Republic of Mining

My Turn: Enough is enough – we need international oversight now – by Rob Sanderson (Juneau Empire – JUne 17, 2015)

June 17, 2015

Rob Sanderson Jr. is the 2nd vice president of the Central Council of Tlingit and Haida Indian Tribes of Alaska, co-chair of the United Tribal Transboundary Mining Work Group, and president of the Ketchikan Tlingit and Haida Community Council.

Mount Polley’s owner received its permit to operate the Red Chris Mine in the headwaters of the Stikine River despite assurances from the British Columbia Minister of Mines that these types of tailings dams would not be used following the disastrous failure of the Mount Polley dam.

B.C.’s words do not match their actions.

The government of B.C. continues to downplay the need for any international oversight over the watersheds flowing into Southeast Alaska stating that we have nothing to worry about from the huge mining projects both active and proposed in these watersheds. The government of British Columbia, through their rigorous permitting and enforcement process, has everything under control. There are even those in Alaska repeating these same words.

So far, just like the permits themselves, these are only words. Words did not stop the Mount Polley dam failure. The B.C. government issued the final permit for the operation of the Red Chris Mine’s tailings dam despite serious concerns about dam safety and the ability of Canadian regulators to oversee these operations.

NEWS RELEASE: GRAND CHIEF OUTLINES STRATEGIC APPROACH FOR INFRASTRUCTURE AND COMMUNITY DEVELOPMENT

June 17, 2015

http://www.nan.on.ca/

THUNDER BAY – June 17, 2015) – Nishnawbe Aski Nation (NAN) Grand Chief Harvey Yesno outlined plans for a strategic approach for infrastructure and community development in NAN territory at the opening of the 5th Annual Ontario Mining Forum in Thunder Bay today.

“NAN is currently developing a strategic and innovative strategy that will position our 49 First Nations as active partners in delivering and financing comprehensive regional transportation infrastructure across our territory in Ontario’s remote north,” said Grand Chief Harvey Yesno during his keynote address. “The development of transportation infrastructure will help our communities diversify their direct reliance on the mining economy while maximizing socio-economic benefits and providing new business opportunities that will help develop local economies and strengthen our Nation.”

Mining accounts for 20 per cent of Canada’s exports to global markets, according to a 2013 Conference Board of Canada report, with Northern Ontario home to the largest mineral mining industry in Canada. Instead of waiting for infrastructure plans developed by industry and government, NAN is moving forward with the identification of corridor options based on First Nation knowledge of local topography, sacred sites, cultural heritage, and environment and resource development activities. This new approach will provide certainty for First Nations and the business community.

Mining rising out of the downturn – by Cole Latimer (Australian Mining – June 16, 2015)

June 17, 2015

http://www.miningaustralia.com.au/home

Mining has reached the bottom of the downturn and has begun its recovery, according to a new IBISWorld report.

The major commodities, across the board, have seen a revival in fortunes after shedding prices continually for the last few months, creating a horror year, causing revenue in the mining division to decline by 10.0% in 2014-15, to reach $211.8 billion.

Iron ore hit a four month high last week after dropping to all-time lows in in April, having now risen to more than 40 per cent of the trough since then.

Gold has also seen a slight rally over the last month, following weaker trading in Europe on the back of poor economic data from China, coupled with a slightly weaker US dollar.

“With the dollar now slipping again and with some of the other markets looking a bit [like they have reached unstable highs and are likely to decline], it may be that the precious metals look relatively cheap as a safe-haven asset class should investors feel the need for a haven,” William Adams, head of research at Fastmarkets, explained.

BARRON’S INTERVIEW: Fortescue’s Andrew Forrest Battles on in Iron Ore War – by Robert Guy (Barrons Magazine – June 17, 2015)

June 17, 2015

http://online.barrons.com/home-page

Billionaire chairman of Fortescue Metals Group on iron ore, China and why he thinks the miner is worth more.

If there’s anyone that understands the joy and the inevitable pain of the waxing and waning of commodity cycles, it is Andrew Forrest.

Having topped the ranking of Australia’s wealthy in 2008 with an estimated fortune of over AUD9 billion, the billionaire founder and chairman of Fortescue Metals Group has watched his fortune – built on a 30% stake in the world’s fourth largest iron ore miner – shrink to a AUD2 billion as the price of the steel making ingredient has tumbled from a record $180 a tonne in 2011 to around $60 a tonne.

