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Activist launches boardroom battle over fees to mining financier – by Jacquie McNish (Globe and Mail – December 17, 2014)

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.

Globe-trotting junior mining financier Stan Bharti has been targeted by a shareholder activist in a boardroom battle that could test the limits of compensation at money-losing companies.

Mr. Bharti, through his private, family-owned Toronto company Forbes & Manhattan, manages a large portfolio of publicly listed resource startups with mostly undeveloped properties in such remote corners as Kurdistan, Ethiopia and Mongolia. Mr. Bharti and a close-knit group of executives and directors have pocketed millions of dollars in consulting fees, bonuses and other payments at a time when a number of companies managed by Forbes & Manhattan have suffered declining financial health and stock performance.

His roster of advisers and directors includes retired Canadian major-general Lewis MacKenzie, former federal cabinet minister Pierre Pettigrew and Canada’s former ambassador to Iran, Ken Taylor. Mr. Bharti’s most prominent adviser, CNN talk show host Larry King, described himself in a Forbes & Manhattan promotional video as a global ambassador. “I provide the contacts, Stan does the close,” he said. which “equals success.”

In recent years, Mr. Bharti and his family have hosted lavish investor conferences at exclusive resorts, in Mexico and Brazil, featuring vodka-cooling ice sculptures and high-profile businessmen such as Eike Batista and Jim Rogers.

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NEWS RELEASE: Barrick to Suspend Operations at Lumwana Following Passage of New Mining Royalty

TORONTO, ONTARIO–(Marketwired – Dec. 18, 2014) – Barrick Gold Corporation (NYSE:ABX)(TSX:ABX) today announced that the company will initiate procedures to suspend operations at the Lumwana copper mine in Zambia following the passage of legislation that raises the royalty rate on the country’s open pit mining operations from six percent to 20 percent.

The new taxation regime, which is expected to go into effect on January 1, 2015, eliminates corporate income tax, but imposes a 20 percent gross royalty on revenue without any consideration of profitability.

“The introduction of this royalty has left us with no choice but to initiate the process of suspending operations at Lumwana. Despite the progress we have made to reduce costs and improve efficiency at the mine, the economics of an operation such as Lumwana cannot support a 20 percent gross royalty, particularly in the current copper price environment,” said Co-President Kelvin Dushnisky .

“We sincerely regret the impact this will have on our people, as well as the communities and the businesses that depend on Lumwana, and we remain hopeful that the government will consider an alternative solution that will allow the mine to continue operating,” said Co-President Jim Gowans .

In the meantime, the company will initiate procedures to transition Lumwana to care and maintenance. Major workforce reductions are planned to commence in March, following the legally required notice period.

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UPDATE 1-Miner Sherritt says U.S. exports possible if Cuba embargo lifts – by Narottam Medhora (Reuters U.S. – December 17, 2014)

http://www.reuters.com/

Dec 17 (Reuters) – The United States move to normalize relations with Cuba could pave the way for Sherritt International Corp to export nickel and cobalt to one of the biggest markets in the world, the miner’s Chief Executive David Pathe told Reuters.

Sherritt shares jumped as much as 36 percent on Wednesday after President Barack Obama moved to thaw a five-decade freeze in relations between the two countries and said he would speak to the U.S. Congress about lifting the U.S. embargo on Cuba.
Toronto-based Sherritt is the largest independent natural resources company in Cuba and operates the Moa nickel mine in the eastern part of the Caribbean island state.

Due to the Cuban origin of its nickel and cobalt, the company is currently unable export to the United States, even though the metals are refined in western Canada.

“If the embargo were to be lifted, we could export some of that nickel and cobalt into the U.S. market, which is obviously one of the biggest markets in the world,” CEO Pathe said in an interview.

“It would also give us access to U.S. suppliers for mining equipment and supplies and services for our oil and gas industries.”

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Venezuela restarts nickel output at asset taken over from Anglo – by Silvia Antonioli (Reuters U.K. December 17, 2014)

https://uk.finance.yahoo.com/

LONDON, Dec (Shanghai: 600875.SS – news) 17 (Reuters) – Venezuela has restarted production from the Loma de Niquel ferronickel asset it took from mining giant Anglo American (LSE: AAL.L – news) in 2012 after cancelling its licenses, data from an industry body showed this week.

Information on Venezuela is patchy but the International Nickel Study Group (INSG) numbers indicated that the country produced 2,700 tonnes of nickel in the first 10 months of this year, after producing nothing in 2013.

Loma de Niquel is Venezuela’s sole nickel producing asset. At full capacity it would produce almost 1 percent of the world’s nickel output.

