Republic of Mining

Australian mining boom subsides with China’s economy – by Don Lee (Los Angeles Times/Duluth News Tribune – January 17, 2015)

January 19, 2015

http://www.duluthnewstribune.com/

KARRATHA, Australia — Joe Norton, a large man with a sunburned face, digs into a plate full of beef, potatoes, carrots and Brussels sprouts at Searipple, a mobile-home camp in Australia’s western frontier.

It isn’t the tastiest food in the world, the 54-year-old says, but it’s free, provided by his employer, iron mining giant Rio Tinto.

So is most everything else in his life: all of his meals, a manufactured house with microwave and flat-screen TV, a round-trip ticket every Friday to fly home, and not the least, his $180,000 salary.

Not bad for a man with an eighth-grade education doing semi-skilled work on railways transporting iron ore.

Yet the gig probably won’t last a lot longer, Norton reckons. Some of his fellow miners already have been sent packing as the company downsizes its contracted workforce. “They’re cleaning the fat,” he said.

With China’s slowing economic growth, one of the biggest mining booms in Australian history is over, leaving behind a trail of jobless workers and struggling local businesses in places such as Karratha, which thrived in recent years but now is at risk of becoming a ghost town.

Nordea to blacklist coal-mining companies – by Madison Marriage (Financial Times – January 18, 2015)

January 19, 2015

http://www.ft.com/home/us

Nordea Asset Management plans to blacklist up to 40 coal-mining companies from its investment universe. It joins a growing list of large investors that have decided to cut their exposure to fossil-fuel assets.

Nordea, the largest Nordic fund manager, with $228bn of assets, is in the process of identifying companies for exclusion that have a “large and sustained exposure to thermal coal mining”, according to Sasja Beslik, head of corporate governance at the group.

“[Thermal coal mining] is the most environmentally compromising fossil-fuel resource,” he said.
The asset manager’s exclusion list, which will be finalised by the end of March, is likely to affect a small proportion (€100m) of Nordea’s total assets.

The move is another setback for the coal-mining industry. A number of big institutions have opted to reduce their exposure to fossil-fuel companies in the past 12 months for ethical and financial reasons.

KLP, Norway’s largest pension fund, decided in November to blacklist companies that derive more than 50 per cent of their revenues from coal-based activities.

History buffs dig into mining – by Ralph Nardone (Times Leader – January 17, 2015)

January 19, 2015

http://www.timesleader.com/ [Wilkes-Barre, Pennsylvania]

Knox Mine program kicks off week devoted to industry

SCRANTON — A tribute to the victims of the Knox Mine Disaster near Pittston kicked off the 16th annual Mining History Week on Saturday at the Anthracite Heritage Museum. Events sponsored by local colleges and historical groups will take place this week in Wilkes-Barre, Scranton, Pittston, Port Griffith and Ashley.

The Knox disaster happened on Jan. 22, 1959, when the Susquehanna River broke through the roof of the River Slope Mine, allowing 10 million gallons of water and ice to rush into the mine. According to Explorepahistory.com, 74 miners were trapped by the rushing waters. Only 62 of them would escape, the bodies of the other 12 were never recovered.

On Saturday, experts on the disaster and folks who were there gathered to discuss its historical significance, to honor those who died and to pay tribute to the professional journalists who documented what happened.

“They were true educators,” said Kings’ College Professor Robert Wolensky, who has authored books on the disaster. “We know what happened that day thanks to their work.”

Goldcorp to Buy Ontario Mining Company Probe for $440 Million – by Judy McKinnon (Wall Street Journal – January 19, 2015)

January 19, 2015

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

Goldcorp Inc. said Monday it has agreed to buy junior mining company Probe Mines Ltd. in a friendly, all-stock deal valued at about 526 million Canadian dollars (US$440 million), expanding the Vancouver company’s presence in one of its core districts in Northern Ontario.

“This transaction is consistent with Goldcorp’s long-standing strategy of securing growth opportunities in and around our existing districts with a focus on low-cost, high-quality gold production,” Chuck Jeannes, Goldcorp’s chief executive, said in a statement.

Toronto-based Probe Mines’ key asset is the Borden Gold project, a deposit minable through conventional underground methods and located west of Goldcorp’s Porcupine mine in Timmins, Ontario.

