Republic of Mining

Indonesia needs to tackle infrastructure hurdles to build on its youthful potential – by Jim O’Neil (Emerging Markets.org – May 2, 2014)

May 5, 2014

http://www.emergingmarkets.org/

Jim O’Neill is Visiting Research Fellow to BRUEGEL and Economic Advisor to the International Finance Corporation

Indonesians probably have the most justifiable gripe of any nation, along with Mexico, not to be included in the Bric group that I dreamt up in 2001.

Indonesia has a larger population than two of the four Bric nations, Brazil and Russia, and of course, it has a remarkably youthful population also, with demographic dynamics that give its growth potential a lot of hope in the next couple of decades.

These basic attractions are partly what led me to thinking of the notion of an additional group of emerging economies to focus on: the so-called Mint countries; Mexico, Indonesia, Nigeria and Turkey. Each of these has the potential to be a significant part of the world economy if not quite as important as the Bric economies. I define a Bric in a global context these days, as an emerging economy that if not already 3% of global GDP or more, one that has that clear potential in the next decade or two. For the Mint economies, I think of them as emerging economies that either are, or have the potential to be somewhere between 1%–2% of global GDP.

Meadowbank helps put Agnico Eagle back in the black – by Canadian Press (CBC News North – May 02, 2014)

May 5, 2014

http://www.cbc.ca/north/

Agnico Eagle Mines has reported a net income of $108 million in the first quarter of 2014 — a big improvement over its $406 million loss in 2013.

Gold prices are lower than at this time last year. Rather, Agnico Eagle says it set a company record for gold production in the last three months, extracting about 366,421 ounces overall at a cost of $567 US per ounce. That’s $200 less per ounce than in the same three months in 2013.

Agnico Eagle president and CEO Sean Boyd said a lot of the first-quarter success was due to the company’s largest gold producer, the Meadowbank mine in Nunavut, but added there was also strong performance from mines in the Abitibi region of northwestern Quebec.

“Meadowbank carried on its strong performance from Q4 of 2013.In fact, it had a very strong entire 2013. We carried that momentum into the first quarter (and) we’re seeing strong production in April. We have encountered higher grades there.”

The company is doing exploration around Meadowbank, about 110 kilometres north of Baker Lake, through which it hopes to extend the life of the mine. This year, it will spend about $2.2 million in exploration in and around the mine site, including at the IVR project, about 50 kilometres northwest of the mine.

The global business of mining [opinion] – by Cole Latimer (Australian Mining – May 2, 2014)

May 5, 2014

http://www.miningaustralia.com.au/home

You can walk on to most sites around Australia and find Aussies, Kiwis, Americans, British, Irish, South Americans, Canadians, and South Africans. And they’ll be using American, Japanese, Chinese, German, Italian and Russian equipment. It is an industry that encompasses the entire world like very few others do.

And it was this global alignment, coupled with the ability to tap into market opportunities, that helped Australia through the devastating global financial crisis in a way that many other countries couldn’t do due to their inability to access the same markets.

The mining boom, right after this devastating financial event, put Australia in an enviable position globally. But as the mining boom slows down, what does this mean for Australia, seeing we spent much of this century focused on just digging minerals up and exporting them?

Well, luckily for our nation we also spent a large chunk of this last century developing our skills and technology.

Australia may not be a mining manufacturing powerhouse like the US, Japan, or Russia, but we are damn good at mining, and even though our productivity has been dropping and become stagnant over the last few years, that hasn’t stopped the nation from making innovative technology and developing smarter ways in which to mine.

Goldcorp, other gold miners’ first-quarter earnings show progress on cost cuts – by Peter Koven (National Post – May 2, 2014)

May 5, 2014

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

TORONTO – Gold miners promised investors they would cut operating costs, and recent earnings reports show they are doing just that. First quarter earnings from Goldcorp Inc., Agnico-Eagle Mines Ltd., New Gold Inc. and Barrick Gold Corp. demonstrate they are all making significant improvements on the cost front. And while there are further reductions to be made, investors and analysts have been pleased with what they’ve seen so far.

This earnings season is an instructive one for the gold sector, because the first quarter of 2013 was the last one before gold prices plummeted and companies began a frantic process of yanking costs out of their business. By comparing this year’s results to last year’s, investors get a good sense of how aggressively miners have acted.

On Thursday, mining giant Goldcorp Inc. reported all-in sustaining costs of US$840 an ounce for the first quarter. The result beat its own forecast and is a significant decline from US$1,134 an ounce in the same quarter a year ago (though that was an unusually bad result for the company).

