Republic of Mining

Barrick Gold posts another big quarterly loss (Canadian Press/CTV News – February 19, 2015)

February 19, 2015

http://www.ctvnews.ca/

TORONTO — Barrick Gold Corp. (TSX:ABX), citing massive impairment charges on mine projects in Africa and Chile, has reported another multibillion-dollar net loss in its most recent quarter.

Canada’s second-largest gold miner by market capitalization says it net loss in the three months ended Dec. 31 was US$2.85 billion or US$2.45 per share, compared with a net loss of US$2.83 billion or US$2.61 per share in the same 2013 period when it had fewer shares.

Revenue was US$2.51 billion, down from US$2.94 billion as the company sold fewer ounces of gold — 1.57 million versus 1.83 million — at an average realized price of US$1,204 per ounce compared with $1,272 in the 2013 quarter.

The quarterly loss reflected the impact of US$2.8 billion in after-tax impairment charges primarily related to the Lumwana mine in Zambia (US$930 million) and the Cerro Casale project in Chile (US$778 million), the company said in an earnings report issued Wednesday after markets closed.

Fourth-quarter adjusted net earnings were US174 million or 15 U.S. cents per share, compared with US$406 million or 37 cents in the 2013 quarter. For the full year, Barrick recorded a net loss of US$2.91 billion or $2.50 per share, reflecting the impact of $3.4 billion in after-tax impairment charges. The full-year net loss in 2013 was US$10.37 billion or US$10.14 per share.

UPDATE 1-Brazil’s Vale beats iron ore forecast, takes nickel crown – by Stephen Eisenhammer (Reuters U.S. – February 19, 2015)

February 19, 2015

http://www.reuters.com/

Feb 19 (Reuters) – Brazilian miner Vale SA said on Thursday it produced 319.2 million tonnes of iron ore in 2014, beating its forecast for the year, as it begins to boost production after years of stagnation.

Vale, the world’s largest producer of iron ore, produced 83 million tonnes of the steelmaking ingredient in the fourth quarter, an increase of 2 percent from the same period a year earlier.

Full-year iron ore production rose 6.5 percent compared with the previous year, breaking through the 300 million-tonne-a-year mark, where it has been practically frozen since 2007. Vale had forecast output of 312 million tonnes for the year.

The growth in production will be more than offset by falling iron ore prices, which fell by half last year as a massive increase in Australian capacity coincided with a slowdown in China, the main market for iron ore.

Vale took the crown for the world’s biggest producer of nickel from Russia’s Norilsk Nickel, reaching 275,000 tonnes of the ingredient used to make stainless steel in 2014. That was its best performance since 2008, despite falling short of guidance.

A Gold Digger’s Guide to the Universe – by Dr. Sten Odenwald (Huffington Post – February 19, 2015)

February 19, 2015

http://www.huffingtonpost.com/science/

Dr. Sten Odenwald is an Astronomer at the National Institute of Aerospace.

The first documented use of gold by humans was found in the jewelery recovered from the Varna Necropolis in Bulgaria and dated to about 6,500 years ago. Since then, enough gold has been mined from Earth’s crust to form a cube 60 feet on a side.

Gold is one of the 100-odd basic elements in the universe. Number 79 in the element list, a cubic meter of it weighs 19 metric tons. Your ‘weight in gold’ would be worth over $2 million! How much gold is there?

The most common ingredient to Earth’s crust is silicon. It makes up beach sand, granite, sandstone and the actually the entire lithosphere. By comparison, you have to sift through about 250 metric tons of this stuff to come up with a measly 1 gram (5 carats) of gold. This kind of a gold mine would be rated at 0.004 g/ton. Generally, industrial mining is only economically feasible if the rating is about 1gram/ton or higher! The best mines produce gold at ratios of 5 gm/ton or more when a rich ore vein is available.

How about sea water? For every 250 million liters of water you will get about 1 gram of gold. This works out to about 1 gram for every 255,000 tons of water or a ratio of 0.000004 g/ton. This of course will be mixed with all kinds of other sediments in solution too, like 34,000 g/ton of sodium, chloride and other ions. So mining for gold in the ocean is not just a matter of evaporating away the water!

Hard up miners turn to Asian contractors to help fund projects – by Nicole Mordant and Sonali Paul (Reuters India – February 19, 2015)

February 19, 2015

http://in.reuters.com/

(Reuters) – Miners who can’t get financing for new projects from banks or traditional equity investors because metals prices have collapsed are turning to an alternative source: the engineering and construction companies, many from China and South Korea, who actually build their mines.

