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United States Mining

Molycorp’s $1 billion rare-earth gamble – by Richard Martin (Fortune Magazine – November 18, 2011)

http://money.cnn.com/magazines/fortune/

How an American company is trying to break China’s monopoly on high-tech minerals.

FORTUNE — Few weekenders making the four-hour run from L.A. to Vegas notice the big mill works overlooking Interstate 15 at Mountain Pass Summit in California, near the Nevada line. Even fewer realize that the pale-pink buildings, gone patchy with age, are the focus of an extraordinary business drama that involves national security, China’s monopolizing the strategic market in rare-earth metals, and one company’s attempt to restore American preeminence in a crucial mining sector it once dominated.

Those sprawling buildings are owned by a Denver mining company called Molycorp (MCP), which is now spending nearly $1 billion to restart rare-earth-mineral production at Mountain Pass Summit and in the process revive a moribund U.S. industry. It won’t be easy. A decade ago the U.S. was the world’s biggest supplier of lanthanides, scandium, and other rare earths, and the Mountain Pass mine was the world’s largest producer of the minerals.

Rare-earth elements enable the creation of super-magnets, which operate at high temperatures and are also used for a range of high-tech applications, from missile-guidance systems to compact fluorescent light bulbs to wind power turbines to motors in electric vehicles.

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Obama budget again seeks hardrock mining royalty, new abandoned mine fees – by Dorothy Kosich (Mineweb.com – February 14, 2012)

www.mineweb.com

The President’s proposed fiscal 2013 federal budget calls for a 5% gross mining royalty on federal lands, and a hardrock abandoned mined land fee on all private and public lands.

RENO – In his proposed $3.8 trillion budget for fiscal 2013 released Monday, President Barak Obama has once again called for creation of a hard abandoned mined land fund, as well as a hardrock mining royalty of not less than five percent of gross proceeds.

Interior Secretary Ken Salazar, who hails from the mining state of Colorado, estimated creation of the Hardrock Abandoned Mine Reclamation Fund–applicable to private and federal, state, and tribal lands–would generate $500 million in savings over the next 10 years.

The Bureau of Land Management would distribute the funds through a competitive grant program to reclaim the highest priority hardrock abandoned sites on federal, state, tribal and private lands.

Salazar also intends to reform Coal Abandoned Mine Land Reclamation by terminating the unrestricted payments to states and tribes that have been certified for completing their coal reclamation work. Currently the money has been dispersed to states based on how much coal they produce.

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Nevada mining industry expects to add at least 1,200 jobs this year – by Sean Whaley (Foxreno.com – February 10, 2012)

www.foxreno.com

NV News Bureau

CARSON CITY – Nevada’s mining industry is stepping up to Gov. Brian Sandoval’s challenge asking businesses and all economic partners to help create 50,000 jobs over the next three years.

The Nevada Mining Association recently conducted an informal survey of its members and has estimated the industry will add 1,200 jobs this year, both in precious metal and industrial mineral production across the state. The survey could be underestimating the number of mining jobs being created this year since not all mining operations are members of the association.

This compares to 500 jobs created in the natural resources and mining sector reported in the 12 months through December 2011 by the Nevada Department of Employment, Training and Rehabilitation on Jan. 23. There were 12,900 jobs in this sector as of December.

Mining has remained a bright spot in the jobs arena during Nevada’s long running economic downturn.

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Cliffs Becomes Easy Target With Cheapest Mining Value in America: Real M&A – by Charles Mead (Bloomberg.com – February 7, 2012)

www.bloomberg.com

For all the acquisitions being struck in the mining industry, no company in North America is a cheaper takeover candidate than Cliffs Natural Resources Inc.

The biggest North American iron-ore producer yesterday sold for 6.4 times its cash from operations, after deducting capital expenses, according to data compiled by Bloomberg. That was less than every other metals or mining company in the U.S. or Canada exceeding $5 billion in market value, and a 70 percent discount to the median. Cleveland-based Cliffs, which analysts say will generate record sales in 2012, was also the least expensive relative to its estimated net income this year and next.

Mining takeovers accelerated to a four-year high in 2011 as companies sought to replace deposits and industrial growth in China and the developing world fueled demand for raw materials. With Glencore International Plc and Xstrata Plc (XTA) agreeing to merge to create a $90 billion global mining company, Cliffs may attract interest from BHP Billiton Ltd. (BHP) or Rio Tinto Group, Lutetia Capital said. An acquirer could pay a 30 percent premium and still get Cliffs for less than any comparable publicly traded mining company versus its free cash flow, the data show.

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NEWS RELEASE: McEwen Mining: US Gold and Minera Andes Business Combination Completed

TORONTO, ONTARIO–(Marketwire – Jan. 24, 2012) – McEwen Mining Inc. (“McEwen Mining”) is pleased to announce that the previously announced business combination (the “Combination”), pursuant to which US Gold Corporation acquired Minera Andes Inc. and was renamed McEwen Mining, has been successfully completed and closed today. The Combination was carried out by way of a plan of arrangement under the Business Corporations Act (Alberta), which was approved by the shareholders of both US Gold and Minera Andes on January 19, 2012 and the Court of Queen’s Bench of Alberta on January 20, 2012.

