Republic of Mining

Patience key, judge tells Sudbury audience – by Jim Moodie (Sudbury Star – May 27, 2015)

May 27, 2015

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

Negotiating with First Nations in the Ring of Fire may be tricky, and take time, but the country can no longer justify ignoring or exploiting its aboriginal communities, a former supreme court judge said Tuesday.

“The project does illustrate how government and industry can, and should, take First Nations seriously in economic development,” Frank Iacobucci told a Greater Sudbury Chamber of Commerce luncheon series audience.

The veteran lawyer, who brokered an agreement in 2013 with the Matawa Tribal Council chiefs on behalf of the Ontario government, said he has been impressed with the leadership of aboriginal communities and the efforts they have made to engage their members.

“With that leadership and that engagement, there is more opportunity for agreements,” he said, while cautioning patience is often required. “It’s not a matter of being quick,” said Iacobucci. “It’s a matter of being right.”

As deputy minister of justice in the Mulroney government of the 1980s, Iacobucci worked on a constitutional amendment that would have afforded more political autonomy to First Nations.

Saskatchewan Mining Association celebrates 50 years of mining – by Bruce Johnston (Saskatoon StarPhoenix – May 26, 2015)

May 26, 2015

http://www.thestarphoenix.com/index.html

Sask. offers ‘fertile ground’

Saskatchewan is considered one of the world’s most attractive places for a mining company to invest, with $7.3 billion worth of mineral production in 2014, world-class resources and a political climate that supports and encourages investment.

In fact, Saskatchewan ranked No. 1 in Canada and No. 2 in the world among jurisdictions that are attractive to mining investment, according to the Fraser Institute’s 2014 survey of executives of 4,200 global mining companies.

But that wasn’t always the case, as the sometimesrocky 50-year history of the Saskatchewan Mining Association shows. Even today industry and government don’t see eye-to-eye on everything, as evidenced by the SMA’s chilly response to the provincial budget’s deferral of capital cost deductions, which will cost potash producers $150 million this year.

As Neil McMillan, president of the SMA, noted there’s a fine balance between ensuring that shareholders get a reasonable return on their investment and the citizens get a reasonable return on their resource.

Blood on the Mountain: New Film Chronicles Coal’s War on Appalachia – by Jeff Biggers (Huffington Post – May 26, 2015)

May 26, 2015

http://www.huffingtonpost.com/green/

One of the most telling moments in the new documentary film Blood on the Mountain draws from 2008 footage of former Massey Energy CEO Don Blankenship calmly mumbling his replies to numerous questions on mine safety at a hearing. When asked if he knew how many coal miners had died in Massey mines in the eight years since Massey became a publicly traded company, the notorious “dark lord” of the coal industry shook his head and said no.

Filmmakers Mari-Lynn Evans and Jordan Freeman allow for a gut-wrenching moment of silence, having methodically chronicled the industry’s treadmill of violation-ridden disasters, and then provide the answer: 52 deaths under Blankenship as CEO of Massey Energy.

China cash lining up for Fortescue Metals Group – by Matthew Stevens, Amanda Saunders and Julie-anne Sprague (Australian Financial Review – May 25, 2015)

May 26, 2015

http://www.afr.com/

Chinese-linked companies have applied to the Foreign Investment Review Board seeking permission for an investment involving Fortescue Metals Group.

Australia’s third-largest iron ore producer has held discussions with China’s largest steel producer, Baosteel, and China’s largest conglomerate, CITIC, about a recapitalision to shore up its balance sheet.

It is unclear if the applications to FIRB are from CITIC or Baosteel but sources said there is interest in Fortescue from one or more companies which are Chinese or part-Chinese owned.

There are no moves to take over Fortescue. Instead, the companies are interested in buying a stake or increasing an existing stake, sources said. A deal could involve the partial selldown by the company’s founder, chairman and biggest shareholder, Andrew Forrest.

Fortescue and Baosteel already work closely. In June 2012 the two companies merged their magnetite iron ore assets in the Pilbara into a venture called FMG Iron Ore Bridge, which is 88 per cent controlled by the Perth company and 12 per cent owned by the Chinese steel giant.

Up North Report: Inside North America’s biggest construction project – by Aaron Brown (Minneapolis Star Tribune – May 25, 2015)

May 26, 2015

http://www.startribune.com/

Construction is accelerating at the long awaited $1.9 billion Essar Steel Minnesota mine near Nashwauk, while Essar now says it’s optimistic about producing direct reduced iron products here.

