Republic of Mining

Undeterred by politics, Eldorado digs in for the long haul in Greece – by Eric Reguly (Globe and Mail – November 30, 2016)

November 30, 2016

http://www.theglobeandmail.com/

ATHENS – The development of Eldorado Gold’s mining projects in Greece have been exercises in misery.

In 2012, the Skouries mining site in northern Greece, the centrepiece of the Canadian company’s European gold portfolio, was besieged by protesters who said the mine would be an environmental disaster. A year later, the site was firebombed. In mid-2015, the new, far-left Syriza government revoked the permits that Eldorado needed to put Skouries into production and the project was suspended.

Today, after striking peace agreements with the Syriza government, Eldorado is sinking more than $1-billion (U.S.) into three projects in Greece, dominated by Skouries, that will drive the company’s growth in the next decade. Propelled by the Greek mines, Eldorado expects to produce more than 800,000 ounces of gold in 2020, up 110 per cent from forecast production in 2017.

Trudeau shows grit endorsing pipeline project, but the toughest work remains – by John Ivison (National Post – November 30, 2016)

November 30, 2016

http://news.nationalpost.com/

OTTAWA — True political leaders, it’s said, have the ability to look their supporters in the eye and explain to them that, while they might not want to follow a particular course of action, it is for the greater good.

Justin Trudeau showed that kind of leadership in announcing the approval of the Trans-Mountain pipeline in British Columbia. “I’m convinced it is safe for B.C. and right for Canada,” he said at a press conference Tuesday.

He said the approval of the Trans-Mountain pipeline and the replacement of the aging Line 3 between Alberta and Manitoba are in the national interest. His government risks paying the electoral price in lower mainland seats — a number of B.C. Liberal MPs, such as Ron McKinnon and Terry Beech, are openly hostile to the development.

Glencore Pivots From Disposals to Dividends as Stock Rallies – by Jesse Riseborough (Bloomberg News – November 29, 2016)

November 30, 2016

https://www.bloomberg.com/

What a difference a year makes. Glencore Plc fended off questions in 2015 about its survival as commodity prices hit new lows, and now there’s talk that the company’s turnaround plan has gone so well that it could be months away from paying dividends again. Surging coal and zinc prices, a rebounding stock price and shrinking debt pile made Glencore one of mining’s biggest success stories this year.

Chief Executive Officer Ivan Glasenberg, who will provide an update on corporate strategy on Thursday, spent the past year ticking off items outlined in a crisis-induced debt reduction plan, including a goal to sell $4 billion to $5 billion in assets. The market rewarded him for it, with the stock tripling in 2016 and clawing back almost all of last year’s losses.

Now, backed by a strong rebound in profits from its coal and zinc divisions, Glasenberg is in a position to pay back shareholders for supporting him through Glencore’s darkest days as a publicly traded company.

Pipeline approvals show Canada is back as a responsible oil producer – by Claudia Cattaneo (Financial Post – November 30, 2016)

November 30, 2016

http://business.financialpost.com/

For Western Canada’s oil producing regions, Tuesday’s approval of two major pipelines marks the beginning of the end of a decade of uncomfortable confrontation and missed opportunity.

It’s been that long since the first major and probably most attractive projects, Keystone XL and Northern Gateway, were proposed, in good faith, to transport growing oil production.

Opposition by environmentalists, aboriginals and local communities led to a flurry of other options: Kinder Morgan’s Trans Mountain expansion, Enbridge Inc.’s Line 9 expansion and reversal (in operation since last year), TransCanada’s Energy East, Enbridge’s Line 3, plus a big build up in costly and dangerous oil transportation by rail. Meanwhile, there were bottlenecks, regulatory gridlock and losses in investment and income.

Ore rally, cost cuts giving Vale room to rethink asset sales – by Christian Plumb (Reuters U.S. – November 29, 2016)

November 29, 2016

http://www.reuters.com/

Vale SA, the world’s No. 1 iron ore producer, is taking advantage of recent gains in mineral and metal prices and successful cost-cutting steps to rethink the pace of an asset sale plan to bring down debt, executives said on Tuesday.

Higher ore recovery and price realization may help Vale generate $2.2 billion next year in free cash flow – the money left for bond and shareholders after all expenses are paid – accelerating debt reduction plans, Chief Executive Officer Murilo Ferreira told the company’s investors in New York.