“Goldcorp’s solid first quarter results underscore what we expect to be recurring themes in 2014: High quality production growth, excellent cost performance and strong progress toward completion of our three current growth projects [Cerro Negro, Eleonore and Cochenour],” chief executive Chuck Jeannes said on a conference call.

EXCLUSIVE: Memos show EPA officials tried to kill mine project before scientific review – by Phillip Swarts (Washington Times – April 30, 2014)

May 5, 2014

http://www.washingtontimes.com/

Agency officials coached tribes on how to oppose Alaska’s Pebble Mine

Though President Obama has repeatedly urged that science guide environmental decisions, regulators inside the Environmental Protection Agency secretly worked with tribal and environmental activists to preempt a full review of an Alaskan mine and veto the project before the owners’ permits could be considered, internal memos show.

Charged with being neutral arbiters, EPA officials instead began advocating for a preemptive veto of the Pebble Mine project in western Alaska as early as 2008, long before any scientific studies were conducted or the permit applications for the project were even filed, the emails obtained by The Washington Times show.

“As you know I feel that both of these projects (Chuitna and Pebble) merit consideration of a 404C veto,” EPA official Phillip North wrote in an email suggesting that the mining project’s rejection be added to the agenda of an agency retreat in summer 2009.

EPA wouldn’t even announce the beginning of a scientific review of Pebble Mine until 2011, two years after Mr. North’s email, but discussion of a pre-emptive veto dominated internal discussions inside the agency for much of the three years beforehand.

Matawa celebrates framework agreement with Premier Wynne – by Rick Garrick (Wawatay News – May 2, 2014)

May 2, 2014

http://wawataynews.ca/

Neskantaga Chief Peter Moonias called for more “meat” on the Ring of Fire regional framework agreement during the April 24 celebration with Premier Kathleen Wynne in Thunder Bay.

“The framework is only a first step,” Moonias said. “We have to put some meat on it. We are the people in Matawa that need to tell (the federal and provincial governments): ‘this is what we need, this is what we want, this is where we want to go.’ That is what we have to do in the next few months, in the next few years, whatever time it takes.” Moonias said the Matawa chiefs did not sell their traditional lands by signing onto the regional framework agreement on March 26.

“Our people think we are selling the land here — we are not selling the land,” Moonias said, noting that the traditional lands are still important to First Nations people. “The land was taken away from us; we are only taking it back.”

The Matawa chiefs celebrated the regional framework agreement with Wynne, Michael Gravelle, minister of Northern Development and Mines, David Zimmer, minister of Aboriginal Affairs, and Bill Mauro, minister of Municipal Affairs and Housing and a crowd of community members at the Valhalla Inn. A pipe ceremony and drumming and dancing were held during the celebration.

Alaska Natives and First Nations Unite to Halt B.C. Mine That Threatens Salmon Habitat – by Paula Dobbyn (Indian Country: Today Media Network.com – May 2, 2014)

May 2, 2014

http://indiancountrytodaymedianetwork.com/

It has become an all-too-familiar story: Pristine waters. Salmon habitat. Sacred significance. Mining.

The Unuk River watershed, straddling the border between British Columbia and Alaska, is on track to become ground zero in a struggle to stop the world’s largest open-pit mine, Kerr-Sulphurets-Mitchell (KSM). The fight against it is uniting First Nations and Alaska Natives as they battle to preserve stewardship of the pristine region. And it is just one of five massive projects proposed for the region.

If KSM secures the financing and the regulatory go-ahead, the giant mine would turn 6,500 acres of pristine land into an industrial zone that would generate more than 10 billion pounds of copper and 38 million ounces of gold, according to a project summary. As with any large mine, it would employ a hefty workforce—in this case mostly Canadians—and create taxes and royalty payments for Canada. But it would also produce a slew of waste. And that’s what critics say downstream Alaska communities stand to take on: none of the economic benefits but much of the environmental risk.

With its remote headwaters in British Columbia, the Unuk River is one of the world’s most prolific salmon waters. An international river, the Unuk flows into neighboring Southeast Alaska and its temperate rainforest, the 17-million-acre Tongass National Forest, a place of towering coastal mountains, tidewater glaciers and fog-shrouded islands.

China’s need for steel will sustain ore miners: Rio – by Andrew Burrell (The Australian – May 2, 2014)

May 2, 2014

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

RIO Tinto iron ore boss Andrew Harding says iron ore prices will remain strong for at least another 10 to 15 years, declaring he pays no attention to short-term fluctuations in the price of the key export commodity.

