Latin America Mining – Page 120

Canadian mining company got embassy help amid controversy in Mexico: Advocacy group – by Julian Sher – (Toronto Star – May 6, 2013)

May 6, 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.

Mining Watch issues report on what Canadian embassy in Mexico knew about the murder of Chiapas anti-mining activist, whose accused killers had ties to Calgary company Blackfire.

Secret diplomatic emails and briefings suggest the Canadian embassy in Mexico provided “active and unquestioning support” to a Canadian mining company before, during and after it became embroiled in controversy over the murder of a prominent local activist in Chiapas and corruption allegations, according to a report issued Monday by MiningWatch Canada.

The study, made available by the advocacy group to the Star and La Presse, is based on 900 pages of documents obtained through Access to Information from the Department of Foreign Affairs and International Trade about its dealings with Calgary-based Blackfire Exploration.

In late 2009, three men with links to the company were arrested after the drive-by shooting of Mariano Abarca, who was leading the fight against Blackfire’s barite mine in the often turbulent state of Chiapas.

Canadian Mining Industry Continues to Face Opposition in Central America (The Costa Rica News – May 5, 2013)

May 6, 2013

http://thecostaricanews.com/

Canadian mining operations have faced fierce opposition from numerous Latin America countries and communities over the past decade continuing most recently in Guatemala and Costa Rica.

In 2008 a Latin American independent report, Investing in Conflict—Public Money, Private Gain: Goldcorp in the Americas condemns the business practices of Canada mining companies, focusing on the largest, Goldcorp Inc., and discusses the Canadian mining industry’s socially and environmentally destructive practices in the Americas.

Even before this report, a Canadian mining operation met strong resistance in Costa Rica. In 2003 Canadian mining corporation Glencairn, started open pit mining in Miamar Costa Rica, ignoring concerns by locals and scientists of the riskiness of the area for large-scale open-pit mining, and an impending ban on open-pit mining in the country. [Reported on http://www.earthworksaction.org]

The company set up a mine using “cyanide heap leaching” at Bellavista, close to Miamar, which is a process where intensely toxic cyanide trickles through massive mounds of ore and removes the gold from the ore.

In July 2007, earth movements caused by geological instability and rainfall cracked the mine’s leach pad liner, allegedly leaking cyanide and contaminating the groundwater near the community of Miramar.

Guatemala declares emergency in four towns to quell mining protests – by Sofia Menchu and Mike McDonald (Reuters U.S. – May 2, 2013)

May 3, 2013

http://www.reuters.com/

(Reuters) – Guatemala declared an emergency in four southeastern towns on Thursday, suspending citizens’ constitutional rights in an area where deadly protests over a proposed silver mine have erupted in recent weeks.

Guatemalan President Otto Perez announced the move in an effort to quell protests targeting the mine belonging to Canadian miner Tahoe Resources Inc. Two people have been killed in the demonstrations.

The company’s security guards shot and wounded six demonstrators on Saturday, said Mauricio Lopez, Guatemala’s security minister.

The next day, protesters, who say the Escobal silver mine near the town of San Rafael Las Flores will contaminate local water supplies, kidnapped 23 police officers, Lopez said. One police officer and a demonstrator were killed in a shootout on Monday when police went to free the hostages, said Lopez.

“I am not going to allow this to continue,” Perez told reporters. “We have conducted a six-month investigation in this area with the attorney general’s office for various criminal activities.” Police and military raided the four towns on Thursday, arresting 15 people suspected of kidnapping, weapons theft and destruction of private property.

Peru rolling back indigenous law in win for mining sector – by Mitra Taj and Teresa Cespedes (Reuters India – May 1, 2013)

May 1, 2013

http://in.reuters.com/

LIMA – (Reuters) – Peru’s mining minister is winning a crucial cabinet battle by swaying President Ollanta Humala to water down a law that gives indigenous groups more say over new mines and oil projects – and a deputy minister will likely resign in protest.

According to half a dozen people with direct knowledge of the internal tug-of-war, Mines and Energy Minister Jorge Merino has prevailed in excluding Quechua-speaking communities in the mineral-rich Andes from being covered by the law.

Sources said he fears applying the law throughout the highlands – as the government once said it planned to do – would delay a pipeline of mining investments worth $50 billion. Several people in Merino’s office declined repeated requests by phone and email for comment.

The tussle underscores a quandary facing Peru, one of Latin America’ fastest-growing economies: how to develop its vast mineral wealth while also addressing a legacy of inequality from its colonial past.

The “prior consultation law,” which Humala touted during his 2011 campaign as a salve for widespread conflicts over natural resources, requires companies to negotiate agreements with indigenous communities before building new mines or oil wells around their lands.

