Republic of Mining

South African Gold Miners Rally Most Since 1999 as Metal Rises – by Neo Khanyile (Bloomberg News – August 21, 2015)

August 21, 2015

http://www.bloomberg.com/

South Africa’s index of gold-mining stocks surged the most this week on record as the precious metal traded near a one-month high and the rand extended declines.

The five-member FTSE/JSE Africa Gold Mining Index climbed 2 percent to 1,022.93 by the close in Johannesburg, bringing its five-day gain to 28 percent. Pan African Resources Plc led the advance on Friday, adding 3.8 percent to bring its gain this week to 17 percent. AngloGold Ashanti was the best performer in the week, gaining 33 percent. Spot gold advanced 0.5 percent to $1.158 an ounce, the highest since July 13.

The precious metal has climbed 3.8 percent this week as investors scaled back bets on a Federal Reserve rate increase next month and a stock and currency sell-off in emerging markets spurred demand for safe assets. South African gold miners also benefit from a weaker rand because they pay costs in the local currency while selling their exports for dollars, helping the index to rally from a 15-year low on August 6.

“The gold stocks, particularly South African gold stocks, were undervalued, not only relative to the global peer group, but to the local mining index as well,” Richard Hart, director of equity research at Arqaam Capital SA Pvt Ltd., said from Johannesburg. “This has really been a recovery of some of that value.”

Iran Prepares to Lure Foreign Investors After Nuclear Deal – by Thomas Erdbrink (New York Times – August 21, 2015)

August 21, 2015

http://www.nytimes.com/

Sadjad Ghoroghi, for one, who runs a mining company in Zanjan in northwestern
Iran, says he had long dreamed of finding a foreign investor willing to help
expand his operations. Iran is thought to have rich deposits of zinc, copper
and gold, and experts say that mining has the potential to become a $60 billion
industry, equal in size to the country’s oil industry.(Thomas Erdbrink)

ZARRINABAD, Iran — When Iran’s Revolutionary Guards Corps took over the nation’s telecommunications monopoly in 2009, the move was denounced as another dark step in the hard-line military group’s seizure of the levers of power.

“It’s not just a matter of the Guards dominating the economy, but of controlling the state,” Alireza Nader, an expert on Iran and the co-author of a comprehensive RAND Corporation report on the Revolutionary Guards, said at the time.

Last month, however, the company, the Telecommunication Company of Iran, was put up for sale, as the Revolutionary Guards now seem more interested in cashing in on what Iranian leaders are hoping will be a flood of foreign investment if a nuclear deal with world powers gains final approval and sanctions are lifted.

Surviving the Chinese and euro storms – by John Redwood (Financial Times – August 21, 2015)

August 21, 2015

http://www.ft.com/

I’m staying well away from commodities

We have just seen a perfect storm. Markets gave a strong warning to the bulls and underlined why many people chose balanced or cautious funds to limit sudden swings into loss on their investments. In recent weeks some markets have issued a timely reminder of why investment specialists usually recommend a spread of assets to limit your risks.

This summer has brought big falls in some markets. The Greek stock market closed for a month and then reopened much lower. Greek uncertainties took some of the shine off the better performance from euro area shares. The Brazilian market, the largest exchange and economy in Latin America, is down by more than 40 per cent over the past year.

The authorities there are trapped between recession and inflation, with crisis levels of interest rates. The domestic Chinese share market suddenly fell nearly 30 per cent after a phenomenal upwards run. Commodity markets continued their downwards moves after the oil rally of the spring.

The inability to buy and sell shares in Greece at all made investors realise how important continuous liquidity in markets is, and how much we rely on the ability to get out if we change our minds.

How SEC Chair Mary Jo White Gave Congolese Warlords Some Unexpected Help – by Zach Carter (Huffington Post – August 20, 2015)

August 21, 2015

http://www.huffingtonpost.com/

Finally, some good news for brutal militias.

WASHINGTON — Warlords in the Democratic Republic of Congo got some help from two conservative judges on Tuesday, when a federal appeals court for the District of Columbia ruled against part of a key regulation on conflict minerals.

