Republic of Mining

Iron Ore Slump Threatens $2 Billion Australian Mine – by David Stringer (Bloomberg News – January 12, 2016)

January 12, 2016

http://www.bloomberg.com/

The plunge in the price of iron ore looks set to claim another casualty with Gindalbie Metals Ltd. questioning its future, as partner Anshan Iron and Steel Group Corp. considers withdrawing funds for their $2 billion mine.

Anshan engaged a third party to assess the viability of its Karara iron ore mine in Western Australia amid the steel making material’s price collapse, according to a statement from Gindalbie.

Shares in the Perth-based company slumped 57 percent to a record low of 0.9 cents in Sydney, giving it a market value of A$13.5 million ($9.4 million) compared with A$780 million at the end of the 2011 fiscal year.

Torex CEO reflects on journey to first gold at Morelos (Northern Miner – January 11, 2016)

January 12, 2016

http://www.northernminer.com/

VANCOUVER — Nearly six years ago Torex Gold Resources (TSX: TXG; US-OTC: TORXF) began to consolidate a promising claim block 180 km southwest of Mexico City — called Morelos Norte — via a US$150 million deal with Teck Resources (TSX: TCK.B; NYSE: TCK). Since then the company has authored one of the few recent success stories in the gold space, and now stands poised to hit commercial production at its El Limon-Guajes (ELG) open-pit mine in the second quarter.

The achievement is even more notable since Torex could be viewed as one of the final chapters in the previous bull-run in commodities markets. The company raised around US$800 million via debt and equity to build a bulk-tonnage gold mine at Morelos, and saw its market capitalization jump from roughly US$400 million to over US$1 billion since mid-2010.

On Dec. 29 Torex announced its first gold pour from the ELG deposits, and president and CEO Fred Stanford spoke with The Northern Miner to reflect on the company’s path to production.

China steel pullback a new blow for miners – by Scott Murdoch (The Australian – January 12, 2016)

January 12, 2016

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

One of China’s largest iron and steel-producing regions, Hebei, has announced a dramatic cut in production levels this year in a fresh blow to the Australian mining industry.

Regulators have revealed that production at Hebei, which produces a quarter of China’s iron and steel output, will be slashed this year in a bid to alleviate the nation’s worsening pollution problem. Iron production will by cut by 10 million tonnes and steel by eight million tonnes this year.

Hebei governor Zhang Qingwei said steel and cement production would be capped at 200 million tonnes as the nation attempts to reduce the overcapacity that exists in the industry across the country.

[Eldorado Gold] Canada Mining Company Suspends Work, Cuts Jobs in Greece (Associated Press/New York Times – January 12, 2016)

January 12, 2016

http://www.nytimes.com/

ATHENS, Greece — Canadian mining company Eldorado Gold said Tuesday it is suspending work at a site in Greece and laying off 600 workers following protests by local residents and a spat with the country’s leftwing government.

The Vancouver, Canada-based company said it was halting operations at a gold mine at Skouries, on the Halkidiki peninsula, one of four major Greek sites where the company is involved.

CEO Paul Wright said a further 500 jobs were also likely to be cut later in the year.

Wright accused the government of holding up permits and using the mining project as a “political toy” but insisted the company had no plans to pull out of Greece and hoped to restart work at Skouries at a later date.

Mining Ready for M&A Revival, Producers Fight for Survival – by Jesse Riseborough, Brett Foley and Agnieszka De Sousa (Bloomberg News – January 12, 2016)

January 12, 2016

http://www.bloomberg.com/

Nothing drives change like necessity.

The $1.4 trillion collapse in the value of mining stocks since 2011 is poised to reshape the industry as all but the strongest companies are squeezed by the lowest commodity prices in six years. Rio Tinto Group and BHP Billiton Ltd. are among the best placed to grab assets sold by rivals desperate to stem losses or pay down debt.

“We would be supportive,” Martin Gilbert, chief executive officer of Aberdeen Asset Management Plc, said in an interview with Bloomberg Television on Tuesday.

Aberdeen has more than $400 billion of funds under management and is the second-largest investor in BHP’s London shares and the fifth-largest holder of Rio’s London stock.

