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NEWS RELEASE: Cliffs Natural Resources Inc. Expects to Include Non-cash Impairment Charges within Its Fourth-quarter Results

http://www.cliffsnaturalresources.com/EN/Pages/default.aspx

January 24, 2013

· Fourth-quarter 2012 Results Expected to Include $1.4 Billion of Non-cash Impairment Charges and $542 Million of Non-cash Tax Valuation Allowances
· Financial Results for Fourth-quarter and Full-year 2012 to be Released After U.S.-Market Close on Feb.13 and Conference Call on Feb. 14

CLEVELAND, Jan. 24, 2013 /PRNewswire/ — Cliffs Natural Resources Inc. (NYSE: CLF) (Paris: CLF) today announced that as a result of its goodwill impairment test conducted in the fourth quarter of 2012, the Company has determined that approximately $1 billion of goodwill related to Cliffs’ 2011 acquisition of Consolidated Thompson Iron Mines Limited is impaired. The goodwill impairment charge will be recorded as a non-cash expense for the year ended Dec. 31, 2012. The impairment is primarily driven by the project’s anticipated lower long-term volumes and higher capital and operating costs. The previously announced delay of the Phase II expansion of the Bloom Lake mine also contributed to the impairment. Cliffs also indicated it expects to incur $100 – $150 million of other charges related to its Eastern Canadian Iron Ore business segment.

(Logo: http://photos.prnewswire.com/prnh/20101104/CLIFFSLOGO)

Additionally, as previously disclosed, Cliffs’ Board of Directors recently authorized the sale of the Company’s 30% interest in Amapa. Based on the pending terms of the sale, Cliffs expects to record a non-cash pretax impairment expense of $365 million within its fourth-quarter results.

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Asteroid-prospecting space plan unveiled – by CBC Radio Sudbury (January 22, 2013)

http://www.cbc.ca/sudbury/

Tiny FireFlies to start exploring in 2015

Laptop-sized spacecraft are slated to blast off for nearby asteroids in 2015, paving the way for larger ships to mine the space rocks for metals and fuels, under plans unveiled Tuesday by a U.S. firm.

Deep Space Industries intends to launch three 25-kilogram FireFly spacecraft – described by the company as slightly bigger than a laptop — on two- to six-month one-way prospecting trips as part of a long-term vision to harvest resources from asteroids.

Those resources could refuel satellites and spacecraft en route to Mars or be used to build orbiting space platforms to deliver power and high speed internet anywhere on Earth, the company said at a news conference at the Santa Monica Museum of Flying in California.

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Alcoa results: resilient but not shiny – by Martin Mittelstaedt (Globe and Mail – January 9, 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.

Alcoa Inc. kicked off the U.S. earnings season with figures that matched profit forecasts but provided little encouragement for those hoping for market-moving gains.

The big aluminum producer reported Tuesday that it made 6 cents (U.S.) a share from continuing operations in the fourth quarter of 2012, equalling analysts’ consensus estimates.

Revenue for the Pittsburgh-based company was $5.9-billion, up 1 per cent from the third quarter 2012, but down 2 per cent compared with the year-earlier fourth quarter. The shares gained about 1 per cent in after-hours trading.

As the first component of the Dow Jones industrial average to report numbers, Alcoa historically has been viewed as a market bellwether – hence the widespread interest in its results.

But some analysts are cautioning investors not to read too much into what Alcoa’s announcement may portend for fourth-quarter profits across the entire U.S. economy. Alcoa is just one company, in a sector – materials – that doesn’t have as much impact on the broader market as it once did.

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Excerpt from “The History of Mining: The events, technology and people involved in the industry that forged the modern world” – by Michael Coulson

To order a copy of The History of Mining please click here:http://www.harriman-house.com/products/books/23161/business/Michael-Coulson/The-History-of-Mining/

HOW THE PROSPECTORS GOT TO CALIFORNIA

The experience of those taking part in the California Rush was easier than the privations that would be experienced by those making it to the Klondike in that later rush. However, getting to the Californian gold fields was no picnic. Whilst today there are many road and rail routes across and through the great Sierra Mountains into the Pacific USA, in the 19th century the overland crossing from the eastern and central states into California was fraught with danger.

The other routes used were sea routes, first the long voyage down to the tip of South America, round Cape Horn and up to San Francisco, before the relatively short land journey south to the gold fields. The time this route took and the considerable dangers posed by the huge storms that often blew around Cape Horn led to a third route being established, sailing to the Panama Isthmus and then going by land to the Pacific side to board ships to San Francisco at the Gulf of Panama. Whilst this latter route was obviously faster than the Cape Horn route it was not without danger as Panama’s climate harboured diseases such as malaria and yellow fever, which led to many fatalities amongst the travellers.