But they also got an unlikely assist from Securities and Exchange Commission Chairwoman Mary Jo White, whose very agency was defending the rule before the court.

Armed militias in eastern Congo have long relied on the mining of tantalum, tin, tungsten and gold to finance more than a decade of violence, much of it targeting civilians. But militia access to mining wealth was dramatically curbed in 2012, when the SEC adopted a new regulation requiring U.S. companies to audit their supply chains for conflict minerals. The agency also required corporations to disclose the findings of those audits to consumers in simple language that explains whether their products are “DRC conflict free.”

Congress directed the SEC to write the rule as part of the 2010 Dodd-Frank financial reform law.

The roles of aviation in supporting mining – by Keith Campbell (MiningWeekly.com – August 21, 2015)

August 21, 2015

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

JOHANNESBURG (miningweekly.com) – Mining depends on infrastructure – so much so that mining companies sometimes have to build and operate their own railways, ports and power stations in parts of the world in which such essentials are nonexistent or woefully inadequate. And those parts of the world tend to be rather isolated or remote. Which brings another form of infrastructure into play, one rarely thought of in relation to mining projects – aviation.

Aviation plays a key role in supporting mining around the world, and not just in areas lacking roads and railways. In places with good terrestrial infrastructure, but long distances, like South Africa, aviation is also most helpful to miners. There are many missions executed by aircraft, both fixed wing and rotary wing and now unmanned as well as manned, in support of the mining industry.

These include aerial surveying, aerial observation, the transport of staff to and from operations in remote or distant locations, the transport of key equipment to these mines and even the transport of precious metals and stones from the mines where they have been extracted to secure locations in major centres.

Nunavut mine owner eyes open pit satellite for Meadowbank (Nunatsiaq News – August 21, 2015)

August 21, 2015

http://www.nunatsiaqonline.ca/

AEM believes Amaruq gold deposit, at two million ounces and growing, might extend Meadowbank’s lifespan

Agnico Eagle Mines Ltd. will study the possibility of transforming its promising Amaruq project, now estimated at two million ounces of gold, into a satellite open pit connected to Meadowbank, the company said Aug. 19.

“This rapidly growing deposit remains a focus for the company given its economic potential, partly due to its close proximity to Agnico Eagle’s nearby Meadowbank mine and mill,” the company said in a news release.

The company said in June that drill teams had continued to find high-grade samples at its new Amaruq site that “exceed our expectations.”

Right now, the Meadowbank mine and mill, which started up in 2010 to become Agnico Eagle’s biggest gold producer, is expected to churn out gold bars until the third quarter of 2018.

But there’s now a possibility that an operation at Amaruq, about 50 kilometres from the existing mine and mill, could extend Meadowbank’s lifespan beyond that date.

Liberal ‘plan’ for the North (Thunder Bay Chronicle-Journal – August 21, 2015)

August 21, 2015

http://www.chroniclejournal.com/

JUSTIN Trudeau brought his election campaign to Northern Ontario this week, but he didn’t have much to say. As outlined today by columnist Carol Goar, the Liberal leader, campaigning to replace Stephen Harper as prime minister, has been remarkably light on major policy details no matter where he goes. What is he waiting for?

“Justin Trudeau Presents Plan for Sustainable Growth in Northern Ontario,” was the title of a news release this week jointly datelined Sault Ste. Marie and Sudbury.

Here is what we know. The plan would “create sustainable economic growth for the middle class (a repetition of his main campaign theme), generate economic opportunities in Sudbury and Sault Ste. Marie (no other Northern communities are mentioned), and create the clean jobs of tomorrow (repeating another major but general campaign promise).

The statement repeats Trudeau’s familiar criticism of Harper for “middle class families . . . struggling to make ends meet. Only Liberals have a real plan . . . .” which he doesn’t explain.

Milkweed takes root on Vale slag pile – by Ian Ross (Northern Ontario Business – August 21, 2015)

August 21, 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.

