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PDAC

NEWS RELEASE: The Prospectors & Developers Association of Canada 2013 Convention Exceeds 30,000 Attendees for Second Year in a Row

 Toronto, March 6, 2013 – The Prospectors & Developers Association of Canada (PDAC) is pleased to announce that for a second year in a row over 30,000 people attended the PDAC 2013 International Convention, Trade Show & Investors Exchange. With 30,147 investors, analysts, mining executives, geologists, government officials, students and international delegations, the PDAC Convention remains the world’s premier event for the mineral industry.

“We are so proud of the tremendous success of the PDAC 2013 Convention,” said PDAC Executive Director, Ross Gallinger. “The level of excitement and interest in the mineral exploration and development industry continues to be strong, and the PDAC Convention has once again provided an outstanding program that attracts government, industry, financial institutions and Aboriginal communities to attend.”

Now in its 81st year, the PDAC 2013 Convention is more diverse than ever before. A number of events including the CSR Event Series, Aboriginal Program and Investors Exchange garnered overwhelming support from the general public, reflecting the dynamic nature of our industry. More elected officials attended the convention than in previous years. The role natural resource development plays in the economic sustainability for Aboriginal communities across Canada is evident by the increased interest from the Aboriginal People present.

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PDAC – The numbers are there, but the money isn’t – by Lawrence Williams (Mineweb.com – March 6, 2013)

http://www.mineweb.com/

This year’s PDAC is seeing plenty of visitors, but a dearth of capital which will lead to serious shortages ahead, and ultimately far higher metal and stock prices.

TORONTO (MINEWEB) – I’ve been attending PDAC meetings since the late 1970s and have seen it through a number of major downturns and subsequent recoveries, but I don’t think I’ve ever seen such a downbeat convention as it is proving to be this year.

What sets it apart is an underlying feeling that this time the downturn may have longer to run.

Even in 2009, following what may have been an even bigger market crash in Q4 2008, there were already signs that the industry might be pulling out of its fall; this time around that optimism is not at all apparent – and this is within a community which is by its very nature a generally optimistic one. If you’re a prospector or a geologist or a miner you have to be an optimist by definition.

It is interesting viewing the local press in this respect. There were indeed comments leading up to the opening of the event that the situation among the TSX-V juniors in particular was so dire that there were almost certainly going to be a big number of no-shows with the companies not going to be able to afford to send personnel, and put them up at the kind of inflated Toronto hotel prices currently prevailing because of the general influx of visitors for one of the bigger events in the Toronto convention calendar.

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Junior miners in survival mode, bracing for industry-wide culling – by Peter Koven (National Post – March 6, 2013)

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

TORONTO — Everyone agrees that junior mining companies are in a severe crisis. The question is: what should they do about it?

It is a theme that has dominated the Prospectors and Developers Association of Canada (PDAC) conference this year. Working capital is whittling away for hundreds and hundreds of Canadian companies, and they have shown little-to-no ability to replenish it. A culling of the TSX Venture Exchange appears imminent, and few people think that is even a bad idea.

But amid the gloom, there are plenty of experts who believe that capable juniors can get back on their feet and emerge from this bear market in a healthier position.

Speaking at a luncheon presentation, hedge fund magnate Eric Sprott said that too many juniors are taking all the cash flow from their producing mines and putting it into the next one.

“Your market cap will go down,” he said. He argued that the ones who can convert their cash flow to dividends will change their fortunes dramatically. And that will allow them to acquire other companies.

Analyst John Kaiser said that the junior market needs to disconnect from the current situation and simply focus on the future. At this point, investors are using any negative sentiment about the mining sector as an excuse to hammer juniors.

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In Canada’s crowded market, junior miners get the shaft – by Peter Koven (National Post – March 5, 2013)

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

For many junior miners, the question is no longer about whether they can raise money at the PDAC conference this year. The question is how they will even get there.

Using a search engine tool on mining analyst John Kaiser’s website, it appears that a mind-boggling 94 companies with negative working capital are listed exhibitors at the conference.

“I think a lot of them aren’t going to show up,” Mr. Kaiser said. “I don’t know how they can afford to fly to Toronto and pay for the hotels.”

That sums up just how awful the market conditions are for junior mining companies today. Despite relatively healthy commodity prices, they are suffering through a surreal bear market in which risk capital has flowed out of the sector and is simply not available to most of them anymore. They routinely have market values below the cash on their balance sheet, and the idea of spending cash is scary when it is so tough to find any more. Their share prices have been slashed, and are routinely down 90% or more in the past 12 or 18 months.

