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Scotiabank’s Patricia Mohr looks ahead to 2015 – by Trish Saywell (Northern Miner – December 3, 2014)

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry.

Patricia Mohr, vice-president of economics and commodity market specialist at Scotiabank in Toronto, will release her metal price forecasts for 2015 in her annual year-end report at the end of December. But she agreed to share some of her thoughts on base metals, gold and uranium a little beforehand with The Northern Miner.

The Northern Miner: Some people seem to think 2015 will be a writeoff for mining and metals and don’t expect a recovery until mid-2016 or even 2017. What are your views?

Patricia Mohr: I’m a little bit more optimistic for the base metals. In fact, I think when you look at the average prices this year you’ll discover that prices late this year are actually higher for most of the base metals than they were late last year. The one exception to that is copper, which is a little lower than it was in late 2013.

If you look at zinc, it was trading at US$1 per lb. on Dec. 1, and the London Metal Exchange (LME) official cash settlement price at the end of 2013 was US89.03¢ per lb. Aluminum is averaging US95¢ per lb. this year, and in December 2013 it averaged US78.8¢. Nickel is averaging US$7.30 per lb. and was US$6.30 per lb. in December 2013.

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Cementation Canada: A New Way of Building Mines – by Robert Spence (Mining Global – December 5, 2014)

 http://www.miningglobal.com/

Cementation is an underground mine contracting and engineering company that provides an extensive array of services for clients throughout North and South America. Based in Ontario, Canada, the company has a unique structure, one that is well suited for technically challenging projects.

“We set out to do something different,” says President of Cementation, Roy Slack. “We wanted to change the way mine contracting is carried out.” The company started by focusing on three key aspects: safety, relationships and the way it implements contracting.

“We wanted this to be an industry with zero harm so we aligned our vision to focus on safety,” says Slack. “Secondly, we wanted to restructure the relationship between us and the clients and avoid adversarial relationships. We really try and understand what the client wants from a project standpoint and we align ourselves with these goals.

Lastly, we wanted to change the way contracting is done by providing a true design-build service for Clients. Traditionally, different groups would work on different stages of a project; we wanted to establish both continuity and one point accountability through a strong engineering service within our contracting group. These are the changes we wanted to make.”

Above all else, Cementation is committed to safety. The company recognizes that a safe contractor is more attractive to both employees and clients and this aligns with the company’s goal of being both an employer and contractor of choice.

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Sandvik to relocate global mining facilities to India, China – by Pratim Ranjan Bose (The Hindu Business Line – December 3, 2014)

http://www.thehindubusinessline.com/

KOLKATA, DECEMBER 2: – In October, Sandvik announced a plan to set up its sixth manufacturing base in India at $ 45 million (approximately 280 crore at current exchange). But that may not be the end of the investment proposals to the country.

According to Kobus Malan, President emerging markets, Sandvik Mining, the company is also relocating number of its global mining equipment facilities from USA and Europe to India and China as part of a two year business reorganisation plan that will be completed in the next fiscal.

“A number of factories in Europe and USA are to be closed down. They were acquired during the 10-year long mining super cycle when chasing orders were a priority,” Kobus Malan, President emerging markets, Sandvik Mining told Business Line on Wednesday.

Malan could not offer details of the factories to be relocated to India and China. He was in the city in connection with International Mining and Machinery Exhibition (IMME).

With commodity prices plummeting Sandvik is focussing on cost efficiencies and shifting its operations to the growth markets of India and China.

“We have formed a focussed group for the emerging markets of India and China,” he said adding that as the business process is on course to be streamlined further India (along with China) may get more investments.

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Education ‘absolutely critical’ to mining sector: SAMSSA – by Jonathan Migneault (Sudbury Northern Life – December 04, 2014)

http://www.northernlife.ca/

Sudbury’s two colleges promote their services to mining sector

Sudbury’s post-secondary institutions play an “absolutely critical” role in the city’s mining cluster, says the executive director of the Sudbury Area Mining Supply and Service Association (SAMSSA).

“New programs are the big thing for us,” said Dick DeStefano at the organization’s 11th annual general meeting Dec. 4. “Our guys hire everybody they can.”

When he addressed SAMSSA members and local dignitaries that morning, DeStefano identified four critical components of Sudbury’s mining cluster: mining extraction, support services, post-secondary institutions and research institutions.

