Republic of Mining

Gold positioned for comeback: Goldcorp founder, CEO – by Robert Gibbens (Montreal Gazette – February 2, 2015)

February 3, 2015

Both the founder and the present CEO of Goldcorp Inc., now commissioning the big Éléonore mine in Northern Quebec, predict investors will soon start returning to the unloved gold mining sector.

“In the past two years, as bullion dropped from a record of almost US$2,000 an ounce, gold miners have dumped old management, slashed exploration spending, lowered operating costs and shifted to high-grade ore to focus fully on restoring cash flow,” said Rob McEwen, chairman of McEwen Mining Inc.

“You’ve got a serious gap developing between declining global output and steadily mounting demand from Asia where millions of new middle-class consumers are emerging,” he said in a recent telephone interview. “That gap could last several years.”

McEwen created Goldcorp via a string of mergers in the 1990s and left in 2005 after a disagreement over strategy. Goldcorp is now the world’s largest gold producer by market value.

He then formed McEwen Mining which plans to dig 96,500 ounces of gold and 3.12 million ounces of silver from mines in Mexico and Argentina in 2015 and aims at intermediate status with annual output of one million ounces of gold.

Local history: Ontario’s first gold mine near Madoc – by Susanna McLeod (Kingston Whig-Standard – February 3, 2015)

February 3, 2015

http://www.thewhig.com/

Hiking through scraggly scrub brush, clambering up jagged, rocky hills, and across grassy fields in the mid-1860s, the prospectors scrutinized each area carefully for signs of a soft reddish-orange mineral.

A copper mine would set a lot of people on the road to good fortune; in demand for coins, housewares, bathtubs, shipbuilding, the metal was indispensable in Canada. After months of exploring in the Madoc, Ont., region, about 115 km northwest of Kingston, the miners were at last tracing a potential mineral seam. The prize they found on John Richardson’s farmland wasn’t copper, it was gold.

Digging a shaft 15 feet down, “the seam was six inches wide at the top and was decomposed for six feet,” said prospector Marcus Herbert Powell in the First Report of the Bureau of Mines, 1891. “Then it was solid rock to 15 feet, where it suddenly opened into a cave 12 feet long, six feet wide and six feet high, so that I could stand upright in it.” It was a discovery that he literally fell into in the summer of 1866.

“The hanging wall was quartzite and the foot wall was granite, while the roof was composed of spar, talc and rocks of various kinds, and the floor of iron, talc, quartzite, black mica and other minerals,” Powell described. The gold was interspersed throughout the rocks “in the form of leaves and nuggets, and in the roof it ran through a foot thickness like knife blades.”

Mushkegowuk Ring of Fire plan attracts railroader interest – by Ian Ross (Northern Ontario Business – February 3, 2015)

February 3, 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 Mushkegowuk Council’s conceptual plan for a Ring of Fire railway, power corridor and James Bay port took a strange twist with possible partnership talk involving a private railway company with a keen eye on buying the Ontario Northland Railway.

Mushkegowuk Grand Chief Lawrence Martin caused a media stir at a Jan. 22 energy conference in Timmins when he told reporters that his northeastern Ontario tribal council was considering teaming up with TGR Rail to extend rail service to the coast and into the Ring of Fire.

TGR, a Toronto-based rail services company, claims it has the financing and the team in place to acquire and expand the rail assets of the North Bay-based Ontario Northland Transportation Commission (ONTC).

The company contacted Mushkegowuk last year when the tribal council on the eastern side of the Ring of Fire began floating the idea of an energy infrastructure corridor.

It calls for a multi-use easement corridor of power, fibre optic and rail links that would provide all-season access and grid-based electricity to isolated communities and the remote mineral deposits with a connection to a proposed saltwater port to move chromite ore to the coast.

Industry applauds Kaska Nation plan to pass resource law – by Nancy Thomson (CBC News North – February 02, 2015)

February 3, 2015

http://www.cbc.ca/news/canada/north

North American Tungsten says move by 5 Kaska First Nations is ‘exciting, positive’

The Kaska Nation’s announcement that it is planning to pass a resource law to create more certainty for industry is being welcomed by one large mining company with projects on Kaska traditional territory.

The five Kaska First Nations have territory in the Yukon, northern British Columbia, and parts of western N.W.T. They say they’ll pass the law later this year, with regulations to follow.

“We’re going to create a set of guidelines and policy around when a company comes in, what they have to do to consult the First Nation, what they have to do to accommodate right and title interest on the land to make sure that all of our interests are met,” said Brian Ladue, chief of the Ross River Dena Council.