“New awakening” in Indigenous engagement – by Ella Myers (Northern Ontario Business – January 11,2016)

January 12, 2016

http://www.northernontariobusiness.com/

Sean Willy brings a unique perspective to his role as director of corporate responsibility for the uranium producing Canadian Mining and Energy Corporation (Cameco).

Willy was raised in the Northwest Territories and Saskatchewan, and belongs to the Metis Nation of NWT.

He runs the Saskatchewan-based Cameco’s Aboriginal engagement program, bringing personal and professional insight to his role, which he presented at a Goodman School of Mines lecture.

The school’s Nicole Tardif said Willy was brought to Sudbury to share Cameco’s years of experience building strong, mutually beneficial relationships with Indigenous populations in northern Saskatchewan with local academia and industry.

Between Rocks and a Hard Place in Africa – by John Feffer (Foreign Policy – January 11, 2016)

January 12, 2016

http://foreignpolicy.com/

Botswana squeezes more money from diamonds than any other country. Why are its citizens among the poorest in the world?

GABORONE, Botswana — A large billboard on the side of the road urges residents of this dusty capital city to restrict their showers to under three minutes. Even now, during the rainy season, Gaborone is experiencing a severe water shortage. At the luxury casino resort hotel where I stayed on a recent trip, water flowed from the taps only a few hours each day.

The current water shortage offers a stark reminder that Botswana — an arid, land-locked country just north of South Africa — has always been at the mercy of the elements. For its entire post-independence history, the most important element for Botswana has been carbon — the fanciest grade.

The discovery of diamonds in the late 1960s propelled the country from a GDP per capita of $70 to its current upper-middle-income status of roughly $16,000, close to the highest in Africa.

Goldcorp needs to look outside Americas for growth: incoming CEO – by Euan Rocha and Nicole Mordant (Reuters Canada – January 11, 2016)

January 12, 2016

http://ca.reuters.com/

TORONTO/VANCOUVER (Reuters) – Goldcorp G.TO, the world’s biggest gold producer by market value, will increasingly have to look for large gold deposits outside the Americas as these are scarcer than “hen teeth,” the miner’s incoming chief executive said on Monday.

David Garofalo, who will become CEO after Goldcorp’s annual meeting in April, said countries in Europe and Africa could possibly meet the miner’s criteria, which include low political risk and the existence of a mining code.

Until now, Goldcorp’s operations have been exclusively in the Americas, where it has invested in countries with relatively low political risks, including Canada and Mexico. But the need to replace the nearly 4 million ounces of gold it mines a year, and a growing shortage of big deposits, will force it to look further afield.

Oil and copper plunge to new depths as anxiety over China mounts – by Ian McGugan (Globe and Mail – January 12, 2016)

January 12, 2016

http://www.theglobeandmail.com/

The great commodity slump has entered a new and dangerous stage, with two of the globe’s most important raw materials diving to fresh depths on growing fears of a Chinese slowdown.

Oil plunged to its lowest point since 2003 on Monday, as West Texas intermediate (WTI), the North American benchmark, declined to $31.12 (U.S.) a barrel. It has lost 15 per cent of its value in the first few days of 2016.

Copper, meanwhile, tumbled to a six-year low of $1.97 a pound. The metal, used for a wide variety of industrial and construction applications, is down more than 9 per cent in January.

Mounting anxiety over China is to blame for much of the recent havoc in commodity prices. The Asian giant’s frenetic growth propelled the world’s booming demand for raw materials over the past decade and its deceleration has already inflicted major damage on commodity prices.

Rubicon Minerals Corp shares plunge as miner slashes its gold resources by 88% – by Peter Koven (National Post – January 12, 2016)

January 12, 2016

http://business.financialpost.com/

Junior miner Rubicon Minerals Corp. has slashed its gold resources by an astounding 88 per cent, confirming the company will go down as one of the worst Canadian mining meltdowns in years.

The stock plunged 64 per cent on Monday, closing at 5 cents, as this news crushed any remaining investor confidence in the formerly high-flying company. Rubicon has hired financial advisors to try to salvage value for shareholders, but there is little confidence that they will succeed.

“We’re very disappointed, as management and the board, at what’s transpired,” interim chief executive Michael Winship said on a conference call.

Toronto-based Rubicon was one of the hottest junior mining stories of the past decade, but the company made fatal errors while developing its Phoenix gold project in Ontario’s Red Lake camp.