Not that he seems worried about the hit to the hip pocket when Barron’s Asia caught up with the one of Australia’s most colorful business identities on Wednesday. Forrest, who is also known by his nickname “Twiggy”, has a deep appreciation of how fortunate he is, with the mining mogul visiting Hong Kong to promote his anti-global slavery foundation, Walk Free.

“We can’t solve everything, so we’re going after one thing and that’s freedom.

Goldcorp’s $1-billion Tahoe deal suffers from weak demand – by Tim Kiladze and Reachelle Younglai (Globe and Mail – June 17, 2015), 2015)

June 17, 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.

The billion-dollar offering of Tahoe Resources Inc. shares is suffering from weak demand, another sign that mining investors remain cautious about the industry.

Late on Monday, Goldcorp Inc. announced plans to sell its remaining 26-per-cent stake in Tahoe for $998-million by way of a bought deal. Because the underwriters, led by GMP Securities and BMO Nesbitt Burns, purchased the Tahoe shares from the miner, Goldcorp has already received the full proceeds.

The financing initially looked like a big win for the lead dealers, particularly GMP, which has seen muted deal flow in recent quarters. However, the underwriting syndicate, which is rather large and includes global banks as well as boutique mining shops, is now responsible for selling the Tahoe shares to investors, and that process is struggling, according to people familiar with the deal.

The total number of shares sold falls anywhere between 25 per cent and 50 per cent of the total size, according to these people.

MagIndustries Corp reveals evidence that subsidiaries allegedly paid major bribes in Republic of Congo – by Peter Koven (National Post – June 17, 2015)

June 17, 2015

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

Potash company MagIndustries Corp. has provided a glimpse of what appears to be a major bribery scandal involving its African subsidiaries. But there may not be any more details to come.

Mag is short of cash and needs money from its controlling shareholder, a Chinese firm called Evergreen Holding Group, to continue funding an independent investigation. Evergreen, which is alleged to be responsible for some of the bribery, said it couldn’t afford to put up any money.

That means the investigation has ground to a halt. Every Mag director who was working on it has resigned, and chief financial officer Geoff Woo was removed from his duties. Auditor Ernst & Young LLP has resigned, concluding it can’t complete its work amid the controversy.

But the allegations already presented suggest this could be one of Canada’s biggest foreign bribery scandals in years. It involves infractions, minor ones such as gifts of furniture, and major ones involving “black money” payments to government officials, and the construction of a villa for one official.

The darker side of solar power – by Konrad Yakabuski (Globe and Mail – May 28, 2015)

June 17, 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.

The Saudi Arabian oil minister’s recent comment that the world’s largest petroleum producer sees a postfossil-fuel world in which his country becomes a solar-power superpower must have comforted climate activists that even the worst offenders can come around. After all, what could be more redemptive than turning abandoned oil fields into solar farms?

Solar power’s image as “clean” and “limitless” has led princes and politicians alike to dole out huge subsidies to bask in its glow. Under the 2009 Green Energy Act, Ontario agreed to pay solar power operators as much as 10 times the market rate for the electricity they produce under 20-year contracts.

Not satisfied with risk-free deals that will make many solar players rich at consumers’ expense, Ontario’s solar industry is now lobbying for even more. And it’s leveraging solar’s apple-pie image to press politicians into giving it what it wants.

On Tuesday, the Canadian Solar Industries Association (CanSIA) released a poll purporting to show that three-quarters of Ontarians “would like to see the government invest more in solar powered electricity and in technologies that enable solar power.”

Coal is not dead, says Adani – by Mark Ludlow (Australian Financial Review – June 16, 2015)

June 16, 2015

http://www.afr.com/

Indian energy giant Adani, which plans to make a final decision on its $16.5 billion Carmichael Mine this year, believes coal will remain the cheapest source of energy for decades.

As Adani signed agreements with indigenous groups which could deliver benefits worth $250 million over the next 30 years, Adani Australia chief operating officer Samir Vora said talk about the end of fossil fuels was exaggerated.

“Coal is definitely the main source of energy – you can’t deny it. It’s growing every year no matter what anyone says,” he said in an interview.

