreto. Critics await improvements to failed complaints process

Chinalco Mining sets sights on copper projects in Latin America – by Eric Ng (South China Morning Post – April 25, 2014)

April 25, 2014

http://www.scmp.com/business/commodities

Metal unit keen on copper projects in Peru with its huge potential and friendly environment

Chinalco Mining, the non-ferrous and non-aluminium metals unit of aluminium giant Chinalco, is seeking acquisition opportunities in Latin America for copper projects with long-term return rates of more than 10 per cent.

Chief executive Peng Huaisheng said the region presented more development potential, especially Peru, where the company has been developing the Toromocho copper project since 2007.

“Our understanding is that Peru offers greater potential within Latin America,” he said. “Peru has a strategy to catch up with Chile in metals and mining development, so it provides an overseas-investor-friendly investment environment.”

Chile is the world’s largest producer and resource holder of copper, which is used widely in the power distribution and construction sectors. China imports about 70 per cent of its raw copper ore needs. Hong Kong-listed Chinalco Mining’s US$3.5 billion Toromocho project, about 140 kilometres from Lima, started trial commercial production in December.

Behind Barrick’s meltdown in the Atacama desert – by Stepanie Nolen (Globe and Mail – April 25, 2014)

April 25, 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.

In the violet light of a February Sunday afternoon, Padre Nelson Barrientos led his flock along the road that winds up Chile’s Huasco River Valley. The congregation of Our Lady of Lourdes of Conay was conveying a new statue of the Blessed Virgin to its home in the parish church, nestled in the shadow of the Andes. A half-dozen young people in traditional indigenous costumes—feathers, beads—drummed and danced, and their parents and neighbours followed in the procession. The mayor, Carmen Bou, was there, walking arm-in-arm at the front with Alicia Páez Campillay, the wife of the man whom everyone calls the valley’s richest businessman.

Many of the other marchers wore jeans and work shirts that hinted at a life spent in vineyards and orchards. Making their way to the village, the mayor, the dancers, their parents and the priest scrabbled up the loose gravel of the hillside, past a road sign almost swallowed by shrubbery, pointing up the mountain. On it, faintly visible despite someone’s best efforts with a can of spray paint, were the words “Pascua Lama.”

The Virgin was installed in the tiny blue chapel. There was dancing, poems, and an offering of the valley’s fat green grapes. As dusk fell, the white-haired priest tugged off a sweaty cassock; he, too, wore a plaid shirt and jeans.