In an interview last week, Goldcorp Chairman Ian Telfer said the company is constantly looking for mergers and acquisitions. Unlike many other industries, mining companies need to grow through acquisitions because their assets are constantly being depleted and gold mines in particular tend to have shorter lives than other types of mines.

Companies the size of Goldcorp can’t rely on exploration to replace all their assets; larger mining concerns have a patchy record with exploration.

NEWS RELEASE: Goldcorp expands Porcupine district with acquisition of Probe Mines Limited

January 19, 2015

VANCOUVER, Jan. 19, 2015 /CNW/ – GOLDCORP INC. (TSX: G, NYSE: GG) and Probe Mines Limited (“Probe”) (TSX-V: PRB) today announced an agreement whereby Goldcorp will acquire, through a friendly plan of arrangement (the “Arrangement”), all the outstanding shares of Probe. The total consideration for the purchase is approximately C$526 million.

Under the Arrangement, each common share of Probe not owned by Goldcorp will be exchanged for 0.1755 common shares of Goldcorp. Goldcorp currently owns 8.4 million shares of Probe representing 9.3% of the basic shares outstanding. Based on the closing price of Goldcorp’s common shares on the TSX on January 16, 2015, the transaction values each Probe share at C$5.00. The consideration received by Probe shareholders represents a 49% premium to the closing price of Probe on January 16, 2015. The number of Goldcorp shares to be issued will be approximately 17 million based on the issued and outstanding shares as of the announcement date, but will be subject to adjustment depending on the number of options and warrants exercised under the Arrangement. The transaction is expected to close in late March, 2015.

In addition to the Goldcorp shares, shareholders of Probe will receive an interest in a new exploration company (“New Probe”) containing Probe’s mineral properties in the Ring of Fire in Northern Ontario, as well as C$15 million in cash and certain other assets currently owned by Probe. Goldcorp will own approximately 9.3% of New Probe following completion of the transaction and looks forward to supporting New Probe in the execution of its business plan.

Noront eager to mine Ring of Fire ore – by Carol Mulligan (Sudbury Star – January 19, 2015)

January 19, 2015

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

The head of Noront Resources is appealing to the provincial government to allow it to begin work developing its Eagle’s Nest nickel mine in the Ring of Fire while a plan to share resources with First Nations over the long term is developed.

Alan Coutts wants the province to give Noront the environmental approval it needs to start on its mine and all-weather road while an “over-arching” framework agreement is being negotiated with First Nations about resource sharing and related issues.

Noront isn’t asking for special treatment, said its president and chief executive officer during a visit to Sudbury.

It just wants the province to approve Noront’s terms of reference for the environmental assessment it submitted 2 1/2 years ago so it can keep and attract investors, reach impact benefit agreements with three First Nations near Eagle’s Nest and start mining ore.

Coutts was in Sudbury at the invitation of the Greater Sudbury Chamber of Commerce Ring of Fire Task Force to talk about the status of Noront’s project, why it is stalled and what he believes must be done to move it forward.

NEWS RELEASE: Ivanhoe Mines and Ivanplats challenge Globe & Mail story about Platreef mine development project in South Africa (January 12, 2015)

January 19, 2015

Attention:

– Paul Waldie, Editor, Report on Business, The Globe and Mail, Toronto, Canada
– Geoffrey York, Africa correspondent, The Globe and Mail

The cover story published in The Globe and Mail’s Report on Business on January 10 (Showdown in South Africa) is flawed by serious failures of what is purported to be standards-based journalism.

The story is blighted by false allegations and misrepresentations, and gratuitous exaggerations. One inevitable result is that parts of the story serve as a soapbox for a coterie of dedicated critics, some of whose self-serving motivations curiously are ignored. But, despite its 3,000-word length, the story fails to present the view of even one ordinary citizen from among the tens of thousands who comprise the overwhelming majority in the neighbouring communities who do support the development of the Platreef mining project by Ivanplats (Pty) Ltd., a subsidiary of Ivanhoe Mines Ltd. That would have required diligence and determination. It begs the pertinent question: Why?

The current economic potential of Ivanhoe’s Platreef world-scale mineral discoveries, and the innovative comprehensiveness of the project’s broad-based black economic empowerment structure, are without peer in South Africa. One essential feature is that the combined population of approximately 150,000 people in the communities surrounding the planned mine development now effectively share a 20% ownership of the Platreef Project through a collective trust.

