Republic of Mining

China eyes Obor Gold Rush as it seeks to build reserves – by Zi Yang (Asia Times – June 16, 2017)

June 16, 2017

http://www.atimes.com/

The country’s own deposits may be costly to explore but Chinese mining giants are taking advantage of ‘New Silk Road’ connectivity to explore additional sources as Beijing looks to close the gap on US reserves

China’s demand for investment-grade gold is going up. The first quarter of 2017 saw a 60.2% rise in demand for physical gold bars, compared to 22.4% growth for the year-earlier period.

Recovering from a 14.4% decline during the same period last year, demand for gold jewelry rose just 1.4%, which is to be expected when demand for gold bars and bullion is high. This year, total Chinese gold imports through Hong Kong are set to breach 1,000 tonnes, compared to 771 tonnes imported in 2016.

The rise comes as no surprise. China has long been interested in accumulating gold to diversify its assets and reduce its dependency on the US dollar. In addition, a larger gold reserve strengthens the renminbi as an IMF reserve currency. In a time of economic slowdown, renminbi depreciation and concern over equity and property markets, however, citizens and businesses also view gold as a safe haven investment.

Why South Africa’s Mining Rules Are Drawing Fire: QuickTake Q&A – by Kevin Crowley and Paul Burkhardt (Bloomberg News – June 16, 2017)

June 16, 2017

https://www.bloomberg.com/

South Africa is far from the egalitarian rainbow nation envisaged by Nelson Mandela when he ushered in democracy in 1994. A prime example is the mining industry. Its highly paid, mainly white male executives oversee hundreds of thousands of mostly black workers laboring in some of the world’s deepest and most dangerous operations.

The government’s updated rules for so-called black economic empowerment, including more stringent ownership requirements, seek to reverse the imbalances. The new regulations have the mining industry up in arms, as producers protest what they say was a disturbing lack of consultation on changes that are likely to require dilution of their existing shareholders.

1. What are the new regulations?

A new national Mining Charter, published in a government gazette by Mineral Resources Minister Mosebenzi Zwane, aims to involve more black groups and women in the mining industry and ensure that more of the proceeds from mining flow to the black majority.

North Korea is sitting on trillions of dollars of untapped wealth, and its neighbors want in – by Steve Mollman (Quartz.com – June 16, 2017)

June 16, 2017

https://qz.com/

Few think of North Korea as being a prosperous nation. But it is rich in one regard: mineral resources. Currently North Korea is alarming neighbors with its frequent missile tests, and the US with its attempts to field long-range nuclear missiles that can hit American cities.

A sixth nuclear test could be imminent. An attack on the US or its allies would be suicidal, so Pyongyang probably aims to extract “aid” from the international community in exchange for dismantling some of its weaponry—rewind about 10 years to see the last time it pulled off the old “nuclear blackmail” trick.

But however much North Korea could extract from other nations that way, the result would pale in comparison to the value of its largely untapped underground resources. Below the nation’s mostly mountainous surface are vast mineral reserves, including iron, gold, magnesite, zinc, copper, limestone, molybdenum, graphite, and more—all told about 200 kinds of minerals. Also present are large amounts of rare earth metals, which factories in nearby countries need to make smartphones and other high-tech products.

BHP’s Tyro Chairman Seen Driving Deeper Shakeup at Biggest Miner – by David Stringer (Bloomberg News – June 16, 2017)

June 16, 2017

https://www.bloomberg.com/

BHP Billiton Ltd.’s decision to look past boardroom veterans and name its youngest director Ken MacKenzie as chairman is raising expectations of further changes in leadership and its portfolio as the mining giant grapples with smoldering shareholder unrest.

While BHP’s most restive investor Elliott Management Corp. welcomed the appointment Friday, billionaire Paul Singer’s hedge fund also called on MacKenzie, 53, to address the No. 1 miner’s performance, review the executive team and nominate new directors. Under the new chairman, there may be management changes and there’s increased potential for the sale of U.S. shale assets, Citigroup Inc. said in a note.

MacKenzie plans to meet investors over the coming weeks before taking up his post from Sept. 1, and aims to “understand their perspectives,” he said in a statement. His plan will be seen as an “olive branch” after more than two months of public skirmishes over strategy and spending between BHP and critics including Elliott, according to Shaw and Partners Ltd. BHP declined to confirm whether MacKenzie will meet with Elliott.

KIA signs gold mine benefit deal with Agnico Eagle (CBC News Canada North – June 16, 2017)

June 28, 2017June 16, 2017

http://www.cbc.ca/news/canada/north/

The KIA and Agnico Eagle have signed an Inuit Impact Benefit Agreement regrading the Whale Tail gold deposit

Officials from the Kivalliq Inuit Association (KIA) and Agnico Eagle Mines Ltd. signed the Whale Tail Inuit impact benefit agreement (IIBA) in Baker Lake, Nunavut, on Thursday. In 2019, the mining company hopes to begin open pit operations at the Whale Tail gold deposit, approximately 50 kilometres north of the Meadowbank gold mine.