Cambrian College President Bill Best, and Collège Boréal President Pierre Riopel took to the stage to address the local mining supply and services sector, and outline the solutions their institutions can provide. Riopel announced Boréal will launch a new prospecting and exploration technology program in 2015.

The program, he said, was a direct response to industry needs after conversations with DeStefano and other mining sector representatives. “The college system is a very nimble system,” Riopel said. “We’re listening to industry.

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Saudi oil-price cut prompts Canadian energy stock slide – by Shawn McCarthy (Globe and Mail – December 5, 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.

OTTAWA — Saudi Arabia slashed the price it will charge for crude in Asia and the United States as the OPEC giant battles to maintain its share in an over-supplied global market.

The move prompted another sell-off among skittish traders, who are wondering where the floor in prices is. The 12-member Organization of Petroleum Exporting Countries last week refused to cut its production quota in the face of a global glut, sending oil prices into a tailspin.

It remains unclear still how low prices will go – and how long it will be before they recover. In New York on Thursday, the benchmark West Texas Intermediate fell 70 cents to $66.68 (U.S.) per barrel, after falling as low as $66.09. In London, Brent crude was down 80 cents to $69.12.

The Saudi move signals a drawn-out standoff among producers that is likely to weigh on oil prices for months and hit Alberta’s oil industry. Canadian energy shares sank another 5 per cent Thursday, extending their slide in recent weeks as investors brace for sharply lower profits from the sector. The dip in energy stocks helped send the S&P/TSX composite index tumbling 2 per cent to close at 14,469.95.

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Enough with pipelines. Refine it – by Gordon Gibson (Globe and Mail – December 5, 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.

Oil prices are down, but they will be back up, as always. Meanwhile, new supply comes on stream from existing construction. So the great Canadian issue remains new oil pipelines from Alberta. For supporters, these long-term projects will generate untold billions of dollars every year, including tax revenue to pay for all the health and education and other good things. For opponents, the pipelines will facilitate the very destruction of the planet through carbon release, or at a minimum foul our streams and oceans.

This is surely of national consequence. So it is passing strange that the debate is being led by premiers and even mayors. After all, the Constitution gives Ottawa exclusive jurisdiction in this area, including the Northern Gateway, Kinder Morgan and Energy East pipelines. And the government with the power stands mute.

Yes, the National Energy Board is holding hearings, but that process is getting minimal respect from opponents on three grounds. First, that it is an alleged rubber stamp. I don’t believe that, though. The technical and route environment and aboriginal investigations are thorough.

The second, correct observation is that the process is not considering the supposedly most important matter of all, namely the carbon consequences of extracting oil from what opponents call the “tar sands.”

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Vale base-metals IPO could prove to be a Bay Street bonanza – by Euan Rocha and John Tilak (Globe and Mail – December 4, 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.

TORONTO — Reuters – Vale to consider base metals IPO only if nickel rallies – by Sarah McFarlane and Eric Onstad (Reuters U.K. – December 5, 2014)

LONDON – (Reuters) – A possible public listing of a stake in the base metals unit of Brazil’s Vale SA (VALE5.SA) hinges on a rally in nickel prices of around 20 percent, its chief financial officer said on Friday.

“We want to see nickel prices above $20,000 per tonne in order to consider such an option, I would say well above,” Luciano Siani said in an interview with Reuters.

Earlier this week Vale, the world’s largest producer of iron ore, said it was considering an initial public offering of 30 to 40 percent of its base metals division, because the unit was undervalued by the market. Benchmark nickel CMNI3 on the London Metal Exchange closed at $16,825 a tonne on Friday after a roller-coaster ride this year.

Siani said that if nickel prices reached $21,000 per tonne and copper $6,600 per tonne next year, the company would meet the lower end of its 2015 target for the base metals unit of $4 billion to $6 billion in earnings before interest, tax, depreciation and amortisation (EBITDA).

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Getting Ontario Mining Opportunities Right – Critical – Gravelle (Netnewsledger.com – December 5, 2014)


Mining Status in Ontario – Minister Gravelle by netnewsledger 

http://www.netnewsledger.com/

THUNDER BAY – Mining – Minister of Northern Development and Mines Michael Gravelle shares the latest information on mining in Ontario. The Minister was in London England this week at a mining conference sharing the news on the opportunities in Ontario for mining, and economic development.

Minister Gravelle stated that in London he was a little surprised that not as many people in the conference were fully aware of the opportunities in Ontario for mining. “One of the keys is to be selling the province of Ontario,” stated Gravelle.