Brazil’s Vale ‘Confident’ in Direction of New Mining Laws – by Paul Kiernan (Wall Street Journal – April 25, 2013)

April 26, 2013

http://online.wsj.com/home-page

RIO DE JANEIRO–Brazil’s Vale SA (VALE, VALE5.BR) has taken a largely favorable view toward a major overhaul of the country’s mining regulations that the government expects to send to Congress in coming weeks, Chief Executive Murilo Ferreira said Thursday.

“We’re confident in the new mining framework in Brazil, that it won’t create constraints and that it will bring motivation for investments,” Mr. Ferreira said in a conference call with analysts to discuss the company’s first-quarter results.

He expressed doubt that the regulations, which are widely expected to raise royalties charges levied on Brazilian mining companies, would include a so-called special-participation tax by the federal government on large projects. Analysts earlier this year had expected such a tax, which would come on top of steeper royalties fees.

“I think on a series of doubts that the market had, we’re going in a very positive direction,” Mr. Ferreira said.

Regarding the other black cloud that has hung over Vale’s share price in recent months–the company’s roughly $15 billion in disputed tax liabilities–executives offered little news. General Counsel Clovis Torres said, however, that the company won’t have to set aside guarantees that are normally required in disputes with tax authorities.

–Brazil’s Vale sees 30 million-40 million tons of additional iron-ore capacity to pressure prices in second-half 2012

Brazil on cusp of domestic potash and phosphate revolution – by Simon Rees (MiningWeekly.com – April 25, 2013)

April 26, 2013

http://www.miningweekly.com/

TORONTO (miningweekly.com) – Fertilisers and their increased application will be vital in driving Brazil’s status as a global agricultural powerhouse. The country is already the world’s fourth-largest consumer, according to Reuters.

Rather than rely on imported raw material for fertiliser production, Brazil’s government is keen to facilitate the growth of a robust domestic potash and phosphate industry. Several significant projects are already in various stages of development, including those being advanced by MBAC, Brazil Potash and Verde Potash.

MBAC is close to bringing on stream its Itafós project, located in the vast Cerrado area, Brazil’s new agricultural frontier.

Construction work is just more than 90% complete, with proven reserves standing at 15.9-million tons and probable reserves at 48.9-million tons. Life of mine is estimated at 19 years, with an average ore grade of 5.08% P2O5 (phosphorus pentoxide). Yearly output is estimated at an initial 500 000 tons single super phosphate (SSP).

“We’ve accomplished a lot over the last four years: we’ve drilled over 75 000 m; obtained the necessary permits and filed the necessary technical reports; [and] secured financing in difficult market conditions,” MBAC VP corporate development Steve Burleton told Mining Weekly Online.

Mining in Chile: Copper solution (The Economist – April 27, 2013)

April 25, 2013

http://www.economist.com/

The mining industry has enriched Chile. But its future is precarious

ANTOFAGASTA – TOURIST shops sell polished copper trinkets. Building after building sports a bit of copper cladding. Even the taxi-drivers in Santiago, Chile’s capital, know the price of copper. It is not hard to guess what the country’s biggest export is.

Copper has been kind to Chile. It provides 20% of GDP and 60% of exports. Thanks to it, Chile’s economy is expanding by nearly 6% annually, while inflation and unemployment are enviably low. Poverty rates have tumbled; public services are mostly good. Chile has other strengths, such as agriculture, tourism and even high-tech. But small shifts in the copper price make headlines.

The copper mines themselves are far from the capital. Escondida, the world’s biggest (and the source of over 5% of global supplies) is a 1,300km (800-mile) trek north, in the middle of the Atacama desert. BHP Billiton, the world’s biggest mining company, operates two gigantic pits there.

The deeper one is 3.9km from side to side and 650 metres from brim to bottom. Trucks as big as houses, working non-stop, haul 1.5m tonnes of rock out of Escondida each day. Managers may drive 150km in a shift. Last year the mine disgorged 1m tonnes of metal. Overall, Chile produces a third of the world’s copper.

Mexican mining royalty plan passes committee in Congress – by Gabriel Stargardter (Reuters India – April 18, 2013)

April 25, 2013

http://in.reuters.com/

MEXICO CITY – (Reuters) – A proposal to levy a new 5 percent royalty tax on mining profits in Mexico, the world’s largest producer of silver, passed a congressional committee on Thursday as the country attempts to boost its paltry tax take.

The plan put forward by lawmakers in President Enrique Pena Nieto’s Institutional Revolutionary Party (PRI) aims to boost revenues from an industry where companies enjoy a more generous tax regime than in other Latin American countries.