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The mixed fortunes of a fuel: Coal in the rich world (The Economist – January 5, 2013)

http://www.economist.com/

Why is the world’s most harmful fossil fuel being burned less in America and more in Europe? The first of two stories looks at America’s cheap gas and new rules

WASHINGTON, DC – IN A high-tech world, dirty black lumps of coal might seem like an anachronism. Yet coal is far from a thing of the past. However whizzy your iPad, your wall-mounted television or your electric car, the chances are that it is powered by the stuff. Coal-fired power stations provide two-fifths of the world’s electricity, and there are ever more of them. In the doubling of the world’s electricity production over the past decade, two-thirds of the increase came from coal. At these rates, coal will vie with oil as the world’s largest source of primary energy within five years. As recently as 2001, it was not much more than half as important as oil (see chart).

The main factor has been the unslakable thirst for energy in China, which in 2011 overtook America as the world’s biggest electricity producer. In 2001, according to the International Energy Agency, a club of rich nations, Chinese coal demand was about 600m tonnes of oil equivalent (25 exajoules). By 2011 China’s coal demand had tripled—a rise from two-thirds of the energy America gets from oil to twice that amount. China’s domestic coal industry produces more primary energy than Middle Eastern oil does.

Other developing economies are just as keen on coal, if not yet on such a grand scale. In India, producing 650 terawatt hours of electricity in 2010 took 311m tonnes of oil equivalent, and the power sector’s coal demand is growing at around 6% a year. The IEA reckons India could surpass America as the world’s second-largest coal consumer by 2017.

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Stream of molten gold signals return of large-scale underground mining to Calif.’s Mother Lode – by Don Thomspson (Associated Press/Victoria Times Colonist – December 17, 2012)

http://www.timescolonist.com/

SUTTER CREEK, Calif. – The gold miners who made California famous were the rugged loners trying to shake nuggets loose from streams or hillsides. The ones who made the state rich were those who worked for big mining companies that blasted gold from an underground world of dust and darkness.

The last of the state’s great mines closed because mining gold proved unprofitable after World War II. But with the price of the metal near historic highs, hovering around $1,700 an ounce (28 grams), the California Mother Lode’s first large-scale hard rock gold mining operation in a half-century is coming back to life.

Miners are digging again where their forebears once unearthed riches from eight historic mines that honeycomb Sutter Gold Mining Co.’s holdings about 50 miles (80 kilometres) southeast of Sacramento. Last week, mill superintendent Paul Skinner poured the first thin stream of glowing molten gold into a mould.

“Nothing quite like it,” murmured Skinner, who has been mining for 65 years. It was just four ounces (112 grams), culled from more than eight tons of ore, but it signalled the end of $20 million worth of construction and the pending start of production. The company announced the ceremonial first pour before financial markets opened Monday, marking the mine’s official reincarnation.

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Molycorp CEO Exits Six Months After Neo Material Deal – by Sonja Elmquist (Bloomberg.com – December 12, 2012)

http://www.bloomberg.com/

Molycorp Inc. (MCP) Chief Executive Officer Mark Smith left the rare-earths producer amid an investigation of its disclosures and a lawsuit related to engineering deficiencies at its mine.

Vice Chairman and former Neo Material CEO Constantine Karayannopoulos is Smith’s interim replacement, the Greenwood Village, Colorado-based company said yesterday in a statement. Molycorp said its board is looking for a permanent hire.

“We feel that Mark had lost credibility with a number of constituents, shareholders, potential investors and analysts,” said Michael Gambardella, a New York-based analyst at JPMorgan Chase & Co.

Molycorp disclosed the probe by the U.S. Securities and Exchange Commission in a filing on Nov. 9, the day after reporting its third-quarter earnings and hosting a conference call to discuss results with investors, a decision that eroded investors’ trust in his management, Gambardella said.

Gambardella, who rates Molycorp shares underperform, equivalent to a sell, said that regardless of who takes Smith’s place, the company will be producing into an oversupplied market and will need to raise more money next year.

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Fix U.S. permitting system before imposing federal hardrock mining royalties – Sen. Lisa Murkowski – by Dorothy Kosich (Mineweb.com – December 12, 2012)

http://www.mineweb.com/

While data may be lacking to determine how much revenue U.S. taxpayers are losing from hardrock mining operations on federal lands, a slow-moving government bureaucracy is discouraging exploration investment.

RENO (MINEWEB) – As expected, the General Accounting Office on U.S. hardrock mining and its lack of federal royalties was finally officially released Wednesday, as the ranking member on the Senate Energy & Natural Resources Committee questioned why reporters received the report before it was made available to the House and Senate resources committees, or even was published on the GAO website.

