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United States Mining

Barrick invites Newmont to restart merger talks – by Rachelle Younglai (Globe and Mail – April 24, 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 formally asked Newmont Mining Corp. to resume merger talks after their negotiations hit an impasse late last week, according to a person familiar with the situation.

The North American-based gold miners had come close to agreeing on an all-stock deal, but their discussions broke down over which assets to spin out from the combined company, other sources have said.

The companies had aimed to make an announcement before their annual shareholder meetings this month. Colorado-based Newmont held its meeting in Delaware Wednesday morning, and Toronto-headquartered Barrick’s meeting is scheduled for April 30.

Barrick e-mailed the request to restart talks to Newmont, outlining the terms of their friendly proposal as well as issues that still must be resolved, according to the source familiar with what transpired.

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Barrick’s Munk: Newmont Deal ’Always Made Sense’ (Bloomberg TV – April 23, 2014)

  http://www.bloomberg.com/tv/ April 23 (Bloomberg) — Peter Munk, founder and chairman of Barrick Gold Corp., talks about a possible merger with Newmont Mining Corp., gold prices, and Barrick’s acquisition of Equinox Minerals Ltd. Munk speaks with Erik Schatzker on Bloomberg Television’s “Market Makers.” (Source: Bloomberg)

Ex-Goldman Banker Emerges as Barrick Gold Dealmaker – by Liezel Hill and Christopher Donville (Bloomberg News – April 22, 2014)

http://www.bloomberg.com/

A week before Barrick Gold Corp. (ABX) Chairman Peter Munk retires, his successor John Thornton is emerging as a dealmaker as the former Goldman Sachs Group Inc. banker pursues a bid to combine the two biggest gold miners.

Negotiations between Barrick and Newmont Mining Corp. broke off last week amid minor disagreements while leaving open the possibility that discussions could still resume, two people with knowledge of the matter said April 19.

The deal under discussion would have seen Thornton become executive chairman of the combined company while the chief executive officer would have been Gary Goldberg, who currently leads Newmont, the people said. Toronto-based Barrick’s CEO Jamie Sokalsky would have led a smaller gold producer spun off from the merged company, according to the people.

The proposed tie-up and its management reshuffle confirm Thronton’s elevation as Barrick’s most senior executive. The 60-year-old, who had no role in the mining industry until he joined the company’s board just over two years ago, is set to succeed Munk, Barrick’s 86-year-old founder, as chairman at the annual shareholders meeting next week. Leading a successful acquisition of Newmont (NEM), in what would be the biggest gold takeover, would set up Barrick to do further deals, including ones involving other commodities.

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[Barrick’s] Munk touts ‘significant synergies’ in potential Newmont deal – by Rachelle Younglai (Globe and Mail – April 23, 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.’s founder and chairman Peter Munk said merging with rival Newmont Mining Corp. could result in “significant” cost savings, especially in Nevada where the two North American gold miners operate.

The world’s two largest gold producers had hoped to announce an all-stock merger deal before Newmont’s annual shareholder meeting in Delaware on Wednesday, but disagreed over which assets to spin off, sources have said. Although talks were halted late last week, the companies are still open to merging in an effort to cut costs amid the deep slump in gold prices, sources have said.

“Combining Barrick and Newmont could result in significant synergies and cost savings, particularly in Nevada, where our operations are literally next door to one another,” Mr. Munk said in an e-mailed statement.

Gold has lost more than a third of its value since peaking above $1,900 (U.S.) an ounce three years ago. The weaker precious metal price, now trading below $1,300 an ounce, has forced the gold industry to overhaul operations to preserve cash.

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Mine Tales: San Manuel was once world’s largest underground copper mine – by William Ascarza (Arizona Daily Star – April 14, 2014)

http://azstarnet.com/

Located in the Lower San Pedro River Basin 40 miles northeast of Tucson and a mile south of the Mammoth-St. Anthony Mine, the San Manuel area enticed 1880s prospectors attracted to the copper-stained exposures of Red Hill and other nearby localities.