The proposal, which was approved by the economics committee of the lower house of Congress, aims to redistribute profits to the states where foreign and domestic companies mine.

The plan is part of a broader drive by Pena Nieto to improve Mexico’s tax take, which is the lowest in the 34-nation Organization for Economic Co-operation and Development.

Under the proposal, mining firms would pay a 5 percent charge on net profits before tax. Mines not yet producing would pay a low, almost symbolic per-hectare fee on their concession. Seventy percent of the revenues would go to the states and municipalities where mining occurs, for infrastructure and development, with the rest going to a federal development fund.

UPDATE 2-Vale Q1 profit falls despite big cost cuts – by Jeb Blount (Reuters U.K. – April 25, 2013)

April 25, 2013

http://uk.reuters.com/

RIO DE JANEIRO, April 24 (Reuters) – Brazil’s Vale SA , the world’s second-largest mining company, reported an 18 percent slide in first-quarter net profit as bigger-than-expected cuts in operating costs failed to offset lower sales and a hit from taxes and foreign exchange.

Despite the drop, the result beat analysts expectations and may help boost Vale’s stock as the company responds to investor calls for a tighter reign on spending amid concerns over weaker metals prices as growth in China slows.

Net income of $3.11 billion in the three months ending March 31 beat the $2.71 billion average estimate of eight analysts surveyed by Reuters and reversed a fourth-quarter loss, Vale’s first quarterly loss in a decade.

The result was still down on $3.79 billion a year earlier, and 25 percent below the average $4 billion quarterly profit the world’s largest producer of iron ore has recorded for the previous 11 quarters.

The lackluster outcome may add to nervousness that a decade-long mining boom led by ravenous Chinese demand for steel and other metals is ending, despite a rebound in iron ore prices after a steep drop last year. Like rivals BHP Billiton and Rio Tinto , who have been cutting costs and shunning expensive acquisitions, Vale slashed planned 2013 investment 24 percent in December.

Vale’s former iron man sets sights on Africa – by Silvia Antonioli and Clara Ferreira-Marques (Reuters U.K. – April 23, 2013)

April 23, 2013

http://uk.reuters.com/

LONDON (Reuters) – At the helm of Brazil’s Vale for a decade, Roger Agnelli turned the conservative iron ore producer into a global heavyweight. Now, he is back in the game.

The 53-year-old, ousted from Vale two years ago, is betting on the world’s hunger for resources, Africa’s potential and his team’s ability to operate where others fear to tread.

“You have a lot of financial guys looking to invest, looking for opportunities,” said the former banker, sitting back in the library of a smart central London hotel. “But guys who go into the middle of the forest, into the middle of the desert to implement a project, those are still scarce.”

Agnelli set up AGN Participacoes, a holding company, shortly after leaving Vale, to invest in biofuel. Last July, he teamed up with billionaire Andre Esteves’ investment bank BTG Pactual to set up B&A Mineracao, a mining group focused on fertiliser, iron ore and copper, in Latin America and Africa.

That $520 million venture – one of a handful of investment ventures set up by an outgoing generation of mining executives – has already put its cash to use, investing $160 million in fertiliser projects and copper.

Barrick rebellion: With gold miner’s stock in the dumps, investors push back – by Peter Koven (National Post – April 20, 2013)

April 22, 2013

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

This has been the worst month in Barrick Gold Corp.’s modern history. It is about to get worse. On Wednesday, the Toronto-based gold miner will be greeted by some very frustrated shareholders at its annual meeting. The company does not usually face hostility from investors at its AGMs, but this year appears to be different.

Virtually everything has gone wrong for Barrick lately. And as gold began a steep descent last week and the company’s key project was partially halted, the stock price plunged 33% in six days. It is an gut-wrenching freefall for a company of Barrick’s size and it takes the stock to its lowest levels since 1993 when gold averaged just US$360 an ounce.

Remarkably, an even bigger source of investor ire emerged on Friday. Seven of Canada’s largest pension funds announced that they are opposing the US$11.9-million “signing bonus” that Barrick paid to co-chairman John Thornton last year, and plan to vote against the entire compensation committee. Mr. Thornton received a whopping US$17-million in 2012, and he was not the only beneficiary of Barrick’s largesse. Chairman Peter Munk (US$4.3-million), chief executive Jamie Sokalsky (US$11.4-million) and “ambassador” Brian Mulroney ($2.5-million) all received big pay hikes despite a bad year for the stock price.

