Republic of Mining

Lab-grown diamonds set to fill projected deficit as mined production declines – by Zandile Mavuso (Mining Weekly – September 18, 2015)

September 18, 2015

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

JOHANNESBURG (miningweekly.com) – Technological developments that enable manufacturers to produce grown diamonds have presented the industry with a significant growth opportunity, with a noticeable influence on the economy and the diamond value chain, as researchers predict the demand for grown diamonds to double in the next ten years.

This is because, in addition to the jewellery industry, manufacturing and energy companies also use grown diamonds. Singapore-based grown diamonds manufacturer IIa Technologies (pronounced ‘2a Technologies) says this is a result of the projected decline of mined diamond supply, as the quality levels of mined diamonds are unpredictable for high-technology applications; further, almost all of the mined diamond production is absorbed by the gems and jewellery industry.

Owing to this, grown diamonds are filling an important gap in the diamond industry as a new source of raw material.

Consulting firm Frost & Sullivan’s ‘Grown Diamond Impact 2050’ report, published last year, indicates that mined diamonds are a finite resource, considering the extreme and rare occurrence of the natural surroundings in which they are formed. Therefore, the sustainability of the mined diamond industry as a primary source for the industry is declining.

Glencore inventory sale could sink world zinc prices further – by Eric Onstad (Reuter U.S. – September 18, 2015)

September 18, 2015

http://www.reuters.com/

LONDON, Sept 18 (Reuters) – Substantial amounts of base metal zinc could be released onto world markets, weighing further on fast falling prices, as major producer Glencore implements a plan to liquidate some of its commodity inventories to help pay off debt.

The overhang of inventories in London Metal Exchange (LME) storage facilities, which has surged more than 40 percent since early August, has wrong-footed investors who had earlier this year targeted zinc as a top bet in metals due to closures of big mines that would create shortages.

Zinc, mainly used to galvanize steel to protect against rust in autos and construction, has slumped from being one of the best performing industrial metals earlier in the year to one of the worst due to the inventory change.

“It’s been a big shock to the market, this massive flood into the LME warehouses,” said Stephen Briggs, metals strategist at BNP Paribas.

But mining and trading company Glencore may add further to a plentiful supply situation after announcing a raft of measures to slash its net debt of $30 billion.

Mining’s long-term outlook positive as urbanisation and infrastructure development intensifies – by Simon Rees (Mining Weekly – September 18, 2015)

September 18, 2015

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

TORONTO (miningweekly.com) – The outlook for the global economy, infrastructure development and mining is not as dismal as many might believe, Deloitte global mining leader Phil Hopwood recently told an audience at the Canada-South Africa Chamber of Commerce’s seminar on infrastructure in Southern Africa.

“People talk about doom and gloom, but it isn’t all that doomy or gloomy. We can talk ourselves into corners by saying things are pretty bad,” he cautioned. “I’d say that you’ve got to focus on the long-term fundamentals and I am optimistic.”

Despite the volatile global economy, the positive drivers for metals and mineral consumption had remained in place over the long term, particularly based on developing economies that had growing rates of urbanisation.

China was important in this regard, although Hopwood also highlighted countries such as India, Indonesia, Mexico and Brazil and the volume of commodities these nations would require to build out their infrastructure on growing urbanisation rates. Countries such as Saudi Arabia were also noteworthy, achieving higher rates of urbanisation and developing large projects, including smelters.

Barrick closing Utah office and copper unit in cost-cutting effort – by Rachelle Younglai (Globe and Mail – September 18, 2015)

September 18, 2015

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.

Barrick Gold Corp. is shutting a major American office and dismantling its copper unit, the company’s latest steps to cut costs and overhaul operations amid the slump in gold prices.

The closing of its Salt Lake City office along with the unwinding of its copper business will help the world’s biggest gold producer save $2-billion (U.S.) by the end of next year, the company said.

Four years of declining gold prices have forced a broad retreat at Barrick and battered the company’s share price. In addition to selling a slew of mines and non-core assets, Barrick recently reduced its dividend again and sold a stake in its top copper mine in Chile as well as part of one of its most profitable gold mines, in the Dominican Republic.