“India is investing in new generation technology to make coal more efficient to bring down the carbon footprint. There is a balance for everything [like renewables] but coal will undoubtedly remain the main source of fuel for decades.”

Amid speculation Adani would not be able to finance the mega-mine in Central Queensland, Mr Vora said he was confident it would have the funds once final mining and dredging approval was granted by the state and federal governments.

Our view: We’ll all be helping struggling iron mines (Duluth News Tribune – June 15, 2015)

June 16, 2015

http://www.duluthnewstribune.com/

After a staggering 1,000-plus announced layoffs over recent months, Northeastern Minnesota’s iron-mining industry clearly needs a boost. Thanks to the Minnesota Legislature, every time any one of us flips on a light switch we’ll help provide it.

An energy-jobs bill passed during Friday’s special session authorized lower electrical rates for iron mines and other big energy guzzlers. They’ll pay less, leaving us little-guy residential and commercial power users to pay more to make up for it.

While this fact probably won’t help ease the pain of opening your Minnesota Power bill in the near future, for years, the utility said, the guzzlers have been paying more and the rest of us have been enjoying more-affordable rates as a result. We’ve had it good for some time. When Minnesota Power last raised rates in 2011, for example, state regulators approved a 4 percent increase for residential customers and a 16 percent increase for mines and other large industrial customers, as the Star Tribune reported Friday.

So the legislation approved Friday simply allows Minnesota Power to set rates more in line with actual energy use — for both big and small customers, said Pat Mullen, Minnesota Power’s vice president of marketing and communications.

“We have some of the lowest (electrical) rates (for residential customers) in the nation.

NEWS RELEASE: Kinross ranked top socially responsible mining company by Maclean’s

June 16, 2015

Toronto, Ontario, June 16, 2015 – Kinross Gold Corporation (TSX:K; NYSE:KGC) has been ranked the top mining company on the list of Top 50 Most Socially Responsible Companies in Canada developed by Maclean’s magazine in partnership with Sustainalytics, an independent sustainability investment research firm.

The ranking, which appears in the June 15th edition of Maclean’s, comes after Kinross was recognized earlier this month as one of Canada’s Best 50 Corporate Citizens for the sixth consecutive year by Corporate Knights, a media and research firm that promotes social responsibility in the private sector.

“Operating in a socially responsible and sustainable manner is about partnership,” said J. Paul Rollinson, Kinross President and CEO. “We approach that partnership on the basis of respect and a desire to contribute to the prosperity and well-being of the communities where we operate. These rankings reflect the dedication of our employees to transforming that commitment into tangible results when it comes to everything from local hiring, and engaging local suppliers to employing environmental best practices.”

Kinross strives to conduct all its operations in a manner that is safe for employees and local communities, protective of the environment and beneficial to the host countries and communities where it operates. Kinross’ key corporate responsibility accomplishments and commitments include:

Ring of Fire development takes time, says Wynne – by Brent Linton (Thunder Bay Chronicle-Journal – June 16, 2015)

June 16, 2015

Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

It was clear that Ontario’s premier had on her mind the slow-moving development of the Ring of Fire and the contentious sale of Hydro One during her visit to Thunder Bay on Monday.

Kathleen Wynne brought up the ownership of the massive electrical utility during a speech she gave in the city. “By broadening the ownership of Hydro One, we are able to make the infrastructure investments that communities across the North need to thrive,” she said.

“We are ensuring that the regulation that is in place now remains in place in terms of the setting of rates, in terms of the building of transmission, in terms of services across the province. That was very much a critical part of that decision to broaden the ownership of Hydro One.

“In terms of these investments in infrastructure there are consultations that are going to happen across the provinces. I believe there is one in July happening in Thunder Bay . . . because the decisions have not all been made how those investments are going to be made.”

Gold price to climb as fears of a ‘Grexit’ rise – by Rose Powell (Australian Financial Review – June 16, 2015)

June 16, 2015

http://www.afr.com/

The price of gold is tipped to rise as investors use the precious metal as a hedge against financial fallout from Greece’s ongoing debt crisis.

Gold has been trading at about $US1180 per ounce in the last week, and between $US1170 and $US1210 per ounce for months, despite a strengthening US dollar.

However, the price could climb as investors attempt to mitigate the risks of a possible Greek exit from the eurozone if the country defaults on its debt mountain.