Huge Barrick mine in Chile faces long delay as obstacles pile up – by Alexandra Ulmer (Reuters U.S. – April 16, 2013)

April 18, 2013

http://www.reuters.com/

SANTIAGO, April 15 (Reuters) – Barrick Gold Corp faces some tough legal obstacles to complete its up to $8.5 billion Pascua-Lama gold mine after a recent court decision, and even the possibility that its Chilean environmental permit might
be canceled.

In the latest of several recent blows to the country’s mining and power industries, a Chilean court last week suspended
construction of the mine, which straddles the border of Chile and Argentina, while it weighs claims by indigenous communities that the mine destroys pristine glaciers and harms their water supply.

The ruling is one of several challenges facing Pascua-Lama, which was originally touted as one of the world’s largest and
lowest-cost gold mines. Experts say there is a risk that the unpopular project faces months, or even years, of legal limbo, damaging Chile’s investor-friendly reputation.

Moreover, politicians are unlikely to intervene during an election year on behalf of the project, a hot potato in Chile. “Pascua-Lama’s legal path looks difficult,” said Luis Cordero, law professor at the Universidad de Chile. “If the company isn’t able to adequately negotiate a plan to meet (demands), its permit could be revoked.”

Colombian miners hit out at Anglo American – by John Vidal (The Guardian – April 15, 2013)

April 18, 2013

http://www.guardian.co.uk/

The joint owners of the Cerrejón opencast mine will be accused at its annual meeting of jeopardising the health of 13,000 people

Communities from Colombia, Mongolia, South Africa and the US will demonstrate in London this week against some of the world’s largest mining companies, which they say are devastating the health of people, widely polluting the environment and forcing communities to move.

Anglo American, joint owners of the giant Cerrejón opencast coal mine in northern Colombia with BHP Billiton and Xstrata, will be accused at its annual meeting on Friday of jeopardising the health of the 13,000 people who live or work close to the operation that provides coal for power stations in Britain and Europe.

“We have had to suffer the impacts of opencast coal mining for over 25 years now. Our communities have been gradually and systematically asphyxiated by the contamination caused by coal mining, our societies [have been] fractured,” said Julio Gomez, president of Fecodemigua, the Federation of Communities Displaced by Mining in La Guajira, in London.

Around 500m of the total estimated 5bn tonnes of coal have been mined from Cerrejón since it opened in 1985, but the largest mine in Latin America plans to increase production by 25% in the next three years.

Barrick’s Pascua-Lama mine setback signals larger shift in Chile – by Pav Jordan (Globe and Mail – April 12, 2013)

April 12, 2013

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.

A ruling from a Chilean court to halt work on the world’s most ambitious gold project marks a growing backlash against the industry in one of the world’s most mining-friendly areas.

The Pascua-Lama gold and silver project straddles the Andes mountain range between Chile and Argentina and is slated to go into production this time next year, if project owner Barrick Gold Corp. can convince an appeals court in the northern town of Copiapo – population 167,000 – that it isn’t polluting the water supplies of indigenous communities.

The ruling represents a rare injunction against a mine that has been more than a decade in the making, having cleared regulatory hurdles including environmental permitting in Chile and Argentina. It’s also the latest instance of a Chilean court hearing a complaint against a project already cleared by environmental authorities.

Chile has long been viewed as a miner’s Utopia, complete with some of the richest mineral reserves on the planet as well as one of its most mining-friendly, stable governments, but some say it has become so saturated with projects that its infrastructure is straining at the seams and communities are becoming alarmed. The shift comes amid a growing wave of resource nationalism, which has touched most of the world’s mining jurisdictions.

Barrick’s woes in Chile deepen as Pascua Lama is suspended – by Pav Jordan (Globe and Mail – April 11, 2013)

April 11, 2013

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 suspended construction in Chile on its massive Pascua-Lama gold and silver project, responding to a court order that further delays work on a mine already a year behind schedule and billions of dollars over budget.

Barrick stock fell 8.6 per cent to a new 52-week low of $24.81 per share on Wednesday after the appeals court said Pascua-Lama should be halted amid allegations the project is polluting precious groundwater and rivers in the Atacama desert region, one of the driest areas on earth.

The allegations have not been proven in court, but they mark the latest roadblock to a project that has been more than a decade in the making, enduring intense environmental scrutiny that has reverberated from Santiago to Toronto.

The complaints are also another instance of communities demanding more control over their environment amid building resource nationalism.

Less than a year ago, Barrick raised the development price tag on Pascua-Lama to more than $8-billion, compared to estimates of around $3-billion when the company launched the project in 2009. A significant portion of higher costs were attributed to a year-long delay in building the mine.