The Whale Tail agreement includes a $6.5 million payment to KIA — including $3 million given on June 15 to a community initiative fund. Other benefits include a 1.4 per cent cut of net gold production, $3.6 million in funding for annual training programs (with an additional $1 million in training investment if Inuit employment goals are not reached), and a preference point system to Nunavut Tunngavik Inc. registered companies.

“KIA has strived to balance the need to protect the environment with the promotion of economic development,” stated David Ningeongan, KIA president, in a press release.

UPDATE 2-Argentina lifts curbs on Barrick mine; full operations lag (Reuters U.K. – June 15, 2017)

June 16, 2017

https://uk.reuters.com/

Authorities in the Argentine province of San Juan lifted restrictions on leaching operations at Barrick Gold Corp’s Veladero mine on Thursday, but the world’s biggest gold producer said it would not immediately resume full operations.

Judge Pablo Oritja told a radio station that he understood Barrick had finished all required work, following its third cyanide spill in 18 months, and had ordered an end to restrictions put in place in late March.

Barrick will not begin adding cyanide until it has completed the ramp up of a new system and verified all elements are ready for normal operations, in keeping with a plan the miner submitted to regulators, said spokesman Andy Lloyd.

De Beers Launches World’s Largest And Most Advanced Diamonds Exploration Ship – by Anthony DeMarco (Forbes Magazine – June 16, 2017)

June 16, 2017

https://www.forbes.com/

De Beers has officially launched the mv SS Nujoma, what the diamond mining giant calls the “world’s largest and most advanced diamond exploration and sampling vessel” to explore diamond deposits in the waters off the coast of Namibia.

The $157 million vessel is under the ownership of Debmarine Namibia, a 50/50 joint venture between the Government of the Republic of Namibia and De Beers Group. It is the only company in the world to mine diamonds offshore, having started in 2002. It produced around 1.2 million carats in 2016.

An inauguration ceremony was held Thursday in Walvis Bay, Namibia, attended by Prime Minister Saara Kuugongelwa-Amadhila and Founding President Dr Sam Shafiishuna Nujoma, who the vessel was named after, as well as Obeth Kandjoze, Namibia’s Minister of Mines and Energy.

New mining rules in South Africa would require 30-per-cent black ownership – by Geoffrey York (Globe and Mail – June 15, 2017)

June 16, 2017

https://www.theglobeandmail.com/

JOHANNESBURG — South Africa has announced a “revolutionary” new mining code to force companies to give a 30-per-cent ownership stake to black partners, triggering a plunge in mining stocks and a swift threat of legal action by the industry.

Canadian companies such as Ivanhoe Mines Ltd., which is developing one of the world’s biggest platinum mines in South Africa, would be among those potentially affected by the new ownership rules. The new code would increase the minimum black ownership from 26 per cent to 30 per cent for mine owners, while also requiring companies to be majority black-owned if they want a prospecting licence.

Mining companies would have to give 1 per cent of their annual revenue to their black shareholders before paying dividends to any other shareholders. The new code would take effect in 12 months.

A drone’s-eye view of mining safety at Rio Tinto’s Kennecott – by Amy Joi O’Donoghue (KSL.com – June 14, 2017)

June 15, 2017

https://www.ksl.com/

BINGHAM CANYON — At about $2,000 apiece, drones have become an invaluable set of eyes for the mining operations at Rio Tinto Kennecott, providing real-time 3-D mapping, equipment inspections and surveillance of slopes, crests and walls.

The five drones at the Bingham Canyon mining operation are the result of a four-year effort by the company to boost employee safety and provide enhanced capabilities of surveying one of the world’s largest open-pit mines. “The potential we can unlock with these is only limited by the imagination,” said David van Hees, drone programs lead for Rio Tinto Kennecott.

Drone pilots go through rigorous certification offered by an aviation company, and each pilot conducts preflight safety checks. Multiple flights lasting about 18 minutes happen daily, and each pilot works with two spotters who measure wind speed and look for potential aerial hazards.

Search for Trapped Chile Miners Intensifies as Deadline Looms – by Laura Millan Lombrana (Bloomberg News – June 15, 2017)

June 15, 2017

https://www.bloomberg.com/

The search for two men buried in a Patagonian gold mine may not be attracting the kind of global attention as the miraculous rescue of 33 miners in Chile seven years ago, but it’s no less dramatic. To begin with, time is running out.

Enrique Ojeda and Jorge Sanchez, trapped in the Mandalay Resources Corp.-owned mine since June 9, have an estimated three days of air left. And while the depths are less than the San Jose mine, technically the rescue is more difficult, said Felipe Matthews, a geologist who advised the Chilean Mining Ministry in 2010 and is also working on this search.

The hope is that the two found their way into a refuge after a section of the mine collapsed and tunnels flooded with water from a nearby lagoon. “If I’m here it’s because I have faith that we can achieve a similar miracle than the one we had in San Jose,” Matthews said Thursday in a telephone interview.

