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United States Mining

UPDATE 3-Indonesia threatens to take over Newmont mine if output stays shut – by Wilda Asmarini and Fergus Jensen (Reuters India – July 18, 2014)

http://in.reuters.com/

JAKARTA, July 17 (Reuters) – Newmont Mining Corp risks its Indonesian mining licence being taken over by a state-owned firm if the U.S. miner does not resume copper production, the Southeast Asian nation warned, escalating a six-month dispute over export rules.

The move represents a hardening of the stance of Indonesia’s outgoing government. The mining ministry earlier this week said it could terminate Newmont’s mining contract in response to the miner stopping production and filing legal arbitration over the export rules.

The developments mark the latest twist in the dispute between Indonesia and U.S. miners Newmont and Freeport-McMoRan Inc that has led to a halt in copper concentrate shipments from Southeast Asia’s biggest economy.

Indonesia plans to soon send a letter to Newmont saying that the company has defaulted on its contract, said Sukhyar, director general of coal and minerals at the mining ministry. “The default is due to the stopping of production, so we can say they are negligent,” Sukhyar told reporters on Thursday.

A Newmont spokesman did not comment on the risk of the company losing its mining licence at its Batu Hijau copper mine but said in an email that the company is eager to resume production as soon as the government issues it an export permit.

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US lawmakers introduce Bill to reform 142-year-old mining law – by Henry Lazenby (MiningWeekly.com – July 11, 2014)

http://www.miningweekly.com/page/americas-home

TORONTO (miningweekly.com) – Twenty US legislators had this week introduced a Bill in the House of Representatives looking for reforms to the General Mining Act of 1872, proposing higher royalties for mining companies.

The Bill suggests that mining companies be charged a royalty of 8% on new mines and 4% on existing properties for mining on public land.

The Bill was introduced on Thursday by the US House of Representatives natural resources committee member Peter DeFazio and subcommittee on public lands and environmental regulation member Raul Grijalva.

For over 140 years, the federal government has allowed mining companies to extract hundreds of billions of dollars’ worth of valuable publically owned minerals from public lands without paying American taxpayers a single dime.

The 1872 Mining Law was signed into law by President Ulysses Grant. Originally intended to spur the nation’s westward expansion, the nineteenth-century statute still governs the extraction of hard-rock minerals on over 350-million acres of public lands in the western US.

“Adding insult to injury, the current law has allowed these mining companies – many of them foreign owned – to carve up our lands and abandon the toxic, hazardous mess for taxpayers to clean up.

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New company buys into proposed copper mine in northeast Minnesota – by John Myers (Twincities.com – July 14, 2014)

http://www.twincities.com/

TAMARACK, Minn. — A proposed copper mine in northeast Minnesota appears to have fresh legs with a new company buying into the project.

Talon Metals Corp. is buying at least 30 percent of the Tamarack project from Kennecott Mining to develop the copper-nickel-platinum mine near the small town of Tamarack along the Aitkin-Carlton county line.

Talon said it also has a “potential pathway” to take over 100 percent of the project if Kennecott chooses not to develop the mine. Talon will pay $7.5 million for the initial 30 percent stake in the Tamarack project and has agreed to spend another $30 million for additional exploration during the next three years.

Utah-based Kennecott has spent the past 14 years obtaining mineral rights and drilling test borings across the boggy terrain located about 45 miles west of Duluth, but the project had been on the back burner for several years with little or no activity.

It’s not clear what Talon’s entry will mean for the project, which is still in the exploratory stage, but additional test drilling is set to start later this month.

Officials with British Virgin Island-based Talon recently said some 124,700 feet, or 23.7 miles, of drill core samples from the area have been analyzed with geologists estimating more than 10 million tons of mineable ore below.

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Don’t neglect mining in America – by Mark Perry (Detroit News – July 10, 2014)

http://www.detroitnews.com/

Mark J. Perry is a professor of economics at the Flint campus of the University of Michigan and a resident scholar at The American Enterprise Institute.

America’s growing reliance on other countries for strategically important minerals is not much of an issue in this election year. It seems not to be on voters’ minds, but it really ought to be.

U.S. mining policy has become increasingly inept — thoughtless and heedless of consequences. The U.S. has one of the most complex mine-permitting systems in the world, marked by delays and redundancies. Obtaining a mining permit typically takes seven to 10 years, five times longer than in Canada or Australia. Companies seeking to open a new mine sometimes must deal with 10 or more federal and state agencies.

Worse, the Environmental Protection Agency claims it can revoke a mining permit already granted, raising regulatory uncertainty to an entirely new level. This isn’t smart or sustainable. How can mining companies invest in the United States if a project can be arbitrarily stopped at any time?