Several North American and Australian miners are in talks with engineering, procurement and construction (EPC) companies to take equity stakes or bring along banking partners to provide debt funding in projects in return for the EPC group winning a contract. China’s NFC and South Korea’s POSCO Engineering & Construction Co Ltd are among the companies pursuing these deals as they look to make up for business lost because of slowing infrastructure growth at home.

“The domestic order books of Chinese construction and equipment companies have been falling for a year, actually quite dramatically,” said Ingo Hofmaier, director at Hannam & Partners, a London-based corporate finance advisory firm. “To avoid underutilization and keep the music going, Chinese companies are now aggressively targeting foreign markets.”

Infrastructure investment in China slowed in 2014 as authorities try to re-engineer the growth model by reducing inefficient state spending and encouraging domestic consumption. Investment grew at its slowest pace in nearly 13 years between January and November 2014 at 15.8 percent, according to official figures.

Lockerby Mine fire under investigation – by Carol Mulligan (Sudbury Star – February 19, 2015)

February 19, 2015

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

A fire underground Monday at First Nickel Inc.’s Lockerby Mine, in which no one was injured, illustrates the effectiveness of procedures and protocols in place in Ontario to react to emergencies underground, says the company’s vice-president.

Officials at First Nickel and with the Ministry of Labour are investigating the cause of a fire detected Monday about 11 a.m. on a conveyor belt in a small space of the mine in which no one was working at the time.

Vern Baker, FNI vice-president of Sudbury operations, said the fire drove more than 30 employees who were working underground to refuge stations, where they remained for 61/2 hours.

Flames were evident when mine rescue teams showed up and they put the fire out with water, said Baker. “The problem almost always in a mine is not the flame,” said Baker. “The problem is the smoke. That’s where the real danger for most of us is.”

While company officials don’t know what caused one of several conveyor belts at the nickel mine to catch fire, they have ruled it was not caused by electricity or “by a person,” said Baker.

NEWS RELEASE: For the first time in Quebec, Canada: World Uranium Symposium

February 19, 2015

QUEBEC CITY, Feb. 19 2015 /CNW Telbec/ – The World Uranium Symposium will be held for the first time in Quebec City, Canada, from April 14 to 16, at the Centre des congrès de Québec. Organized by medical associations and civil society partners, the symposium will welcome more than 100 national and international specialists who will examine major questions associated with the nuclear fuel chain, including issues related to economic trends in the industry, safety and governance, social and environmental aspects, health, ethics, human rights, and indigenous peoples’ rights (register online: www.uranium2015.com/en).

“We’re very pleased to be able to present the World Uranium Symposium in Quebec this year. This is an important event and a unique opportunity for specialists and the public alike to explore the key issues pertaining to the nuclear fuel chain,” says Dr. Juan Carlos Chirgwin, Faculty lecturer at McGill University and president of Physicians for Global Survival (1985 Nobel Peace Prize).

2015: a key year for debating the future of nuclear energy

The World Uranium Symposium is taking place in a unique international context: rising costs and safety issues related to the Fukushima accidents in 2011 have led many countries to question the future of nuclear energy, which currently generates about 11% of the world’s electricity. This year also marks the 70th anniversary of the bombings of Hiroshima and Nagasaki, as well as the United Nations’ negotiations in New York for the Non-Proliferation Treaty. A new United Nations climate agreement will also be signed in Paris this year. All of these issues form the backdrop for the Symposium, whose primary aim is to make key recommendations to public policy makers to ensure increased protection of health, safety and the environment (see Preliminary Program).

COLUMN – India coal output closer to ending years of disappointment – by Clyde Russell (Reuters India – February 18, 2015)

February 18, 2015

http://in.reuters.com/

LAUNCESTON, Australia – One of the most common assumptions among coal watchers is that India’s rising demand will translate into increasing imports, thus providing one of the few bright spots for a beleaguered industry.

While there is little doubt about the bullish demand outlook for India, the belief that imports will have to rise is predicated on the view that domestic coal output will continue to disappoint.

If history is a guide, then this is a safe bet, with state-controlled behemoth Coal India (COAL.NS) consistently failing to meet output targets and battling to supply enough fuel for the South Asian nation’s electricity generators.

India’s coal imports have steadily risen and gained 19 percent last year to 210.6 million tonnes, making the country the world’s second-biggest importer after China and ahead of Japan. But it may pay to heed a warning that accompanies financial products that past performance isn’t necessarily a guide to future outcomes.

