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Ontario Mining

The Mighty Sudbury Basin – Politically Secure, Enormously Pro-Mining and Geologically Rich – is on a Mine Building Boom – by Nick Stewart (Part B)

This article was first published in Northern Ontario Business, a newspaper that has been providing northerners with relevant and insightful editorial content, business news and information for over 25 years.

FNX Mining

The first half of 2008 has been a busy one for the mid-tier miner with a new shaft in operation and a change at the top.

President John Lill resigned from the company in early August, indicating a desire to pursue other interests. Lill had taken up the mantle of president and CEO in September 2007, replacing Terry MacGibbon, who has since been appointed to his prior roles.

The company’s Podolsky mine went into production earlier this year and has shown greater results than exploration potential had indicated.

With expectations for copper grades of 3 per cent, production has shown 12 per cent in the first quarter, and more than 5 per cent in the second. It’s expected to average out between 6 and 7 per cent over the rest of the year.

“Historically, in the Sudbury basin, these types of deposits have mined about 20 to 40 per cent better than they drilled off,” says MacGibbon.

Having cost $150 million to put into production, Podolsky has been a 300-tonne per day producer since January. That number will rise to 1,000 tonnes by year’s end, representing 400,000 tonnes annually at full production.

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The Mighty Sudbury Basin – Politically Secure, Enormously Pro-Mining and Geologically Rich – is on a Mine Building Boom – by Nick Stewart (Part A)

This article was first published in Northern Ontario Business, a newspaper that has been providing northerners with relevant and insightful editorial content, business news and information for over 25 years.

While much of southern Ontario’s manufacturing economy is taking a beating, Sudbury and its mineral industry is riding high with record capital investments in mining. Here’s a round-up of what’s going on with the big and small producers.

Xstrata Nickel

The world’s fourth-largest nickel miner has a series of major local investments on the go and recently received approval from head offices in Switzerland for $455 million to move them forward.

Of that total, $280 million will be spent on developing the new Fraser Morgan mine, which goes into operation in 2010, producing 7,000 tonnes of nickel per year. Up to $70 million has been spent on the project to date.
 
The remaining $175 million will go towards the local Strathcona Mill, which currently handles 2.4 million tonnes of ore. The investment will expanded that to 3.4 million.

These are just a small part of Xstrata’s local growth plan, which includes bringing its flagship Nickel Rim South mine into production in 2009, having first hit upon its value in 2001. Once fully operational, it will annually produce between 12,000 and 15,000 tonnes of nickel, 50,000 tonnes of copper and several hundred ounces of precious metals.

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Ontario Mining Act Public Consultations are Flawed – by Don McKinnon

The world-class Hemlo deposit was the major gold discovery in Canada during the 1980s. The three individuals who were responsible for discovering one of the country’s richest gold camps were Don McKinnon, John Larche and David Bell. Don McKinnon is still an active Timmins-based prospector.

It was a farce.

That is the only way to describe the so-called public consultation session on changes to the Ontario Mining Act (OMA) held in Timmins Aug.11.

The 70 people who turned out were told they could not:

1-ask questions;

2-make any statements to the room;

3-have any other material other than a government handout; and

4-question Northern Development and Mines Minister Michael Gravelle as he broke his promise to attend.

Any changes to the OMA will have an important bearing, either a negative or positive impact, on a $10.7 billion Ontario industry.

Premier Dalton McGuinty wants “focused discussions” with municipalities, the mineral industry, Aboriginals, prospectors and the public. He certainly went about it in a strange way.

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Honourable Michael Gravelle – Ontario Minister of Northern Development and Mines – Welcome Speech at Public Consultation – Toronto, Ontario

Honourable Michael Gravelle - Ontario Minister of Northern Development and MinesMODERNIZING ONTARIO’S MINING ACT

September 8, 2008

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Good evening, ladies and gentlemen and thank you.

Thank you for taking the time to participate in this consultation.

And thank you for your interest in helping my ministry undertake this next important, indeed historic stage in our government’s commitment to modernize Ontario’s Mining Act.

Historic because together we have the opportunity to ensure this legislation promotes sustainable development that benefits all Ontarians.

As Canada’s largest producer of minerals, Ontario accounted for 28 per cent of the national total in 2007, at an approximate value of $10.7 billion. 

