Republic of Mining

Native band downstream from proposed B.C. mine fears long-term pollution – by Mark Hume (Globe and Mail – February 13, 2014)

February 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.

VANCOUVER – A native band downstream from what may become the biggest mine in Canada says it is worried about the long-term threat that pollution could pose to the Nass and Bell-Irving Rivers in northwest B.C.

“The mine’s life span is for 50 years and they are estimating that mine will be required to treat [waste water] for well over 200 years. And who’s going to be responsible for that?” Glen Williams, Hereditary Chief of the Gitanyow First Nation said Wednesday.

The Kerr-Sulphurets-Mitchell (KSM) mine, which Seabridge Gold Inc. is proposing to build high in the mountains 65 kilometres northwest of Smithers, would use tailings ponds and a water treatment plant to handle pollution generated by two billion tons of waste rock.

Brent Murphy, vice-president of environmental affairs for the Toronto-based resource explorations company, said, “Protection of the environment has been a key guiding principle in the design of the project, and we’ve worked very hard to ensure that there’s no impact downstream of the facility.”

Mining industry slump forces students to look overseas for work (CBC News Sudbury – February 13, 2014)

February 13, 2014

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

A downturn in the minerals industry is affecting students looking for work. More than 250 mining students from across Sudbury gathered at Cambrian College on Wednesday to take part in Mining Day, an annual conference where hopeful mining sector workers meet with industry professionals.

Those professionals included representatives from Cementation Canada, the Ministry of Labour, Redpath, Sandvik, Stantec, Sudbury Integrated Nickel Operations, the Technica Group and Vale.

The fourth annual event also brought together educators from Cambrian College, Collège Boréal, and Laurentian University. With the mining industry in a downturn, one official said students should apply for opportunities overseas.

“You shouldn’t be thinking of just staying and working in Sudbury,” said Claudine Beausoleil, a spokesperson with Laurentian’s engineering school.

“The best thing to do is go out, to go out to Indonesia, Africa, all over the world to learn new trades. It’s good for them to learn all the different kinds of mining.”

No oil, but a phosphate future for Saudi desert outpost – by Angus McDowall (Reuters India – February 13, 2014)

February 13, 2014

http://in.reuters.com/

TURAIF, Saudi Arabia, Feb 13 (Reuters) – Billboards on the highway outside Turaif, a remote desert town in the far north of Saudi Arabia, foretell a glittering future of glass offices and palm-shaded residential streets. A future that won’t rely on Saudi oil.

Last week an array of government ministers gathered in a tent near this barren outpost, 1,100 kilometres (700 miles) from Riyadh, to sign contracts to develop an industrial complex around a phosphate mine, with a new railway link to a Gulf port and total investments estimated at more than $9 billion.

The Waad al-Shimal project, or “Northern Promise”, is part of a wider strategy in the kingdom, the world’s largest oil exporter, of building downstream industries and boosting the private sector instead of simply exporting raw materials.

It follows in the footsteps of Jubail and Yanbu, massive industrial cities on the Gulf and Red Sea coasts that were built in the 1980s as Saudi petrochemical production grew.

Kinross slashes gold reserves by a massive 33% – by Peter Koven (National Post – February 12, 2014)

February 13, 2014

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

TORONTO – Kinross Gold Corp. has slashed its gold reserves by a staggering 33% as it focuses on mining high-grade ounces in a low-price environment.

The Toronto-based miner surprised investors on Wednesday by stating that its year-end reserves have dropped to 39.7 million ounces, down from 59.6 million at the end of 2012. It is a massive decline, particularly since Kinross used the same gold price in both years (US$1,200 an ounce) to calculate reserves.

Kinross said that part of the drop (6.7 million ounces) was due to the removal of its failed Fruta del Norte project in Ecuador, and part of it was simply depletion from mining. But the other key factor is its internal strategy.

The company wants to stick to mining high-margin ounces. As a result, it decided to calculate reserves using what it calls a “fully-loaded costing methodology” that factors in costs for sustaining capital, waste management and other work. The result is that millions of marginal ounces were dropped out of reserves.

The Keystone effect? Farmers blaming grain backlog on oil-by-rail surge – by Claudia Cattaneo (National Post – February 12, 2014)

February 13, 2014

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

Has the Keystone XL domino effect spread to Canadian farmers? Many are blaming a backlog in Western Canadian grain movements on the surge in oil transportation by rail, in turn the result of insufficient pipeline capacity, caused by environmental opposition to oil sands growth.

The situation is so serious Saskatchewan Premier Brad Wall appointed a delegation of provincial cabinet ministers Wednesday to meet with grain and rail companies and solve the “urgent matter.”

“This grain movement backlog is a very serious situation for the entire province and it is a high priority for our government,” Mr. Wall said in a statement. “The delays in moving grain have led to lower prices for our producers at the farm gate and are harming our reputation as a reliable supplier of agriculture products throughout the world. We want every possible avenue explored to ensure our producers have the ability to market and deliver their grain in a timely manner.”

