Republic of Mining

UPDATE 3-Implats says most miners want to end platinum strike – by Ed Stoddard (Reuters India – May 2, 2014)

May 2, 2014

http://in.reuters.com/

JOHANNESBURG, May 2 (Reuters) – Impala Platinum said on Friday that two thirds of its striking workers had indicated by text messages and phone calls that they want to accept the company’s latest wage offer and end South Africa’s longest and most costly mining strike.

The 14-week strike by the Association of Mineworkers and Construction Union (AMCU), which has also hit Anglo American Platinum and Lonmin, has taken out 40 percent of global platinum production and cost the companies nearly 16 billion rand ($1.5 billion) in lost revenue.

Implats spokesman Johan Theron told Reuters that workers who were unable to send texts because they have no money for air time were making use of telephones at mine recruitment offices. “We will have a totally clear picture next week,” he said.

AMCU General Secretary Jeffrey Mphahlele declined to comment on the company’s claim, but the union said it planned to hold a press conference in Johannesburg on Monday.

The producers last week said they would take their latest offer directly to the roughly 70,000 striking miners after talks collapsed, setting the stage for a dramatic showdown.

Goldcorp sees year of ‘significant growth’. No regrets on Osisko – by Dorothy Kosich (Mineweb.com – May 2, 2013)

May 2, 2014

http://www.mineweb.com/

Goldcorp reported increased gold production and lower all-in sustaining costs for the first quarter. More significant forecast growth is to come this year, says CEO Chuck Jeannes.

RENO (MINEWEB) – Goldcorp CEO Chuck Jeannes says in an interview with Reuters he doesn’t feel pressured to make another acquisition, after losing Osisko Mining to Yamana Gold and Agnico Eagle, but continues to believe “quality growth is the best way to add value to our shareholders.”

During a conference call with analysts Thursday, Jeannes said, “While I’m disappointed that we didn’t get to the finish line on the Osisko deal, I am absolutely convinced that we did the right thing in not increasing our offer to a level that will leave us unable to deliver appropriate returns for our shareholders.” “We have an outstanding portfolio of existing assets and we’ll continue to be disciplined in the way we seek to enhance the portfolio going forward,” he stressed.

Meanwhile, Jeannes told analysts, “We’re pleased to confirm this morning that we’re on track to meet our 2014 production guidance of between 2.95 million and 3.1 million ounces this year, which now excludes the forecast of the Marigold production [The Marigold joint venture has been sold to Silver Standard].

Harper’s petro-folly: How Canada fumbled its post-Keystone energy vision of a gateway to China – by Edward Greenspon, Andrew Mayeda, Jeremy van Loon and Rebecca Penty (Bloomberg News/National Post – May 2, 2014)

May 2, 2014

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

Stephen Harper was in need of a new friend with a big appetite for oil. The Americans just weren’t cutting it.

It was February 2012, three months since President Barack Obama had phoned the Canadian prime minister to say the Keystone XL pipeline designed to carry vast volumes of Canadian crude to American markets would be delayed.

Now Harper found himself thousands of miles from Canada on the banks of the Pearl River promoting Plan B: a pipeline from Alberta’s landlocked oil sands to the Pacific Coast where it could be shipped in tankers to a place that would certainly have it — China. It was a country to which he had never warmed yet that served his current purposes.

Harper stood before a business audience in a luxury hotel banquet hall in Guangzhou, capital of China’s most populous province, putting on his best pro-China face while touting his nation’s virtues. “Canada is not just a great trading nation; we are an emerging energy superpower,” he said surrounded by a phalanx of red Chinese and Canadian flags.

Oil was top of mind. He noted that a single country — the U.S. — took 99% of Canada’s exports, a situation he described as contrary to Canada’s commercial interests.

Sherritt Tops Armoyan With Putin’s Help: Corporate Canada – by Christopher Donville (Bloomberg News – May 1, 2014)

May 2, 2014

http://www.bloomberg.com/

Nickel and energy producer Sherritt International Corp. (S) is poised to fend off an attack by activist shareholder George Armoyan, helped by the soaring price of the industrial metal.

Nickel has risen 32 percent this year, propelling Sherritt to top performer among its Canadian base-metal peers, as Armoyan has sought to convince investors to replace three of the Toronto-based mining company’s nine directors with himself and two others.

“I think for George, the worst thing that could have happened was nickel prices went up,” David Taylor, the Toronto-based chief investment officer of Taylor Asset Management Inc., said by telephone last week. “He would have had a much better chance if this stock was still hovering around three bucks.”

