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Private Equity Groups Exercising Patience With Mining Industry – EY Mining Leader – by Alex Létourneau (Kitco News – March 21, 2014)

http://www.kitco.com/

(Kitco News) – While there’s been quite a bit of talk regarding private capital finding its way into the mining sector, there hasn’t been the kind of movement expected yet.

Media reports over the last few months peg a total of $8 billion to $10 billion in private capital available and ready to be pumped into the industry, but these private equity groups are exercising patience before jumping in to any deals, according to Bruce Sprague, Ernst & Young’s Canadian mining and metals leader.

“We’re seeing more and more of these private capital groups, astute mining entrepreneurs and leaders that are amassing really substantial pools of capital that are out there and looking for deals,” Sprague told Kitco News over a telephone interview. “I’d stress the word, and its patient capital.

“They’re not really in a hurry to do a deal. They’re going to be methodical, they know the sector quite well — tried and true industry veterans with the benefit of good teams that can really do their requisite financial and technical due diligence,” he said. “If they find the right opportunity, they certainly have more than adequate access to capital.”

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Out of sight, out of mind [Nuclear Waste] – Thunder Bay Chronicle-Journal Editorial (March 23, 2014)

Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

IT has been 35 years since the governments of Canada and Ontario established the Nuclear Fuel Waste Management Program to develop a concept to safely and permanently dispose of the radioactive byproducts of nuclear energy. We are told it will be 2035 before a repository can be operating. So there is no hurry.

It took authorities just a year, though, to propose deep geological disposal in Northern Ontario’s granite as opposed to finding a way to keep the stuff near to where it is produced in southern Ontario.

There is a great deal to be said for geological disposal. Earthquakes are rare here and not violent. What ground movement there is would not be enough to dislodge lead-lined canisters filled with nuclear waste stored 500 metres down in rock caves backfilled with concrete. Groundwater movement is minimal. Still, nuclear waste remains radioactive for a long time.

So there is a risk, however small, no matter where this material is stored. Would the risk be greater in a vault of some description near the reactors in southern Ontario? Would terrorists be more likely to try to steal it there than here or enroute?

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Top Ten Mining Events in Northern Ontario History – by Stan Sudol (March 22, 2014)

This column was also published on the Huffington Post – the “New York Times” of the web: http://www.huffingtonpost.ca/stan-sudol/ontario-mining_b_4885841.html

Klondike Versus Northern Ontario

For crying out loud, I continue to be astonished with our collective Canadian obsession over the Klondike Gold Rush while northern Ontario’s rich and vibrant mining history is completely ignored by the Toronto media establishment, especially the CBC.

Discovery Channel’s recent six-hour mini-series on the Klondike – vaguely based on Charlotte Gray’s book, “Gold Diggers: Striking It Rich in the Klondike – once again highlighted this glaring snub.

Unfairly, the Klondike did have the benefit of terrific public relations due to famous writers like Jack London, Robert W. Service and Pierre Berton, but I still don’t understand how this brief mining boom continues to dominate the “historical oxygen” in our national psyche.

At its peak, the Klondike only lasted a few years – 1896-1899 – and produced about 12.5 million ounces of gold. And unlike the California gold rush that created one of the largest and richest states in the union, the entire Yukon Territory’s population today is about 36,000. Contrast that with booming Timmins with 45,000 hardy souls who have dug out of the ground about 68 million ounces and counting of the precious metal, since the Porcupine Gold rush of 1909.

It’s enough to make to make Benny Hollinger, Jack Wilson and Sandy MacIntyre – the founders of this extraordinary deposit – spin in their collective graves!

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Bob Rae discusses Ring of Fire mining project at Western Law – by Sean Meyer (London Community News – March 21, 2014)

http://www.londoncommunitynews.com/london-on/

The Ring of Fire is the name given to a massive Northern Ontario chromite-mining project that geologists have called the biggest resource find since the end of the 19th century.

The project would impact numerous First Nations communities and so potential developers are required to negotiate agreement with them prior to development. Bob Rae — the former premier of Ontario and former leader of the federal Liberal party — serves as chief negotiator for the Matawa First Nations Tribal Council, which represents nine First Nations located around the Ring of Fire, roughly 400 kilometres northeast of Thunder Bay.

