Republic of Mining

NEWS RELEASE: Lourenco Goncalves Appointed Chairman, President and Chief Executive Officer of Cliffs Natural Resources Inc.

August 7, 2014

CLEVELAND – Aug. 7, 2014 – Cliffs Natural Resources Inc. CLF -1.23% today announced that the Company’s Board of Directors has appointed Lourenco Goncalves to the positions of Chairman, President and Chief Executive Officer, effective immediately.

“I am honored by the opportunity to lead Cliffs into its next chapter, with a keen focus on improving performance and restoring shareholder value,” said Mr. Goncalves. “Cliffs has a unique position of strength in iron ore in the Great Lakes region, many valuable assets in other sectors elsewhere in the US and around the world, and talented employees at all levels of the company.

I look forward to working closely with all of my fellow Directors to refocus Cliffs on a new strategic path that builds on those strengths, and I am grateful to my fellow shareholders for the vote of confidence they have placed in us. While there is much to be done and many challenges ahead of us, there is also much promise. I can assure all of our stakeholders we are hitting the ground running.”

Mr. Goncalves replaces Jim Kirsch who served as Chairman since July 2013, and Gary Halverson who served as CEO since February 2014.

Richard K. Riederer, who has been a Director of the Company since 2002 and was re-elected at this year’s Annual Meeting, added, “I look forward to working with the new Board and management team. The Company wishes to thank Gary Halverson for his contributions to Cliffs as CEO. We also extend our thanks to Jim Kirsch for his service as Chairman of our Board and wish him well in his future endeavors.”

The Risky Rise of the [Mine Tailings] Dams – by Andrew Nikiforuk (The Tyee.ca – August 7, 2014)

August 7, 2014

http://thetyee.ca/

A massive mining wastewater spill in the interior of British Columbia highlights a new global trend: tailing dams that hold waste are not only getting bigger, but posing greater risks to watersheds and communities downstream.

Drawing upon recent industry reports and presentations made by engineers living in the province, it’s clear that the complexities of the industry have multiplied and with them, risks to water are escalating.

Increased global mining production of substances such as iron ore, gold, copper and nickel along with rising metal prices has tripled the value of the industry from $200 billion to $600 billion over the last decade.

But due to declining ore quality, the sheer volume of waste produced by the industry, which can contain substances such as arsenic, lead and cyanide, is increasing.

Every year, the industry digs and moves as much solid rock (several thousand million tonnes per year) as all earthen materials transported by natural geological processes, such as landslides and erosion.

Because of the challenge of peak metals and high global demand, the mining industry faces a number of somber risks, as reported by Andrew M. Robertson of Robertson GeoConsultants at a recent mining conference.

Rodriguez would renew fight for resource revenues – by Ben Leeson (Sudbury Star – August 7, 2014)

August 7, 2014

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

Some may call it an old idea. John Rodriguez calls it unfinished business.

The former Greater Sudbury mayor, who’s running again in the municipal election in October, said he’ll take up the fight once more to tackle the municipality’s $700-million infrastructure deficit by seeking “a fair share” of resource revenues.

Rodriguez made the announcement in front of the Ministry of Northern Development and Mines in Sudbury on Wednesday.

“It’s a question of justice, of fairness,” Rodriguez said. While the province receives royalties from the ores mined in Greater Sudbury – to the tune of $50 million in 2007, based on figures supplied by Rodriguez – the city does not.

Greater Sudbury does get 7.5 cents per tonne for gravel under the Aggregate Resources Act, while the province gets 13 cents.

“But for ores, we don’t get a penny,” Rodriguez said. “We have these major roads in the city – Lasalle Boulevard, Falconbridge Road, Cote Boulevard, (Municipal) Road 15, (Highway) 69 North — that are used as major routes for transporting ores from the mines to the smelters and refineries, yet we bear the cost of repairing these roads. You can set your clock by it, or your calendar. Every four or five years, we have to resurface the roads, but we don’t receive any royalties to help us offset the cost of repairing these roads.

Editorial: Mount Polley tailings spill – Imperial’s best not good enough – by John Cumming (Northern Miner – August 6, 2014)

August 7, 2014

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry. Editor John Cumming MSc (Geol) is one of the country’s most well respected mining journalists. jcumming@northernminer.com

The complete failure of the tailings dam at Imperial Metals’ Mount Polley copper–gold mine in Central B.C.’s Cariboo region on Aug. 4 is the most depressing thing to have happened in Canadian mining since the Bre-X Minerals debacle in 1997. It’s the worst tailings dam failure tied to a Canadian company since the Los Frailes disaster in Spain in 1998 (5 million cubic metres spilled) and the Omai spill in Guyana in 1995 (2.3 million cubic metres spilled).