We’re confident a bid for Rio Tinto will clear hurdles: Glencore – by Bridget Carter and Scott Murdoch (The Australian – Jun 15, 2017)

June 15, 2017

http://www.theaustralian.com.au/

Rio Tinto’s preferred bidder is expected to be revealed next week and Glencore is lobbying that its offer is unlikely to be hamstrung by onerous legislative hurdles.

The Switzerland-based trading house’s global coal boss, Peter Freyberg, briefed the Rio Tinto board in Montreal overnight and reportedly emphasised it was confident regulators would not pose an insurmountable hurdle.

Glencore’s critics have highlighted that China’s Ministry of Commerce took six months to approve the company’s purchase of a 50 per cent stake in Rio Tinto’s Clermont mine. But the six months was based on the fact that the Mofcom, arguably the country’s second most powerful arm of government, was examining the broader Glencore and Xstrata transactions.

UPDATE 4-Barrick Gold to hold talks with Tanzania over export row – by Fumbuka Ng’wanakilala and David Lewis (Reuters U.S. – June 14, 2017)

June 15, 2017

https://www.reuters.com/

DAR ES SALAAM/NAIROBI, June 14 Barrick Gold’s chairman and Tanzania’s president met on Wednesday and agreed to hold talks aimed at resolving an escalating dispute over an export ban which has hit Barrick’s Acacia Mining PLC .

Shares in Acacia, which is 63.9 percent owned by Barrick, jumped as much as 11 percent, to 303 pence, after the news and closed 5.5 percent higher, outpacing sector rivals. Tanzania is Africa’s fourth-largest gold producer, and Acacia its largest miner, with three gold mines that also produce copper in the East African country.

Acacia’s market value has nearly halved to about $1.4 billion since Tanzania banned the export of unprocessed ore in March, part of a push for the construction of a local smelter to make the country’s gold exports more valuable.

Sabina finds deeper mineralization at Back River in Nunavut – by Trish Saywell (Northern Miner – June 14, 2017)

June 28, 2017June 15, 2017

http://www.northernminer.com/

Drilling during Sabina Gold and Silver’s (TSX: SBB) spring exploration program has extended mineralization 300 metres down plunge of the Back River project’s existing resources in southwestern Nunavut.

Drill hole 17GSE513 stepped out about 300 metres down plunge of the existing resource structure at the project’s Llama deposit and intersected 48 metres of altered and mineralized iron formation that included an intercept of 6.52 grams gold over 8.3 metres from a depth of 618.90 metres. Another hole, 17GSE512, cut 6.30 grams gold over 2.65 metres from a depth of 603.5 metres.

“Results bode well for future resource growth,” Andrew Kaip of BMO Capital Markets wrote in a research note. “We continue to believe that the Back River project represents an attractive feasibility study stage project, at an advanced stage of permitting, in a safe jurisdiction, and with a large reserve base containing above-average grade.”

RENEWED DIGGING: The US coal industry’s future could be to mine rare-earth metals for wind turbines – by Akshat Rathi (Quartz.com – June 15, 2017)

June 15, 2017

https://qz.com/

In an era where every country in the world—apart from the US, Syria, and Nicaragua—is bound by commitments to reduce greenhouse-gas emissions, it should be little surprise that the demand for coal is falling fast. Despite these global trends, US coal is looking for ways to revive its dying industry.

One idea is to change its product: instead of mining coal to burn as a source of fuel, it could mine coal for crucial metals found in it.Coal is the dirtiest fossil fuel. Not only does it produce the most amount of carbon dioxide pollution for each unit of energy, it contains non-hydrocarbon chemicals that, when burned, release dangerous toxins into the air. These include a strategically important group called “rare-earth metals.”

These metals, such as neodymium and scandium, are used in everything from smartphones to wind turbines. They’re also used in guided missiles and other defense applications. That is what makes them a strategically important resource, and for the last decade or more, China is responsible for the production of over 90% of global rare-earth metals.

Analysis: A diamond of an opportunity for northern Manitoba – by Joseph Quesnel (Winnipeg Free Press – June 15, 2017)

June 15, 2017

http://www.winnipegfreepress.com/

Joseph Quesnel is a research associate with the Frontier Centre for Public Policy.

In early March, the Manitoba Geological Survey and its industry partner, Lynx Consortium, made an important diamond discovery southeast of Thompson. While there is no guarantee the find will lead to a significant mining project, the province should move quickly to enhance the potential by involving industry partners, First Nations and municipalities in the region.

If this development works out, Manitoba would join Ontario, Quebec and the Northwest Territories in profiting from diamond mining. Royalties, employment opportunities and tax revenue may lie ahead from, and in, places where they are sorely needed. Mining is a long-term venture relying on good economic policies, political stability and the prospect of decent returns on investment. The provincial government should be careful, but also reasonably venturesome.

To move forward, the province will have to involve northern First Nations. Indigenous communities would best become true partners in the venture to avoid problems that have plagued some other ventures and communities, such as Attawapiskat First Nation in northern Ontario.