“You have a horrendous washout in the market where institutional money has departed, and retail money has no interest in it,” said Mr. Kaiser. He figures there are nearly 700 companies on the TSX Venture Exchange with less than $200,000 in their treasuries. All the Venture mining companies combined have raised only $110-million this year, according to Financial Post data.

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China’s PDAC absence conspicuous – by Kip Keen (Mineweb.com – March 5, 2013)

http://www.mineweb.com/

It can be argued the Chinese need to pay more attention to early stage exploration – otherwise they leave the field open to others committed to the long game in minerals and metals.

TORONTO (MINEWEB) – It must be said. The Chinese are MIA at the PDAC – absent in playing an important role in funding and driving Canadian mineral explorers and exploration. In my PDAC miles so far this year, it strikes me that by now the Chinese should be an undercurrent in Canadian exploration and investment.

They are instead the anomaly.

Their role here – in the still undisputed centre of global mineral exploration – should be a natural extension of their interests and needs. The Chinese have a dominant position as metal consumers. They are exhausting high quality domestic resources. They are, intelligently so, closing their smaller, dirtier and more dangerous mines. And, of course, they have an abundance of cash and perhaps more importantly a stated desire to secure supply. That cannot, as the case has largely been so far, mean a role focused just on mineral development. Longterm supply demands, more than anything else, calls for careful attention to early stage exploration.

Yet so few early stage exploration companies boast an important Chinese investor. It’s clear, coming from the floor at the PDAC, the Chinese are not plying the crowd of PDAC in droves looking for investments or that they have already done so and invested.

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Ontario Premier Kathleen Wynne’s PDAC Speech (March 4, 2013)


(L to R) Honourable Kathleen Wynne, Premier of Ontario; Michael Gravelle, Minister of Northern Development and Mines (Photo by Stan Sudol – republicofmining.com

 

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Good Afternoon. Thanks Michael for that kind introduction. I’d like to acknowledge that we are on the traditional territory of the Mississaugas of the New Credit.

I want to welcome to Toronto all of our friends from Northern Ontario and beyond. I’m excited to be here and to get a chance to talk to you about your work, and how it will inform the work that I’m going to do, along with our new government.

As I was on my way here today, I was thinking about how inspirational you are to a politician like me. As prospectors, a key part of your efforts come down to the belief – the deep seeded knowledge – that if you keep working and working, if you stay focused on your goal, eventually there will be a big pay-off.

In mining, just like in government, hope springs eternal! And trust me, I need that kind of motivation right now! But really, the work that you do holds many lessons for what I am working toward on behalf of this province. You are the embodiment of hard work, dedication and resolve.

It is not an industry for the weak of heart. But your association also bridges the expanse between Ontario’s history and its future.

Resource development – that unstoppable quest for value in our natural landscape – that is a proud part of who we are.
As a province, but also as a nation. This is the work on which Ontario has been built.

Mining is the reason that Toronto is the financial services centre of Canada.

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At the world’s biggest mining convention, schmoozing benefits charities – by Pav Jordan (Globe and Mail – March 5, 2013)

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.

Despite the doom and gloom, the mining industry is good at rising above it all, confident that good times always follow bad ones, so even when times are tough they try to give a little back.

Pronounced by its citizens – the 30,000 or so global mining industry players that attend each year – as the Peedac (PDAC), the Prospectors and Developers Association of Canada annual conference is more than just a marathon of presentations by miners, analysts and industry service providers.

Attracting industry players from 125 countries around the world, the PDAC is the world’s largest mining convention, and also the first big event in the calendar year, providing a unique opportunity for CEOs, engineers and financiers to rub shoulders with allies and rivals.

Amidst the schmoozing along Bay Street hot spots are the events that mix socializing and networking with charities to support the communities where companies mine, in Canada and abroad.

One such event is Bullion Belts, a boxing match at the Ritz Carlton hotel in downtown Toronto that pitches professional boxers against one another while investors and mining executives watch on. The proceeds from sponsors like Iamgold, an Africa-focused miner, go to the Right To Play charity, which aims to take children in poor countries off of street corners and put them on playing fields.

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Mining Minnows Burning Cash Signal More Mergers Coming – by Liezel Hill (Bloomberg.com – March 3, 2013)

http://www.bloomberg.com/

Prospectors and mine developers, the lifeblood of the wider $1.5 trillion industry, are running low on cash as funding dries up, increasing the chances they’ll need to consider sales and mergers to survive.

So-called juniors have enough cash to last 5.7 months, according to the median multiple among 1,273 companies with a market value of no more than $500 million, data compiled by Bloomberg show. That’s 25 percent less than a year earlier, according to the data.