Barrick’s Salt Lake office, which employs about 110 staff, will close in November after supporting the miner’s core Nevada operations for nearly two decades. It follows the shutdown of Barrick’s Perth bureau and job cuts in its Santiago office.

Forced labour built Canada mine in Eritrea, ex-official says – by Chris Arsenault (Reuters/Globe and Mail – September 18, 2015)

September 18, 2015

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.

Hundreds of men drafted into Eritrea’s army were used as forced labour to build a Canadian company’s copper-gold mine in central Eritrea, according to a former construction official, in a case testing the global responsibility of foreign firms to workers.

Claims of forced labour at the Bisha mine, jointly owned by Nevsun Resources Ltd. and state-owned Eritrean National Mining Corp., date back to 2008 but are now the subject of a class-action lawsuit at British Columbia’s Supreme Court.

Eritrean plaintiffs, living in exile in Ethiopia, say in the lawsuit filed last November that they were forced to build the only operating mine in the Horn of Africa country during national service, enduring filthy conditions, little food or scarce payment.

Although Nevsun was not directly responsible for hiring local staff – that was done through local contractor firm Segen – plaintiffs argue the Canadian company was complicit in their servitude, a claim the Vancouver-based company denies.

South African Commodity Exporters Brave Rout to Protect Market – by Andre Janse Van Vuuren and Liezel Hill (Bloomberg News – September 18, 2015)

September 18, 2015

http://www.bloomberg.com/

South African miners are largely maintaining export volumes of commodities including coal and iron ore despite a pricing bloodbath in those markets, according to the head of the state-owned freight-rail and ports operator.

Transnet SOC Ltd. expects to move about 75 million metric tons of export coal and 60 million tons of iron ore on its railways in its financial year through March 31, Acting Chief Executive Officer Siyabonga Gama said. That’s largely unchanged from 76.3 million tons and 59.7 million tons in fiscal 2015. Miners have indicated they’re concerned about losing market share if output slows, Gama said.

“There is a bloodbath in the commodities market, but the extent to which we have experienced it, it is much less than what we thought might actually happen,” Gama said in an interview last week at Bloomberg’s Johannesburg office. “When I talk to the customers, some of them feel very strongly that if they responded to the market they would be squeezed out completely.”

The company had budgeted for export coal volumes of 77 million tons and 62 million tons of iron ore in the current financial year, Gama told reporters in July.

Detour Gold finds silver lining in current economic climate – by Len Gillis (Timmins Daily Press – September 18, 2015)

September 18, 2015

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – The declining value of the Canadian dollar has actually been a great boost to Detour Gold and the mining supply sector in Timmins.

Those were among the revelations that came forward Thursday when Paul Martin, the president and chief executive officer of Detour spoke at a Timmins Chamber of Commerce lunch event.

Martin made reference to the fact the Canadian dollar, which was valued at 76 cents U.S. Thursday provided an unexpected benefit.

“The weak Canadian dollar, some people jokingly call it the Canadian peso, is a huge benefit for a company that sells its revenue in U.S. dollars,” Martin told the audience.

It has effectively dropped the price Detour has to pay to produce each ounce of gold. He said it this is a competitive edge for Detour that is not shared by U.S. gold producers, for example. The payoff for Northern Ontario and Timmins is significant, said Martin.

Oil forecaster Ed Morse sees oil price rebound — but don’t count on US$100 levels again – by Claudia Cattaneo (National Post – September 18, 2015)

September 18, 2015

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

BANFF, Alta. – The oil-price crash remains painful and may be far from over, but top oil forecaster Ed Morse offered some hope Thursday to Canada’s gloomy oil industry — a recovery by 2017 as the “weeding out” of uneconomic production runs its course.

Still, Morse’s relative, medium-term optimism has its limits. The rebound won’t mean a return to the heyday of the North American energy renaissance because new technologies that enabled production from the oilsands in Canada, shale oil in the United States, and deepwater fields will continue to change the oil business and keep prices in check.