Rae brought his perspective on the project, the impact it will have on First Nations people in the area, and the legal challenges it faces, when he spoke before a group of more than 70 Faculty of Law students at Western University on Thursday (March 20).

“I have actually been doing a lot of speaking to students in just about every university I can, every law school, every mining faculty. I do a lot of talking to people to kind of really explain what is going on, get people engaged, give them a chance to listen and learn,” Rae said. “This generation of lawyers is going to be doing this front and centre so it is important to get them involved.”

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Crowdfunding: the new penny stock – Editorial (Globe and Mail – March 21, 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.

Canada’s securities regulators are opening up an entirely new route for small companies to raise money using the Internet. The cautious new regime unveiled on Thursday will allow companies for the first time to raise capital and issue shares through crowdfunding websites, but under a slew of restrictive conditions aimed at trying to prevent crowdfunding from becoming the new stock-fraud vehicle of choice.

Crowdfunding has become a surprisingly popular option for individuals and small companies to raise tiny donations – as little as $1 each – from thousands of people over the Internet, to finance projects such as documentary films or the development of new technologies. Until now, all such financing in Canada has been in the form of a donation, sometimes in exchange for a small gift of a company’s product, because companies are barred from issuing shares to give investors an ownership stake in the firm, except under narrow conditions outlined by provincial securities commissions.

Those conditions are about to be broadened considerably. On Thursday, most of Canada’s provincial securities commissions said they will proceed with new rules – with variations in details among the provinces – to allow crowdfunding of equity offerings under limited conditions.

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HudBay playing long game in bid for Augusta – by Rachelle Younglai (Globe and Mail – March 21, 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.

HudBay Minerals Inc.’s strategy to buy a reluctant Augusta Resource Corp. is likely quite simple and will not require a higher bid.

The Toronto-based mining company recently extended its hostile offer for Augusta and waived its minimum tender condition. It is a risky plan for HudBay, which already owns 16 per cent of Augusta. The company could fail in its bid to acquire the miner and be stuck with a much larger chunk of Augusta that it would have trouble selling if it so desired. But the strategy has worked for HudBay’s chief executive officer in the past.

“We are not running an emotional roller-coaster here. We have a game plan and I think it’s well executed up to this point,” HudBay’s CEO David Garofalo said in an interview.

Mr. Garofalo would not say whether he would continue to extend HudBay’s offer or sweeten the bid for Augusta, which is developing a large copper mine in Arizona. However, a look at one of his past deals sheds light on how HudBay plans to wear Augusta down.

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Stakeholders rally to save passenger rail – by Lindsay Kelly (Northern Ontario Business – March 21, 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.

Stakeholders have one month to delay CN Railway’s decision to stop running passenger service between Sault Ste. Marie and Hearst. In January, the company announced that, because $2.2 million in federal funding for passenger service had been cut, the service provided by Algoma Central Railway would halt on March 31. CN has since extended that deadline to April 29.

A new working committee, spearheaded by Sault Ste. Marie and comprised of communities, First Nations, tourist operators, and cottage owners, is seeking a one-year extension to give stakeholders a chance to come up with alternatives to sustain the rail line over the long term. The group has hired a part-time coordinator, Dave Murphy, who has worked for the Sault’s Economic Development Corporation and the Northern Ontario Heritage Fund.

“Our first objective is to secure the one-year extension of the funding for the continuation of the passenger service, which is scheduled now to cease April 29 in the absence of any extension,” said Joe Fratesi, Sault Ste. Marie’s CAO and chair of the Algoma Passenger Rail Stakeholder Committee.

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Book examines loss of Northlander (Timmins Daily Press – March 20, 2014)

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – Two years after the Ontario government announced the divestment of the ONTC, the author of an upcoming book is calling on the government and stakeholders to find a resolution to the ONTC issue as quickly and as fairly as possible to avoid any further uncertainty for residents of Northern Ontario reliant on ONTC services.

This fall, author and photographer Thomas Blampied, who specializes in rail transportation, will release Call of the Northland: Riding the Train that Nearly Toppled a Government. The book charts the uncertainty of the past two years, which saw the iconic Northlander passenger train cancelled and Northern life made more difficult by the doubtful future of the Ontario Northland Transportation Commission.