Diversified miner Anglo had a 91.4 percent stake in Loma de Niquel until 2012, when the Venezuelan government under late president Hugo Chavez cancelled 13 of its concessions and refused to renew three others, forcing the company to abandon its operations in the country.

Nickel production from Venezuela fell from 8,100 tonnes in 2012 to nothing in 2013. In 2011 it had produced over 14,000 tonnes.

The data shows that production resumed at a rate of 200 tonnes per month in January and increased to 300 tonnes per month from April.

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Funds available for grassroots exploration projects – by Ian Ross (Northern Ontario Business – December 17, 2014)

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.

It’s a grim market reality for mineral explorationists trying to raise capital for their projects. But there’s one tool available to help prospectors at the grassroots levels with their costs in working their claims.

The Ontario Exploration Corporation (OEC) is a for-profit entity overseen by the Ontario Prospectors Association that allows successful applicants to access as much as $85,000 to fuel their work.

The OEC was established in 2002 to invest in mining lands that may produce prospects with high economic potential. The three-phase program delivers financial assistance in exchange for a royalty on the lands, up to 1.5 per cent net smelter return, which prospectors can buy back up to 11 years after receiving the funds.

The net smelter return (NSR) refers to revenues expected from the mill feed, taking into consideration mill recoveries, transport costs of the concentrate to the smelter, treatment and refining charges, and other deductions at the smelter.

That hitch isn’t always popular in the prospecting community, said Garry Clark, executive director of the Ontario Prospectors Association (OPA), who admits the program is underutilized.

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Modi Getting His Thatcher Moment Confronting Coal Unions – by Rajesh Kumar Singh and Debjit Chakraborty (Bloomberg News – December 17, 2014)

http://www.bloomberg.com/

Is India’s Prime Minister Narendra Modi reading up on Margaret Thatcher?

The late former prime minister of the U.K. had one of her defining and controversial confrontations in a protracted fight with striking coal miners in the 1980s. Different time, another country, but Modi has angry unions threatening to stop work at the world’s biggest coal miner, Coal India Ltd. (COAL)

Coal-fired power plants generate 60 percent of India’s electricity, except for when shortages lead to repeated blackouts. Outages shaved $68 billion or almost 4 percent off annual gross domestic product in the year ended March 2013, says the Federation of Indian Chambers of Commerce and Industry.

Last week, Modi made a move toward ending shortages, winning partial passage of a bill that will allow him to end a 40-year government coal monopoly. The plan is to bring in more efficient private companies. The coal unions say that will mean job losses, and that they will fight the legislation.

“Let them open up the sector, there will be strikes all across and large-scale violence,” S.Q. Zama, secretary general at the Indian National Mineworkers Federation, a unit of the opposition’s Congress party-backed Indian National Trade Union Congress, said in a Dec. 5 interview.

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Obama tightens environmental noose around resource-rich Alaska – by Dorothy Kosich (Mineweb.com – December 17, 2014)

http://www.mineweb.com/

Will the president’s permanent ban on oil & gas development in Alaska’s Bristol Bay weaken Northern Dynasty’s chances for Pebble project approval?

RENO (MINEWEB) – Pebble Partnership CEO Tom Collier told Mineweb Tuesday that the decision by President Barack Obana to indefinitely withdraw more than 52,000 square miles of waters off Alaska’s coastline (including Bristol Bay) from oil and gas exploration or drilling “doesn’t apply to us at all”.

In a video release from the White House, Obama called Bristol Bay one of the country’s great natural resources, which is “something too precious for us to be putting out to the highest bidder”.

“It supports about $2 billion in the commercial fishing industry,” he said. “It supplies America with 40% of its wild-caught seafood.” Bristol Bay also hosts one of the world’s largest wild salmon runs and is home to threatened species and the endangered North Pacific Right Whale.

However, Sen. Lisa Murkowski, R-Alaska, and the incoming chairman of the Senate Energy and Natural Resources Committee, said, “I think we all recognize that these are some of our state’s richest fishing waters. What I do not understand is why this decision could not be made within the context of the administration’s upcoming plan for offshore leasing—or least announced at the same time.”

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Ring of Fire Bogging Down? – by James Murray (Netnewsledger.com – December 17, 2014)

http://www.netnewsledger.com/

Ring of Fire Being Frozen in Ontario Ottawa Ice Storm?

THUNDER BAY – BUSINESS – The Ring of Fire is a major mining project that has the potential to make a massive impact across Northwestern Ontario. That potential has taken a number of hits over the past several years. Initially, Cliffs Natural Resourses, KWG Resources, and Noront Resources were the large players in the region. The Ring of Fire often is discussed for its huge chromite deposit potential. There are of course other minerals in the Ring of Fire, nickel being one of those minerals.