The situation facing the juniors will be a hot topic for the 30,000 geologists, promoters and investors expected to attend the Prospectors & Developers Association of Canada convention, the world’s biggest mining gathering, which started yesterday in Toronto.

Smaller companies probably will seek to merge, or they may “just cease to exist,” said Dan Barnholden, a Toronto-based investment banker at Cormark Securities Inc. “We’ve been counseling guys to manage their treasury very carefully because there really isn’t a lot of money out there,” Barnholden said last week in a telephone interview. “It’s sort of desperate times here now.”

Stock sales, one of the few options available to smaller companies to cover costs and advance projects, fell in 2012 for a third straight year, according to Bloomberg data. Canadian mining companies raised $726.8 million in equity and equity- linked financings this year, 45 percent less than the year- earlier period.

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Survival name of the game as miners gather [PDAC] – by Pav Jordan (Globe and Mail – March 4, 2013)

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.

Plagued by the worst outlook in recent memory, global miners are thinking about one thing more than any other as they gather for the industry’s largest annual gathering: survival.

The Prospectors and Developers Association of Canada (PDAC) convention this week in Toronto is the largest international gathering of its kind. As the first of the calendar year, it is closely watched for signs of what’s to come for the next 12 months, especially for the junior mining sector, the lifeblood of majors that rely on it to discover assets for them to develop.

“Only the strong will survive,” said Ioannis Tsitos, chief executive officer of Vancouver-based Eagle Mountain Gold Corp., which owns a small gold property in Guyana. “What’s happening now is part of natural selection.”

Metals producers have become accustomed in recent months to tough times, starting with ever-embattled share prices. Multibillion-dollar writedowns on assets touted just a few years ago in bold bets on growing global metals demand, add to the bleak outlook. Equally large cost overruns and massive asset divestitures by industry leaders show that the industry is in clear retrenchment.

The message was loud and clear at the the conference on Sunday, where prospectors Clayton and Sara Larche stood at the top of an escalator flogging mining claims the old-fashioned way.

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Hard-hit mining sector puts on brave face at annual conference – by Peter Koven (National Post – March 4, 2013)

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

TORONTO — Amid an extremely difficult period for the global mining industry, the Prospectors and Developers Association of Canada conference remains a source of cautious optimism for shell-shocked companies and investors.

The industry’s largest event, expected to draw more than 30,000 people, kicked off Sunday in Toronto. And while none of the speakers pretended that these are pleasant times for mining companies, they tried to remind everyone that some positive fundamentals are still in place.

“There’s still a long way to go in China’s urbanization story,” said Duncan Hobbs, a London-based analyst with Macquarie Group. He added that roughly 300 million Chinese people are expected to move to cities in the decades ahead, implying strong long-term demand for commodities.

But it doesn’t help mining companies right now. They are suffering from numerous wounds, some of which are self-inflicted. Senior companies have been forced to write down assets by tens of billions of dollars over the last year after they paid too much to acquire them. Cost inflation continues to be a huge industry concern, while metal prices are struggling amid an uncertain global economy.

The PDAC conference is mostly populated by junior companies, and they are doing much worse than the seniors. Raising capital has become almost impossible for smaller juniors, as investors have little-to-no interest in financing early-stage exploration.

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The Honourable Tony Clement Minister for FedNor PDAC [Ring of Fire] Speech March 3, 2013

(L to R) Ross Gallinger, Executive Director, Prospectors and Developers Association of Canada (PDAC); Tony Clement, President of the Treasury Board, FedNor Minister, Federal Ring of Fire Lead; Peter Kent, Minister of the Environment; Glen Nolan, President, Prospectors and Developers Association of Canada (PDAC)
(Photo by envisiondigitalphoto.com)

SPEECH TO THE PROSPECTORS AND DEVELOPERS ASSOCIATION OF CANADA (PDAC) International Convention, Trade Show and Investors Exchange (Toronto, Canada – March 3, 2013)

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Like every region where mines have been developed across Canada and around the world, this
part of Northern Ontario is unique.Its marshy wetlands have been home to First Nations
for thousands of years. And their communities and their experience are unique to them.And
it is incumbent upon the mining industry to understand those circumstances, engage those
communities and be able to appreciate their perspective. (Federal Minister Tony Clement
– PDAC March 2013)

Thank you for that kind introduction and good evening. It’s a pleasure to join you here today at the start of Canada’s premier mining conference. In fact, this event is recognized right across the globe and for good reason.

With over 30,000 visitors expected to attend from 125 countries, the conference clearly demonstrates the importance of the sector to the global economy, but it also highlights Canada’s role as a world leader in mining innovation, technology and responsible environmental stewardship.