The mountainous slag piles at nickel miner Vale in Sudbury are becoming a favourite landing spot for one of nature’s most threatened species.

A milkweed patch has also been established at the base of the waste industrial material on the periphery of the company’s Copper Cliff smelter complex in an effort to attract and boost the declining monarch butterfly population.

Long considered a nuisance plant, milkweed has been disappearing fast in recent decades due to the use of chemical herbicides and deforestation. The plant is crucial to the survival of the monarch butterfly on its journey between Mexico and Canada. It’s the only suitable plant for monarch to lay their eggs and is also a main food source of monarch caterpillars.

Lisa Lanteigne, Vale’s manager of environment, soil and water, first noticed the hardy perennial growing naturally at her Manitoulin Island cottage.

Oil nears longest losing streak since 1986 as markets fall in worst bloodbath of the year – by Marc Jones (National Post/Reuters – August 21, 2015)

August 21, 2015

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

LONDON — World stock markets tumbled towards their worst week of the year on Friday and commodities got another kicking, as more alarming data from China sent investors scurrying to the safety of bonds and gold.

The data from China showed its giant manufacturing sector slowing at the fastest pace since the depths of the financial crisis in 2009, confirming the worries about its health that have preying on economist’s minds for months.

Emerging market assets took another hammering and oil prices were on track for their longest losing streak since 1986, as fears of a China-led deceleration in global growth gripped sentiment.

“The market is stuck in a relentless downtrend,” said Robin Bieber, a director at London brokerage PVM Oil Associates. “The trend is down — stick with it.”

China’s woes continued to roil commodities. Oil resumed its downward trend. U.S. crude was at a more than 6-year low, on track for its eight straight weekly decline as it slipped 0.5 per cent to $40.85. Brent nudged $46 a barrel.

Cheap Australian iron ore feeding China steel glut ‘like a bad virus’ – by Jasmine Ng (Bloomberg/Sydney Morning Herald – August 21, 2015)

August 21, 2015

http://www.smh.com.au/

Steel exports from China will surge to more than 100 million metric tons this year as local mills benefit from cheap iron ore to produce more than Asia’s top economy needs, according to Cliffs Natural Resources.

“It’s like a bad virus,” Lourenco Goncalves, chief executive officer of the largest US iron-ore producer, said in a phone interview from the company’s headquarters in Cleveland. “Australia continues to give iron ore to China almost for free, allowing them to produce more than they need.”

Shipments from the biggest producer are headed for a record this year as slowing local demand prompts mills to seek overseas buyers, driving down prices and spurring trade tensions from the US to India.

At the same time, the largest iron-ore miners including Australia’s Rio Tinto Group are boosting output to expand sales. China’s steel shipments were called extraordinary by Credit Suisse Group, which said last month they were now in line with total output from Japan, the No. 2 producer.

“What China is exporting alone is bigger than the second-biggest producer of steel in the world: it is crazy,” Goncalves said on Wednesday.

Big (Rotting) Apple – by Kip Keen (Mineweb.com – August 21 2015)

August 21, 2015

http://www.mineweb.com/

For some miners and resource equities, trading in New York is no longer an option.

HALIFAX – Simply put, low share prices amidst the deep and protracted rout in commodities and mining shares are forcing delistings in New York, or at least raising the spectre of delisting, at an accelerating pace.

Two leading exchanges – the NYSE MKT and the NYSE – house numerous mining and exploration companies, many of which are cross-listed in Toronto or elsewhere.

For Canadian-listed resource companies especially, going to list in New York became increasingly popular during the raging bull market in commodities in the mid to late 2000’s and early 2010’s. Suddenly there was a much greater appetite for resource investing in America.

But in recent months flagging share prices of many of these companies has forced many companies to leave, or chose to leave, given stringent regulations in New York.

FNI locks gates at Lockerby mine site – by Mary Katherine Keown (Sudbury Star – August 20, 2015)

August 21, 2015

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

The lay-off notices have been issued and nearly three dozen miners are out of work.