In a tour of the Northern Minnesota site on May 21 with Mitch Brunfelt, Essar’s assistant general counsel and director of government and public relations, I took pictures and observed progress at the site of the biggest construction project on the Mesabi Iron Range in a generation.

This is currently the largest greenfield construction project on the continent, and it’s hard to understate the sheer size, commontion, and labor involved. The site produces a steady drone, easily heard from my home eight miles away.

After years of starts and stops, Essar now says it is finally fully financed and has increased its contractor workforce at the site. About 400 workers were on site the day I visited. Brunfelt said they will soon see 600-800 workers on site each day as summer arrives in force.

Essar has officially amended its construction timeline to reflect the realities of the company’s progress. Brunfelt said Essar engineers are now eying production of taconite by late June or July of 2016.

Barrick Gold Corp, Ivanhoe Mines Ltd sell stakes to China’s Zijin in Papua New Guinea, Congo mines – by Peter Koven (National Post – May 26, 2015)

May 26, 2015

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

Canadian miners Barrick Gold Corp. and Ivanhoe Mines Ltd. have both struck deals with Chinese miner Zijin Mining Group Co., which is investing a total of US$710 million in their projects.

Zijin, one of China’s largest gold and copper producers, will buy half of Barrick’s 95 per cent stake in the Porgera gold mine in Papua New Guinea for US$298 million. And it will buy just under half of Ivanhoe’s 95 per cent stake in the Kamoa copper project in the Democratic Republic of Congo for US$412 million.

The two transactions are the direct result of work by John Thornton and Robert Freidland, the respective chairmen of Barrick and Ivanhoe. Both men have very deep business ties to Asia.

Thornton, who became Barrick’s chairman last year, has put a priority on forming partnerships with Chinese companies, and negotiations with Zijin have been going on for several months. There were also talks around Zijin becoming a partner on the failed Pascua-Lama project, though no agreement has been struck to date.

Sweden to relocate entire city to meet China’s energy needs – by Dominic Hinde (Washington Times – May 24, 2015)

May 26, 2015

http://www.washingtontimes.com/

KIRUNA, Sweden — To feed China’s growing appetite for raw materials, this venerable mining town 90 miles north of the Arctic Circle is poised to become a cutting-edge Tomorrowland as it prepares to move buildings, residents and even a century-old wooden church to a new location a few miles away.

“These will be the first to go,” said Kjell Torma, editor of KirunaTidningen, the local newspaper, pointing to a row of red brick apartment blocks surrounded by construction fences. “If you want a cheap kitchen fan or some radiators, get in there.”

Over the next 10 years, Kiruna officials plan to demolish the apartments and most other buildings in this town of 18,000 residents and then rebuild them as far as three miles away — all part of an ambitious $375 million project to make way for the expansion of a giant iron mine as demand from China has suddenly made extraction here worth the investment.

But officials aren’t constructing an exact duplicate of Kiruna, founded in 1900 as the most northerly town in Sweden. With funding from Sweden’s state-owned mining company — Luossavaara-Kiirunavaara AB, or LKAB — officials in Kiruna aim to create one of the most environmentally friendly cities in Europe.

South African miners accelerate job cuts to 35,000 over two years – by Andrew England (Financial Times – May 25, 2015)

May 26, 2015

http://www.ft.com/intl/companies/mining

Johannesburg – South Africa’s mining industry has shed more than 35,000 jobs in two years as it has been battered by labour unrest, rising costs and weak commodity prices.

The scale of the job losses — equivalent to one out of 14 workers in the sector — indicates how the labour unrest that has plagued the industry since the police shooting of 34 striking miners at Marikana in 2012 has accelerated restructuring in the sector.

Mining is one of the biggest private sector employers in South Africa and the new data from the Chamber of Mines — seen by the Financial Times — provide the first detailed analysis of the extent of job losses since the shooting.

The majority of the losses between 2012 and last year occurred in gold and platinum, with those sectors’ workforces shrinking by about 23,100 and 10,800 respectively, according to the chamber. These amount to labour reductions of 16 per cent and 5 per cent respectively.

A further 1,600 jobs — or 7 per cent of the workforce — have been cut in iron ore mining between 2012 and last year.