First, I wish to thank the organizers of the Prospectors and Developers Association of Canada for inviting me and for providing me this opportunity to speak with you this evening.

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Developers struggle to balance exploration with native consultations – by Shawn McCarthy (Globe and Mail – January 28, 2013)

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 — As the first aboriginal president of the Prospectors & Developers Association of Canada, Glenn Nolan has a unique understanding of the resource sector’s increasingly onerous duty to consult with First Nations when developing mining or energy projects.

Mr. Nolan is vice-president of NorOnt Resources Ltd., one of the leading companies developing the mineral deposits in northern Ontario’s Ring of Fire district. He knows how critical it is, in a hyper-competitive industry, for mining companies to be able to move swiftly and secretively in establishing claims to promising tracts of land.

But as a former chief of the Missanabie Cree from northeastern Ontario, he is also acutely aware of the potential for resource development to help lift Canada’s First Nations out of crushing poverty, and the need for a respectful partnership between industry, government and the indigenous people.

“We’ve been saying all along to our [Prospectors & Developers Association] members that the best strategy is to go in at the earliest opportunity and talk to the community,” Mr. Nolan said. “And that means as soon as you’ve secured the land tenure.”

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NEWS RELEASE: RESPONSE FROM MISSANABIE CREE FIRST NATION CHIEF REGARDING NATIONAL POST COLUMN

 Tuesday, January 22, 2013

GARDEN RIVER, ON — Regarding an article published in the National Post January 8, 2013 where Glenn Nolan, a former Chief of the Missanabie Cree First Nation made comments regarding key First Nations issues and resource revenue sharing, current Chief Kim Rainville issues the following statement:

Let it be known that the support from the Missanabie Cree First Nation council and community have been instrumental in Mr. Nolan achieving his professional goals. Being the president of the Prospector’s and Developers Association of Canada (PDAC) as well as an executive of a junior mining company embroiled in the Ring of Fire development, it would make it very difficult for Mr. Nolan to express support for such a significant movement as “Idle No More”. Mr. Nolan’s opinions do not reflect the belief of the Missanabie Cree First Nation regarding the actions taken by Attawapiskat’s Chief Spence or support of the Idle No More movement.

“I believe the agenda of the government smearing a courageous leader such as Chief Spence is reprehensible,” said Chief Kim Rainville. “To have it seemingly come from a former Chief undermines the changes which are being called for by the “Idle No More” movement and a denial of the realities faced by many first Nations citizens.”

The list of issues is long; inadequate housing, health care, education economic opportunities, youth suicide, family violence, policing and the list goes on. These are immediate issues which need to be addressed. Recognition of First Nation autonomy, sovereignty, changes to the Indian Act driven by a First Nations process are paramount to achieving our rightful place in society, resource revenue sharing but a component of righting the many injustices.

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The Importance of Canadian Flow-through Share Financing and the Mineral Exploration Tax Credit – by Ross Gallinger (Toronto, Canada – November 14, 2012)

PDAC Executive Director Ross Gallinger gave this speech at the Toronto Stock Exchange on November 14, 2012.

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Thank you Minister Oliver for your remarks and for being here with us this evening. We sincerely appreciate your ongoing support of our industry. Your efforts are paramount to our success, and we thank you for your hard work.

For those of you who don’t know me, my name is Ross Gallinger and I am the Executive Director of the Prospectors & Developers Association of Canada.

For 80 years, our association has been a leading voice in representing the mineral exploration and development industry. The PDAC has more than 10,000 members, both individual and corporate, and exists to protect and promote mineral exploration and development, and to ensure a robust mining industry in Canada.

As Minister Oliver and others have noted on numerous occasions, the natural resources sector, and in particular the exploration and mining sector, are vital to Canada’s economic sovereignty. Mineral exploration and junior mining operations play a key role in driving economic development, and provide employment opportunities throughout the country—especially in: Northern, Aboriginal and remote communities.

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Junior miners seek their own voice – Jody Porter (CBC News – March 29, 2012)

http://www.cbc.ca/news/canada/thunder-bay/story/2012/03/29/tby-miners-united.html
 
Exploration companies form new group to share concerns about First Nations

A lawyer who represents junior mining companies in disputes with First Nations says some exploration companies feel they’re not being heard by their industry association.
 
Neal Smitheman said the Prospectors and Developers Association is trying, and sometimes failing, to represent both industry and First Nations.
 
Smitheman said that ignores the fact the two are often in conflict. Neal Smitheman, lawyer representing junior mining companies in disputes with First Nations.

“Some people think that PDAC, by trying to accommodate both First Nations and the industry, finds itself in an unresolvable conflict from time to time,” he said.

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