The San Manuel group of mining claims was found in the 1920s and ’30s. Several claimants initiated exploratory drill holes in the area in search of a substantial ore body that would yield profit.

Concerned about potential copper shortages during World War II, the United States government classified copper as a strategic wartime metal in July 1942. As a result, extensive test drills were undertaken by the Magma Copper Corp., which by then owned an interest in the property.

The San Manual Copper Corp. formed as a subsidiary of the Magma Copper Co. to carry on the exploration, revealing reserve estimates for copper ore that totaled 30 million tons, averaging 0.80 percent copper. Development of the San Manuel ore deposit — 7,700 feet long, 3,500 wide and up to 2,700 feet deep — began in 1952 with the approval of a $94 million loan by the Reconstruction Finance Corp. to the Magma Copper Corp.

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Hunt Becomes Billionaire on Bakken Oil After Bankruptcy – by Brendan Coffey (Bloomberg News – March 28, 2013)

http://www.bloomberg.com/

William Herbert Hunt was once one of the wealthiest men on Earth. With his brother, Nelson Bunker Hunt, the billionaire bought more than 195 million ounces of silver — 60 percent of the U.S. market — in the 1970s. By early 1980, their stake was valued at more than $9 billion.

The Hunts’ position imploded when silver prices plummeted 80 percent over the course of a few weeks in March 1980, culminating 33 years ago this week on what traders called Silver Thursday. The crash rattled Wall Street and sent the Texas brothers into bankruptcy.

Hunt is once again a billionaire, this time with oil. In October, he sold 43 percent of the North Dakota petroleum assets owned by his closely held Petro-Hunt LLC for $1.45 billion to Houston-based Halcon Resources Corp. (HK) The cash and stock deal made Hunt Halcon’s largest shareholder and boosted his net worth to $4.2 billion, according to the Bloomberg Billionaires Index.

“The numbers are out there,” said Hunt, 84, in a telephone interview from his Dallas headquarters. “We’re a family-owned company — a private company — and are really not interested in being out in the public arena.” Hunt hasn’t appeared on an international wealth ranking in 25 years. He said oil will continue to fuel the U.S. economy.

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Barrick Gold-Newmont Mining ripe for merger as conditions favour tie-up of world’s gold giants – by Peter Koven (National Post – April 22, 2014)

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

Barrick Gold Corp. and Newmont Mining Corp. have held merger talks numerous times in the past without getting a deal done. But conditions finally appear right to bring together the world’s two largest gold producers.

A rough gold market, along with new personalities on both sides of the negotiating table, have helped the two companies overcome their longstanding differences and put them on the cusp of a deal that analysts and investors have eagerly awaited for years.

Recent merger talks between the two sides broke down over a disagreement on what assets to put into a spin-off company, according to sources. However, the broad terms of the merger were largely agreed upon, with Toronto-based Barrick planning to buy Denver-based Newmont for close to US$13-billion in stock, representing a small 13% premium over its recent trading range.

The two gold miners hoped to announce the deal ahead of Newmont’s annual meeting on Wednesday, but that now appears unlikely. Newmont shares rose 6.4% on Monday. Barrick shares opened higher, but then declined as gold dropped and investors absorbed the merger news. They ended the day down 4%.

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Barrick must check its hubris to achieve a smooth Newmont merger – by Boyd Erman (Globe and Mail – March 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.

Barrick Gold Corp. says its strategy is no longer about bigger, but about better. A successful merger with Newmont Mining Corp. has got to be about a bit of both.

Barrick is not talking yet, as no deal is done, but job one when a transaction is finalized will be to explain just how a combination with Newmont would square with Barrick’s new strategy.

Toronto-based Barrick has long sought to gain control of Newmont. Talks have gone on and off for more than decade as Barrick grew to become the world’s largest gold producer.