Sherritt, which closed today at C$4.68 in Toronto, has advanced 26 percent this year on an Indonesian ban on nickel-ore exports. The threat of wider economic sanctions on Russia for President Vladimir Putin’s annexation of Crimea and skepticism of his efforts to defuse tensions in eastern Ukraine also lifted the price of the stainless-steel ingredient. Nickel generated 50 percent of Sherritt’s first-quarter sales, the company said yesterday in its earnings statement.

Vale: Iron ore price to improve second half of the year – by Frik Els (Mining.com – May 1, 2014)

May 2, 2014

http://www.mining.com/

Murilo Ferreira, CEO of Brazilian mining giant VALE (NYSE: VALE), knows how to talk his book – he’s regularly been the most optimistic about the direction of the iron ore price of the large producers.

The Rio de Janeiro-based miner’s first quarter results disappointed with earnings falling 19% and sales of $9.5 billion coming in more than $1.5 billion below expectations in large part due to lower iron ore realized prices.

During the earnings call Ferreira was undeterred:

“We expect that the price in the second half will be better than the first half. One thing is for sure the price will not go below $110 on a sustainable basis. I think we have many time seen the price going below this level, but recovering very fast […] because those are the level that many producers mainly in China will leave the market

Ferreira, at the helm of the $70 billion firm since May 2011, does caution that since supply is going to be steady, his prediction would depend on improvement on the demand side “not only in China, but outside China.”

NEWS RELEASE: Duluth Metals Highlights Twin Metal’s Nickel Position with 4.7 Billion Measured and Indicated Pounds and 4.2 Billion Inferred Pounds

May 2, 2014

Duluth Metals has 60% ownership interest in Twin Metals Minnesota LLC which is currently close to completing a detailed pre-feasibility study on a very large copper-nickel-PGM project in NE Minnesota
Duluth Metals is well positioned to benefit from the current recovery in world nickel prices
Nickel currently contributes 30 percent to the base case NSR valuation of the Maturi Measured + Indicated Resource*
Realization of projected escalating spot nickel prices over the next two years may significantly increase the overall TMM nickel value and potential revenue ratio
January 2014 AMEC resource update highlights a contained nickel resource of 4.7 billion pounds Measured + Indicated and 4.2 billion pounds Inferred*
Duluth Metals has previously announced high grade nickel intersections in the southern portion of the Maturi Deposit **

TORONTO, May 1, 2014 /CNW/ – Duluth Metals Limited (“Duluth Metals”, “Company”) (TSX: DM) (TSX:DM.U) is pleased to announce that the Company is well positioned to take advantage of the rapidly recovering nickel market through their 60% ownership in Twin Metals Minnesota LLC (“Twin Metals”), which is currently in advanced pre-feasibility phase on a major polymetallic copper-nickel-platinum-palladium-gold project in NE Minnesota.

Barrick Gold’s chair lauds Glencore over BHP as a mining model – by Liesel Hill and Simon Casey (Mail and Guardian – May 1, 2014)

May 2, 2014

http://mg.co.za/

In an exit interview, Barrick Gold’s founder Peter Munk has said Glencore Xstrata’s boss is going to “eat them all”.

Ask Peter Munk, the founder and former chairperson of Barrick Gold Corporation, whom he most admires in the mining industry, and you get a passionate, digressive response, along with a possible clue to the direction of the world’s largest gold producer.

“What Ivan Glasenberg has done equals an Olympic record,” Munk said last week in an interview, referring to the billionaire chief executive at Glencore Xstrata Plc.

It was Glasenberg who led Glencore’s 2013 takeover of Xstrata Plc, the biggest in mining. Munk, who is 86 and retired at Barrick’s annual shareholder meeting in Toronto on Wednesday, says he’s good friends with the Glencore boss and admires his ambition to compete with the biggest miners, such as Rio Tinto Group, BHP Billiton and Vale SA.

“He’s taken Xstrata, he’s now very close to the BHP Billitons, he’s going to eat them all,” Munk said. Munk’s comments are being scrutinised particularly closely after failed merger talks between Barrick and Newmont Mining Corporation degenerated this week into a public dispute between both miners.

Nickel bolsters Vale’s bottom line – by Jeb Blount (Reuters/Sudbury Star – May 1, 2014)

May 1, 2014

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

Brazilian miner Vale SA said on Wednesday that first-quarter profit fell by nearly a fifth, a result in line with expectations, after the price of iron ore, its main product, fell sharply.

