Republic of Mining

Column – Falling gold supply a rare beacon of hope for price recovery – by Clyde Russell (Reuters India – November 14, 2014)

November 14, 2014

http://in.reuters.com/

LAUNCESTON, Australia – (Reuters) – It must be getting increasingly hard for the World Gold Council to find something positive to focus on when compiling its quarterly report.

The latest instalment, released on Thursday, is no exception and the council, which represents gold producers, chose to highlight what it termed the “good health” of the market for jewellery.

This was despite a drop in jewellery demand of 4 percent year-on-year in the third quarter, but maybe it looks better than highlighting the fact that overall gold demand fell to the lowest level in nearly five years.

However, instead of focusing on the demand side of the gold equation, if the council was looking for some better news on the outlook for the precious metal, the supply side offers some hope.

It’s becoming a more common theme in commodities this year, namely that supply-side dynamics are driving markets far more than demand, but many in the market have been slow to adjust to this.

Ottawa vows to protect ‘Canada brand’ with social responsibility policy – by Shawn McCarthy (Globe and Mail – November 14, 2014)

November 14, 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 — The federal government plans to punish mining and energy companies that run afoul of its new corporate social responsibility policy by withdrawing support they receive from agencies such as Export Development Canada and embassies abroad.

International Trade Minister Ed Fast is to announce the measure in a speech in Vancouver Friday, saying it is important to protect Canada’s “brand” as a global heavyweight in the resource industries.

“Let there be no mistake,” the minister says in a draft copy of the speech provided to The Globe and Mail, “Canada’s expertise in the extractive sector is second to none; Canada is a world leader in sustainable technology, and in environmentally, ethnically and socially responsible business practices. That is the ‘Canada brand’ – it is how we are known throughout the world.”

The government is launching a corporate social responsibility (CSR) strategy as part of its broader effort to enhance the business prospects for resource companies abroad. Toronto is a global centre for mining finance and Canadian-based companies are particularly prominent in Africa and South America, where more than 250 companies controlled $81-billion in assets in 2011.

Nordgold tries to usurp AuRico with microcap takeover – by Kip Keen (Mineweb.com – November 14, 2014)

November 14, 2014

http://www.mineweb.com/

The Russian miner looks to takeover Carlisle Gold Fields in a hostile takeover – not that it’s calling it that yet.

HALIFAX, NS (MINEWEB) – Now you get some thick stuff on this one. Carlisle Goldfields, which owns some near surface gold assets in Manitoba, numbering close to two million ounces in highish-grade resources, has become the bargain prize in an atypical tussle between two intermediates gold miners.

The twisting, and extremely caveat-ridden language in multiple press releases out of Carlisle and Nord Gold sets the tone of what may prove a nasty tug-o-war. From Carlisle today:

“Nordgold issued a news release this morning announcing its request for Carlisle’s consent to make a take-over bid. Carlisle is of the view that, although the request made to Carlisle may be in compliance with the Mutual Confidentiality Agreement, the news release in that regard is in clear violation of the terms of the agreement.”

You may have to read the last line at least twice. Carlisle says Nordgold may be in compliance with a confidentiality agreement, but that it is also in clear violation of said agreement. A little convoluted to say the least.

Vedanta to build R8.7bn Gamsberg zinc project – by David McKay (Miningmx.com – November 13, 2014)

November 14, 2014

http://www.miningmx.com/

[miningmx.com] – UK-listed mining group Vedanta Resources said it had approved an in principle investment of $782m (R8.7bn) in the Gamsberg zinc deposit in South Africa’s Northern Cape province with a view to producing first zinc during the group’s 2017/18 financial year.

In terms of the proposed investment, Vedanta will establish an open pit mine producing 250,000 tonnes/year of zinc and a refinery at the site of Skorpion, a mine first developed by Anglo American, producing 150,000 tonne/year of zinc concentrate. The Skorpion mine produced 13% less refined zinc, or 60,000 tonnes, in the first half of Vedanta’s financial year.

“The detailed feasibility study for the mining project was placed at the board meeting, while the work for setting up pilot plant for refinery conversion is underway,” said Vedanta today as part of its interim results presentation. “Preliminary work on financing options have also been commenced,” it said.

Vedanta has a positive view on the internationally traded zinc market saying in its interim results that it expected a supply deficit to remain in place until 2018. London Metal Exchange zinc prices averaged $2,196 per tonne compared to $1,850/t in the same period in 2013, it said.