Amazingly, the federal government restricts — or has an outright ban — on new mining operations on more than half of all federally owned public lands. Why should Americans care about the supply of mineral resources?

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THE LUDLOW MASSACRE STILL MATTERS – by Ben Mauk (The New Yorker – April 19, 2014)

http://www.newyorker.com/

On April 20, 1914, members of the Colorado National Guard opened fire on a group of armed coal miners and set fire to a makeshift settlement in Ludlow, Colorado, where more than a thousand striking workers and their families were camped out. Today, the Ludlow massacre, which Caleb Crain wrote about in The New Yorker in 2009, remains one of the bloodiest episodes in the history of American industrial enterprise; at least sixty-six men, women, and children were killed in the attack and the days of rioting that followed, according to most historical accounts.

Although it is less well-remembered today than other dark episodes in American labor history, such as the Triangle Shirtwaist Factory fire that claimed a hundred and forty-six lives, the Ludlow massacre—which Wallace Stegner once called “one of the bleakest and blackest episodes of American labor history”—changed the nation’s attitude toward labor and capital for the next several decades. Its memory continues to reverberate in contemporary political discourse.

In the summer of 1913, United Mine Workers began to organize the eleven thousand coal miners employed by the Rockefeller-owned Colorado Fuel & Iron Company. Most of the workers were first-generation immigrants from Italy, Greece, and Serbia; many had been hired, a decade prior, to replace workers who had gone on strike. In August, the union extended invitations to company representatives to meet about their grievances—including low pay, long and unregulated hours, and management practices they felt were corrupt—but they were rebuffed.

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Alcoa pledges finished products push as results beat Wall Street – by Nicole Mordant (Reuters U.S. – July 8, 2014)

http://www.reuters.com/

(Reuters) – Alcoa Inc’s (AA.N) chief executive officer said on Tuesday the aluminum company would push deeper into the market for more profitable finished products like truck wheels and aircraft fuselages as it reported quarterly results that beat analysts’ expectations.

At the same time, CEO Klaus Kleinfeld said Alcoa was focused on cutting costs and improving the performance of its traditional commodity business, which has been hit by weaker aluminum prices.

Alcoa’s shares rose as much as 2 percent in after-hours trading. The company’s stock price is up nearly 40 percent this year.

“The transformation of Alcoa truly is in high gear and the results show this. Our strategy is working,” Kleinfeld said on a conference call.

Alcoa’s strategy to boost value-added fabricated product output and broaden its footprint in other light-weight materials like nickel, titanium and lithium has partially offset the pain of prolonged weak underlying primary aluminum prices on the London Metal Exchange CMAL3, which have been close to or below breakeven for many smelters over the past year.

Alcoa has idled or permanently closed loss-making smelting capacity as it ramps up its smelter complex in Saudi Arabia, which will be the world’s lowest-cost.

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Frustration Builds for Newmont Investors – by ALISTAIR MACDONALD and JOHN W. MILLER (Wall Street Journal – July 9, 2014)

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

Shareholders Lose Patience, Urge Gold Miner to Break Itself Up or Revive Deal With Barrick

In the lobby of the local Elko, Nev., office of Newmont Mining Corp. NEM +2.42% , the world’s second-biggest gold miner by production, a series of posters celebrate almost a century of mining, exploration—and fighting takeovers.

But after another attempt to take over the company failed in April, many investors have lost patience. They are urging the miner to either rekindle this year’s aborted deal with No. 1 Barrick Gold ABX.T +0.35% Corp., or break itself up.

All gold miners are facing a lengthy list of problems—lower gold prices, high costs and declining accessible gold grades. Newmont, based in Greenwood Village, Colo., posted a loss of $2.5 billion last year, the biggest in its history, and its share price has fallen by half since 2011, making it one of the worst performers in the S&P 500.

Investors “are frustrated because they wanted something to happen, after being bruised and battered for the past 18 months,” said Dan Denbow, a portfolio manager for the San Antonio-based United Services Automobile Association, a Newmont shareholder.

Newmont “hasn’t communicated the specifics of what they’re doing,” he said. Now, as many Newmont shareholders clamor for action, the question is: what kind of change do they want?

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U.S. Seen as Biggest Oil Producer After Overtaking Saudi Arabia – by Grant Smith (Bloomberg News – July 4, 2014)

http://www.bloomberg.com/

The U.S. will remain the world’s biggest oil producer this year after overtaking Saudi Arabia and Russia as extraction of energy from shale rock spurs the nation’s economic recovery, Bank of America Corp. said.

U.S. production of crude oil, along with liquids separated from natural gas, surpassed all other countries this year with daily output exceeding 11 million barrels in the first quarter, the bank said in a report today. The country became the world’s largest natural gas producer in 2010. The International Energy Agency said in June that the U.S. was the biggest producer of oil and natural gas liquids.