Don’t count, then, on US$100 a barrel oil making a comeback any time soon.

“The age of abundance of supply is here, even as the world is moving away from fossil fuel, and makes it highly unlikely that we will see $100 oil again,” Morse, the New York-based global head of commodities at Citi Research, said in an interview on the sidelines of the Global Business Forum, an annual gathering of business leaders.

[Northern Superior Resources] Sudbury junior miner squares off against province – by Ian Ross (Northern Ontario Business – September 17, 2015)

September 17, 2015

Established in 1980, Northern Ontario Business provides Canadians and international investors with relevant, current and insightful editorial content and business news information about Ontario’s vibrant and resource-rich North. Ian Ross is the editor of Northern Ontario Business ianross@nob.on.ca.

Barring a last-minute settlement, a Sudbury junior mining company expects to be in a Toronto courtroom in early October to take on the Ontario government in a potential landmark case that could prompt revisions to Ontario’s Mining Act concerning First Nation consultation.

“I’d rather be talking about exploration,” lamented Tom Morris, president and CEO of Northern Superior Resources, who was making preparations for a four-week trial in an Ontario Superior Court starting Oct. 5.

Northern Superior is seeking compensation from the province for failing to protect its interests in a gold exploration play in northwestern Ontario that the company was forced to abandon its mining claims after a series of disputes with a First Nation community in 2011.

Close to two years ago, Northern Superior filed a $110-million lawsuit in late 2013 to recover the $15 million it spent on exploration since 2006, plus the estimated future value of the three properties on Crown land as they worked toward a major gold discovery near the Manitoba border.

Gold Sees Moderate Rally in Aftermath of FOMC Leaving Rates Unchanged – by Jim Wyckoff (Kitco News – September 17, 2015)

September 17, 2015

http://www.kitco.com/

(Kitco News) – Gold prices are moderately higher in afternoon U.S. trading Thursday, as prices rallied in the wake of the FOMC [Federal Open Market Committee] holding steady on its monetary policy and not raising U.S. interest rates. The U.S. dollar index extended its earlier losses on the FOMC news, which also helped the precious metals market bulls.

As of this writing traders were awaiting Fed Chair Janet Yellen’s press conference, which could yield further clues on the timing of a U.S. rate hike. December Comex gold was last up $11.20 at $1,129.90 an ounce. December Comex silver was last up $0.31 at $15.195 an ounce.

After weeks and even months of speculation about this meeting, the Federal Open Market Committee meeting that began Wednesday morning ended Thursday afternoon saw the Fed leave its monetary policy unchanged.

While there was no consensus among traders and investors on whether the Fed would or wouldn’t make an interest rate hike for the first time in several years at this week’s meeting, there seemed to be a growing sense the Fed would make a rate hike at this meeting.

Is it the end of coal? – by Tracy Johnson (CBC News Business – September 17, 2015)

September 17, 2015

http://www.cbc.ca/news/business/

The coal industry meets in Vancouver today to talk survival in the midst of a deep downturn

At a glance, the Canadian Coal Conference kicking off in Vancouver today looks like any other corporate confab: A golf tournament, a hotel ballroom and a reception at an uptown restaurant are all on the agenda.

However, amid the pleasant trappings Canada’s coal industry will spend the next few days contemplating a frightening present that’s pointing toward an even more uncertain future.

Coal is facing a laundry list of challenges: reduced demand in Asia, prices at decade lows and environmental pressure in North America to stop burning the fossil fuel.

Max Wang is the chief executive of Grande Cache Coal. His company made headlines a year ago when it was sold for just $2 to Up Energy Group, based in China. Wang says that without that new ownership he’s not sure Grande Cache would have survived.

Nunavik women say family demands keep them from jobs at mines – by Sarah Rogers (Nunatsiaq News – September 17, 2015)

September 17, 2015

http://www.nunatsiaqonline.ca/

“They want to make sure that their children are cared for”

KUUJJUAQ — Consultations with Inuit women across Nunavik earlier this year found that — not surprisingly — they face the same barriers to seeking and securing employment in the mining sector as other Aboriginal women around the world.