Last January, Cliffs Natural Resources pulled their camps out and left the Ring of Fire in a physical presence. More recently, Cliffs is stating that they don’t think it is possible for the project to actually happen in the next half century.

The Ring of Fire presents an opportunity for Canada, for Ontario, and for First Nations. Right now that project is in effect moving far slower than business would like it to move.

Relations Between Ontario and Ottawa Chilly at Best

Part of this appears to be an ongoing impasse between Prime Minister Stephen Harper and Ontario Premier Kathleen Wynne. A few weeks ago, the Premier wrote the Prime Minister expressing that December 5th marked the one year anniversary of their last meeting. There appears to be a level of ice in the relationship between the PM and the Premier thick enough to safely drive a transport truck over.

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Poland’s KGHM has talks with Canadian rival over permit dispute – by Adrian Krajewski and Anna Koper (Reuters India – December 17, 2014)

http://in.reuters.com/

WARSAW – Dec 17 (Reuters) – Europe’s second largest copper producer KGHM has held talks with Canadian-owned rival Miedzi Copper about two disputed Polish concessions which are the subject of a legal battle, KGHM said on Wednesday.

Miedzi Copper filed a case in a Polish court against the government after two copper permits it had been awarded were withdrawn by the government following a challenge from KGHM, which itself wanted to develop the concessions.

“KGHM management met with Miedzi Copper management,” KGHM spokesman Dariusz Wyborski said. “We’re aiming at a solution that’s best for us, Miedzi Copper and the region.”

He said further geological studies on the concessions would be carried out “to accurately reflect on the possibilities sketched out at the meeting.” He did not elaborate. Miedzi Copper declined to comment.

KGHM, part state owned and the only miner producing copper in Poland, has previously said it challenged the award of the permits to Miedzi copper because it had spent time and money researching the permits, adjacent to areas it is already mining.

The government said the permits were withdrawn because of shortcomings in the way the bidding process was administered.

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Sudbury column: Big mining still tests city’s mettle – by Carol Mulligan (Sudbury Star – December 17, 2014)

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

Philosopher-poet George Santayana wrote, “Those who cannot remember the past are doomed to repeat it.” Sudbury’s largest employer and its largest trade union haven’t forgotten the past, but they are determined to leave it behind.

Last week, the president of United Steelworkers Local 6500 and the Canada/UK vice-president of Vale Ltd. held a news conference. Rick Bertrand and Kelly Strong sat side by side in the Steelworkers’ Hall, in itself significant, and signalled their intention to settle a new contract in 2015.

The former Inco and the union for production and maintenance workers historically made a show of exchanging proposals three months before a contract expired. That was all the public knew until they reached a tentative deal or the union went on strike.

Sudbury held its collective breath in contract years, getting antsy the year before. When the local had 12,000 members, the city’s economy rose and fell with its labour status. Decades of hard bargaining earned Steelworkers solid wages and good benefits, the spinoffs of which kept many of us working.

Advances in mining technology have decimated the miner’s blue-collar workforce to 2,700 members, and the city isn’t as dependent now on the labour fortunes of Vale and its union.

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Why Talisman Energy Inc is the first — but not last — victim of the oil price slump – by Claudia Cattaneo (National Post – December 17, 2014)

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

Senior oil and gas producer Talisman Energy Inc. became the first Canadian oil patch company to surrender to the global oil price crash Tuesday, when it announced its sale to Spain’s Repsol SA for US$8.3 billion in cash after a long campaign to re-focus its global business.

There will be more.

With share prices at garage-sale levels, the whole Canadian energy sector is vulnerable to being picked on by anyone with a war chest, expectations of an oil price recovery or better ideas on how to create value.

“The likelihood for high-profile M&A transactions is almost a guarantee,” said Sonny Mottahed, CEO and managing partner of Black Spruce Merchant Capital in Calgary. “In the environment that we are in today, where you have equity prices reacting dramatically to the drop in the commodity … the intrinsic value of a lot of these companies is far greater than what the market is valuing them at.”

In anticipation of more consolidation, investors pushed up many battered Canadian energy names, with Encana Corp. bouncing 7.4% to close at $14.53, Crescent Point Energy Corp. gaining 10% to close at $24.13; Baytex Energy Corp. gaining 5.7% to $16.21, and Whitecap Resources Inc. gaining 5.4% to $10.99.

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B.C. approves $8.8-billion Site C hydroelectric dam – by Justine Hunter and Ian Bailey (Globe and Mail – December 17, 2014)

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.