Shares of McEwen Mining will commence trading on the NYSE and the TSX, subject to final exchange approvals, under the symbol “MUX” on Friday January 27, 2012. Holders of Minera Andes shares will receive 0.45 of an exchangeable share of McEwen Mining – Minera Andes Acquisition Corp. for each one (1) Minera Andes share held. These exchangeable shares of McEwen Mining – Minera Andes Acquisition Corp., will also start trading on the TSX on January 27, 2012 under the symbol “MAQ”. The exchangeable shares of McEwen Mining – Minera Andes Acquisition Corp. are convertible on a one-for-one basis at any time into shares of McEwen Mining. McEwen Mining will have an aggregate of 267,084,203 shares of common stock outstanding and issuable upon the exchange of exchangeable shares.

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USGS NEWS RELEASE: U.S. Mineral Values Up in 2011

Released: 1/30/2012

The value of mineral production in the United States increased by 12 percent in 2011 from that of 2010, suggesting that the nonfuel minerals industries, particularly metals, continued to recover from the economic recession that began in December 2007 and lasted well into 2009.

The value of raw, nonfuel minerals mined in the United States was $74 billion in 2011, up from $66 billion in 2010, according to the U.S. Geological Survey’s annual release of mineral production statistics and summary of events and trends affecting domestic and global nonfuel minerals.

“Information in the Mineral Commodity Summaries helps business leaders, policy makers, managers, and anyone else understand the critically important flow of minerals through the supply chain and how they are contributing to, and reflecting the health of, our nation’s economy,” said USGS director Marcia McNutt. “For example, in 2011 domestic recycled metallic and mineral materials alone contributed $32 billion to our economy.”

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Cleaning up California’s Wild West: EPA takes on polluted mercury mine in San Benito ghost town – by Paul Rogers (San Jose Mercury News – December 4, 2011)

This article originally came from the San Jose Mercury News: http://www.mercurynews.com/

Every second of every day it flows: a river of poison gushing from the hillsides.

Forty gallons a minute, 21 million gallons a year. It bubbles and gurgles across the landscape, a bright orange toxic brew, nearly as corrosive as battery acid, teeming with mercury, aluminum, iron and nickel, the legacy of a long-abandoned mine, relentlessly pouring into nearby streams.

For 120 years, the mining town of New Idria in the rugged back country of southern San Benito County was a colorful California outpost, a Wild West community frequented by prospectors and speculators, stagecoaches and famous bandits like Joaquin Murrieta, known as the “Mexican Robin Hood.” Herbert Hoover even owned part of the claim at one point.

Today, after decades of neglect, this remote landscape with so much history may finally have a future.

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Arizona town bitterly split over copper mine – by Paul Waldie (Globe and Mail – January 19, 2012)

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.

Florence, Ariz., isn’t the kind of place that usually gets a lot of attention. After all, its main claim to fame is being home to nine prisons.

But these days Florence is up in arms over plans by a Canadian company to build a copper mine right in the middle of town. The proposed mine, by Vancouver-based Curis Resources Ltd., has garnered national attention and brought out some heavy hitters, including Arizona Governor Jan Brewer and developer Robert Sarver, who owns the Phoenix Suns basketball team.

Ms. Brewer has expressed support for the project, saying it will spark badly needed economic development in the area. Mr. Sarver, whose company has a housing project in town, is backing a campaign to stop the mine, arguing it will ruin the water supply.

The city’s 10,000 residents are bitterly divided over the proposed mine. A recent survey by city officials found 39 per cent of locals support the mine, 32 per cent don’t and 28 per cent aren’t sure.

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The War Against Us [Coeur d’Alene silver region] – by David Bond (Silverminers.com – January 16, 2012)

http://silverminers.com/

This commentary is by Silverminer.com editor David Bond

Wallace, Idaho – Just when was it that the United Snakes of America declared war on the Coeur d’Alene Mining District, and why?

We were ruminating, fulminating on these weighty questions last week. Pretty clearly, the opening salvo was fired in the final decade of the 19th Century, when Federal troops were dispatched under a declaration of martial law to lock up 600 miners here who were striking for decent wages.

Then of course during World War II there was the undeclared conscription of lead and zinc miners here who were prevented from taking better paying jobs in the shipyards of Puget Sound to keep wresting rocks from our earth that could be smelted into bullets and cartridges to kill Germans and Japanese.

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A Mining Law Whose Time Has Passed – by Robert M. Hughes and Carol Woody (New York Times – January 11, 2012)

http://www.nytimes.com/

Op-Ed Contributors Robert M. Hughes and Carol Ann Woody are fisheries scientists based in Corvallis, Ore., and Anchorage, respectively.

IN 1872, President Ulysses S. Grant signed a mining law to spur the development of the West by giving hard-rock mining precedence over other uses of federal land. But the law has long since outlived its purpose, and its environmental consequences have been severe.

Mining claims for copper, gold, uranium and other minerals cover millions of those acres, and the law, now 140 years old, makes it nearly impossible to block extraction, no matter how serious the potential consequences. Soaring metal prices are now driving new mine proposals across the West.