And one of those challenges is balancing work with home and family life in a job that demands that workers be away from home for extended periods of time.

Over the last year, the Kativik Regional Government has worked alongside the region’s Kautaapikkut mining roundtable, a body launched last year to encourage Inuit employment in Nunavik’s mines and mor specifically, to look at the under-employment of women.

Together men and women make up 15 per cent of all Nunavimmiut working at the region’s two mines.

But fewer than half of all Inuit working at the region’s two operating mines are women; about 44 per cent at Glencore Raglan’s nickel operation, and about 20 per cent at Canadian Royalties’ Nunavik Nickel.

Udall, Heinrich propose bill requiring hard-rock miners to help pay cleanup costs – by Justin Horwath (Santa Fe New Mexican – September 16, 2015)

September 17, 2015

http://www.santafenewmexican.com/

New Mexico’s two U.S. senators say they will introduce legislation that would require companies digging for hard-rock minerals on public lands to pay royalties to help cover the cost of cleaning up tens of thousands of mines across the nation abandoned by the industry decades ago.

Sens. Tom Udall and Martin Heinrich, both Democrats, are proposing the legislation because of the Aug. 5 Gold King Mine spill that turned sections the Animas River orange and yellow from heavy metal waste that had been sitting in the abandoned mine since the 1920s.

The U.S. Environmental Protection Agency admits to causing the spill while cleanup crews were working at the site. EPA Administrator Gina McCarthy once again defended the agency during a hearing Wednesday before Congress.

Defenders of the agency say the root of the problem that caused 3 million gallons of waste to contaminate the Animas River from Silverton, Colo., to Farmington is a lack of money to clean up waste rock piles that sit in old mines.

Udall said in a statement Wednesday that the legislation “would reform the nation’s antiquated mining laws, which date back to 1872, to ensure mining companies pay a royalty for the minerals they take from public lands.”

Petcoke: the ticking time bomb at the heart of aluminum – by Andy Home (Reuters U.S. – September 16, 2015)

September 17, 2015

http://www.reuters.com/

LONDON – The world is producing too much aluminum. That’s what the price says. London Metal Exchange metal for three-month delivery is currently trading just above $1,600 per tonne, a level which is simply not sustainable for many higher-cost producers.

There have been plenty of smelter closures and curtailments. But not enough, particularly in China, which is exporting its surplus to the rest of the world in the form of semi-fabricated products.

Widespread allegations that some of these are “fake semis” have added extra heat to already simmering trade tensions. Aluminum’s problems have a lot to do with the metal’s production process.

Bauxite, the key metallic input, is a commonly occurring mineral and one that can be easily scooped out of the ground without the need for “hard rock” mining.

That abundance of supply has been proven by Indonesia’s ban on exports of bauxite to China.

Chile Begins Relief Efforts After Powerful Quake Kills Eight – by Javiera Quiroga and Eduardo Thomson (Bloomberg News – September 17, 2015)

September 17, 2015

http://www.bloomberg.com/

Chile began dispatching emergency crews and assessing damage left by the biggest earthquake in the world this year that claimed 10 lives and forced more than a million people to evacuate coastal areas.

After a tsunami alert was lifted early Thursday, residents of towns in the region of Coquimbo began returning to their homes, many of which had crumbled in the 8.3-magnitude earthquake. Tsunamis caused severe damage to the region’s main port, Interior Minister Jorge Burgos said.

The disaster brought back memories of an even-stronger 2010 quake that trigged a tsunami that killed hundreds. Copper prices, which had jumped after the quake hit at 7:54 p.m. local time Wednesday, retreated after producers said their mines escaped damage. Chile is the biggest producer of the metal.

“Once again we’ve been forced to face a tough blow from nature,” President Michelle Bachelet said in televised remarks. “Today our main focus is on supporting and helping people.”

On Thursday, Bachelet embarked on a tour of the hardest hit areas near the cities of Illapel and Coquimbo.