“The U.S. increase in supply is a very meaningful chunk of oil,” Francisco Blanch, the bank’s head of commodities research, said by phone from New York. “The shale boom is playing a key role in the U.S. recovery. If the U.S. didn’t have this energy supply, prices at the pump would be completely unaffordable.”

Oil extraction is soaring at shale formations in Texas and North Dakota as companies split rocks using high-pressure liquid, a process known as hydraulic fracturing, or fracking. The surge in supply combined with restrictions on exporting crude is curbing the price of West Texas Intermediate, America’s oil benchmark. The U.S., the world’s largest oil consumer, still imported an average of 7.5 million barrels a day of crude in April, according to the Department of Energy’s statistical arm.

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Canadian company hopes to find copper in Methow Valley – by Craig Welch (Seattle Times – July 5, 2014)

http://seattletimes.com/html/home/index.html

Less than 2 miles from the heart of one of the most popular outdoor recreation spots in Washington, a Canadian company plans to drill holes to hunt for copper. The Forest Service says it doesn’t have the authority to stop the project.

MAZAMA, Okanogan County — Behind the general store and the outdoor gear shop — above the inn and horse corral — granite walls and pine-covered hills rise thousands of feet to form a towering nob called Goat Peak.

This fixture overlooking the North Cascades’ upper Methow Valley — one of the most popular outdoor playgrounds in the state — is where residents and visitors, including many from Seattle, walk dogs, run trails, cross-country ski, snowmobile, hike, bike and even paraglide.

Now a Canadian mining company wants to explore the earth beneath this recreation hot spot to see if metals marbled into the rock are plentiful enough for a copper mine. And despite mountains of opposition, the U.S. agency overseeing exploration maintains it’s powerless to stop the project.

Not 2 miles from the heart of Mazama, Vancouver-based Blue River Resources is proposing to drill as many as 15 bore holes 1,000 feet deep to see how much copper and molybdenum ore is there. The drilling could go on 24 hours a day for months, and would require the company to haul thousands of gallons of water up the mountain. The drilling could start later this summer.

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Major Partner Won’t Expand Stake In Mine Near Ely – by CBC Minnesota (July 3, 2014)

 http://minnesota.cbslocal.com/

MINNEAPOLIS (AP) — A major partner gave up the right Thursday to take a bigger stake in the proposed Twin Metals copper-nickel mine near Ely in northeastern Minnesota, which has been a target of criticism from environmentalists who fear it will harm the nearby Boundary Waters Canoe Area Wilderness.

Chilean-based mining company Antofagasta PLC said it has terminated its option to buy another 25 percent of Twin Metals Minnesota LLC. The announcement said Toronto-based Duluth Metals Ltd. is now assuming control of the joint venture.

Duluth Metals owns 60 percent of Twin Metals Minnesota. Antofagasta, which could have upped its stake to 65 percent, said it’s now “evaluating its options” for what to do with its 40 percent interest in the joint venture and its 10 percent direct ownership stake in Duluth Metals.

“By doing this today Antofagasta has signaled they intend to walk away from the project,” said Aaron Klemz, spokesman for the Friends of the Boundary Waters Wilderness. An Antofagasta spokesman denied that.

“No they’re not walking away,” spokesman Robin Wrench said by phone. He said Antofagasta still likes the project for the long-term, it’s just not exercising its right to buy a larger stake. The move means Antofagasta is only responsible for 40 percent of the project’s future funding, not 65 percent, he said.

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RPT-After 125 years, Alcoa looks beyond aluminum – by Allison Martell (Reuters India – June 27, 2014)

http://in.reuters.com/

(Reuters) – Alcoa Inc, the company that helped create the aluminum industry more than a century ago, is reinventing itself as a manufacturer of specialized components for aerospace and automotive customers, including some that contain no aluminum at all.

The company’s deal for jet engine part maker Firth Rixson, which uses little aluminum, is its biggest move yet to escape the terrible primary aluminum market by crafting the parts its customers need, even if they are made of nickel or titanium.

It announced the proposed $2.85 billion deal to buy Firth Rixson earlier on Thursday. Alcoa talks constantly about expanding its downstream businesses, which sell truck wheels, aircraft parts and other goods. Now it is rebranding itself in ways that would have seemed unthinkable just a few years ago.

“We are really material-agnostic,” Chief Executive Officer Klaus Kleinfeld said in an interview on Thursday. “We love, internally, that we have fights over what is the right material, in front of our customers, together with our customers.”