The Minister states that the opportunities in the mining field in Ontario are large and that there are 70 million hectares in the Northwest which are open for stalking.

On the Ring of Fire, the Minister shared how critical it is, for Ontario to “Get the Ring of Fire right”, and the steps are being taken to do just that.

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Nickel prices should increase, economist says – by Mary Katherine Keown (Sudbury Star – December 5, 2014)

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

The grey wintry skies mirror the global economic outlook for 2015-16, says one of Canada’s foremost economists. But the local economy should inch upwards over the next two years.

Derek Burleton, vice president and deputy chief economist for the TD Bank Group, spoke to Greater Sudbury’s business community on Thursday at a luncheon hosted by the Chamber of Commerce.

“I’m not expecting any major improvements in the year ahead,” Burleton said of the global economic outlook for 2015. Specifically, he pointed to Japan and the Eurozone, indicating the latter would have to make some “difficult decisions over the next year.”

There is good news for this city, however, as the price of nickel is expected to climb, but not as a result of increased demand.

“The big story here is that it’s a supply story; the export ban of ore in Indonesia will lead to a supply deficit in 2015. That’s what’s being priced into the market,” Burleton told the crowd assembled at Ristorante Verdicchio.

He projected nickel prices would near $15 per pound; however, a forecast published by TD in September put that projection at a more modest $10.44 per pound by 2016. Burleton noted he is “not as optimistic on copper; it’s pretty low and flat,” due to an excess of the mineral flooding the market.

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DECEMBER 4 CELEBRATED AS INTERNATIONAL MINERS DAY – by Workplace Safety North (December 3, 2014)

http://www.workplacesafetynorth.ca/

Mining tradition dates back centuries to St. Barbara, patron saint of miners

Around the world, many miners celebrate December 4 as Miners Day and commemorate their patron saint, St. Barbara, requesting her continuing protection for their daily work.

In Canada last year, the Legacy Project Barbara Celebration 2012 was held at the German Cultural Centre in Saskatoon, with all employees of German-based K+S Potash Canada invited, along with consultants and local service-providers. The organization hopes to establish the Barbara Celebration in Canada, importing some of the traditions and values of the European mining industry. This festive celebration is connected to the very beginning of potash mining in Germany.

Saint Barbara is the patron saint of artillerymen, armourers, military engineers, gunsmiths, miners and anyone else who worked with cannon and explosives, according to Wikipedia. She is invoked against thunder and lightning, all incidents arising from explosions of gunpowder, and venerated by Catholics who face the danger of sudden and violent death in work.

Mining traditions are strictly observed at European mining companies like KGHM International. Beer halls are organized by both the company and individual divisions, and include a traditional “jump over the leather apron” initiation rite. Other festivities include retirement ceremonies, employee anniversaries and awards, meetings with the mothers of miners, family trips to the mines, and many other social events.

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Show us the Ring of Fire plan, says Rickford to province – by Ian Ross (Northern Ontario Business – December 4, 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.

Federal Natural Resources and FedNor Minister Greg Rickford remains optimistic about the future prospects for the Ring of Fire despite the slow exit of Cliffs Natural Resources from Ontario.

But the Kenora MP stuck to the federal government’s line that the province must identify “focussed infrastructure projects” before Ottawa is prepared to spring for any dollars to help the Wynne government develop a transportation corridor to reach the stranded chromite and nickel deposits in the James Bay region.

“I remain confident that the province will come to understand that that’s what Northern Ontarians expect on this legacy resource development project.”

Rickford was in Sudbury Dec. 4 to announce the Community Investment Initiative for Northern Ontario, a FedNor program that sets aside $3 million for small towns and remote First Nations to hire economic development officers to advance local projects in their communities.

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UPDATE 2-Rio Tinto not looking at acquisitions to raise defences against Glencore – by Silvia Antonioli (Reuters India – December 4, 2014)

http://in.reuters.com/

LONDON, Dec 4 (Reuters) – Global mining company Rio Tinto is not looking to make any major acquisition to protect itself from a potential Glencore takeover, Chief Executive Sam Walsh said at a meeting with investors on Thursday.

Since Rio Tinto rejected a tentative approach from smaller rival Glencore in July, speculation has mounted that it might rush to make an acquisition to raise its defences against another takeover attempt by the mining and trading giant.