The Gamsberg deposit and Skorpion mine were sold to Vedanta in 2010 as part of a package of zinc assets for about $1.3bn by Anglo American, then led by Cynthia Carroll who had embarked on a wave of non-core asset sales.

The gold mining meltdown is so bad even activist investors won’t touch it – by Peter Koven (National Post – November 14, 2014)

November 14, 2014

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

As gold prices stumble and mining stocks sink to woeful lows, a lot of investors are asking the same question: where are the activists? The sad answer, experts say, is that activists don’t see any more hope for this sector than anyone else does right now.

It was a given over the past several years that proxy battles would break out across the mining space whenever commodity prices dropped. Frustrated investors would scrutinize the strategy and compensation of boards and management teams, and quickly act when they saw a problem.

Activists overhauled many mining boards during recent bear markets, including HudBay Minerals Inc. in 2009. There was an average of nine mining proxy fights a year between 2008 and 2013, according to law firm Fasken Martineau.

There are more frustrated mining investors today than at any other point in recent memory. But prices for commodities such as gold, silver and iron ore have fallen so much that it is hard to find opportunity in any of the related stocks.

“If you take over the board and take over the company, how are you going to create value at a gold price like this?” said Wes Hall, head of Kingsdale Shareholder Services.

Obama backed into Keystone corner as U.S. House to vote on pipeline Friday – by Claudia Cattaneo (National Post – November 14, 2014)

November 14, 2014

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

As the United States Congress moved closer to voting on the Keystone XL pipeline, President Barack Obama seemed increasingly isolated in his dislike of the Canadian project.

After years of bizarre regulatory delays, an out-of-nowhere court challenge in Nebraska and changing White House expectations, the push to line up votes in support of the Alberta-to-Texas pipeline is gaining momentum in Washington.

The House of Representatives was expected to start debating a bill to approve the US$8 billion project proposed by Calgary-based TransCanada Corp. on Thursday and hold a vote on Friday. The Senate is expected to hold a similar vote early next week, likely on Tuesday.

If Democratic Senators, led by Louisiana’s Mary Landrieu — yes, the instigators are people in President Obama’s own party — manage to line up 60 votes in support of KXL, the bill could be on President Obama’s desk for final approval by the end of next week.

Republicans have been long-time supporters of the project and have vowed to present legislation of their own in January, when they will take over control of both the House and the Senate thanks to their mid-term election wins last week.

What does an RMB trading hub mean for Canada? – by Dana Flavelle (Toronto Star – November 11, 2014)

November 14, 2014

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Canada has been designated a trading hub for China’s currency. What does it mean in terms of jobs, the economy and international trade?

Canada has been designated a trading hub for China’s currency, a move aimed at boosting international business between the two countries while also nudging China’s once cloistered “redback” toward global status.

Among other things, it means for the first time, Canadians can open bank accounts in Canada that contain China’s yuan, also known as the renminbi (RMB).

Canadian institutional investors, such as pension funds, will also be able to buy up to 50 billion yuan worth of Chinese bonds and stocks directly. That’s roughly $9.2 billion.

The deal will “continue to boost the Toronto region’s status as a global financial centre,” Janet Ecker, president and chief executive officer of the Toronto Financial Services Alliance, said in a statement.

Webequie chief calls for true partnerships at mining summit – by Rick Garrick (Wawatay News – November 13, 2014)

November 13, 2014

http://www.wawataynews.ca/

Webequie Chief Cornelius Wabasse called for “true partnerships” at the 4th Annual Mining Ready Summit, held Oct. 28-29 in Thunder Bay.

“That’s the way going forward for us to have a step in the processes and also be part of the processes that are potentially going to happen in our area,” Wabasse said. “We have to have these agreements and they have to be real and they have to be honoured.”

Wabasse said his community does not want to sign agreements where “nothing is happening on our side.”

“We know that we have to work our part as well too to make that agreement become reality,” Wabasse said. “We need to understand as First Nations about that agreement, what we need to do to make that happen as well too.”

Wabasse said his community is not opposed to development. “We want to be able to benefit from our lands and resources,” Wabasse said. “We want to be able to benefit from any development that is happening in our area. We know that things are changing — we are not going to be trapping and fishing all our lives — we have to look at other ways of benefitting from our lands and resources.”

But the community still does practice its traditional ways of life on the land, including harvesting traditional foods such as moose, caribou, rabbits and partridge.