“Work stoppages, which reduce mining volumes, reduce profitability,” said Monique Mathys, economist at the chamber.

China Pollution War Boosts Anglo Iron Prospect 10,000 Miles Away – by Juan Pablo Spinetto (Bloomberg News – May 26, 2015)

May 26, 2015

http://www.bloomberg.com/

Anglo American Plc’s Brazilian iron foray was fraught with misfortune from billion-dollar overruns to a global glut. As the $8.4 billion mine finally ramps up, it’s catching a break from China’s greener approach to making steel.

The Minas-Rio iron-ore mine, the largest project in Anglo’s 98 years, is scheduled to reach output capacity pace by mid-2016. And while the start of operations coincides with a price rout of the steelmaking ingredient, the London-based miner is betting the higher quality of its product will help shield the venture from the malaise affecting the industry.

Minas-Rio produces pellet feed, an ultra fine type of ore containing about 68 percent iron. That allows Anglo to sell at a premium over the benchmark because steelmakers — including those in China, the biggest buyer — find it more productive and less polluting.

“China is more and more focused on the environmental impact of consuming the iron ore at the steel mills,” Andreas Bokkenheuser, an equity analyst at UBS Group AG, said by telephone from New York. “The lower silica content means they will consume more of it in the future,” he said, referring to the most common impurity.

Oz Minerals CEO Andrew Cole eyes off four takeover targets – by Simon Evans (Australian Mining Review – May 25, 2015)

May 26, 2015

http://www.afr.com/

OZ Minerals chief executive Andrew Cole says the copper and gold company has four potential acquisitions it is doing due diligence on but will only proceed if the price tags are at a level that deliver good value.

Mr Cole says while geographic diversification may be an outcome if OZ does make an acquisition it is not necessarily a driver of the company’s acquisition strategy.

OZ operates just one mine, the Prominent Hill copper and gold mine in South Australia, which employs 1200 workers. He made the comments at the OZ annual meeting in Adelaide, where the company is in the process of shifting its head office to from its previous base of Melbourne.

OZ chairman Neil Hamilton said after the meeting the price paid by Evolution Mining for Barrick’s Cowal mine in New South Wales appeared to be a steep price. “It’s a robust number,” Mr Hamilton said.

Evolution bought the mine in a $US550 million ($702 million) transaction on Monday. Mr Hamilton declined to officially confirm if OZ had also been closely looking at the Cowal mine, as has been heavily speculated. “We don’t comment on speculation about sale processes,” Mr Hamilton said.

How the violence at Southern Copper’s Tia Maria mining project could have been avoided – by Robert Spence (Mining Global – May 25, 2015)

May 26, 2015

http://www.miningglobal.com/

The government of Peru declared a state of emergency on Saturday, calling in national police and armed forces to maintain order as protests at the Tia Maria copper project turned violent.

According to CNN, one protester appeared to be dead from wounds to the head as others battled with police who lobbed tear gas at them.

The announcement follows almost two months of increasingly violent protests against the $1.4 billion copper mining project as oppositions fear the mine will pollute the environment and do very little for the local economy.

“We don’t want the mine,” said Enrique Torres Alvarez, an 85-year-old farmer attending a rally in Cocachacra’s main square. “It will ruin our land, and that will be the end of the farming.”

Development of Tia Maria, which is owned by Southern Copper, a subsidiary of Grupo Mexico, has been suspended since 2011 due to protests.

Earlier this month, Southern Copper CEO Oscar Gonzalez Rocha asked for all parties involved to “present their concerns and fears, identify solutions … and define the responsibilities that all must assume in a reasonable timeframe.”

Australia’s gold miners drive M&A revival – by James Regan (Reuters U.S. – May 26, 2015)

May 26, 2015

http://www.reuters.com/

SYDNEY – May 26 Gold miners are spearheading a wave of merger and acquisition activity in Australia, riding a rebound in local gold prices to pounce on projects promising quick growth.

In the first signs of life since the country’s mining boom went bust three years ago, companies are buying assets from international rivals tightening their belts, and partnering with fellow Australian miners.

“Everyone is looking for assets that enable them to grow. We’ve seen more M&A in Australia in 2015 than in the past five years,” Ian Murray, chairman of Perth-based Gold Road Resources Ltd told Reuters, referring broadly to the level of interest in the sector.