It’s about as big a tailings dam failure as you can get: some 15 million cubic metres of tailings muck has so far flowed out of the mine’s tailings-impoundment area through a gaping hole in an obliterated eastern portion of a huge dam wall.

To see the jaw-dropping scale of the devastation, watch the full video of a helicopter survey of the affected area at http://youtu.be/M1YgX2jXnpA, posted by the Cariboo Regional District authority. The video takes 37 minutes, because the affected area is so huge: the massive tailings facility itself, Polley Lake immediately to the east and the deeply messed-up Hazeltine Creek, which empties into the western reaches of the formerly pristine Quesnel Lake, where there are critical salmon-spawning grounds.

In the video, huge amounts of material is actively flowing out of the tailings facility in great, muddy torrents into Hazeltine Creek. Have you ever seen a waterfall of mine tailings? It’s here in this video, in the middle of Hazeltine Creek — a formerly 1-metre wide trickle of wending water that is now a scoured-out 45 metres wide.

UPDATE 2-China’s Ramu nickel mine in PNG restarts after attacks – embassy – by Sonali Paul, Melanie Burton and Polly Yam (Reuters India – August 7, 2014)

August 7, 2014

http://in.reuters.com/

Aug 7 (Reuters) – A Chinese-owned nickel mine in Papua New Guinea has resumed production three days after an attack by armed villagers forced work to halt, a Chinese embassy official in the South Pacific country said on Thursday.

The $2.1 billion mine, forecast to produce 22,000 tonnes of nickel in 2014, is operated by Ramu NiCo, which is majority owned and run by Metallurgical Corporation of China Ltd (MCC) .

Equipment including nine excavators, a fuel truck and a lighting vehicle were burned and five Chinese workers were injured in the attack on Monday, the embassy said, confirming earlier media reports.

“The embassy strongly condemns these brutal attacks and makes urgent request to the PNG Government to take immediate and effective measures to prevent the violence from recurring and ensure the safety of the personnel and properties, and to bring those attackers to justice to deter such criminal acts,” an embassy official said in an emailed response on Thursday.

“With the assistance of the police force, now the situation is under control and the mining production has been resumed.”

Mining and energy projects are the major source of income for Papua New Guinea, but outbreaks of violence sparked by landowner disputes and environmental concerns are not uncommon.

Mount Polley mine tailings spill: Imperial Metals could face $1M fine (CBC News British Columbia – August 06, 2014)

August 7, 2014

http://www.cbc.ca/news/canada/british-columbia

Company ordered to stop pollution immediately and provide environmental impact assessment

Bill Bennett, B.C’s minister of energy and mines, says Imperial Metals will have to acknowledge and pay for any mistakes that led to the massive breach earlier this week of the tailings pond at its mine in central B.C.

The breach of the tailings pond dam at the copper and gold mine near Likely, B.C., released 10 billion litres of water and 4.5 million cubic metres of metals-laden fine sand, contaminating several lakes, creeks and rivers in the Cariboo region on Monday.

Speaking at a news conference Wednesday afternoon, Bennett said a pollution abatement order had been issued to Mount Polley Mining Corp., owned by Imperial Metals. If the firm does not comply, it could face fines of up to $1 million.

“If the company has made some mistakes… they will have to bear the responsibility,” Bennett told reporters in Williams Lake.

What you need to know about tailings ponds – by Adrian Lee (MACLEAN’S Magazine – August 6, 2014)

August 6, 2014

http://www.macleans.ca/

Understanding the tailings ponds breach at Mount Polley near Likely, B.C., which has emptied mine waste into waterways

On Monday, an Imperial Metals tailings pond in B.C. breached its embankment, spilling contaminated water and waste material into the surrounding waterways and spurring a state of emergency in the area. It’s raised the ire of First Nations groups, who say the company ignored a report that the growth of the pond was unsustainable.

It’s angered environmental groups, furious at the suggestion that water with arsenic and mercury was released into the lakes. But what exactly are tailings ponds? Does the industry have an alternative? We talked to Scott Dunbar, the head of the University of British Columbia’s school of mining engineering, to explain the issues at play and the institutional attitudes that need to change so this doesn’t happen again.

Q: So what is a tailings pond, and how does it work?

When you take the rock out of the ground, you grind it up to particles about the size of sand and silt, then you run it through what they call a concentration plant and it separates the minerals of interest from the waste. The waste becomes tailings, and it gets mixed up with water, and it’s pumped out into this pond. The purpose of this pond, with an embankment around it, is to retain the tailings and allow them to drain as much as possible. It’s basically sand-sized particles, but there’s an awful lot of it that’s produced relative to the minerals that generate all that cash. This waste that has to be dealt with. It’s mostly silicates. If the filtering is done well, which it usually is, there would be very few metallics.