“We had a good fall harvest this season,” Wabasse said. “The community engaged in a fall hunting festival, so it was good to see our people still very into the traditional ways of life and also eating traditional foods.”

Lack of domestic minerals/metals supplies worry U.S. manufacturers – by Dorothy Kosich (Mineweb.com – November 13, 2014)

November 13, 2014

http://www.mineweb.com/

A growing global population relying on greater combinations of minerals have increased U.S. manufacturers’ minerals/metals demands.

RENO (MINEWEB) – A survey of 400 senior executives in the U.S, manufacturing sector or industries heavily impacted by manufacturing determined that more than 90% of them are concerned about the U.S. minerals and metals supply.

“The issue of minerals and metals supply is a growing concern among U.S. businesses, as U.S. manufacturers currently rely on foreign countries for more than half of the minerals and metals they use,” said the Edelman-Berland survey, Mining: The Foundation of U.S. Manufacturing.

Those executives are also concerned about supply disruptions outside of their control, “citing geopolitics and increasing global demand as the most pressure factors,” said the survey.

“Most executives surveyed also believe minerals and metals demand will only increase in the next five to 10 years,” according to the survey. Meanwhile, mineral and metal scarcity is also expected to increase during the same period and negatively impact business.

Of those surveyed, 40% said most of the minerals they use in their supply chains come from within the U.S., while 21% get 50% of the minerals domestically. Only 14% of those surveyed said all of the minerals they use come from the United States.

Russia and SA aim to boost PGMs – by ANDRE JANSE VAN VUUREN AND YULIYA FEDORINOVA (Bloomberg/Business Day Live – November 13, 2014)

November 13, 2014

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

RUSSIA and SA will next year invite platinum group metal producers and users for talks as the countries seek ways to support falling prices.

The two nations, holding about 80% of the world’s reserves of the metals, met last Thursday in Pretoria “to collaborate on technology development and jointly exploring new applications for the metal” to grow demand, Phuti Mabelebele, a spokeswoman for SA’s mines ministry, said on Wednesday in an e-mailed response to questions.

The parties agreed to arrange a conference in the second half of next year to which they would invite mining companies, traders and consumers to “jointly consider appropriate options to achieve stability and sustainable growth”.

Platinum prices have tumbled more than 20% since Russia and SA said in March last year that they were looking for ways to buoy the market. Palladium gained about 8% in that period. SA mines about 70% of the world’s platinum and Russia 40% of its palladium.

The countries would meet for separate talks about the issue in the first quarter of next year in Russia, Ms Mabelebele said.

Success secrets of Francis H. Clergue [the visionary founder of Algoma Steel] – by David Helwig (Soo Today.com – November 13, 2014)

November 13, 2014

https://www.sootoday.com/

If you look carefully at the structural steel in the oldest of those magnificent Romanesque buildings at the Mill Square redevelopment, you’ll see Andrew Carnegie’s maker’s mark.

Francis Hector Clergue used the American robber baron’s Carnegie Steel in the initial buildings of his new pulp mill. Clergue, as every Saultite knows, was the lawyer from Bangor, Maine who came here in 1894 on behalf of a group of Philadelphia capitalists looking for investment opportunities.

He founded St. Marys Paper, what is now Essar Steel Algoma, and Algoma Central Railway, all in just eight years from 1895 to 1902. Other buildings at the St. Marys Paper/ Mill Square site were built with Clergue’s Algoma Steel after the first local ingot was cast in 1902.

Glen Martin sees a ton of significance and symbolism in Clergue’s switch to homegrown Algoma Steel. Martin is the hirsute Los Angeles-based Saultite who was the initial driving force behind the Sault Ste. Marie Solar Park before the project was acquired by Starwood Energy in 2010.

He’s also the founder and chief executive officer of Energizing Company, a California startup that’s planning to deploy its flagship utility-distributed microgrid project here in Sault Ste. Marie. In recent months, Martin has been thinking a lot about the history of his hometown.

NEWS RELEASE: More Holistic Views Key to Better Resource Management

November 13, 2014

Oliver Cann, Director, Public engagement, Tel.: +41 79 799 3405; Email: Oliver.Cann@weforum.org

http://www.weforum.org/

Divided views about the future of natural resources are preventing better resource management
Understanding the drivers of future resource availability can create common ground among decision-makers
Above-ground risks present more of a threat to natural resources than physical depletion

Download the full report here: http://www3.weforum.org/docs/WEF_FutureAvailabilityNaturalResources_Report_2014.pdf

Dubai, United Arab Emirates, 10 November 2014 – The gravest threat to the future availability of natural resources comes not from their physical depletion but from above-ground risks and a lack of understanding of the drivers of resource scarcity. This is according to a new report, The Future Availability of Natural Resources: A New Paradigm for Global Resource Availability, released today by the Forum.