Ladue says the law will simplify the process for mining companies, and ensure good relationships with industry. He says leaders are entrusted to protect and preserve the land for future generations. North American Tungsten owns the MacTung project north of Ross River, and the CanTung mine north of Watson Lake.

Exclusive – The FAA: regulating business on the moon – by Irene Klotz (Reuters India – February 3, 2015)

February 3, 2015

http://in.reuters.com/

CAPE CANAVERAL, Fla. – (Reuters) – The United States government has taken a new, though preliminary, step to encourage commercial development of the moon.

According to documents obtained by Reuters, U.S. companies can stake claims to lunar territory through an existing licensing process for space launches.

The Federal Aviation Administration, in a previously undisclosed late-December letter to Bigelow Aerospace, said the agency intends to “leverage the FAA’s existing launch licensing authority to encourage private sector investments in space systems by ensuring that commercial activities can be conducted on a non-interference basis.”

In other words, experts said, Bigelow could set up one of its proposed inflatable habitats on the moon, and expect to have exclusive rights to that territory – as well as related areas that might be tapped for mining, exploration and other activities.

However, the FAA letter noted a concern flagged by the U.S. State Department that “the national regulatory framework, in its present form, is ill-equipped to enable the U.S. government to fulfill its obligations” under a 1967 United Nations treaty, which, in part, governs activities on the moon.

Cliffs highlights huge downsizing in 2014 – by John Myers (Duluth News Tribune – February 2, 2015)

February 3, 2015

http://www.duluthnewstribune.com/

Cliffs Natural Resources officially highlighted its massive 2014 sell-off on Monday, releasing the company’s fourth quarter and year-end results that show millions of dollars lost as it shuttered and sold large swathes of its holdings.

Cliffs recorded a net loss of $7.2 billion in 2014, or $47.29 per diluted share, thanks largely to selling U.S. coal mining operations at a loss and then declaring bankruptcy at its Bloom Lake Canadian iron ore operations.

Fourth-quarter 2014 consolidated revenues of $1.3 billion were down 15 percent from 2013. The company said the decline was driven by lower revenues from the Asia Pacific Iron Ore and Eastern Canadian Iron Ore segments hit hard by a 45 percent drop in the price of seaborne iron ore as a worldwide oversupply develops.

There was good news from the company’s U.S. iron ore operations, however, as the company moves toward becoming an all-U.S., all-iron ore business.

U.S. Iron Ore’s pellet sales volume in the fourth quarter of 2014 hit 7.8 million tons, a 26 percent increase when compared with 6.2 million tons sold in the fourth quarter of 2013.

[Indonesia] House pushes for Freeport smelter location in Papua – by Ina Parlina and Raras Cahyafitri (Jakarta Post – February 3, 2015)

February 3, 2015

http://www.thejakartapost.com/

The House of Representatives is pushing the government to make copper giant PT Freeport Indonesia establish its smelter in Papua, increasing concerns over whether the company will be able to complete development by 2017 when a full ban on ore exports will be implemented.

The House’s leaders brought up the Papua smelter issue during a meeting with President Joko “Jokowi” Widodo on Monday.

The House’s deputy speaker, Agus Hermanto, claimed that the President had agreed that Freeport Indonesia should build its smelter close to its mine in Papua instead of following its plan to build in Gresik, East Java. “I say many problems will arise if the smelter is built in Gresik,” Agus said after the meeting, without elaborating.

Freeport Indonesia, a subsidiary of US-based giant miner Freeport-McMoRan Inc., is required to build a copper smelter in the country as a consequence of the 2009 Mining Law that requires mining firms to process and refine their minerals in domestic facilities.

Recently, the company said that it had signed a memorandum of understanding (MoU) to lease 80 hectares of land belonging to PT Petrokimia Gresik, located adjacent to the only copper smelter in the country, operated by PT Smelting Gresik.

Iron ore family embroiled in will dispute – by Ben Hagemann (Australian Mining – February 3, 2015)

February 3, 2015

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

The daughter of late iron ore magnate Michael Wright has issued a wish list of bizarre and extravagant “needs” to increase her claim on his estate.

Michael Wright died in 2012 with an estimated worth of $2.7 billion (as reported by The West Australian; $1.5 according to The Australian), which was built thanks to mining royalties inherited from his father Peter Wright, who was a business partner with Lang Hancock.

Olivia Mead, 19, the youngest child fathered by Wright has lodged claim against the Wright estate that the $3 million trust fund (only to be accessed when she turns 30) was not adequate.