Net income fell 19% to $2.52 billion, compared with $3.11 billion in the same quarter of 2013, according to a securities filing. The result was near the $2.59 billion average estimate in a Reuters survey of 13 analysts and comes after a $6.54 billion fourth-quarter loss.

Vale Chief Executive Officer Murilo Ferreira has been working to slash costs and unload unprofitable businesses for more than a year as a slowdown in Chinese growth limits demand for iron ore and other metals. China, the world’s largest steel producer, is the biggest market for iron ore, the main ingredient in steel.

Vale is the world’s largest iron ore producer and a major miner of nickel, copper and fertilizers. In Sudbury, Vale is the city’s largest employer and runs mines, mills and a smelter. Nickel and copper are the main minerals produced in Sudbury.

As Munk ‘steps down’, Barrick Gold records 90% plunge in profits – by Dorothy Kosich (Mineweb.com – May 1, 2014)

May 1, 2014

http://www.mineweb.com/

“You can take, maybe, Munk out of Barrick, (but) you can’t take Barrick out of Munk,” Peter Munk told Barrick shareholders at the company’s AGM Wednesday.

RENO (MINEWEB) – Anyone who thinks Peter Munk’s influence will no longer play a major role at Barrick Gold as he retired as co-chairman of the board Wednesday was in for a rude awakening as Munk told shareholders at the company’s annual general meeting that he intends to remain “very involved in Barrick.”

Munk’s son Anthony Munk was re-elected to the Barrick Board of Directors with 94.1% of the shareholder vote. Peter Munk will retain an office at Barrick corporate headquarters in Toronto.

As he departed from the Barrick board, Munk predicted Wednesday his greatest investment for Barrick over the past 32 years will be new Chairman of the Board John Thornton.

During Munk’s tenure as CEO, chairman, and co-chairman over the past 32 years, Munk said Barrick twice earned more money than any mining company in Canadian history, paid $8 billion in taxes, and created 25,000 jobs in 20 countries. However, along with Munk’s overall success as a CEO and chairman of Barrick, have come some staggering losses.

COLUMN-Nickel options boom shows scale of bulls’ ambitions – by Andy Home (Reuters U.S. – May 1, 2014)

May 1, 2014

http://www.reuters.com/

The opinions expressed here are those of the author, a columnist for Reuters.

(Reuters) – Nickel is the only game in town right now among the base metals traded on the London Metal Exchange (LME).

LME three-month metal has edged back from the 15-month high of $18,715 per tonne reached on Monday but it is still up by over 30 percent since the start of the year. The next best performer among the LME pack is tin, trailing far behind with year-to-date gains of just 5 percent.

Nickel is trading a strong fundamental story with Indonesia’s ban on exports of nickel ore expected to turn the market from supply feast to supply famine in double-quick time. Extra spice comes in the form of possible sanctions against Russian producer Norilsk Nickel as geopolitical tensions around Ukraine ratchet up.

The company, which last year produced 285,000 tonnes of nickel, has not yet been targeted but the most recent sanctions include Sergei Chemezov, who sits on its board, suggesting the potential sanctions net is drawing closer.

Peter Munk’s bittersweet goodbye to Barrick – by Rachelle Younglai (Globe and Mail – May 1, 2014)

May 1, 2014May 1, 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.

Peter Munk, a Hungarian refugee whose ambitions led him to build hotels in the South Pacific and create stereos for Frank Sinatra, said goodbye to Barrick Gold Corp., the company he founded three decades ago and turned into the world’s biggest gold producer.

The 86-year-old Canadian businessman stepped down as the company’s chairman on Wednesday, a bittersweet moment for Mr. Munk, who has described Barrick as his life and the one thing that keeps him up at night.

“You can take, maybe, Munk out of Barrick. You can’t take Barrick out of Munk,” he said at the company’s annual meeting of shareholders in Toronto.

Mr. Munk knew nothing about gold mining when he took a stake in a small mine near Wawa, Ont., in 1983. He spent the next 30 years buying out rivals and building Barrick into a gold giant.

He has been succeeded by former Goldman Sachs executive John Thornton, who he says shares his vision of transforming Barrick into a Canadian-based mining titan with production in all types of metals.

Copper miners grapple with arsenic problem – by Xan Rice (Financial Times – April 30, 2014)

May 1, 2014

http://www.ft.com/intl/commodities-note

New flow of ‘dirty’ copper pushing up treatment costs

In the world’s driest desert in Chile, arsenic has long been a hazard. Research published this month revealed that a 1,000-1,500-year-old mummy found in the Atacama region, north of the country, died from drinking water laced with the poisonous element. Today, the threat is less to human life than to the profitability of copper miners.