Mining sector will find reward by addressing risk – by Simon Rees (MiningWeekly.com – January 16, 2015)

January 16, 2015

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

TORONTO (miningweekly.com) – Consider the resource supercycle; it was a once-in-a-generation event driven by China becoming the world’s workshop. The country’s demand for commodities seemed insatiable and pushed many metal and mineral prices to historic highs.

The mantra for most mining seniors became “big is beautiful” and their mergers and acquisition (M&A) activity was soon geared towards fulfilling this.

Today, the supercycle is on hiatus and subdued prices are likely to last for some time to come. The industry continues to clean out its Augean Stables and, just like the Herculean labour, the task has been both messy and necessary, with the spate of write-downs, divestments and spin-offs reflecting this.

Compounding matters are the ongoing economic headwinds, the unnerving volatility and the ability for some prices to sink still further. For example, the iron-ore sector continues to struggle after the price plunge during the second half of 2014.

Aside from cutting costs and reducing cash burn, the seniors are also focusing on improving their productivity and their competitive edge. This was identified as the number one issue in multinational professional services firm EY’s ‘Business risks facing mining and metals 2014 to 2015’.

No help from Ottawa as Alberta’s economy devastated by oil collapse – by Claudia Cattaneo (National Post – January 16, 2015)

January 16, 2015

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

The oil-price crash that is causing a major pullback in energy investment is also stirring plenty of worry in oil-revenue dependent Canadian governments. But while top oil-producing provinces such as Alberta are in full damage-control mode, the federal government is taking the oil shock in stride.

In a speech in Calgary Thursday, federal finance minister Joe Oliver was sympathetic to Alberta’s predicament, noting the price crash is the third-largest in four decades. As for the impact on Canada, he said Ottawa remains on track to balance its budget after years of deficit spending triggered by the global recession. He said there are no plans to increase taxes.

“Lower oil prices will adversely impact our federal government’s fiscal situation, but the decline in oil prices will not prevent our government from achieving the budgetary balance in 2015/16,” Mr. Oliver said in a speech to the Calgary Chamber of Commerce, after conducting consultations on the upcoming federal budget.

Because of the high level of instability in the economy, though, he said the budget would not be tabled at least until April.

Tough times in the energy sector are balanced by benefits for consumers at the gasoline pumps, as well as lower energy costs for manufacturers and transport companies that are also getting a boost from a decline in the value of the Canadian dollar, making them more competitive, he said.

Swiss currency cap move spurs gold price – by Collen Goko and Maarten Mittner (Business Day Live – January 16, 2015)

January 16, 2015

http://www.bdlive.co.za/

GOLD received a boost on Thursday, soaring to near four-month highs as risk aversion weighed on the market, following a surprise move by the Swiss National Bank to discard its minimum exchange rate and to further cut its interest rates.

Analysts described the bank’s step as “shocking” and “unexpected” ahead of predicted bond-buying stimulus measures set to be announced next week by the European Central Bank (ECB).

Regenesys Investments CEO Devin Shutte said the Swiss franc is regarded as a safe currency. It strengthened 28% against the euro at one point after the decision was made as the central bank realised it was futile to keep the cap in place.

“But it is sure to cause more volatile markets with the present turbulence harking back to 2008,” Mr Shutte said. In the official statement, the Swiss National Bank said it was discontinuing the minimum exchange rate of CHF1.20/euro. At the same time, it announced it was lowering the interest rate by 0.5% to 0.75%.

The gold index on the JSE immediately traded higher, and ended the day 4.31% higher. The gold price increased 2% and was at $1,254.05 per fine ounce in the late afternoon from Wednesday’s close of $1,230.83.

Anglo American release a video about women in mining – by Vicky Validakis (Australian Mining – January 16, 2015)

January 16, 2015

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

Anglo American has released a video aimed at showing the opportunities open to women at its mining operations. The video features women working at Anglo’s metallurgical coal operations discuss how they made their way into the mining industry.

Gabrielle Horn, an automotive electrical apprentice, said she was working in hospitality when she saw an ad by Anglo in the local newspaper. “My dad encouraged me to apply and I got to choose what position I wanted,” Horn said.