He even suggested to reporters that the federal government slap fines on railway companies for poor performance, and that transportation of grain, which is seasonal, be made a priority over other commodities.

Copper thieves hit art and buildings in Toronto parks – by Rachel Mendleson (Toronto Star – February 13, 2014)

February 13, 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.

Incidents at Christie Pits and Art Eggleton Park show the market for stolen copper and bronze remains hot. The half-dozen copper-clad landscape surfaces installed in the late ’90s in Art Eggleton Park were intended to recall Garrison Creek, a now-buried ravine that once flowed through the city.

But in recent months, the public art installation at Harbord and Montrose Sts., dubbed “Memory Banks,” has become a testament to another, somewhat baser, phenomenon: The still-hot market for stolen copper.

Ray Stukas, parks manager for Toronto and East York, said thieves made off with about 200 pounds of copper cladding, apparently ripped from the back of the planter-like installation, sometime late last year. “I suspect (it was) late at night,” Stukas said. “They probably put a pry-bar down through the top, and then they would just leverage it toward them.”

An epidemic that stretches well beyond the city limits, in recent years copper theft has become a big concern, thanks to historically high prices for the metal, currently pegged at about US$3.25 per pound.

NEWS RELEASE: Cliffs Natural Resources Inc. Responds to Casablanca Capital

February 13, 2014

CLEVELAND – Feb. 12, 2014 – Cliffs Natural Resources Inc. (NYSE: CLF) (Paris: CLF) today issued the following statement in response to Casablanca Capital:

The Board of Directors and management team of Cliffs Natural Resources welcome open communications with all of our shareholders and value their input toward the collective goal of enhancing shareholder value. As part of the goal to enhance shareholder value, over the last year, the Cliffs Board and management team have taken significant steps to improve Cliffs’ financial and operating performance across all businesses.

The Company’s focus has been – and continues to be – on reducing costs, strengthening its balance sheet with cash flow from operations, taking a disciplined approach to capital spending, and evaluating the strategic fit and value creation potential of all the Company’s assets. In addition, Cliffs has made significant changes to strengthen the Board of Directors and management team, including the addition of four new Board members, a new Chairman and Gary Halverson as the incoming Chief Executive Officer.

Consistent with its focus on enhancing shareholder value, on Feb. 11, 2014 the Company announced that it expects full-year 2014 capital expenditures to be between $375 – $425 million, a reduction of more than 50% from full-year 2013 capital spending. This decrease is driven by a significant reduction in the Company’s expansion and capital spending at the Bloom Lake Mine. Given the wide range of outlook for iron ore prices, the Company decided to reduce 2014 capital expenditures at Bloom Lake as it considers strategic alternatives for the asset.

No mention of Ring of Fire in budget: Critics – by Laura Stricker (Sudbury Star – February 13, 2014)

February 13, 2014

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

A local economist is “disillusioned” by the federal government’s latest budget. “I thought the Conservatives were more fun than that,” David Robinson, a Laurentian University professor, laughed. On Tuesday, Finance Minister Jim Flaherty introduced the $279-billion budget, which he told reporters would be “boring.”

“I’m surprised at how little there is going on in it. I thought the Conservatives still had some ideas and were pressing for stuff, and they either don’t have any ideas or they really are doing what a lot of people think, which is saving everything for one last attempt to keep themselves in government,” Robinson said. “How could you put so little into so many pages?”

Conservative Party critics were less kind about it. “My party has been calling it the do-nothing budget. Unfortunately, it’s exactly that,” Sudbury MP Glenn Thibeault said Wednesday, a few minutes before Question Period in the House of Commons. “I think Canadian families, Canadians in general, will have to wait another year before we actually see anything that will help (them).

COMMENT: The Conservatives’ boring budget – by Marilyn Scales (Canadian Mining Journal – February 12, 2014)

February 12, 2014

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

On Tuesday afternoon federal Finance Minister Jim Flaherty delivered the latest budget from the ruling Conservative party, a budget that has earned the sobriquet “boring”. There were no big new programs, no new tax relief measures for the young or middle class, nothing except the predictable rise in taxes for tobacco products.

If there was any good news in the budget, it is Flaherty’s promise to balance it and even generate a surplus in 2015.

So what’s in the budget for mining?

The Mining Association of Canada, Prospectors & Developers Association and the Association for Mineral Exploration British Columbia all congratulated the government for extending the mineral exploration tax credit. This credit helps raise money for exploration by giving individuals who invest in junior companies exploring in Canada a 15% tax credit on eligible expenditures. The credit has been extended to March 31, 2015. At a time when raising money for mineral exploration has become so difficult, a credit that rewards investors is particularly welcome.

Vale Indonesia Targeting $112m in Profit, May Reduce Land Concession by Up to 44% – by Tito Summa Siahaan (Jakarta Globe – February 12, 2014)

February 12, 2014

http://www.thejakartaglobe.com/

Jakarta. Vale Indonesia, the country’s largest nickel producer, has set its net income target at $112 million this year, according to a document presented during a hearing with members of the House of Representatives Commission VII overseeing mineral affairs.