“We are only just starting to see signs of contagion from Greece to other bond and equity markets in the eurozone,” Capital Economics analysts said in a note to investors.

“A Greek default alone may no longer be a huge surprise and the sums involved would be small in the global scheme of things. However, if the uncertainty undermines investor confidence in the rest of the region, the gold price is likely to climb a lot further.” Five years after the first bailout, the possibility of a Greek exit from the eurozone has edged closer than ever before.

Shouldn’t India, like China, consider buying Australian iron ore assets? – by Kunal Bose (Business Standard – June 15, 2015)

June 16, 2015

http://www.business-standard.com/

Chinese iron ore production this year is likely to fall below 200 mt from 240 mt in 2014

The world is aware that Chinese steelmakers and investment groups are circling around distressed iron ore assets in Australia with a view to gaining control. Nothing surprising about the recent Chinese moves since these are part of by-now-long-established strategy of the world’s largest producer and consumer of steel to secure future supply of iron ore.

But shouldn’t some of our large producers of steel, which were forced to import rising quantities of iron ore in the past three years due to court-imposed curbs aimed at ending illegal mining, also consider buying assets in Australia and elsewhere when their valuations are so low? India, which not very long ago was the world’s third largest exporter of ore, had to import 15.5 million tonnes in 2014-15 to supplement reduced domestic supplies. Our steelmakers would often complain about domestic ore suppliers charging premiums over world prices.

What will also be a justification for them to seek a presence in Australian iron ore landscape is the difficulty in securing iron ore deposits here and then long gestation in opening mines. This is despite the country sitting on the world’s sixth largest iron ore resources estimated at well over 25 billion tonnes (bt). Business wanderlust led Indian groups in the past to acquire mines in more than one continent, though not all proved to be prized catches.

Rio Tinto uranium shutdown creates demand urgency – by Kip Keen (Mineweb.com – June 15, 2015)

June 16, 2015

http://www.mineweb.com/

What braking on the Ranger 3 Deeps project means for supply.

HALIFAX, NV – The Ranger 3 Deeps uranium project in Northern Australia, mostly owned by Rio Tinto, is dead, or at least in deep sleep for now. And the shelving of Ranger 3 – with a feasibility study no longer going ahead – has important implications for uranium supply, and presumably uranium prices.

This was the conclusion of analysts David Talbot and Zain Nathoo, of Dundee Securities, in a recent note dissecting the impact of Energy Resources decision to halt progress on developing the underground project, which would have extended existing operations at the Ranger uranium mine (now processing stockpiles).

The uranium market is not that large, so decisions like these can quickly have profound effects on supply. In this case we have, as Talbot notes, what could have become – if it reached production – the world’s third largest uranium mine after McArthur River and Cigar Lake, producing some 9 million pounds uranium a year.

Talbot sees the withdrawal of Ranger 3 Deeps as creating urgency for uranium buyers to start looking at securing long term supply contracts.

Billionaire Seeks BHP-Style Conglomerate in Vedanta Deal – by Debjit Chakraborty (Bloomberg News – June 14, 2015)

June 16, 2015

http://www.bloomberg.com/

Billionaire Anil Agarwal’s move to merge his two Indian units will create a national natural resources group to compete with BHP Billiton Ltd. and Vale SA. Agarwal’s Vedanta Ltd. is planning to absorb Cairn India Ltd., combining India’s biggest producer of aluminum and copper with its largest onshore oil producer. The merger will create an entity with a market capitalization of about $11 billion, based on the last traded price of Vedanta Ltd.

“It’s a dream to create a singular yet powerful natural resources conglomerate of Indian origin to mirror the likes of BHP or Vale,” Tom Albanese, chief executive officer of parent Vedanta Resources Plc, said Sunday at the media briefing in Mumbai. “This conglomerate will be globally recognized.”

The merger will also help the group, weighed down by $12 billion of total debt, reorganize the finances of Vedanta Ltd., India’s second-most indebted metals company. The increased size will allow Albanese, the former CEO of Rio Tinto Group, to be more competitive against global resources giants.

“The consolidated entity will have the distinct advantage of size and strength because of the cash on Cairn India’s balance sheet,” Deven Choksey, managing director of K.R. Choksey Shares & Securities Ltd., said in a phone interview.