“I love coming to work, things change every day so it’s always a different situation.” Claire Stevens, a technical services superintendent at Grasstree mine, said she actively sought a role in an underground mine because she was fascinated with how it worked.

Sudbury reaches halfway mark in reclamation efforts – by Lindsay Kelly (Northern Ontario Business – January 14, 2015)

January 16, 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.

If you were a youth in Sudbury, chances are you, or someone you know, spent a summer or two lugging bags of dolomite limestone up the city’s barren hills, prepping the ground for reforestation.

The routine is so ubiquitous, it’s almost become a rite of passage, said Dr. Peter Beckett, a reclamation, restoration and wetland ecologist with Laurentian University who’s dedicated his life’s work to rejuvenating the city’s landscape.

“I’m beginning to think that, by the time we finish this program, everybody in Sudbury will have done this,” Beckett chuckled during his keynote address at a recent meeting of the Canadian Institute of Mining, Metallurgy and Petroleum. “It’s part of growing up in Sudbury, to put lime bags down on the hills.”

Over four decades, the city has spent $28 million planting 9.5 million trees, and life has returned to Sudbury, once pegged as a barren moonscape. Yet despite the decades-long investment, the work is only half done: 3,450 hectares have been reclaimed, but 7,000 altogether need to be done.

That’s still a fraction of the 81,000 hectares impacted by industrial activity, which began with logging in the late 1800s and intensified with the onset of mining when open roasting beds sent high levels of sulphur dioxide into the air, raining down metal particulate, which leached into the soil, impacting the ecosystem.

NEWS RELEASE: KWG Shareholder Loeb Capital Liquidating Holdings

January 16, 2015

TORONTO, ONTARIO–(Marketwired – Jan. 16, 2015) -KWG Resources Inc. (TSX VENTURE:KWG)(FRANKFURT:KW6), reports that Loeb King Capital Management advised its clients in a letter dated January 13, 2015 that “the funds will begin an orderly liquidation”. According to a Bloomberg News report issued yesterday Loeb King Capital Management, an investment firm with about $1 billion, is closing after principal Gideon King decided to manage his own money. Loeb Capital Management LLP previously advised KWG management that it held approximately 49 million of KWG’s issued and outstanding shares and yesterday advised that 8 million of those had been sold on the TSX Venture market this week.

“We have appreciated the long term support of Loeb King Capital and its principal Gideon King,” said KWG President Frank Smeenk. “He has believed in our strategy and been with us in the trenches as we navigated the tortuous path to the creation of a new enterprise in Canada. The opportunity for our many smaller shareholders to acquire this equity interest now, at the prices Loeb is prepared to accept, is also welcomed by those of us who will continue. We wish Mr. King well.”

About KWG: KWG has a 30% interest in the Big Daddy chromite deposit and the right to earn 80% of the Black Horse chromite where resources are being defined. KWG has also acquired patent interests, including a method for the direct reduction of chromite to metalized iron and chrome using natural gas. KWG also owns 100% of Canada Chrome Corporation which has staked claims and conducted a $15 million surveying and soil testing program for the engineering and construction of a railroad to the Ring of Fire from Exton, Ontario.

Sudbury letter: Liberals fail to deliver – by Ryan Minor (Sudbury Star – January 16, 2015)

January 16, 2015

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

It is election time in Sudbury. The governing Liberals will be out making new promises and restating old promises. There is a saying that ‘words whisper, actions scream.’ We need to look past the rhetoric and ask: where are the results?

On the Highway 69 file, the minister of Transportation wants us to believe that the government is still committed to finishing the highway by 2017.

There are several troubling facts that cast doubt on this claim. The last contracts for construction of the highway were tendered in 2012. As of now, the MTO has not concluded a single deal with any of the three First Nations to acquire reserve lands. The remaining 82 km have been in federal environmental assessment since at least 2011. The MTO has no federal permits.

The 2014 budget included funding for 11 km of Highway 69 near Nobel and indicated that construction would start this fiscal year (by March 31). According to an email dated Jan. 8, 2015, from Fisheries and Oceans Canada, information to complete the environmental assessment has been outstanding for years, which is surprising since the engineering is done, the project is entirely on Crown land, the project involves adding two more lanes to the existing highway and First Nations legally cannot withhold consultation.

Sudburians need to ask: what is the true construction timetable for the highway? What sort of issues are holding up agreements with the First Nations?