VICTORIA and Vancouver — The B.C. government has approved the construction of the Site C dam on the Peace River at an estimated cost of almost $8.8-billion, making it the largest public infrastructure project in the province’s history.

But the government will delay the project until next summer and has adjusted the price to be $900-million higher than what BC Hydro had proposed. The project faces a series of lawsuits, and on Tuesday, environmentalists, First Nations and the NDP renewed their opposition to the dam.

Premier Christy Clark, at a news conference in Victoria, said the revised budget reflects “the true cost” of building the dam, but she believes it remains the cheapest option to meet British Columbia’s growing demand for electricity in the future.

“I believe the people of our province will continue to prosper,” she said. “We need to ensure there is power – clean, reliable, sustainable power.”

Site C will be built downstream of the W.A.C. Bennett and Peace Canyon dams in northeastern B.C., and will be the first major hydroelectric dam to be built in the province since completion of the Revelstoke dam in 1984.

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Greg Rickford responds to province’s latest Ring of Fire request – by Jody Porter (CBC News Thunder Bay – December 17, 2014)

http://www.cbc.ca/news/canada/thunder-bay

Ontario wants $1B from Building Canada Fund for roads and power to remote mineral deposit

Ontario’s plan for the remote Ring of Fire mineral deposit has “serious structural problems” according to the federal Natural Resources Minister, and that’s why Greg Rickford says Canada is cautious about partnering with the province to build roads and power lines.

Ontario’s Minister of Northern Development and Mines wrote to Rickford last week, asking for a meeting to discuss the province’s proposal for $1 billion under the Building Canada Fund.

“We need you to be actively engaged in these discussions as we chart a path forward,” Michael Gravelle wrote in a letter dated Dec. 11. “Your government’s acknowledgement of a matching $1 billion commitment to support infrastructure development is key.”

Rickford said he is happy to meet with Gravelle but is not so happy with the way the province is approaching development of what both levels of government see as a key resource.

“We’re waiting for the province to maybe move beyond the letter-writing and get a submission to us, technically, about a priority and a priority project and we’ll move forward on that,” Rickford said.

He outlined what he describes as three key structural problems with Ontario’s approach that “only the province can resolve.”

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Resource revenue sharing ‘not going away’ – by Jason Warick (Regina Leader Post – December 15, 2014)

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

“This is something we need to get right,” Cam Broten says

The Saskatchewan government should join the growing number of other provinces and consider sharing natural resource revenue with First Nations, say experts.

“How do you reconcile if you don’t share the resources?” said Vancouver lawyer Tom Isaac, author of Aboriginal Law: Commentary, Cases and Materials. Isaac, a University of Saskatchewan law graduate who represents governments and resource companies, said any revenue sharing must be sustainable and measured, but the issue “is not going away.”

Resource revenue sharing hit the national stage last week when former Federation of Saskatchewan Indian Nations Chief Perry Bellegarde was elected to head the national Assembly of First Nations. In a fiery speech to AFN delegates in Winnipeg, Bellegarde vowed resource development would occur only after First Nations’ concerns were addressed.

“We weren’t meant to be poor in our own lands,” Bellegarde said. Saskatchewan’s Energy and Resources Minister, Bill Boyd, was not available for an interview this weekend. In a written statement, the government said its position has not changed.

“Our province’s resources belong to everyone in the province. Revenues from Saskatchewan’s resources belong to all Saskatchewan people, and everyone, including First Nations, benefit from that revenue,” read the statement.

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Researcher poses two scenarios for Nunavut gold mine closure – by David Murphy (Nunatsiaq-On-Line.ca – December 16, 2014)

http://www.nunatsiaqonline.ca/

“People are actually left with mining skills, but not with other skills once the mine closes”

The 1,800-person community of Baker Lake has less than three years to go before the Meadowbank gold mine, about 100 kilometres from the town, closes down.

Until then, questions linger about how Nunavut’s only inland hamlet can support itself afterwards, problem free.

“People said overwhelmingly that — with the mine closing in 2017 — there is very little awareness and very little preparedness for that scenario,” said Annabell Rixen, a master’s student assessing the mine closure and community preparedness as part of a project called “Tuktu.”

Rixen’s presentation was part of the four-day Arctic Change conference, hosted by ArcticNet, which unfolded Dec. 8 to Dec. 12 at the Ottawa Conference Centre. Rixen boiled her research down to two visions: a worst and best-case scenario.

The best case: job training programs are implemented to stimulate new local businesses and money is injected into mental health, childcare and cultural programming. Also, dwindling caribou numbers return to full strength.

“As the elders emphasized: let our land recover. We need to give our land the proper time to rejuvenate,” Rixen told Nunatsiaq News.

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