Speaking at the In the Zone conference at the University of Western Australia, a bullish Mr Harding said the most important indicator for iron ore was the rate of urbanisation in China, which buys 60 per cent of the world’s seaborne iron ore.

With the iron ore price slipping to $US105.40 ($113.53) yesterday — a 20-month low — and prompting a sharp fall in iron ore miners’ shares, some analysts have forecast a return to prices well below $US100 in coming months as increased supply hits the market and Chinese economic growth slows.

That would hit the profits of Rio and its Pilbara iron ore rivals BHP Billiton and Fortescue Metals Group. It would also eat into the coffers of the cash-strapped federal and West Australian governments.

The three big iron ore miners have pulled back on their future expansion plans, preferring to preserve cash and boost productivity rather than commit to multi-billion-dollar greenfields projects.

World’s heaviest haul railways defining the Pilbara then and now – by Ben Collins (Australian Broadcasting Corporation – May 2, 2014)

May 2, 2014

http://www.abc.net.au/northwestwa/?ref=banner

Iron ore trains are one of the unsung heroes of the Pilbara’s mammoth industry. Leading the world in heavy haulage, these trains also track the history of the region.

It was an inauspicious dawn of the rail age in Australia’s north western Pilbara region. But what began with short tramways and a problematic narrow gauge line from Port Hedland to Marble Bar over one hundred years ago, eventually became the lifeblood of Australia’s economic engine room.

As in many North West towns established in the late 1800s, tramways were built to service the early ports at Cossack and Balla Balla in the Pilbara. A more substantial railway, though still just narrow gauge, was built from Port Hedland to Marble Bar to service goldmining and the pastoral industry. The 114 mile railway was completed in 1912, and proceeded to run at a loss for 39 years until the last train came to a halt in 1951.

But a new era of heavy haulage standard gauge railways burst into existence with a flood of iron ore mines in the 1960’s. The first earthworks for the rail bed began in 1965 as iron ore mining permits and sales contracts were put in place for the Goldsworthy iron ore deposit. Construction proceeded at a cracking pace with over 100 kilometres completed and the first train running by May 1966. The line was then extended by 67 kilometres to the Shay Gap iron ore mine in 1972.

[Saskatchewan] Mining exploration spending forecast to mirror ’13 – by Scott Larson (Regina Leader-Post – May 2, 2014)

May 2, 2014

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

The amount of capital invested in mining exploration in Saskatchewan this year will mirror last year’s total of $236 million, says Gary Delaney, chief geologist with the province’s Ministry of the Economy.

“Most of the focus is between potash and uranium, but we will see a few million in gold and I suspect we might see a little more optimism in the diamond area,” said Delaney, who spoke at the fourth annual Saskatchewan Mining conference Thursday in Saskatoon.

The ministry conducts a survey to see how much was spent last year and what people are planning to spend this year (estimated at $234.6 million). That ranks Saskatchewan fourth in mining exploration expenditures in Canada.

Spending in 2014 will be split fairly evenly between juniors (who don’t have production) and major producers, he said. It has been a rough few years for junior miners trying to raise capital. Between 2012 and 2013, the amount of money junior companies were able to raise dropped by 50 per cent. “These are pretty rough times,” Delaney said.

Uranium There are bright spots, like the Patterson Lake South uranium discovery by Fission and Alpha Minerals in the Athabasca Basin. Companies with stakes in that area have been able to raise money.

Mine Waste Transformed to Tap Water for 80,000 Consumers – by Firat Kayakiran, Randall Hackley and Kevin Crowley (Bloomberg News – May 2, 2014)

May 2, 2014

http://www.bloomberg.com/

Anglo American Plc (AAL) was the first company to transform the wastewater from its coal mines into something 80,000 people drink. Now they’re seen as a model.

Purifying contaminated waters from three sites in South Africa has proven so successful that Anglo’s plant in Witbank is doubling in size and being replicated elsewhere in the country by BHP Billiton Ltd. (BHP), the biggest mining company, and Glencore Xstrata Plc. (GLEN)

While the $130 million plant won’t upend the $600 billion world water industry, Anglo’s treatment center provides as much as 12 percent of the area’s municipal drinking supply and serves as a template for how the industry could treat waste in the future. It also shows how companies and municipalities are finding new ways to confront an increasingly water-stressed planet.