Arsenic is often found alongside the red metal on the west coast of South America, home to the world’s largest copper reserves. Until recently, mining companies there chose not to develop copper deposits containing high amounts of arsenic, in favour of the abundant cleaner operations.

But as the large, old mines have become depleted, some arsenic-rich sites are now being exploited. They include Toromocho in Peru, which is owned by the Chinese state-owned group Chinalco, and Codelco’s Ministro Hales project in northern Chile. Both are important sources of new global greenfield copper supply.

The new flow of “dirty” copper concentrate is a sign of the declining ore grades globally, and presents fresh challenges for the industry since the material cannot be sent directly to smelters. Delays in processing this concentrate has resulted in stocks increasing and a rise in treatment and refining charges.

Sherritt International swings to Q1 loss – by Henry Lazenby (MiningWeekly.com – April 30, 2014)

May 1, 2014

http://www.miningweekly.com/page/americas-home

TORONTO (miningweekly.com) – Diversified Canadian miner Sherritt International on Wednesday reported a first-quarter net loss, as a charge at its new Ambatovy nickel mine, in Madagascar, and financing costs related to a weakening Canadian currency impacted results.

The Toronto-based miner, which specialises in mining and refining nickel from lateritic ores at its operations in Canada, Cuba, and Madagascar, reported a first-quarter loss of C$48.2-million, or C$0.16 a share, compared with earnings of C$23.1-million, or C$0.08 a share.

Earnings were affected by the impact of higher financing outlay related to foreign exchange losses as a result of the weakening Canadian dollar against the US greenback and by depreciation, depletion, and amortisation being recognised at Ambatovy for the first time following the commercial production declaration in January, which totalled C$27.5-million for Sherritt’s 40% share.

The Ambatovy Joint Venture (JV) is a vertically integrated nickel and cobalt mining, processing, refining and marketing JV between subsidiaries of Sherritt (40%), Sumitomo (27.5%), Korea Resources (27.5%), and SNC-Lavalin (5%).

No surprise mining taxes [Australia] please: Rio head – by Kim Christian (Sydney Morning Herald – May 1, 2014)

May 1, 2014

http://www.smh.com.au/

Rio Tinto’s head of iron ore Andrew Harding has warned Australia should not squander its reputation as a stable place to do business.

As the iron ore-focused miner began legal action in the US against its Brazilian rival Vale, Mr Harding urged the Australian government not to introduce surprising tax changes which could deter foreign investment.

“It really does startle an organisation,” Mr Harding told a business lunch in Perth. “Australia’s not the only place you can mine iron ore. “There’s an awful lot of high grade iron ore sitting in Africa, and for a whole lot of instability reasons it hasn’t been mined to date.”

His comments come as Rio Tinto filed a lawsuit in the US District Court against Brazilian miner Vale and an Israeli company over the rights to develop the massive Simandou iron ore deposit in Guinea in west Africa.

Rio alleges billionaire Beny Steinmetz and his company BSG Resources bribed officials and conspired with Vale to steal mining rights to the multi-billion tonne Simandou deposit but it has not specified the amount of damages it is seeking. Mr Harding said a period of volatile industrial relations and iron ore supply disruptions in Australia several decades ago had opened the door for Brazil to build the biggest iron ore business in the world.

Peter Munk says he’s leaving Barrick Gold in good hands – by Lisa Wright (Toronto Star – May 1, 2014)

May 1, 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.

Outgoing founder and chairman praises management team and new board chair amid tough times in the gold industry in emotional farewell at annual meeting.

Gone, but definitely not forgotten. That was the tone of Barrick Gold Corp.’s annual meeting in Toronto Wednesday, which marked the emotional farewell of outgoing chairman and founder Peter Munk, and the release of dismal first quarter financial results amid the lacklustre gold price.

The auditorium was filled with the requisite Bay St. suits and shareholders while the annual group of environmental protesters outside hoisted a 15-foot Munk puppet and waved signs like “Gold is a toxic asset” to mark the 86-year-old’s departure.

But it was really Munk’s show, in which he made a farewell speech that drew laughs, hugs, kisses and a standing ovation for his 30 years at the helm of the firm that began as a penny stock with one mine in Northern Ontario to the world’s largest gold miner.

“As much as we’d like to believe we are eternal, the reality hits home,” he said. “The time has come to hand it over.”