“A central reason for the world’s failure to effectively manage its water, food, energy and mineral resources is the existence of deep divides among stakeholders in this field, who tend to use similar data but distinct mental models to come to vastly different conclusions about tomorrow’s resource picture,” said Kristel Van der Elst, Senior Director and Head of Strategic Foresight at the Forum. Rather than sharing a common view on what causes resource scarcity, their mental models broadly fall into four polarized groups.

Commentary: What miners need to know about Canada’s new payment reporting law – by Graham Erion and John Munnis (Northern Miner – November 11, 2012)

November 13, 2014

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

On Oct. 23, 2014, the Government of Canada introduced its long-awaited legislation to mandate disclosure of public payments made by mining and oil & gas companies for the commercial development of oil, gas and minerals. The Extractive Sector Transparency Measures Act follows over a year of industry consultations and an industry and civil society-led roundtable, both of which Davis LLP has covered extensively. With the introduction of the Act, key details for the payment reporting scheme have been clarified, which are reviewed below.

The basic payment reporting obligation

The Act applies to any entity engaged in, or controlling other entities engaged in, the commercial development of oil, gas or minerals anywhere in the world so long as the entity: has publicly listed in Canada; has a place of business in Canada, does business in Canada or has assets in Canada, and that, based on its consolidated financial statements, meets at least two of the following conditions for at least one of its two most recent financial years; has $20 million in assets; has $40 million in revenue; and/or has 250 employees.

Entities covered under the Act must provide the Canadian government with an annual report detailing the payments it has made directly or indirectly to a public body — whether monetary or in-kind — to develop oil, gas or minerals if the total amount of such payments during the previous financial year is at least $100,000 (or such other amount if prescribed by regulation).

Groups ask why no charges have been laid a year after Alberta coal mine spill – by (The Canadian Press/Globe and Mail – November 12, 2014)

November 13, 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.

EDMONTON — Conservation groups want to know why no federal or provincial charges have been laid over a massive spill from a coal tailings pond in west-central Alberta.

An estimated 670 million litres of waste water spilled into tributaries that feed into the Athabasca River after an earth berm broke at the Obed Mountain mine on Oct. 31, 2013.

The mine was owned at the time by Sherritt International, which has since sold it to Westmoreland Coal Company. Groups including the Alberta Wilderness Association say Sherritt should be charged under the federal Fisheries Act.

They also say they want both governments to make public what was in the tailings, how the spill has affected the rivers and how it may affect the health of people who live downstream. Federal officials and staff at the Alberta Energy Regulator were not immediately available for comment.

“The lack of enforcement and charges for a spill of this magnitude calls into question the approval of any mining development in Alberta,” Brittany Verbeek, a spokeswoman for the wilderness association, said Wednesday.

NEWS RELEASE: Barrick Appoints Executive Project Director for Pascua-Lama

November 13, 2014

TORONTO, November 13, 2014 — Barrick Gold Corporation (NYSE:ABX)(TSX:ABX) (Barrick or the “company”) today announced the appointment of Sergio Fuentes as Executive Project Director for Pascua-Lama. Mr. Fuentes was most recently Vice President, Projects for Codelco and has nearly 30 years of mining industry experience, with a proven track record of engineering, optimizing and constructing complex mining projects, including high-altitude operations in the Andes.

As Executive Project Director, Mr. Fuentes will focus on optimizing detailed engineering, improving the project’s economics and developing a robust execution plan for remaining construction activities at Pascua-Lama. He will work with the project leadership team to advance Pascua-Lama in an environmentally responsible manner, in compliance with legal and regulatory requirements. In the short term, he will lead the completion of final engineering for the water management system in Chile and will work to reduce ongoing care and maintenance expenditures at the project.

Mr. Fuentes will work closely with Eduardo Flores, Executive Director, Chile and Guillermo Calo, Executive Director, Argentina to ensure alignment of all project activities in both Chile and Argentina and will support the development of enduring partnerships with governments, communities and other stakeholders in both countries.

A decision to restart the Pascua-Lama project will depend on resolution of permitting and legal matters in Chile and improved project economics. The company will only proceed with construction if the project meets minimum return-on-investment thresholds.