Water of a different sort — sewer water — is similarly about to be treated, purified and pumped back to residents in Wichita Falls, Texas, to augment shortages caused by growth and the area’s worst drought on record.

Mines often treat wastewater to some extent yet until the Emalahleni water-reclamation plant, 120 kilometers (75 miles) east of Johannesburg, none was of drinking quality.

Budget concern over Ring of Fire funding – by Leith Dunick (tbnewswatch.com – May 1, 2014)

May 2, 2014

http://www.tbnewswatch.com/

Mayor Keith Hobbs has deep concerns that $1 billion earmarked for Ring of Fire infrastructure now appears to be contingent on matching federal funds.

Hobbs, who watched the budget being delivered on television at his city hall office Thursday, said his government sources have told him that means the money will have to be drawn from the $14-billion Building Canada fund.

When announcing the $1 billion investment last week, a trio of provincial ministers made no mention of the money being contingent on federal participation, and vehemently said they wanted Ottawa to fund its share of the estimated $2.2 billion project as a standalone entity as they’ve done elsewhere in Canada.

“It is a bit of a concern after speaking to some people in the federal government yesterday,” Hobbs said. “Apparently their stance is they’ve already contributed $14 billion, or earmarked $14 billion … with the Build Canada fund and the provincial government has to take out of that fund for matching dollars.”

Editorial: Barrick-Newmont fling ends in acrimony – by John Cumming (Northern Miner – April 30, 2014)

May 2, 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

It’s gotta rank right up with the worst “first dates” in recent mining history: the proposed merger between gold titans Barrick Gold and Newmont Mining broke off a week after it was made public through media reports in April, and then things soured with a flurry of rival press releases pinning the blame on the other party for the breakdown.

Barrick and Newmont executives had gone so far as to negotiate a term sheet for a merger that was signed by both parties on April 8, after months of private negotiations. It’s a deal that hearkened back to 2005–2006 — the era of the growth for growth’s sake mega-merger — and would have been the biggest merger in the history of gold mining.

But by April 28, merger discussions were officially terminated. It didn’t stop there, however, with discreet silence or any deflecting “it’s not you, it’s me” sentiment: Barrick put out a press release and told reporters that it had wanted to finish the merger, but Newmont’s board had backtracked.

Newmont slipped that jab, came back hard with its own, by making public a private letter it had sent to Barrick’s board the week before.

Quebec mining industry urging provincial government to help restore stability – by Lia Levesque (Montreal Gazette – April 28, 2014)

May 2, 2014

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

THE CANADIAN PRESS – MONTREAL – The province’s mining community is urging Quebec’s new Liberal government to help restore some stability in the industry.

Investor confidence was tarnished by numerous political skirmishes that preceded the adoption of the province’s new Mining Act last December, the head of the Quebec Mining Association said Monday.

Josee Methot said the process took its toll on the industry and she added that the new Liberal government will have to play a part in restoring confidence.

“We absolutely have to reverse this trend,” Methot said in a speech to the Montreal Board of Trade. “The image investors have of us is very poor, so we need to change this trend and look to the future.” Methot’s plea came during a panel discussion organized by the board of trade at the launch of Quebec mining week.

Several hurdles had to be overcome before the Mining Act was finally adopted. The contentious issues included royalties, protection of the environment, the establishment of protected areas, ore processing and the role of municipalities.

Sudbury-area MP’s comments perplex mining leader – by Laura Stricker (Sudbury Star – May 2, 2014)

May 2, 2014

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

The president of the Canadian Mining Association says he’s perplexed by comments made by Claude Gravelle earlier this week, likening them to something you’d hear in the 1970s.

Gravelle, the NDP’s Nickel Belt Member of Parliament, is a former Inco employee and former long-time member of United Steelworkers 6500. During Monday’s National Day of Mourning ceremonies at Laurentian University, Gravelle told the crowd – which included a number of local mining executives – he believes mining companies put profit ahead of safety.

“As we know, the bottom line in a corporate culture is their own bottom line, not first nor last the safety or lives of workers. In a culture and economy that exalts capitalism, the worker is exploited,” Gravelle, who is also the NDP’s mining critic, said.  In an interview after with The Star,

Gravelle went further, saying he believes the profit-over-safety approach is not isolated to mining.  “People are getting killed on the job regularly, and it’s not getting any better … they are cutting corners to save money. I worked in the mining industry for 34 years. I’ve seen it. It’s not only mining companies, it’s all companies that are driven by the profit margins. They will cut corners to make more money.”