There are signs that India is taking the right steps to boost its domestic coal industry, and while these won’t necessarily bear immediate fruit, it’s always worth watching the trend.

Uganda: Why Can’t Uganda Simply Stamp Out Blood Minerals? – by Jeff Mbanga (All Africa.com – February 18, 2015)

February 18, 2015

http://allafrica.com/

Let’s talk about blood minerals today. About nine years ago, I was assigned to write a story about Uganda’s gold exports.

Back then, as it is today, a number of government reports would list the amount of revenue the country earned from gold exports. However, you could hardly put a name to a company that exported gold, nor tell where this gold was mined, processed, and flown out.

As part of my prep, I looked up a company, which I will not reveal, that dealt in gold. I was lucky to be granted an interview with one of its top directors. We met at a secluded area, somewhere in Kisementi, at the outskirts of the central business district. The man, of Indian origin, made sure few people were at our meeting point.

He first questioned my interest in the story. He then went ahead and complained about the risks in the business, and told me of his fights with a rival company. By the end of our conservation, I knew this was not a trade for the faint-hearted dealers; the mafia were alive and well in this mineral trade.

After all these years, questions still loom large over the trade in gold in Uganda. The characters that prowl around the city, flaunting money as result of their links to the illegal gold trade from the Democratic Republic of Congo, would comfortably fit in a Martin Scorsese movie script.

B.C. schools increase mining education despite industry downturn – by Derrick Penner (Vancouver Sun – February 17, 2015)

February 18, 2015

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

While recent mining news has been dominated by mine closures, layoffs and a retrenchment of prospecting and exploration, UBC’ is launching a new executive MBA program

VANCOUVER — It might seem counterintuitive to launch new education programs focused on mining while the industry is in the middle of a downturn, but B.C.-based institutions are taking a longer-term view than the current business cycle.

While recent mining news has been dominated by mine closures, layoffs and a retrenchment of prospecting and exploration, UBC’s Sauder School of Business is launching a new executive MBA program for mining professionals. At BCIT in Burnaby, the coming fall will see it offer a new bachelor of engineering program in mining.

It is an age-old story now of preparing for the rising tide of retiring baby-boomers, so current layoffs and unemployment aside, the mining industry — B.C.’s in particular — is staring at a disproportionally high segment of its workforce in the 54-to-64 demographic.

“I’m not sure if the timing is good or bad,” said Brian Bemmels, associate dean of the Sauder School. “There are pros and cons to doing this at this time.” It was Vancouver-headquartered mining firms, though, that don’t see the next generation of their industry’s leaders being developed, who prodded the Sauder School into developing the program, Bemmels added.

U.S. “vs.” China in Africa: A Message to President Obama and Premier Li Keqiang – by André Corrêa d’Almeida and Jinglin Duan (Huffington Post – October 14, 2014)

February 18, 2015

http://www.huffingtonpost.com/theworldpost/

The U.S. and China are not actually competing in most of the African markets and sectors in which they are operational. They could in fact adopt much more official collaborative approaches and drop the political competitive rhetoric, which, regardless, economic agents are not following in practical terms.

The political rhetoric used by the U.S. and China to distinguish their respective economic policies toward Africa is misaligned with the actual strategy, investments and operations governmental agencies and companies from those same countries develop on the ground. The behavior of “real economic agents” in Africa, such as companies, follows much more closely notions and principles of complementarity, synchronization, comparative advantages, market niches and market segmentation, than principles of competition, market shares and rivalry.

While official discourse about the presence of these two countries in Africa has been inflamed with political intrigue and a competitive attitude, economic agents’ actual behavior shows a much broader propensity for collaboration. Will the competitive paradigm in geo-strategic politics hold Africa back once again?

“We don’t look to Africa simply for its natural resources. We recognize Africa for its greatest resource which is its people and its talents and its potential,” President Obama stated during the US-Africa Leaders Summit held in the White House in August. The President continued: “We don’t simply want to extract minerals from the ground for our growth. We want to build partnerships that create jobs and opportunity for all our peoples, that unleash the next era of African growth.”

Barrick Gold Chairman’s Shakeup Keeps Investors Guessing – by Liezel Hill (Bloomberg News – February 17, 2015)

February 18, 2015

http://www.bloomberg.com/

(Bloomberg) — On an icy late-January evening in Toronto, more than 30 Barrick Gold Corp. mine managers and country heads gathered in the basement of a pub to hear their executive chairman’s vision for the world’s largest gold producer.