Economic mood darkens as rout spreads beyond oil patch – by Barrie McKenna and Bill Curry (Globe and Mail – January 12, 2016)

January 12, 2016

http://www.theglobeandmail.com/

OTTAWA — The worsening price rout in commodities is hitting home far beyond the oil patch, darkening the mood of Canadian consumers, businesses and investors.

As the price of crude slumped to near $31 (U.S.) on Monday, two new confidence surveys suggest the main drivers of the economy – consumers and businesses – may be stalling. That points to weaker spending and hiring this year.

In spite of optimism from the Liberal government, the glum mood was on full display in financial markets on Monday. The Standard & Poor’s/TSX composite – already 20 per cent off its 2014 high – lost more ground, falling 1 per cent to 12,319.25. Meanwhile, the oil industry took another hit when the B.C. government said it has not been given enough information to allow it to support the expansion of Kinder Morgan’s Trans Mountain pipeline.

[Sudbury mining] Quakes occurred near Creighton – by Carol Mulligan (Sudbury Star – January 12, 2016)

January 12, 2016

http://www.thesudburystar.com/

Two seismic events that occurred before 6 p.m. Sunday in Sudbury have been reclassified from slight earthquakes to rock bursts, and their location has changed from east of the city to three kilometres northwest of Lively.

Vale recorded two seismic events 500 and 800 feet north of Creighton Mine, which were felt in the community about 5:40 p.m. The first event occurred about 7,680 feet underground and the second at 7,400 feet underground, said Vale spokeswoman Angie Robson.

The 7,680-foot level event registered a magnitude of 3.1Mn and the second event registered a magnitude of 3.3Mn, according to Creighton’s ground control system.

All workers at Creighton were brought to surface as a precaution and no one was injured, said Robson. Operations resumed at the mine Monday and there didn’t seem to be any significant damage the operation, she said.

[KGHM] Poland studies energy sector mergers, copper concerns (Reuters U.S. – January 11, 2016)

January 11, 2016

http://www.reuters.com/

WARSAW – Poland surprised the markets on Monday with plans to merge its biggest oil and gas firms to forge central Europe’s No.1 energy company and prevent any hostile takeover threat.

Treasury minister Dawid Jackiewicz is considering tie-ups between the state-run oil refiners PKN Orlen PKN.WA and Lotos LTSP.WA, and gas firm PGNiG PGN.WA, with the analysis to be ready by the end of this quarter.

Put together their joint market value would stand at 60 billion zlotys ($15 billion), almost twice as much as Austria’s OMV (OMVV.VI) and three times the market cap of Hungary’s MOL MOLB.BU.

Northern Ontario Multi-modal transportation study rolls toward finish – by Ian Ross (Northern Ontario Business – January 11, 2016)

January 11, 2016

http://www.northernontariobusiness.com/

The province is about a year away from rolling out a multi-modal transportation strategy for the North.

Since 2011, the Ministry of Transportation (MTO) has been studying how people and freight move across the region and have been regularly meeting with regional stakeholders to gather their feedback on how to plan and improve transportation infrastructure over the next 25 years.

Tija Dirks, the MTO’s director of transportation planning, estimates a final report will be presented to premier and cabinet by January, 2017. The strategy is tied to the government’s Growth Plan for Northern Ontario. Once revealed it will provide short, medium and long-term solutions to improve the region’s transportation systems for road, rail, marine, air and other modes.

New South African mines minister faces daunting year ahead – by Sungula Nkabinde (Mineweb.com – January 11, 2016)

January 11, 2016

http://www.mineweb.com/

The inexperienced Zwane is against the odds in his first full year at the helm.

President Jacob Zuma’s decision to replace the minister in the Department of Mineral Resources (DMR), Ngoako Ramatlhodi with the inexperienced Mosebenzi Zwane in September last year came as a shock to the South African mining community.

Ramatlhodi, whose inclusive approach as mining minister restored some confidence in his historically maligned office, had been hands-on addressing critical matters such as the five-month long platinum strike of 2014, and, not long before the cabinet reshuffle, had begun talks between stakeholders to find a solution to arrest the spate of retrenchments happening throughout the sector.

Nevertheless, he was moved on to the Department of Public Service and Administration as minister, and replaced by Zwane, who had little to no experience in the sector and had reportedly been linked with the controversial Gupta family.