Wright’s other two daughters Leonie Baldock and Alexandra Burton have been directors of Wright Prospecting, which in 2013 won a legal dispute against Hancock Prospecting over a 25 per cent stake in the Rhodes Ridge iron ore deposit.

Mead said in the WA Supreme Court on Monday she did not have a close relationship with her father “overall”, but that she visited him at least once a week in 2012 prior to his death in April. She said Wright told her he wanted to leave property for her, but property was not bequeathed to her in the will.

Commodity slump could finally bring balance to Canada’s economy – Hamid Faruqee, Lusine Lusinyan and Andrea Pescatori (Globe and Mail – February 3, 2015)

February 3, 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.

Since last fall, oil prices have plunged 50 per cent and nervousness is running high about a slowing Canadian economy. Lower oil prices will unambiguously hurt growth and the latest data on GDP point in that direction. About one-quarter of Canada’s exports and private investment (excluding housing) are tied to the energy sector that, itself, accounts for about 10 per cent of GDP.

Weakness in the oil and gas sector could also spill over to the wider economy. In response, the Bank of Canada surprised markets on January 21 and cut its policy rate – which had been on hold at 1 per cent since September, 2010. The currency fell and interest rates eased. The loonie currently is near a 6-year low against the U.S. dollar. So is the economy in trouble?

In the IMF’s annual report on Canada released last week, forecasts for growth have been marked down. A further downgrade is likely to come given that oil prices have fallen further since the forecasts were made. The oil shock has been noteworthy in terms of its nature, size and sharpness – perhaps, best resembling 1986’s supply-driven price decline, when Canada was not a large oil exporter.

So it is hard to know with high confidence just how deep the effects might be. What is clear is that the energy sector is on the front lines and will take a hit. Recent announcements from the oil industry confirm plans for layoffs and scaling back investment in the near term.

How Dodd-Frank Is Failing Congo – by Lauren Wolfe (Foreign Policy – February 2, 2015)

February 3, 2015

https://foreignpolicy.com/

The campaign to stop conflict minerals is supposed to be protecting people’s lives in one of the most fragile parts of Africa. In fact, it seems to be doing the opposite.

Minerals are ruining lives. For several years now, in conversations about conflict and crisis in the Democratic Republic of Congo, this has been a common refrain.

About $24 trillion worth of gold, tantalum, tin, and tungsten are estimated to be in Congo’s eastern hills. They are dug from the fertile, brown mud there through exploitation: Kilos upon kilos of rocks and water are lifted and filtered each day for a few dollars per laborer. Minerals are smuggled, too, and help to line the pockets of the security guards, militias, and Congolese soldiers who lord over mining sites, wielding weapons and perpetrating sexualized violence against women.

By extension, the advocacy message goes, the “conflict minerals” from Congo that wind up in devices like iPhones cause rape. U.S. electronics and other expensive, shiny things fuel war. Individuals and companies must not buy dirty minerals, because exposing and cleaning up supply chains will reduce the stranglehold armed groups have on Congo’s mines.

Battered Anglo facing downgrade to junk – by Danny Fortson (The Australian – February 2, 2015)

February 3, 2015

http://www.theaustralian.com.au/

MINING giant Anglo American risks a downgrade to “junk” status as it faces billions of dollars of writedowns and plunging profits as commodity prices tumble.

It is understood that the ratings agency Standard & Poor’s is finalising a review of leading miners following the slide in commodities, including copper, coal, iron ore and platinum.

Anglo American, which controls the De Beers diamond group, is considered particularly vulnerable among the biggest ¬diversified resource companies. It is rated BBB, which is two notches above BB+, considered “sub-investment grade” or junk.

Analysts expect Anglo to be knocked down at least one notch after the price of copper, one of its key products, fell 16 per cent last month. Standard & Poor’s could take a more aggressive stance, -depending on the agency’s view on long-term commodity prices.

Any downgrade would heap pressure on Mark Cutifani, the Australian who became chief executive nearly two years ago with a mandate to revive the foundering company.

Gravelle describes first formal Ring of Fire meeting with Rickford as “positive” step – by Matt Vis (tbnewswatch.com – February 2, 2015)

February 3, 2015

http://www.tbnewswatch.com/default.aspx

THUNDER BAY — Michael Gravelle says he is encouraged after a “positive” first formal meeting regarding the Ring of Fire with the federal Minister of Natural Resources.

The provincial Minister of Northern Development and Mines and Greg Rickford met last week in Ottawa where the two discussed the significance of the proposed northern mining development and the importance of the two senior levels of government to work together to make it a reality.

The ministers have communicated extensively but had yet to arrange a formal meeting. Gravelle described the sit-down as productive and said Rickford expressed some issues the federal government has had with the process up to this point.