The fact is our mineral sector is a powerhouse that employs tens of thousands of people and pumps millions into the economy.

Our government understands this and we’re proud to stand shoulder to shoulder with the world’s leading mining jurisdictions.
   
We also believe that mining holds tremendous potential, especially for the province’s northern, rural and Aboriginal communities. 

We want the industry to be competitive, vibrant and prosperous.

But we want to ensure this potential and this prosperity is developed in a way that respects communities.

In short, our task is to find a balance – and this is where we need your help.

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Modernizing Ontario’s Mining Act (6 of 6)

Ontario, the largest mineral producer in Canada, is modernizing its Mining Act. These six postings are from a provincial policy document – titled “Modernizing Ontario’s Mining Act – Finding A Balance” produced by the Ministry of Northern Development and Mines.

Elements of the Review

The government believes five critical policy issues must be addressed in this review of Ontario’s Mining Act:

1. Mineral tenure system and security of investment

Potential adjustments to the mineral tenure system, including free entry, to assure investment security while taking into account other interests, including Aboriginal community concerns and private landowners’ issues.

2. Aboriginal rights and interests related to mining development

Potential approaches to consultation and accommodation related to the broad range of mineral sector activities as they affect Aboriginal and treaty rights.

3. Regulatory processes for exploration activities on Crown Land

Potential approaches to regulating exploration activities, including consultation and accommodation with Aboriginal communities.

4. Land use planning in Ontario’s Far North

Potential approaches to the requirement that new mines in the Far North would need community land use plans supported by local First Nations.

5. Private rights and interests relating to mining development (mineral rights/surface rights issues)

Potential approaches to address mineral rights and surface rights issues.

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Modernizing Ontario’s Mining Act (5 of 6)

Ontario, the largest mineral producer in Canada, is modernizing its Mining Act. These six postings are from a provincial policy document – titled “Modernizing Ontario’s Mining Act – Finding A Balance” produced by the Ministry of Northern Development and Mines.

Ontario’s Mining Act

The purpose of the Mining Act, which applies throughout Ontario, is “to encourage prospecting, staking and exploration for the development of mineral resources and to minimize the impact of these activities on public health and safety and the environment through rehabilitation of mining lands in Ontario.”

Despite its name, the Mining Act has limited application in the day-to-day activities of operating mines. Generally, it focuses on activities that occur before and after mineral production. These activities include the acquisition and maintenance of mineral rights – claim staking, prospecting, mineral exploration and mine development related to mining land tenure – and the safe, environmentally sustainable closure of mining operations.

The Mining Act does not, however, regulate the following matters, which are covered by other legislation:

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Modernizing Ontario’s Mining Act (4 of 6)

Ontario, the largest mineral producer in Canada, is modernizing its Mining Act. These six postings are from a provincial policy document – titled “Modernizing Ontario’s Mining Act – Finding A Balance” produced by the Ministry of Northern Development and Mines.

What We Have Learned So Far

Consultation with Aboriginal Communities

In February 2007, the Ministry of Northern Development and Mines released a discussion paper, Toward Developing an Aboriginal Consultation Approach for Mineral Sector Activities, and initiated a collaborative engagement process with the goal of developing an improved Aboriginal consultation approach.

The ministry held community-based discussions across Ontario, met with several political territorial organizations and tribal councils, as well as the Métis Nation of Ontario, and held several facilitated workshops. Through these discussions, we learned that Aboriginal communities have a variety of views on mineral sector activities, and when and how they want to be consulted.

Aboriginal communities told us:
• They want to be consulted and accommodated at all stages of the mining sequence, including preliminary exploration
• They desire meaningful participation in land use decision making and economic development
• They desire a measure of control over development within their traditional territories, including proposed activities before exploration work is undertaken
• They require assistance to build capacity that would allow them to participate fully.

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Modernizing Ontario’s Mining Act (3 of 6)

Ontario, the largest mineral producer in Canada, is modernizing its Mining Act. These six postings are from a provincial policy document – titled “Modernizing Ontario’s Mining Act – Finding A Balance” produced by the Ministry of Northern Development and Mines.