Ferreira and other executives expect the announcement soon of several, unnamed asset divestitures that could help Vale trim net debt to a range between $15 billion and $17 billion next year. Last year, in the middle of a rout in ore and metal prices, Ferreira set a target of disposing of non-essential assets to help cut debt by $10 billion.

Tribes Call On Obama to Bar Uranium Mining in Grand Canyon Forever – by Tanya H. Lee (Indian Country Today Media Network – November 22, 2016)

November 29, 2016

http://indiancountrytodaymedianetwork.com/

The Havasupai, Hualapai, Navajo, and Hopi are among the tribes working with Rep. Raul Grijalva, D-Ariz., environmental groups and other lawmakers to designate 1.7 million acres bordering Grand Canyon National Park as the Grand Canyon Heritage National Monument.

The designation would make permanent the 20-year federal moratorium on new uranium mining in and around the canyon put in place in 2012. At stake are a fragile watershed, extensive wildlife habitat and sacred and archaeological sites important to the tribes’ religious and cultural survival.

With elections less than a month away and a lawsuit brought by mining companies seeking to end the federal moratorium set for a hearing in the U.S. Court of Appeals for the 9th Circuit in December, time is short.

Rio seeks iron ore premium from China mills in likely pricing war revival: sources – by Manolo Serapio Jr (Reuters U.S. – November 29, 2016)

November 29, 2016

http://www.reuters.com/

MANILA – Australian miner Rio Tinto is asking Chinese steel mills to pay a premium for its highest grade iron ore product for the first time since an annual pricing system collapsed in 2010, two sources familiar with the situation said.

The demand by the world’s No. 2 iron ore miner comes as Chinese steel producers recover from years of losses, buoying demand for the steelmaking raw material, but could revive tensions between miners and mills over pricing that they seemed to have ditched six years ago.

Rio is seeking up to $1 per ton more than the index price for its Pilbara iron ore product, or PB fines, from Chinese mills on long-term contracts for 2017, the sources said, in a break from a years-long trend of pricing at spot values. Previously, Rio was selling the ore at a premium only to traders.

Miners go green in hunt for cost efficiencies, using renewable energy sources in far-flung locations – by Sunny Freeman (Financial Post – November 29, 2016)

November 29, 2016

http://business.financialpost.com/

Mining companies are digging into renewable energy as a way to reduce costs and offset the impact of volatile conventional fuel prices as the world shifts to a low-carbon economy.

Industry executives gathered last week at the Energy and Mines World Congress in Toronto focused on how innovation in energy – which can comprise as much as one-quarter of operating expenses in remote locations – can make mines more cost-effective and environmentally sustainable. “I think we will be surprised at the speed at which mining companies will start to adopt these things,” said Adriaan Davidse, mining innovation leader at Deloitte.

Amid rapid improvements in renewable technologies, wind and solar prices have fallen dramatically in recent years and are expected to keep dropping. In many parts of the world —especially in remote locations – the alternative energy solutions are becoming cheaper than conventional sources.

Saskatchewan, Ottawa strike accord on coal-fire power generation – by Shawn McCarthy (Globe and Mail – November 29, 2016)

November 29, 2016

http://www.theglobeandmail.com/

OTTAWA — Saskatchewan has reached a deal with Ottawa on reducing greenhouse gas emissions in its coal-fired power sector, but the two governments remain at odds over carbon pricing ahead of next week’s first ministers’ meeting on climate change.

Saskatchewan Environment Minister Scott Moe and his federal counterpart, Catherine McKenna, announced Monday that the two governments will conclude an “equivalency agreement” that could keep one or more coal-fired power plants operating past 2030, so long as the province makes major GHG reductions elsewhere in its electricity sector.

Ms. McKenna last week unveiled the federal plan to accelerate the phase-out of coal-fired electricity as part of the Canada’s commitment to reduce GHG emissions by 30 per cent from 2005 levels by 2030 under the international Paris Agreement on climate change.

Ontarians will be forced to pay for imaginary ‘credits’ just so the government can feel good – by Christine Van Geyn (Financial Post – November 29, 2016)

November 29, 2016

http://business.financialpost.com/

Canada contributes just 1.65 per cent of global greenhouse gas emissions, with only a tiny portion of that coming from Ontario. [Ontario contributes less than half a per cent of global greenhouse gas emissions. – RepublicOfMining.com] The buying and selling of carbon credits will make no real difference. In fact, shutting down the entire Ontario economy would make no measurable difference to global climate change.