From an upstart, this would be one thing. But Alcoa has been synonymous with aluminum since 1888, and it has a role in every part of the sector: mining bauxite, refining it into alumina and smelting alumina to create aluminum.

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Augusta Resource Corp agrees to HudBay Minerals Inc sweetened takeover offer – by Peter Koven (National Post – June 23, 2014)

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

It took four and a half months of hostilities and the sighting of a rare wild cat. But in the end, HudBay Minerals Inc. got just what it wanted.

The Toronto-based miner unveiled a friendly deal on Monday to buy Augusta Resource Corp. for about $555-million in shares and warrants. And to the surprise of many observers, it only had to boost its original hostile bid by 10% to get the deal done.

When HudBay made its initial offer in February, Augusta chief executive Gil Clausen said it had “no chance of success.” Augusta’s shares were trading far above the bid, and the company thought it would receive all the key permits for its Rosemont copper project in the first half of 2014. That was expected to be a key catalyst for the stock price.

HudBay maintained that Augusta’s permitting timeline for the Arizona-based project was too optimistic. That turned out to be correct — but not for any reason HudBay expected.

Last month, an ocelot was photographed near the Rosemont project site. It is highly unusual for these wild cats to be spotted as far north as Arizona, and as a result, the U.S. Forest Service requested a new round of consultations on the project before permitting would be granted.

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Elko-area mines still thriving despite continued slide in gold prices – by Sean Whaley (Las Vegas Review – Journal – June 21, 2014)

http://www.reviewjournal.com/

ELKO — Nevada’s mining industry might be taking a hit right now because of low gold prices, but walk through this city on any weekday about 6 a.m. and you wouldn’t know it.

Workers in pickups and mining rigs, most of them with the ubiquitous red warning flags called buggy whips, crowd Idaho Street, the main drag. Long lines of traffic roll in from the residential areas south of town along the Lamoille Highway as locals head to the mines for another workday.

Gold prices have plunged over the past 18 months, dropping from a high of about $1,800 an ounce in 2012 to about $1,315 Friday, but don’t tell the people of this mining-centric town in northeastern Nevada. Although some operations are struggling to stay open, here the boom continues for the most part unabated.

Mining is the ninth largest economic sector in Nevada based on gross domestic product, according to the U.S. Commerce Department. There were 12,600 direct mining jobs in Nevada in 2012.

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B.C. Developers Defend Near-Border Mines – by Ed Schoenfeld (Alaska Public Media – June 18, 2014)

http://www.alaskapublic.org/

We’ve heard a lot about mines planned for northwest British Columbia, just across Alaska’s border. Southeast tribal, fishing and environmental groups have blasted those plans. Critics say they’ll pollute rivers that cross the border, damaging or destroying salmon and other fish runs.

Much of the recent focus has been on what’s called the Kerr-Sulphurets-Mitchell or KSM Project, being developed by Seabridge Gold. The site, which also includes copper, is roughly 80 miles east of Wrangell.

Critics say it could damage the Unuk River, which flows into the ocean northeast of Ketchikan. Seabridge says that’s not the case. Brent Murphy is the corporation’s vice president of environmental affairs

“The concern with minimizing downstream environmental impacts has been the guiding principal behind the whole design of the mining project,” Murphy says. Critics say the KSM could be about the same size as the proposed Pebble Prospect, a controversial mine proposed for Southwest Alaska.

They worry about plans for huge, dammed tailing lakes that could leak or break, sending acidic water into nearby streams and rivers.

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Gold Miners Feel Lucky in Search for Nevada Buried Riches – by Liezel Hill (Bloomberg News – June 18, 2014)

http://www.businessweek.com/

It’s not just gamblers, celebrity chefs and brides-to-be that find Nevada irresistible. About 400 miles north of the Las Vegas strip, the world’s two biggest gold producers are doing some prospecting too.

Even after more than a century and a half of exploration, Barrick Gold Corp. (ABX) and Newmont Mining Corp. (NEM:US) say there’s plenty of hidden gold still to be uncovered in Nevada, which already accounts for a third of their output and produces more of the metal than South Africa and Chile combined. The miners are refining exploration techniques, while looking deeper and in areas they’d previously dismissed to find new resources.

“In a lot of ways, even as mature as northern Nevada is, it’s still young from a discovery standpoint,” said Doug Livermore, Newmont’s regional project director for North America. The state accounts for more than 6 percent of global gold production.

With the 28 percent drop in gold prices last year forcing miners to look for lower-cost ways to increase output and cut exploration budgets, companies such as Barrick and Newmont are focusing more on existing holdings. Nevada’s deposits also offer lower investment risk than mines in less politically stable regions of the world.

One of the two potential new mines that Greenwood Village, Colorado-based Newmont is considering is in Nevada.

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