Purpose of the Review

Blueprint for Development

Released in March 2006, Ontario’s Mineral Development Strategy serves as a blueprint for the future of mineral development in Ontario. It commits Ontario to sound management, effective stewardship and responsible development of the province’s mineral resources.

Ontario is modernizing its Mining Act to ensure that this legislation promotes fair and balanced development that benefits all Ontarians in a sustainable, socially appropriate way, while supporting a vibrant, safe, environmentally sound mining industry.

Modernization will bring the Mining Act into harmony with the values of today’s society while maintaining a framework that supports the mineral industry’s contribution to Ontario’s economy. This process supports Premier Dalton McGuinty’s July 14, 2008 Far North Planning announcement, including his promise that the government will modernize the way mining companies stake and explore their claims to be more respectful of private land owners and Aboriginal communities.

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Modernizing Ontario’s Mining Act (2 of 6)

Ontario, the largest mineral producer in Canada, is modernizing its Mining Act. These six postings are from a provincial policy document – titled “Modernizing Ontario’s Mining Act – Finding A Balance” produced by the Ministry of Northern Development and Mines.

Overview of Ontario’s Mining Industry

The mineral sector is the largest private sector employer of Aboriginal workers in Canada.

Ontario is Canada’s largest producer of minerals, accounting for 28 per cent of the national total in 2007, at an approximate value of $10.7 billion. Exploration spending in Ontario has risen fourfold from $120 million in 2002 to $500 million in 2007. In 2008 that figure is expected to exceed $625 million.

Ontario is a leading producer in a number of base and precious metals. The province ranks among the top 10 global producers of platinum, nickel and cobalt and among the top 20 global producers of gold, silver, copper and zinc. Currently, there are 43 producing mines across Ontario: 28 metal mines; 14 major industrial mineral operations and Ontario’s first diamond mine.

The mining sector employs 100,000 Ontarians directly and indirectly. The average weekly earnings of the mining sector are 50 per cent higher than any of Ontario’s other industrial sectors. Mining companies inject approximately $1 billion annually into the Ontario economy and support over 1,000 local businesses.

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Modernizing Ontario’s Mining Act – Minister Michael Gravelle’s Message (1 of 6)

Honourable Michael Gravelle - Ontario Minister of Northern Development and MinesOntario, the largest mineral producer in Canada, is modernizing its Mining Act. The following six postings are from a provincial policy document – titled “Modernizing Ontario’s Mining Act – Finding A Balance” produced by the Ontario Ministry of Northern Development and Mines.

Ontarians share a fundamental value – a deep and profound love for the natural wonders of this province.

The natural world of trees and rocks and water and wildlife has built our economy into one of the strongest in the world. Since earliest times, it has inspired our art and shaped our character as a people. It sustains us and lies at the core of our self-image.

Whether we are urbanites who relish our annual canoe trips with the kids; Cree hunters awaiting the return of the geese to Hanna Bay; lone prospectors plying their craft in the winter wilderness; cottagers enjoying the sunset at the lake; or small-towners sneaking out at lunch to dip a line in a local stream – whoever we are and whatever we do, we all love this place.

In a sense, we Ontarians are all people of the land. It is natural, then, that the land – and the uses we put it to – should spark strong feelings. Sometimes we find ourselves at odds with each other. Occasionally, these differences lead to conflicts.

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Timmins – the Legendary Porcupine – has a Golden Prosperous Future – by Gregory Reynolds

Gregory Reynolds - Timmins ColumnistThe world-wide boom in commodities has seen profits for Canadian mining companies soar and shareholders are loving it.

Buried in the good news is an interesting development that may prove beneficial to mining companies and the communities dependent upon them even after base and precious metal prices hit the bottom of the present cycle.

Flush with profits, mining companies are taking intense and expensive looks at former producers in Ontario’s historic mineral camps. What this is doing in the short term is putting pressure on the exploration sector as companies turn back to Red Lake, Kirkland Lake, Sudbury and Timmins while coping with a shortage of workers.

Still, it is good for the local economies and contains the promise of a bright future if mineable ore can be found in closed workings.

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Mixed Reaction at Ontario Mining Act Consultations – by Bill Bradley

Northern Life, Greater Sudbury’s community newspaper, gave Republic of Mining.com permission to post Bill Bradley’s article. www.northernlife.ca

Reaction was mixed at the provincial Mining Act consultations Wednesday night at the Howard Johnson Hotel on Brady Street. Some prospectors fumed they were not being properly consulted and bolted from the meeting while others stayed to express their concerns.