“The McGuinty government was not the first to attempt to divest the ONTC, but its lack of research and consultation meant its plan was doomed from the start,” explained the author, who began work on the book while aboard the Northlander in April 2012.

“The trip made me aware of how hurt Northerners were by the loss of their Northlander and how they felt the McGuinty government was ignoring them. The ONTC is an integral part of life in the North.

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Multicommodity projects rolling out on Bushveld’s rich northern limb – by Martin Creamer (MiningWeekly.com – March 20, 2014)

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

JOHANNESBURG (miningweekly.com) – Multicommodity-focused projects embracing iron-ore, vanadium, titanium and phosphate are rolling out on the rich northern limb of South Africa’s Bushveld Complex, a huge mineral repository best known for its world-leading platinum and chrome endowment.

Currently some of the Bushveld’s least-mined metals and minerals are beginning to come to the fore as experienced South African geologists prove up the area as a new iron-ore province with strong titanium and vanadium by-products.

The Council for Geoscience estimates that the Bushveld hosts between 25-billion tons and 27-billion tons of iron-ore and the metallurgical impediments that have stood in the way of easy exploitation have been steadily removed.

In addition, the Bushveld granites contain tin, as well as fluoride, uranium, base metals and rare earths. “All of a sudden, if you look at the area, it’s probably the richest piece of real estate on the planet,” Bushveld Minerals technical director, Professor Richard Viljoen, formerly of the University of the Witwatersrand, tells Mining Weekly Online in a video interview (see attached).

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Mining companies show increased confidence in British Columnbia – by Alana Wilson (Troy Media – March 20, 2014)

http://www.troymedia.com/

But there’s still plenty of room for improvement

Alana Wilson is a senior economist with the Fraser Institute and co-author of the Survey of Mining Companies 2013.

VANCOUVER, BC, Mar 20, 2014/ Troy Media/ – British Columbia was once regarded by miners as hostile to investment and ranked last in Canada for the attractiveness of its mining policy environment. However the tide has turned in recent years and British Columbia has again improved its ratings for global mining investment.

Bringing a mine from discovery to production is a long, expensive and time-consuming process with thousands of mineral prospects explored for each new mine eventually developed. For this reason, mining companies seek out stable, predictable, and transparent policy environments for mining investment. Results from the recent Fraser Institute Annual Survey of Mining Companies suggest that the province is becoming more attractive to mining investment with miners rating the province higher for a fifth consecutive year. However, despite this vote of confidence, B.C. could go further and become a global leader in mining.

The mining survey is based on the opinions of mining executives and assesses the effects of different public policy factors on attracting or dissuading investment. British Columbia has been included in the survey since its inception in 1997, where British Columbia ranked last of Canadian mining jurisdictions assessed.

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UPDATE 3-Australia’s Rinehart seals funding for $10 bln iron ore project – by Sonali Paul (Reuters India – March 21, 2014)

http://in.reuters.com/

MELBOURNE, March 21 (Reuters) – Australian billionaire Gina Rinehart has secured $7.2 billion in debt for her Roy Hill iron ore mining project, completing all the funding for a giant mine in Western Australia due to start exporting in late 2015.

The 55-million-tonnes a year mine will make Roy Hill Australia’s fourth largest iron ore producer, adding to a looming supply glut built up by bigger rivals Rio Tinto , BHP Billiton and Fortescue Metals Group. “We look forward to becoming a major iron ore producer on an international scale,” Rinehart, chairman of Roy Hill and Asia’s richest woman, said in a statement.

The $10 billion project is already 30 percent built, the company said, including dredging for two deepwater port berths, an airport with a runway big enough for a Boeing 737 plane and villages to house 3,600 construction workers and 2,000 operational staff on site and at Port Hedland.

The debt financing, the biggest ever provided for a mining project, is made up of loans and guarantees from five Export Credit Agencies from Japan, South Korea and the United States and 19 commercial banks from Australia, Japan, Europe, China, Korea and Singapore.

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Osisko says $4.4-billion Canadian Malartic mine plan proves Goldcorp’s bid is far too low – by Peter Koven (National Post – March 21, 2014)

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

TORONTO – As Sean Roosen sees it, Canadian Malartic is the second most valuable gold mine fully owned by a North American producer.