Progressive central bank interest rate cuts aimed at knocking down the Australian dollar and falling labour and mining costs are adding fuel to the frenzy.

Gold output in the world’s second-biggest producing country after China reached a decade high last year and is tipped to rise further in 2015.

‘Tragic [mining] milestone’ – by Len Gillis (Timmins Daily Press – May 26, 2015)

May 26, 2015

The Daily Press is the city of Timmins broadsheet newspaper.

BLACK RIVER-MATHESON – It appears Alexie Dallaire-Vincent may be the first woman to die on the job in an underground mine in Ontario. The 22-year-old tram operator at the SAS St. Andrew Goldfields Holt Mine, was killed Saturday afternoon, according to the Ontario Ministry of Labour

It was reported the woman, a native of the Kirkland Lake area, died from injuries after being struck by an ore-haulage car on the 925 level in that mine, located east of Matheson.

A number of local veteran mining inspectors and investigators reached by The Daily Press on Monday said they could not recall a previous incident in which a woman died on the job, working underground in an Ontario mine.

“I’m not sure, to be honest with you, but I do believe that is the case,” said Ministry of Labour district manager Pete Lefebvre, who is also a former mine rescue officer.

The Ontario Ministry of Labour communications office in Toronto could not confirm it, as the ministry does not keep gender-based statistics, said spokesman William Lin.

HISTORY: In 1923 Timmins already bustling – by Karen Bachmann (Timmins Daily Press – May 23, 2015)

May 26, 2015

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – A few stories from the year 1923… let me first, however, set the mood. According to a number of news sites, some of the big news events for that year included the discovery of King Tutankhamun’s tomb (in February), the eruption of Mt. Etna in Sicily, which left over 60,000-plus homeless (in June) and the Great Kanto earthquake that nearly flattened Tokyo (over 100,000 people were killed).

Calvin Coolidge was sworn in as president of the United States after the death of President Warring Harding in August of that year – Harding had suddenly died while he was staying in the Palace Hotel in San Francisco, Calif.

In Canada, William Lyon McKenzie King continued on as Prime Minister, and, overseas, a young Adolph Hitler led the Nazi Party in a failed coup d’état in Germany (known as the Beer Hall Putsch). On the popular culture scene, Time Magazine was launched (and is still in print today), women’s one-piece bathing suits were all the rage (woo-hoo!) and Agatha Christie cranked out another Hercule Poirot mystery (“The Murder on the Links”).

So while the Cotton Club opened in New York City, Pablo Picasso built the stage sets for Jean Cocteau’s production of “Antigone” and Albert the Duke of York married Elizabeth Rowes-Lyon (later known as King George VI and Queen Elizabeth), this is what was happening in the Porcupine in 1923…

NEWS RELEASE: Barrick Announces Strategic Partnership with Zijin Mining Group

May 26, 2015

All amounts expressed in US dollars unless otherwise indicated.

TORONTO, May 26, 2015 — Barrick Gold Corporation (NYSE:ABX)(TSX:ABX) (“Barrick” or “the company”) today announced that it has formed a strategic partnership with leading Chinese mining company Zijin Mining Group Co., Ltd (“Zijin”).

As a first step, Zijin will acquire 50 percent of Barrick (Niugini) Limited (“BNL”), the company which owns 95 percent of and manages the Porgera Joint Venture gold mine in Papua New Guinea. In addition, Barrick and Zijin have signed a long-term strategic cooperation agreement which outlines the intent of both companies to collaborate on future projects and joint investments, leveraging the strengths of each company.

“A twenty-first century mining company with global reach and the intention to become an industry leader must, by definition, have a distinctive relationship with China. This is particularly true in our industry, where China has become both the largest producer and consumer of gold, and a major source of capital and expertise for the mines of the future,” said Barrick Chairman John L. Thornton. “Our partnership with Zijin is the first step in a long-term strategic relationship with one of China’s leading mining companies—a multi-faceted partnership that will provide significant opportunities to work together on an ongoing basis as we continue to create value for our respective owners.”

“A strategic partnership with Barrick is an excellent fit for Zijin and a powerful combination as we look to expand our business globally outside of China. Our companies have complementary expertise and experience and share a common vision for creating long-term value for our owners,” said Zijin Chairman Chen Jinghe.