Oregon’s Chetco River is one example. The river’s gin-clear waters teem with wild trout and salmon, including giant Chinook salmon tipping scales at more than 60 pounds. In 1988, Congress designated the Chetco a national wild and scenic river “to be protected for the benefit of present and future generations.”

But the river is now threatened by proposals to mine gold along almost half of its approximately 55-mile length. Suction dredges would vacuum up the river bottom searching for gold, muddying water and disrupting clean gravel that salmon need to spawn.

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Minerals mining in Arizona can help spur U.S. economic growth – by Senator Al Melvin, R-Tucson, and Joe Hart, Arizona State Mine Inspector (The Arizona Republic – September 26, 2011)

http://www.azcentral.com/arizonarepublic/azrepdex.html

The explosion in worldwide demand for minerals is good for Arizona’s mineral producers, including the state’s copper mines, which produce more copper than all the other 49 states combined and account for more than 60 percent of the nation’s total copper production. Arizona’s mineral mines have also made a positive contribution to our state and national economy.

According to a recent study by PricewaterhouseCoopers, mineral mining in Arizona supported more than 62,000 jobs, contributed roughly $7.5 billion to the state’s GDP and generated $1.8 billion in taxes to local, state and federal governments in 2008.

And that’s just Arizona. More than 1.1 million jobs are supported nationwide by mineral mining, and last year U.S. manufacturing used minerals to make products or provide services that added more than $2 trillion to the economy – approximately 14 percent of the nation’s GDP.

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Mining firms in Arizona seek riches – by Ryan Randazzo (The Arizona Republic – December 24, 2011)

http://www.azcentral.com/arizonarepublic/azrepdex.html

Investors face long odds in quest for mineral profits

Arizona is the top copper producer in the U.S., but several small-time geologists and entrepreneurs combing the rocky desert in hopes of finding the next bonanza don’t produce any minerals at all.

Many exploration companies prospecting in Arizona hope to raise money through the stock markets to take investors along on their risky hunt for mineral profits.

They might have historical maps of their mines, ore samples, assay reports and other data, but almost none have a shovel in the ground.

Exploration companies face extremely long odds of finding minerals that big firms have overlooked and raising the money to dig for them, but they persist on the small chance they could strike it rich.

“It is definitely a risky form of investment,” said Daniel Bleak of Mesa, who has been involved in several exploration ventures, most recently Silver Horn Mining Ltd., which has stock traded on the over-the-counter market. “It is a long shot. It is just like the old oil fields.”

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California Gold Rush from 10 Days That Unexpectedly Changed America

This series is from 10 Days That Unexpectedly Changed America.

10 Days that Unexpectedly Changed America: The Gold Rush chronicles the
trials and tribulations of settling the west and the stories of the people who were obsessed by the notion of imminent success on the American frontier. The quest for gold transformed America, bringing in over 500,000 people into the California territory and is responsible for the eventual industrialization of the west.

Using primary sources, reenactments, expert historians’ analysis and dramatic imagery, the program explains the premises for moving west and dissects the myths that were entrenched in the idea of the 19th century American frontier. This History Channel® program is a moving and
informative link to the events of great American expansion, thereby fulfilling your curiosity and providing in-depth explanations of life on the trail westward.

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Laying pipe and drilling shale [in U.S.] – by Clifford D. May (National Post – December 13, 2011)

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

My country, America, is in economic distress. The crisis threatens our national security because a nation that is weak economically cannot be strong in other ways. If only we had an untapped source of wealth, a nest egg we could crack and use to grow the economy, create jobs, raise Americans’ standard of living while providing the resources needed to defend the nation from its enemies.

Oh wait: We do.

Much of it is under our feet, in the ground, in deposits of shale – sedimentary rock rich in both oil and natural gas. Large shale fields have been found in South Dakota, Montana, Pennsylvania, New York, West Virginia and elsewhere in both the U.S. and Canada.

Until recently, this energy was expensive to access. Now, however, revolutionary new technologies have changed the cost equation. In particular, there is hydraulic fracturing: pressurized water is used to free the oil and natural gas.

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Wisconsin Reps. seek to ease mining regulation, fast track iron ore project – by Dorothy Kosich (December 9, 2011)

http://www.mineweb.com/

The desperate need for jobs in northern Wisconsin has generated increased momentum among state lawmakers to create a favorable regulatory environment for the Gogebic Taconite iron ore project.

RENO, NV – The state–which rejected the proposed Crandon gold mining project in the 1990s and engaged in a series of protests from February to June of this year that all but shut down the Wisconsin Legislature– now says it desperately needs a change in mining regulations to generate the 700 jobs a US$1.5 billion iron ore mining project would bring.

On Thursday, Republican lawmakers of the Wisconsin Assembly introduced a measure that will require Wisconsin’s Department of Natural Resources (DNR) to act on a mining permit application within 360 days after application.

The bill also eliminates so-called citizens’ lawsuits against iron ore mining, as well as contested case hearings.

The measure is specifically aimed at helping Gogebic Taconite open an iron ore mine in the Penokee Hills south of Lake Superior.

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