Anne-Marie MacInnis, president of Mine Mill Local 598-Unifor, said Thursday she received an email at about 5 a.m. informing her that First Nickel Inc. (FNI) was shuttering operations at its Lockerby mine site, located off Highway 17 near Fairbank Lake.

Effective immediately, 35 of the union’s members have been laid off. “People are feeling surprised,” she told The Star on Thursday. “They showed up today and the gates were locked.”

MacInnis is currently liaising with the union’s legal department to settle severance for affected employees. “I will be talking to the legal department to see if we have any kind of legal action we can take on behalf of our members,” she said.

MacInnis said her members could be eligible for a federally-funded severance program, but only to a maximum of $3,800. It would also mean they would relinquish any recall rights.

Twilight over COP 21 – by Peter Foster (National Post – August 21, 2015)

August 21, 2015

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

If wind and solar were uneconomic when oil was $100 a barrel, they are wildly uneconomic now

A decade ago, Houston investment banker Matt Simmons (since deceased) received a too-respectful hearing from a bunch of Harvard alumni in Toronto for his theories about “peak oil.” His take, outlined in his book “Twilight in the Desert,” was that the Saudis, the world’s largest producers, had been lying about their reserves, which were on the point of catastrophic decline.

He predicted oil prices would hit $200 a barrel by 2010 (all prices in US$). His “solution” was Soviet levels of control of people’s lives. Simmons confirmed that peaksters neither understand nor like markets, which he described as a “500-pound wrecking ball.”

Canada acquired its own peak fanatic in the shape of Jeff Rubin, sometime chief economist at CIBC, who provided further proof that anti-consumerist moralism could quickly drain all traces of Economics 101 from even a professional’s noggin.

In the fall of 2007, Rubin predicted $100-per-barrel oil, and sure enough, oil soon hit $100. In January of 2008 he was predicting $150 oil within five years.

Bible in one hand, shovel in the other: Tony Abbott is for coal – by Laura Tingle (Australian Financial Review – August 20, 2015)

August 20, 2015

http://www.afr.com/

Booms and busts used to be in the very marrow of the Australian experience. The gold rushes remain a staple of our education. Until the last 20 years or so of continuous growth, the spectacular nature of the booms and busts in the economy set the rhythm and drama, not just of personal fortunes but politics.

Yet even in recent decades, there has been nothing like a mining boom to stir a swarm of political flies.

The trouble now is that the longest and most spectacular boom in our history has ended. But politicians don’t seem quite sure what to do about it.

Where to go next when your rhetoric is all supposed to be about jobs and growth, and reassuring people that the economy will continue to be okay, even as the boom fades?

You could focus on new areas of growth – for example, the government recently announced a doubling of the NBN workforce to 9000 – or you could grab on to signs that the resources boom isn’t entirely over with a project that is boasting will generate (a contested) 10,000 jobs.

[Mining Pollution] When a River Runs Orange – by Gwen Lacheltaug (New York Times – August 20, 2015)

August 20, 2015

http://www.nytimes.com/

Gwen Lachelt is a La Plata County commissioner.

Durango, Colo. — THE recent mining pollution spill in my corner of Colorado — La Plata County — is making national news for all the wrong reasons. Beyond the spill and its impact on everyone downstream, the underlying causes are far more worrisome and dangerous than just a mistake made by the Environmental Protection Agency.

Yes, it is a cruel irony that an E.P.A. contractor, while trying to clean up pollution from old mines, instead made the problem much, much worse. The jaw-dropping before-and-after photos contrasting the pre-spill Animas River I know and love with the subsequent bright orange, acidic, heavy-metal-laden travesty are sadly accurate.

The Animas River is the heart of La Plata County. Our jobs rely on it, people the world over travel here to raft and fish it, and farmers and ranchers feed their animals and water their crops with it. But more than that, it’s a member of the community. We see it every day. We play in it. We work with it. And of course we drink it. It’s no overstatement to say that La Plata County as we know it would not exist without the Animas River.