There is a process now underway to revise the Mining Act arising from promises made during the last provincial election.

“There is going to be new legislation developed this fall from issues arising from the far north protection of the boreal forest initiative by Premier McGuinty announced July 14 to bring in the interests of First Nations,” said Anne-Marie Flanagan with Northern Development and Mines Minister Michael Gravelle’s office.

“But the Mining Act covers the whole province including the rights of private property owners.”

The sessions are the first step in a consultation approach according to a discussion paper entitled Modernizing Ontario’s Mining Act: Finding A Balance that was handed out in the Sudbury session.

To be included in the discussions are the minerals industry, municipalities and other stakeholders, First Nations and Metis leaders, as well as input from First Nations communities across Ontario.

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Miners Need to be Wary of Ontario Premier McGuinty – By John Cumming

John Cumming MSc (Geology) is the editor of the Northern Miner, Canada’s global mining newspaper.  jcumming@northernminer.com

The week ended July 19, the 29th trading week of 2008, kicked off with a surprise announcement by the Ontario government that it would “protect” at least 225,000 sq. km, or roughly half of the province’s boreal forest.

The scope of the proposal is broad. It includes: banning economic activity within at least half the province’s boreal forest; holding meetings across the province with every conceivable stakeholder to come up with new land-use plans; giving local aboriginal communities veto power over proposed economic activities; revamping the way resource businesses are taxed, including more taxes going to local aboriginal communities; and building up bureaucracies to create and implement land-use plans.

The government also restated its intention to rewrite the province’s mining act before 2010, including changing the process for staking and exploration. It starts reviewing the act this August.

Given that you can’t trust anything Premier “I-won’t-cut-your-taxes-but- I-won’t-raise-them-either” McGuinty says, and that his professed environmentalism is driven by pure political expediency, figuring out what this latest proposal means for miners in Ontario is tricky.

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China Demand Keeps Xstrata Business in Sudbury Booming – by Bill Bradley

Northern Life, Greater Sudbury’s community newspaper, gave Republic of Mining.com permission to post Bill Bradley’s article. www.northernlife.ca

Demand for nickel is booming and will continue to do so well into the future, said Mike Romaniuk, vice-president Ontario Operations, Xstrata Nickel. He was a speaker at a luncheon for the Rotary Club earlier this week at the Howard Johnson on Brady Street.

Close to $400 million is expected to be invested in Sudbury operations. In 2007, 300 workers were hired and another 400 are expected to join the company this year, said Romaniuk.

Why the good times?

In China, they are building the equivalent of a Greater Toronto Area city every year, he said.

“I was there three years ago and saw a sign in the dirt saying a new city of 15 million to be built at this site within three years. They did it. Cities like that require a lot of nickel in their infrastructure and consumer products. That’s why we are prospering,” said Romaniuk.

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Half of Northern Ontario Now Off-Limits to Mineral Industry – by Marilyn Scales

Marilyn Scales - Canadian Mining JournalMarilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication.

On July 14, Ontario Premier Dalton McGuinty announced plans to protect at least 225,000 km² of the boreal forest in Northern Ontario. “Protect” will mean permanently removing the declared area from mineral exploration, mining and forestry.

The Northern Boreal forest covers 43% of Ontario’s land mass, an area 1.5 times the size of the Maritime provinces. The forest is home to only 24,000 people in 36 communities. (No mention has been made as to whether or not these people had a say in the decision). The forest supports more than 200 species of animals, including polar bears, wolverines and caribou, some of which are threatened or endangered.

McGuinty is touting the plan as a means of reducing climate change. The government claims that the boreal region absorbs 12.5 million tonnes of carbon dioxide annually from the atmosphere. Therefore, the trees must be protected or global warming will accelerate. By waving the holy grail of global warming, the premier has ensured that every non-governmental environmental group will follow vociferously in his wake.

The decision is a blow to northern communities. Reports in the “Timmins Daily Press” indicate that citizens of that community were not consulted prior to the announcement. The local mayor and mining industry executives interviewed for the article expressed grave concerns that this is disastrous for the provincial economy.

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