But Rio Tinto’s boss said the focus remained on improving mining operations and delivering more cash to shareholders, rather than becoming involved in disruptive mergers and acquisitions.

“I see speculation that we are going to rush out and buy somebody. Let me reassure you that we are not looking at any major M&A. We are not looking at doing anything stupid,” Walsh said.

Glencore Chief Executive Ivan Glasenberg has criticized the strategy of rival miners BHP Billiton and Rio Tinto to flood the market with new iron supply to squeeze out smaller competitors. He says the move has backfired and led to a fall in the iron ore price, which is down 50 percent this year.

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Constitutional Court in Indonesia Upholds Ore Shipment Ban – by Yoga Rusmana (Bloomberg News – December 3, 2014)

http://www.bloomberg.com/

Indonesia’s Constitutional Court upheld today the country’s ban on exports of raw mineral ores imposed in January, rejecting a challenge from mining companies.

The court ruled the prohibition was acceptable to ensure ore supplies to domestic smelters. The Indonesian Association of Mineral Entrepreneurs and companies with mining business licenses filed a request in January to seek revision of articles in the 2009 law that formed the legal basis of the ban. Chief Justice Hamdan Zoelva said the ruling was final.

The country, the biggest producer of mined nickel and third-largest bauxite miner last year, banned shipments from Jan. 12, seeking to spur investment in domestic processing and transforming the nation into the producer of high-value metal. President Joko Widodo reaffirmed his commitment to the ban last month. Nickel and aluminum prices have climbed in London this year helped by the curbs.

“This will continue to act as a restraint on Indonesia’s export revenues, and therefore continue to adversely affect Indonesia’s balance of trade,” Luke Devine, foreign legal consultant, finance and projects, at Hadiputranto, Hadinoto & Partners, said by e-mail before the decision.

Nickel futures climbed 18 percent this year to $16,370 a metric ton, the biggest gainer among six base metals on the London Metal Exchange, while aluminum added 9 percent to $1,961.50 a ton.

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Petronas delays decision on Pacific NorthWest LNG project – by Brent Jang (Globe and Mail – December 4, 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.

VANCOUVER — Petronas has delayed making a final investment decision on plans to export liquefied natural gas from British Columbia, warning that estimated construction costs are too high.

The Petronas-led Pacific NorthWest LNG terminal proposed for Lelu Island has been budgeted to cost $11.4-billion, part of a $36-billion undertaking to ship LNG from the West Coast to energy-thirsty customers in Asia.

But Pacific NorthWest LNG warned Wednesday that pipeline and terminal engineering costs estimated so far make the Canadian LNG project uneconomic, especially against a backdrop where the Malaysian energy giant needs to scrutinize capital spending because it is being hurt by plunging oil prices.

In postponing the project decision, Petronas may be seeking to squeeze prospective suppliers’ bids on the project in hopes of nudging the project closer to being launched. Still, the delay raises the possibility that another major resource project in Canada could be sidelined, following a string of planned oil pipelines that have run into political and environmental opposition.

The window of opportunity for LNG exports from Lelu Island is closing, Pacific NorthWest LNG president Michael Culbert said in an interview.

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Emerging markets mock the pessimists – by Jim O’Neill (Business Standard – December 3, 2014)

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

Analysts’ prediction that 2014 would be a bad year for emerging markets didn’t play out. The numbers show that developing-country stock markets performed better than those in the advanced economies

Remember how this time last year a lot of analysts were predicting that 2014 would be a bad year for emerging markets? Didn’t really happen, did it? Now I hear economists saying the reckoning they’d expected has only been postponed. It’ll happen next year instead. It’s possible, but I wouldn’t bet on it.

In this discussion, one crucial fact is both obvious and usually forgotten: the so-called emerging markets are all quite different. They don’t move in unison. Take the impact of cheaper oil. Just as in the advanced economies, it’s good news for some (the equivalent of a tax cut) and bad news for others (the equivalent of a cut in income). It’s unhelpful to generalise. Many of the world’s star performers in 2014 were emerging-market economies. The same will be true in 2015.

The fallacy of agglomeration is compounded by a failure to grasp relative scales. Taken together, the two errors give a distorted picture of global activity.

The slowing of China’s expansion is a constant theme these days. Yes, but remember that China will be a $10-trillion economy by the end of 2014; that during the course of this year’s slowdown, it added roughly $1 trillion to world output; and that slowing growth in China is still quite rapid by most countries’ standards.

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