“I think I allayed a number of those concerns in our meeting,” Gravelle said. “I reaffirmed how we think in order for the Ring of Fire to reach its full potential the federal government needs to be involved.”

“I had well over an hour with my deputy minister and senior officials with the Minister of Natural Resources and his senior officials. We agreed to actually have more formal discussions with our senior ministry and departmental staff.”

The North Treasure Trove Or Partner In Confederation?: Ken Coates – by Jeremy Mouat (Aurora Online – Issue 1990)

February 3, 2015

http://aurora.icaap.org/index.php/aurora/index

Historian Ken Coates Explains What The North Is

Ken Coates was raised in the North, and has written extensively on the region. His doctorate, completed at the University of British Columbia in 1984, examined federal government policy and the Native people in the Yukon. Since then, he has written a number of articles on Northern topics, as well as edited books on Canadian native history the Alaska Highway, and on Canada’s North. He has also written a history of the North, Canada’s Colonies, and co—written a contemporary account of the region, The Modern North, with Judith Powell. Ken taught history at Brandon University for several years, but since 1986 has been teaching at the University of Victoria.

Aurora: You’ve written that the North has always been seen as a place for economic development, development by and for southerners.

Coates: I think the best description of the way Canadians view the North is as an attic. That is, a place where you have a store of potential treasures that are largely forgotten. They are left up there until something be comes valuable, at which point you go scurrying up as quickly as you can. You don’t worry if you push things aside and create a mess; you just grab what you want. Because so very, very few Canadians have lived in the North, they tend not to see its human or environmental side. They see it as simply a place with resources that are to be used in the national interest.

The federal government looks upon the North primarily as its treasure trove. The government carefully protects the resources that might be there for its own future use. This is coupled with the idea of an allegedly tiny population that does not deserve full control of these wonderful resources. For example, with National Energy Policy and mineral policy, the federal government sets the pattern for economic development in the South and for the South.

Goldcorp, Wabauskang sign agreement – by Staff (Northern Ontario Business – January 30, 2015)

February 2, 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.

Goldcorp and Wabauskang First Nation have signed a collaboration agreement that paves the way for long-term economic benefits for the northwestern Ontario First Nation.

The new agreement, which marks Goldcorp’s sixth First Nation partnership in Canada, provides a framework for strengthened collaboration in the development and operations of Red Lake Gold Mines. A signing ceremony was held Jan. 29 in Wabauskang, located about 100 kilometres south of Red Lake.

Goldcorp now has collaboration agreements in place with all of the First Nations which assert Aboriginal and treaty rights in the vicinity of its active operations in Canada: Red Lake Gold Mines, Musselwhite Mine, Porcupine Gold Mines and Éléonore Mine.

“This new agreement is about so much more than economic benefits,” said Brent Bergeron, Goldcorp’s executive vice-president of corporate affairs and sustainability, in a news release. “It’s about long-term partnership, open dialogue and shared prosperity. It demonstrates our company’s ongoing commitment to develop Northern Ontario’s natural resources in a mutually beneficial and sustainable way, and will bring well-deserved recognition to the people of Wabauskang.”

Sumitomo sees first nickel deficit in 5 years – by Aya Takada & Ichiro Suzuki (Mineweb.com/Bloomberg – February 2, 2015)

February 2, 2015

http://www.mineweb.com/

Demand will exceed production by 12,000 metric tons, compared with a 36,000-ton surplus last year. Sumitomo Metal Mining Co., Japan’s biggest nickel producer, expects global output of the metal to fall short of demand in 2015 for the first time in five years as supply from China drops.

Demand will exceed production by 12,000 metric tons, compared with a 36,000-ton surplus last year, according to Hiroshi Sueta, general manager at the Tokyo-based company’s nickel sales and raw materials department. China’s production of nickel pig iron, a cheaper alternative to the refined metal, may drop 15 percent from a year earlier to 365,000 tons, he said.

“Ore stockpiled in China will be probably exhausted by around the middle of this year,” Sueta said in a Jan. 30 interview in Tokyo. “They must review their NPI production for the latter half of this year.”

The forecast deficit represents 0.6 percent of global nickel production this year, and will help London Metal Exchange prices stabilize above the current level, he said. Output is forecast to expand 1.5 percent to 1.99 million tons.

Nickel advanced 9 percent last year, the most among the six main metals on the LME, as Indonesia, the world’s biggest producer from mines, barred unprocessed ore exports in January. The metal for delivery in three months on the LME rose 1.8 percent to $15,165 a ton on Jan. 30.