Newmont plus Barrick would create by a huge margin the world’s largest gold miner. There was a time when that would have been sufficient rationale for Barrick, but that is no longer good enough. Shareholders want returns and cash flow from their mines. They want profit from mining companies, not just growth.

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Merger Talks Between Gold Giants Break Down – by Gillian Tan, Alistair MacDonald and Dana Mattioli (Wall Street Journal – April 18, 2014)

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

Barrick Gold, Newmont Mining Were Said to Be in Advanced Discussions

Barrick Gold Corp. ABX.T -1.88% and Newmont Mining Corp. NEM -0.88% recently held abortive talks over a deal that would have combined the world’s two largest gold producers at a time when they are battling a sharp drop in the price of gold, according to people familiar with the matter.

The two companies had intended to announce a deal as early as Tuesday, one of the people said. They have discussed combining a number of times before, people familiar with the matter have said, and it is possible they could do so again.

The deal talks come as the companies try to adapt to lower gold prices. The precious metal’s futures fell 28% last year—their biggest annual price drop since 1981.

Prices have fallen amid moves by the Fed to wind down its efforts to stimulate the economy. The stimulus steps had been a source of support for gold, which is used by investors as a hedge against the inflation that such efforts can spark.

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Ludlow massacre spurred New Deal labor reforms – (Associated Press/Washington Post – April 18, 2014)

http://www.washingtonpost.com/

DENVER — A century ago this Sunday, 11 children and two women died in a fire that followed a shootout between the Colorado National Guard and striking coal miners at a tent camp in southern Colorado.

What became known as the Ludlow Massacre quickly evolved into a national rallying cry for labor unions and eventually helped lead to New Deal labor reforms. But over the years, the tragedy has been largely forgotten, even among many in Colorado.

To mark the centennial, a Greek Orthodox Easter service will be held Sunday on the prairie where the women and children died on April 20, 1914. They had hidden in a dugout beneath the tent colony when the fire roared through the camp. The miners came from many countries; mining rules were posted in 27 languages. But most had joined fellow Greek strikers in celebrating Orthodox Easter the day before.

The United Mine Workers of America plans a May memorial at the site about three hours south of Denver with descendants of labor activist Mother Jones, who was jailed twice for refusing to stay away from the strike zone. The deaths at Ludlow came during a strike launched in September 1913 by miners whose living conditions were largely controlled by Colorado Fuel & Iron, owned by John D. Rockefeller Jr.

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Proxy adviser backs Augusta poison pill as hostile bid looms – by Bertrand Marotte (Globe and Mail – April 17, 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.

Augusta Resource Corp. says a leading independent proxy advisory firm is recommending that shareholders vote for the continuation of the company’s defence plan in the face of the hostile takeover offer by HudBay Minerals Inc.

Vancouver-based Augusta said on Thursday that San Francisco-based Glass, Lewis & Co. backs the mining company’s stance that the shareholder rights plan should continue. HudBay, which is after Augusta’s rich copper-molybdenum project near Tucson, Ariz., is seeking a decision from Canadian securities regulators that would get rid of Augusta’s so-called poison pill.

A poison pill — or shareholders’ defence — allows non-HudBay shareholders to buy additional shares at a discount, making it prohibitively expensive for HudBay to acquire the rest of Augusta it does not already own. Toronto-based HudBay owns about 16 per cent of Augusta. Augusta shareholders are to vote on the poison pill on May 2.

“Our intention is to put the power of this important decision in the hands of Augusta shareholders by giving them the opportunity to vote on the rights plan on May 2, three days before the expiry of HudBay’s bid,” said Augusta president and chief executive officer Gil Clausen.

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Why the Great Wash U Sit-in Against Peabody Coal Matters: Which Side Are You on? – by Jeff Biggers (Huffington Post – April 16, 2014)

http://www.huffingtonpost.ca/

Entering its second week, the inspiring Washington University sit-in against Peabody Energy has already gone beyond its goals to cut school ties with the St. Louis-based coal giant, and forced the rest of the nation to ask themselves an urgent question in an age of climate change and reckless strip mining ruin: Which side are you on?