Miners talk up big asset sales – by Paul Garvey (The Australian – August 7, 2014)

August 6, 2014

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

IT’S long been said that the juiciest stories out of Diggers & Dealers come not from the procession of speakers at the conference podium, but instead from the Hannan Street bars packed full of delegates each night (and often well into the next morning).

This year was no different. If the chatter doing the rounds in the bars of the Palace and Exchange hotels is anything to go by, we should be standing by for a flow of deals in the months ahead.

While Kalgoorlie’s infamous skimpies went about their business behind the bar — this year’s collection of scantily clad barmaids were apparently flown in from the Gold Coast specially for the event — much of the talk focused on the big asset sales said to be in the works.

The sales process around BHP Billiton’s Nickel West smelter, just down the road from the action in Kalgoorlie, was a subject of significant gossip.

Despite reports Glencore had walked away from the process, there was talk the Swiss giant was in fact still in the fray albeit frustrated by BHP’s approach to the sale. Private equity group Apollo Global Management is understood to have its offer for the assets knocked back, while China’s Jinchuan is still very much in the running.

Tailings ponds for mining and oilsands waste: FAQs (CBC News – August 05, 2014)

August 6, 2014

http://www.cbc.ca/news/technology

What’s in them, what makes them risky and how they’re regulated

The breach of a tailings pond at the Mount Polley copper and gold mine in B.C. has released 10 billion litres of mining wastewater into local waterways in early August. Local residents have been banned from using the water from the Quesnel and Cariboo river systems.

Here are the answers to some questions you might have about tailings ponds.

What are tailings?

Tailings are the byproducts left over from mining and extracting resources, such as extracting bitumen from the oilsands or minerals such as copper or gold from ores. Tailings include:

Finely ground rock particles – ranging from sand-sized to silt-sized.
Chemicals used to extract the valuable mineral or oil.
Water.

Shanduka Urges S. African Platinum Against Mechanizing – by Antony Sguazzin and Gordon Bell (Bloomberg News – August 6, 2014)

August 6, 2014

http://www.bloomberg.com/

Companies that buy operations put up for sale by Anglo American Platinum Ltd. (AMS) after a pay strike by South African mineworkers will need to coexist with labor unions rather than mechanize the operations, said the chief executive officer of Shanduka Group, which owns stakes in platinum mines.

Anglo American Platinum, the Johannesburg-based unit of Anglo known as Amplats, said last month that it will sacrifice its status as the world’s biggest producer of the precious metal by seeking buyers for four mines and possibly stakes in two joint ventures after first-half profit fell 88 percent because of a five-month strike. The company employed almost 50,000 people at the end of last year, according to data compiled by Bloomberg.

South African mines are labor-intensive, a legacy of the apartheid system that ended in 1994. The whites-only government based its economy on using cheap black labor to mine the world’s biggest gold and platinum deposits. To end the strike, Amplats, Impala Platinum Holdings Ltd. and Lonmin Plc were forced to agree to above-inflation pay increases that they said they couldn’t afford. Impala has said it may mechanize a future development to reduce its labor costs.

“Going the mechanized route is an aggressive approach,” Phuti Mahanyele, the CEO of Shanduka, said in an interview at the U.S.-Africa Business Forum in Washington yesterday. “We have to find ways to work with labor.”

British firm reviews Sudbury mining project – by Staff (Sudbury Northern Life – August 06, 2014)

August 6, 2014

http://www.northernlife.ca/

Study could lead to new spending on River Valley project

North West Capital Corp. has hired a British company to review its platinum group metals project east of Sudbury. In a release, Pacific North West said it the study could lead to new spending on the River Valley platinum group metals project.

British Columbia-based Pacific North West said it has hired SFA Oxford Limited to provide an independent strategic assessment of its River Valley platinum group metal project, near Sudbury.

SFA Oxford is a group of independent consulting analysts in mining, metals and commodities, with specialization in platinum group metals, including palladium – the main metal at River Valley.

Pacific North West said in a release its decision to hire SFA Oxford at this time “builds on the strong global fundamentals currently driving up the commodity price of palladium. Continuing production challenges in South Africa and rising tensions with Russia, the world’s two largest PGM (platinum group metal) producers, combined with soaring demand from the global automotive industry for auto catalysts (of which palladium is a key component) have all renewed interest in PGM projects in safe, secure mining jurisdictions like Canada.”