For a time, it was fashionable to buy a star in the sky and name it after a love interest, a new baby or a recently deceased loved one. Could anything be more romantic or more sentimental?

It turns out that the companies that take money from consumers for “naming stars” are the only ones who actually recognize the name. The practice is considered by many to be a kind of scam that profits off of the idealism of consumers. Money for a star name is just money for nothing.

Mining on a ‘knife edge’ due to political strife says Sibanye CEO (Reuters/Times Live – November 28, 2016)

November 28, 2016

http://www.timeslive.co.za/

The mining industry is at risk of collapse due to political unrest and labour instability which have negatively impacted investment into the country, the chief executive of the nation’s biggest gold company said on Monday.

Political ructions in Africa’s most industrialised country including scandals surrounding President Jacob Zuma for his alleged connections to the wealthy Gupta family have caused concern among investors, putting credit ratings at risk.

The mining sector, which accounts for about 7 percent of GDP, has opposed the introduction of regulations and laws that could see the powers of the mining minister increase and social capital commitments of companies rise.

Cullen promises duty-to-consult mining framework by May – by Jonathon Naylor (Flin Flon Reminder – November 24, 2016)

November 28, 2016

http://www.thereminder.ca/

Manitoba Growth, Enterprise and Trade Minister Cliff Cullen has pledged a target of May 2017 or earlier to create a framework for the consultation process with indigenous people on mining and exploration projects. It’s a step many people within the mineral sector say is overdue and would help bolster an industry that has been shedding jobs in the province for years.

Cullen has long been critical of the previous NDP government’s policy toward the constitutionally required “duty to consult” with First Nations on resource projects that involve traditional indigenous territory.

He spoke of clarifying that process while in Flin Flon in September, but last week he went a step further by telling mineral sector leaders that a new framework would be complete within six months, according to the Winnipeg Free Press.

Grande Cache coal mine looking to restart operations – by Roberta Bell (CBC News Edmonton – November 23, 2016)

November 28, 2016

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

Northwest Alberta mine shut down in 2015, laying off 400 employees

Steelmaking coal producer Grande Cache Coal says it plans to reopen its shuttered surface mine and coal-processing plant next year. “It is expected that the [surface] mine will resume operations by the end of Q1 2017,” the Chinese-owned company said in a regulatory update posted to its website this week.

The coal processing plant would start operating within a month of the resumption of mining operations, the update said. But the plans depend on “shareholders’ approval and the negotiation of key contracts,” the company said, adding that pre-production activities would start in January.

The company also said it plans to apply to the Alberta Energy Regulator to mine one of its underground coal seams “and not to abandon it.” More information is expected at an open house in Grande Cache on Dec. 14, the company said.

Rio marks the re-emergence of the miners – by Robert Gottliebsen (The Australian – November 28, 2016)

November 28, 2016

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

In the next two years we are going to have a mining profits boom of considerable magnitude. Don’t be surprised to see the profits of some mining companies rise 50 to 100 per cent above their lows. Sometimes the rise will be even more.

I reached that conclusion as I was listening to the address by the chief executive of Rio Tinto Jean-Sébastien Jacques to some 700 mining, accounting, investment, legal and other executives at the Melbourne Mining Club last week.

Jean-Sébastien Jacques did not actually mention profit trends, so, to get the message, you had to listen very closely to what he was saying and combine that with the mood of the people at the function.

Unfair Chinese practices put U.S. aluminum jobs at risk – by Garney Scott (Knoxville News Sentinel – November 27, 2016)

November 28, 2016

http://www.knoxnews.com/

Because it’s so common in our everyday lives, it’s easy to overlook aluminum. Everyone is familiar with the ubiquitous soda and beer can or kitchen foil, but aluminum is also used to create materials for building construction, aircraft, automobiles and even cellphones and tablet computers.

And a lot of that metal is made right here. In fact, the industry represents approximately $75 billion in direct economic impact in the United States and more than $3.1 billion in Tennessee.

Virtually alone among the basic material sectors of the world, aluminum is experiencing a once-in-a-generation expansion in projected demand as firms move to engineered aluminum solutions, from fuel-efficient vehicles to green buildings.