Will other schools, alumni groups — and investors in Peabody Energy — follow the lead of the Washington U. students?

Case in point: Tonight in my native Saline County in southern Illinois, the county commissioners genuflected to short-term Peabody coal dollars over the “negative impact on about a dozen homeowners who live near the site of the proposed mine,” according to one cynical commissioner, and voted to allow the company to close off Rocky Branch road for a proposed strip mine expansion, despite the lack of EPA permits, and documented evidence of flooding, blasting and emergency access problems.

Facing financial ruin, grave heath problems and displacement, the Rocky Branch residents will fight on, thanks to the Wash U. students, and continue to tell the truth: We all live in the coalfields now, in this age of climate change, and it is no longer acceptable to allow anyone to be collateral damage to a disastrous energy policy.

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HudBay CEO disputes Augusta’s claims of rival bidders – by Rachelle Younglai (Globe and Mail – April 15, 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.

HudBay Minerals Inc. is asking Canadian regulators to get rid of Augusta Resource Corp.’s defense plan so that it can acquire Augusta’s copper project in Arizona.

HudBay already owns a 16 per cent stake in Augusta. But the Toronto-based company is blocked from acquiring more shares because Augusta adopted a shareholder rights plan, also known as a poison pill, when it found out HudBay had accumulated such a large position.

The plan allows non-HudBay shareholders to buy additional shares at a discount, which would make it prohibitively expensive for the Toronto miner to acquire the rest of Augusta. On Monday, HudBay asked the British Columbia Securities Commission to make a decision before its hostile offer expires May 5.

Vancouver-based Augusta is scheduled to hold a meeting May 2 where shareholders will get to vote on whether they want to keep their poison pill in place. HudBay’s chief executive David Garofalo said if regulators strike down the poison pill, that would make the shareholder vote moot.

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Montana Moment: Miners win eight-hour workdays – by Kristen Inbody (Great Falls Tribune – April 12, 2014)

http://www.greatfallstribune.com/

The moment: Butte miners win eight-hour workday in 1901.

The story: Children grew up in Butte attuned to the sounds that signaled death and disaster in the mines, sounds that could leave them fatherless, as accidents killed a miner every other day in Butte in the 1890s.

One woman lost three husbands in a row to the mines, with children from each to support on her own, wrote Janet Finn in her “Mining Childhood.” Another former child of Butte recalled a widow with 20 children who became a midwife, rustled railroad ties, had a cow, baked bread and took in washing, which her children delivered.

Mines were opportunities and peril, bread on the table and a stake in a new land for 8,000 miners pulling 210 million pounds of copper a year from five square miles. Against a rising swell of populism, Butte unions lobbied for better pay and safer conditions. Unions helped members when they were sick, paid for funerals and gave workers a voice. A campaign for a balanced day of eight hours of work, eight hours of leisure and eight hours of sleep became a rallying cry for workers around the industrialized world. A 12- to 14-hour workday was the norm.

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MINE WATER: Tough to share it with drought-stricken communities – by Dorothy Kosich (Mineweb.com – April 9, 2014)

http://www.mineweb.com/

Since most mining operations in arid regions are zero-discharge facilities that don’t produce grey water, chances are slim today’s mining operators can share water with municipalities in times of drought.

In February, the Society for Mining, Metallurgy and Exploration (SME) held its second international symposium on water in mineral processing.

Those mining professionals and consultants in attendance viewed the event as pivotal in focusing miners’ attention on what they believed would emerged as mining’s hottest issue—water management strategies and their critical role in securing mining’s social license in the permitting and operation of mining projects and expansions.

Much was made by those presenting papers to SME that “opportunities abound for mine water reuse,” which can help with community water needs. In the future, mine wastewater could be reused for irrigation, steel manufacturing, hydraulic fracturing, or cooling and power generation, consultants advised.

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