“Whether GAO intended it or not, leaking the report to reporters before lawmakers gives the distinct impression that the GAO is promoting its own agenda,” said Sen. Lisa Murkowski, R-Alaska, and the ranking Republican on the Senate Energy & Natural Resources Committee.

As Mineweb reported on December 12th, the Washington Post published a story on the report one day prior to its official release. In that story, a Post reporter conducted interviews with the two lawmakers who originally requested the study.

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When the big just keeps getting bigger – Duluth releases new metals resource – by Lawrence Williams (Mineweb.com -December 7, 2012)

http://www.mineweb.com/

A significant increase in the enormous Twin Metals polymetallic resource in Minnesota, and identified higher grade zones, means the project economics just look like getting better and better

LONDON (MINEWEB) – With the release of an updated NI 43-101 compliant resource, Duluth Metals is just confirming the massive scale, and strategic mineral content, of the ground which falls under its Twin Metals jv with Antofagasta on the Duluth Metals complex in eastern Minnesota.

What is perhaps most impressive with regard to the future potential of the resource is that it only relates to around 11% of the ground controlled by the jv.

And from Duluth’s own viewpoint it is a resource which does not form part of its additional wholly-controlled ground holdings in the area where it has just started an exploration drilling programme, with four drill rigs turning.

But, coming back to the Twin Metals jv resource, the latest Indicated resource figures come out as containing an enormously impressive 13.7 billion lbs of copper, 4.4 billion lbs of nickel, and 21.2 million ounces of palladium+platinum+gold (TPM).

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Incoming Newmont CEO is an honest-to-goodness miner – by Dorothy Kosich (Mineweb.com – December 4, 2012)

 http://www.mineweb.com/

A major North American mining company announced Monday it will actually appoint a mining engineer as CEO, shattering years of CFO, lawyers, and investment banker promotions to the top spot.

RENO (MINEWEB) – With the announced promotion of Newmont President COO Gary Goldberg to President and CEO, Newmont returns to a mine operator in the top job for the first time since South African Gordon Parker was named CEO in 1986.

Could the promotion of Goldberg, who joined Newmont in December last year from Rio Tinto, to the CEO’s post be a sign that Wall Street and mining’s love affair with non-technical mining types, such as CFOs, attorneys and investment bankers as mining company CEOs, be drawing to a close?

This reporter was born in Nevada during the era of one of Newmont’s finest CEOs, metallurgist Plato Malozemoff, who occupied the top spot for an unprecedented three decades. Some of the biggest names in mining would become part of Newmont’s portfolio during his tenure as Newmont expanded around the world.

Malozemoff and Newmont geologists John Livermore and J. Alan Coope would usher in the era of the submicroscopic, disseminated gold with the Carlin Trend discovery that would revolutionize gold mining.

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Wisconsin governor expects $1.2b iron ore project to return to Iron Range – by Dorothy Kosich (Mineweb.com – November 29, 2012)

http://www.mineweb.com/

In the last session of the Wisconsin Legislature, an iron mining reform bill failed by one vote. However, another pro-mining measure is expected to be introduced in January.

RENO (MINEWEB) – Wisconsin Gov. Scott Walker said Wednesday that he is confident that Gogebic Taconite will resurrect an iron ore mining project south of Lake Superior.

In comments made to the Associated Press after a speech to the Wisconsin Manufacturers & Commerce, Walker said Florida-based Gogebic Taconite is still interested in mining in Wisconsin.

A special committee of Wisconsin’s State Senate is scheduled to meet today and get a briefing from Tim Sullivan, the former CEO of mining heavy equipment manufacturer Bucyrus. He is chairman of the Wisconsin Mining Association.

The committee will hear testimony from local government representatives and regional economic development officials on the issue of state-local distribution of tax revenue raised by future mining operations.

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Cliffs Natural Resources idles iron-ore production on weak demand – by Henry Lazenby (MiningWeekly.com – November 19, 2012)

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

TORONTO (miningweekly.com) – New York- and Paris-listed Cliffs Natural Resources on Monday said it would idle mine expansion in Quebec and a portion of production at two US operations as a result of weak iron-ore prices.

The company, which is the largest producer of iron-ore pellets in the US, said it would idle iron-ore production at its Bloom Lake mine Phase 2 expansion, in Quebec, and at two of its US iron-ore operations, Northshore Mining, in Minnesota, and at the Empire mine, in Michigan.

Cliffs said it was adjusting its 2013 operating plans for its North American iron-ore businesses to align with expected sales volumes. These production decreases were driven by increased iron-ore pricing volatility and lower North American steelmaking utilisation rates.