The chief executive of Osisko Mining Corp. said Thursday that his shares should be worth $10 to $12 each on the value of this asset alone, or as much as 58% above the current level. He spent all day in Toronto to try to get that point across to shareholders and convince them not to tender to Goldcorp Inc.’s hostile bid.

“There’s a lot of value left on the table here that we’ve been able to highlight,” he said in an interview. Mr. Roosen’s claims are based on Osisko’s updated mine plan for Canadian Malartic, which it released on Thursday. Based on that plan, Osisko estimates that the Quebec-based mine has a net present value of about $3.1-billion. And after accounting for the relative trading multiples of other gold miners, the company figures it should be valued at about $4.4-billion.

That is far above the $2.9-billion in cash and stock that Goldcorp currently has on the table. Goldcorp will almost certainly boost its offer in the weeks ahead, so the pressure is on Mr. Roosen to show this transaction is a bad idea.

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Transparency is vital to relationship between oil industry and aboriginals – by Claudia Cattaneo (National Post – March 21, 2014)

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

Calgary – As Canada’s aboriginals play a larger role in the development of Canada’s natural resources, the federal government is taking steps to boost the transparency of the payments they receive from developers.

But the move, which would force annual disclosure of payments worth $100,000 or more, is drawing push-back from those affected the most — aboriginals and the oil industry.

Yet greater transparency would promote better practices, increased accountability, set ground rules and inform the public debate around the impacts of resource extraction on Canada’s aboriginal people. The proposal is part of an international effort to put a spotlight on payments made by extractive industries to governments.

But Ottawa’s proposal goes farther. It would require payments made by oil and gas and mining companies to all levels of governments, including aboriginal communities, domestically and abroad, to be disclosed, preferably through public filings to provincial securities regulators.

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Glencore Xstrata: A controversial colossus – by Lisa Steyn (Mail and Guardian – March 20, 2014)

http://mg.co.za/

You probably don’t know it, but almost everyday is a Glencore Xstrata day.

With global sales of $239-billion last year, as reported in its 2013 annual report released on March 18, the commodities colossus straddles markets from chrome and copper to cotton and corn. Its reach is so pervasive that it’s quite likely that the appliances you use or food items you consume each day have in some way been touched by Glencore Xstrata.

The company, based in the low-tax jurisdiction of Switzerland, made collective dividend payments to its seven directors, the largest shareholders, of $500-million during the past financial year. Johannesburg-born Ivan Glasenberg, the Glencore Xstrata chief executive who owns 8.4%, the largest share of the company, received dividend payments of $173-million in 2012 and $182-million last year.

When Glencore listed in 2011 it was owned by just 480 people, all employees. The company, which operates in 50 countries, emerged from obscurity in 2011 when Glencore first listed on the London Stock Exchange. In 2013 it merged with Xstrata in the largest takeover ever seen in the mining industry, at a cost of $46?billion. When it listed on the JSE in November 2013, it was instantly the third largest listing.

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Trust, compromise required to resolve overlapping territory [Wabun Tribal Council] – by Shawn Batise (Onotassiniik Magazine – Spring 2014)

 http://onotassiniik.com/

The following is from a presentation by Shawn Batise at the 2013 Mining Ready Summit in Timmins, hosted by Nishnawbe Aski Development Fund. Batise is executive director of Wabun Tribal Council, which has six member First Nations: Beaverhouse, Brunswick House, Chapleau Ojibwe, Flying Post, Matechewan, and Mattagami.

I’ve been involved with Wabun Tribal Council since it started in 1990. The Wabun communities are in northeastern Ontario, all within about a two-hour drive of Timmins. Their traditional territories kind of intersect here in Timmins.

It’s the busiest area in the province in terms of mining exploration and development, and mining has become top of mind in most of the communities of our tribal council. With our participation in resource development over the past five to seven years, I’ve never seen more growth in the communities in terms of wealth, health, better jobs … being economically well off.

A large part of it is because of what we’ve been able to do in the tribal council area, with the help of the First Nations, obviously, in negotiating agreements around mining development. Things have really taken off. We’ve created a number of businesses servicing the industry that have been very successful.

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