River Valley is located within 100 kilometres of Sudbury and is readily accessible via paved and gravel roads with settlements, power and rail all nearby.

AUDIO: Ring of Fire ‘soap opera’ continues with recent court ruling (CBC News – August 05, 2014)

August 6, 2014

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

A mining industry observer says a recent court ruling will do nothing to spur development in the Ring of Fire. A divisional court ruled last week that Cliffs Natural Resources may apply to the province to build a road over KWG Resources’ land. KWG had been withholding its consent.

Cliffs has said it wants to build a road to transport ore from the Ring of Fire in the Northwest. In an interview last week, Cliffs vice-president Bill Boor said the decision was reason for optimism for Sudburians.

The company has floated the idea of a chromite smelter in Capreol. But the head of the Sudbury Area Mining Supply and Services Association said Cliffs still has to satisfy the minister, negotiate with Aboriginal groups and complete environmental assessments.

“If it’s a good step, I’m not sure for whom,” Dick Destefano said. “But it seems to open up another avenue for discussion — which means another delay and another discussion, and another study.”

He noted there are so many variables that the opportunities around the project could easily vanish. “This is like the Wizard of Oz for me,” Dick Destefano said.

UPDATE 2-Glencore courts Guinea’s iron ore treasures- document – by Silvia Antonioli and Alexandra Reza (Reuters India – July 6, 2014)

August 6, 2014

http://in.reuters.com/

LONDON, Aug 5 (Reuters) – Miner and commodity trader Glencore has expressed interest in iron deposits in Guinea, a presentation obtained by Reuters shows, although the company said it had not pitched for a stake in Simandou, the country’s largest deposit.

Glencore is the latest mining major looking to invest in iron ore assets in Guinea. Most interest is focused on Simandou, one of the world’s biggest deposits.

Any potential investors in Simandou are treading carefully, however. Israeli-owned BSG Resources, which was stripped of its license to develop part of Simandou following a Guinean corruption investigation, is seeking arbitration and has threatened to sue companies that invest in its former license area.

Three sources close to the government said London-listed Glencore had indicated its interest in investing in Simandou, in a meeting with government officials in Conakry in June.

A copy of a power point presentation, which the sources said a Glencore representative delivered at the meeting, includes a reference to Glencore having the financial and technical ability to develop big projects in the region and “the willingness to proceed very quickly together with the government to the exploitation phase of iron ore projects”.

Mount Polley Mine tailings water ‘very close’ to drinking quality, company says – by Rhiannon Coppin and Bal Brach (CBC British Columbia – August 5, 2014)

August 6, 2014

http://www.cbc.ca/news/canada/british-columbia

Imperial Metals president Brian Kynoch says he would drink water from tailings pond that leaked into rivers

Imperial Metals president Brian Kynoch says the company accepts full responsibility for the breach that caused a massive failure at the Mount Polley Mine in central B.C. on Monday and sent billions of litres of wastewater into river systems.

“I apologize for what happened,” Kynoch said at a news conference plagued with technical problems in Likely, B.C., on Tuesday afternoon. “If you asked me two weeks ago if this could have happened, I would have said it couldn’t.”

Wastewater and tailings sediment from Imperial Metals’s Mount Polley copper and gold mine near Likely has contaminated several lakes, creeks and rivers in the Cariboo region, causing officials to evacuate local campgrounds and enact a number of water-use and drinking water bans.

Cliffs wins key court battle – by Staff (Sudbury Star – August 6, 2014)

August 6, 2014

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

The company that once planned to build a $1.8-billion chromite plant in Capreol has won a key court battle. Last week, an Ontario Divisional Court set aside a decision reached by the Ontario Mining and Lands Commissioner in September 2013. In that decision, the lands commissioner denied Cliffs Natural Resources an easement for a road to reach its Black Thor chromite deposit in the so-called Ring of Fire area of northwestern Ontario.

Cleveland-based Cliffs wanted the easement, even though the land is owned by rival KWG Resources. Cliffs, which has halted all exploration on its chromite project, launched the appeal in October. The case was heard in Toronto in June.

The court’s decision means that Natural Resources Minister Bill Mauro will now decide if Cliffs gets the OK for a road into the Ring of Fire.

“Whether or not it is in the public interest to grant an easement for a road is a matter for the minister of natural resources to determine, after an environmental assessment and consultation with First Nations and other affected interests,” the court ruled. “It is for the minister to determine whether the easement should be granted in the public interest and on what terms.”

Cliffs wants to stake a 330-kilometre long corridor using mining claims from Nakina north to the exploration camps in the James Bay lowlands.