“Disciplined capital allocation is core to our operating strategy and reducing higher cost production will enhance our financial flexibility in both the short and longer term. Despite today’s announcement, we are still committed to our investments in Canada and believe Bloom Lake will deliver significant long-term value over time,” Cliffs chairperson and CEO Joseph Carrabba said.

At the Bloom Lake mine, Cliffs had suspended certain components of the second phase of expansion, including the completion of the concentrator and load-out facility. As a result, construction related to these activities was halted and third-party contractors were demobilised immediately.

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Chamber and Unions unite to push for Duluth Complex base/precious metals mines – by Lawrence Williams (Mineweb.com – November 20, 2012)

http://www.mineweb.com/

Mining on the environmentally sensitive Duluth Metallurgical complex in Minnesota is gleaning strong local support from a union/Chamber of Commerce alliance.

LONDON – In what must be a welcome development for prospective miners, PolyMet and Duluth Metals, Minnesota’s Chamber of Commerce and local mining unions will be mounting a combined campaign to try to ensure that mining of what has to be one of the world’s most significant mineral deposits, is given the go-ahead by state and federal bodies.

According to a report in the Duluth News Tribune, The Minnesota Chamber of Commerce, the state’s largest business group, and the Minnesota Building and Construction Trades Council have formed “Jobs for Minnesotans” to promote development of the state’s first-ever massive base and precious metals mining operations on the Duluth Metallurgical Complex which hosts one of the world’s largest potential polymetallic orebodies and which could see large scale mining for the next century, with its associated employment and tax benefits for the state and federal economies.

The Duluth Complex hosts an enormous resource of relatively low grade polymetallic mineralisation, which in combination represents perhaps the world’s largest ever discovery of an orebody containing copper, nickel, cobalt, pgms and gold – and Polymet and the Duluth Metals 60:40 jv with Antofagasta – the Twin Metals project – are the two most advanced projects on the Complex at the moment. However the area where these enormous deposits is hosted lies in an environmentally sensitive locality between the Boundary Waters recreational area and brownfields mining and processing sites left over from the still significant Minnesota taconite iron ore mines and process plants.

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Insolvent US coal miner agrees to stop mountaintop-removal mining – by Henry Lazenby (MiningWeekly.com – November 15, 2012)

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

TORONTO (miningweekly.com) – Bankrupt US coal miner Patriot Coal on Thursday became the first miner to cease large-scale mountaintop-removal coal mining in central Appalachia in exchange for more time to comply with the Clean Water Act at several of its central Appalachian mines.

As the company is preparing for Chapter 11 litigation, it had reached an agreement with three environmental groups that had sued over water pollution from its West Virginia operations.

The agreement was presented for consideration to Judge Robert Chambers of the US District Court for the Southern District of West Virginia, and had its roots in water pollution lawsuits filed by environmental protection groups the Sierra Club, the Ohio Valley Environmental Coalition (OVEC) and West Virginia Highlands Conservancy.

Mountaintop-removal coal mining is an economical but devastating form of strip mining unique to West Virginia, Virginia, Kentucky and Tennessee. Coal companies blast apart mountain ridge tops to expose multiple coal seams and then dump the waste in streams, creating so-called valley fills.

Patriot Coal said it had concluded that continuing and expanding its surface mining, particularly large-scale surface mining of the type common in central Appalachia, was not in its long-term interests.

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More mineral riches from the smoky waters of Minnesota – by John Chadwick (International Mining – November 2012)

International Mining is a global technical magazine written for miners by miners. John Chadwick is the publisher. john@im-mining.com 

Ore riches that built America have much more to offer. Minnesota’s Iron Ranges to the west of Lake Superior – Vermilion, Mesabi and Cuyuna from the northeast of Duluth down to the south-southwest – have been the most important ore deposits in US history, and continue to be so, providing well over 90% of the iron ore the country needs. Just a few of the great historical landmarks include the establishment, in 1901, of the world’s first multi-billion dollar corporation, US Steel.

Before that, in May 1890, Edmund Longyear (founder of one of the companies that was to become, much later, Boart Longyear) brought the diamond drill to the Iron Ranges. This exploration tool was to be a key to unlocking the riches of the region.

There was also the Minnesota Mining and Manufacturing Co (3M) founded in 1902 at the Lake Superior town of Two Harbors. However its only connection with the Iron Ranges was location. The deposit was set up to mine for grinding-wheel abrasives proved to be of little value.

William Boeing made profits from the Mesabi Range and just a few other great names with Iron Ranges associations include Henry Bessemer, Frederick Weyerhaeuser, Andrew Carnegie, John D. Rockefeller, Kelsey D. Chase, and J.P. Morgan.

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