In town for year-end meetings, the group listened intently as John Thornton outlined a plan to give them the authority they needed to run their units like their own businesses, according to a person present. Barrick’s Toronto headquarters would shrink in size and reach.

To outsiders these are eye-opening words, coming from a leader known within Barrick for a detail-oriented style which has placed him at the center of decision-making at different levels of the company.

While his comments suggest he’s trying to return Barrick to its nimble roots, questions remain within the investment community about what that may mean over the long run. Will Thornton, an ex-Goldman Sachs Group Inc. banker, keep Barrick focused on gold, or diversify further into other metals such as copper, as he has hinted in the past?

“I have no idea what’s going on,” said David Christensen, chief executive officer of ASA Gold & Precious Metals Ltd, a San Mateo, California-based investor that holds Barrick shares. “I feel like I’m looking into a black hole.”

Mining review final report near end of March – by Carol Mulligan (Sudbury Star – February 18, 2015)

February 18, 2015

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

A much anticipated report on improving safety in Ontario mines will be released by the end of March, focusing on challenges in the mining sector today and those anticipated tomorrow, says the province’s chief prevention officer.

It will contain some recommendations that are regulatory and require amendments to mining legislation and others that are voluntary or industry-led, directed at employers, workers, health and safety committees, and other stakeholders.

The final report will be the result of 14 months’ work including several meetings by the stakeholder advisory panel, and public and private consultations with dozens and dozens of miners, more than 90 mining industry experts and several health and safety advocates.

George Gritziotis has been leading the mining review and he said he’s pleased with the way the final report is shaping up. Last week, he was going over a draft and consulting with panel members to put the finishing touches on it.

The Mining Health, Safety and Prevention Review was ordered in December 2013 by then Ontario Labour Minister Yasir Naqvi after a Sudbury-led campaign to reduce the number of mining fatalities by improving working conditions underground.

Mines are development engines for host countries – ICMM – by Martin Creamer (MiningWeekly.com – February 17, 2015)

February 17, 2015

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

JOHANNESBURG (miningweekly.com) – Mines are proven engines of economic development for the host countries, which benefit significantly from the foreign direct investment (FDI) that mines attract as well as the export earnings that they generate, the International Council for Mining & Metals (ICMM) has found in a unique 214-country study, which attests to the need to strengthen the contribution of mining to economic and social wellbeing.

While the focus of host governments was generally on taxes and royalties, the study showed that a strong new focus needed to be placed on the invaluable long-term benefits of FDI and export earnings.

The ICMM report – a world first in terms of scope and scale – also provided evidence of mining making its most profound contribution in the most impoverished regions of the world.

Under the right conditions, the study found that mining could make a contribution that translated to greater citizen wellbeing and ongoing economic momentum even after mines had closed.

NEWS RELEASE: Mineral Explorers Express Support for BC Budget 2015

February 17, 2015

http://www.amebc.ca/

Budget Lift for Ministry of Energy and Mines and Flow-Through Tax Credit Welcome

Victoria, BC — February 17, 2015 —Today, the Association for Mineral Exploration British Columbia (AME BC) expressed support for the 2015/2016 BC budget delivered by Finance Minister Michael de Jong. “We thank the provincial government for maintaining a balanced budget overall while meeting its commitment to increase funding for the Mines and Mineral Resources Division of the Ministry of Energy and Mines,” says David McLelland, Chair of AME BC. “We believe that this important budget lift will be a strong catalyst to increase public and investor confidence in the mineral exploration and development sector, particularly now and when the minerals cycle enters its next upswing.”

As announced by Premier Christy Clark on January 26 at AME BC’s Mineral Exploration Roundup 2015 conference, the provincial government has committed to increasing base funding of the Mines and Mineral Resources Division by $6.3 million to $17.1 million as well as an extension of the $10 million BC mining flow-through share tax credit through December 31, 2015. Further to Premier Clark’s announcement, mineral exploration will be exempt from permitting fees.

“The BC government has demonstrated that it has considered many of the concerns raised by mineral explorers and developers in AME BC’s annual Policy Issues & Recommendations paper,” says Gavin C. Dirom, President & CEO of AME BC. “The government has also developed an approach to issuing mineral exploration permits in a more timely manner that includes consultation with First Nations, and enables responsible mineral exploration to advance.