The local outfit of Brazil’s Vale targets production of 79,691 metric tons of nickel matte this year, a slight increase from last year’s target of 79,500 tons, which is set to be missed due to operational disruption in the fourth quarter, the document showed.

“We expect to book sales of $1 billion, assuming that the price at the London Metal Exchange averaged $16,000,” Vale Indonesia president director Nico Kanter said at the parliament building.

The company may have missed its target of $213.6 million in net income last year due to a sharp decline in nickel prices, according to Nico.

The average nickel price for last year was $15,000, down from an average of $17,374 in 2012. He said the price of nickel is projected to recover this year thanks to the government’s decision to ban exports of unprocessed nickel ore, but trends for the first few months still showed price fluctuations.

UPDATE 2-Hedge fund plans proxy fight with Cliffs to install new CEO – by Allison Martell (Reuters U.S. – February 12, 2014)

February 12, 2014

http://www.reuters.com/

Feb 12 (Reuters) – The activist investor squaring off with Cliffs Natural Resources Inc named its preferred candidate for chief executive officer on Wednesday and said it plans to nominate enough new directors to form a majority of the iron ore miner’s board.

Hedge fund Casablanca Capital, which owns about 5.2 percent of Cliffs, said it is backing Lourenco Goncalves, former CEO of Metals USA, to take the top job at hard-hit Cliffs.

Last month Casablanca publicly urged Cliffs to spin off its international operations and form a master limited partnership from its U.S. assets, but the fund declined to say what its next steps would be if Cliffs refused.

Cliffs, a relatively high-cost producer, has been battered by weak iron ore prices. Operational issues and worse-than-expected costs have plagued its Bloom Lake Mine in Quebec, once seen by analysts as a key growth project.

After months of uncertainty, the company said on Tuesday it has decided to indefinitely suspend a planned expansion at Bloom Lake, and idle Wabush, another Canadian mine, slashing capital spending and cutting some 500 jobs.

Numsa head calls for nationalisation of mines – by Kim Cloete (MiningWeekly.com – February 11, 2014)

February 12, 2014

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

JOHANNESBURG (miningweekly.com) – The National Union of Metalworkers (Numsa), which is in the midst of a battle against the union federation it ostensibly falls under, the Congress of South African Trade Unions (Cosatu), has called for the nationalisation of mines and the financial sector in South Africa.

Numsa general secretary Irvin Jim told the Cape Town Press Club that nationalisation was not “some dogma from the past” but an immediate and urgent requirement to “save our nation”.

“I want to say this very clearly and very straightforwardly. There is only one way to create the number of jobs that are needed in South Africa – the number the National Development Plan dreams about. That is to harness the profits of the mining and financial sectors and use them to build a manufacturing industry.”

Jim said deindustrialisation had caused a massive loss of jobs in the manufacturing sector. “This will not stop until we fundamentally change direction.”

Jim, who represents around 340 000 workers in the metal sector, called for an end to liberalised trade, which he said caused huge dumping of products from China and elsewhere and had shut South Africans out of jobs.

HudBay Low Bid for Arizona Copper Invites Rival Offer: Real M&A – by Tara Lachapelle (Bloomberg News – February 11, 2014)

February 12, 2014

http://www.businessweek.com/

The prospect of mining copper in Arizona has traders lining up bets that Augusta Resource Corp. (AZC), the target of an unsolicited bid by HudBay Minerals Inc. (HBM), will win a higher offer.

Shares of Vancouver-based Augusta rose 15 percent above HudBay’s all-stock bid, which was valued yesterday at C$2.78 a share, or about C$440 million ($400 million) including net debt. The gap, one of the widest among pending North American deals in which traders expect bidding wars, indicates investors are anticipating a boost from HudBay or another suitor.

Augusta’s Arizona copper project is in the last stages of attaining necessary permits. Laurentian Bank of Canada said it’s large enough to attract other producers including OZ Minerals Ltd. (OZL) and Teck Resources Ltd. (TCK/B) and estimates the company’s value is at least C$3.89 a share based on similar deals. Freeport-McMoRan (FCX:US) Copper & Gold Inc., based in Arizona, is another possible suitor with the financial (FCX:US) strength to outbid HudBay, according to National Bank Financial.

“The market expects that this may be the initial offer and Augusta could negotiate better terms,” Shane Nagle, a Toronto-based analyst at National Bank, said in a phone interview. “It’s a high-quality asset. There is room certainly to sweeten the offer.”

CA miners applaud exploration tax credit extension, skills training – by Dorothy Kosich (Mineweb.com – February 12, 2014)

February 12, 2014

http://www.mineweb.com/

As Canada’s Minister of Finance Jim Flaherty Tuesday tabled his Economic Action Plan of 2014, he committed to a balanced federal budget in 2015.

RENO (MINEWEB) – Two prominent Canadian mining organizations Tuesday hailed Minister of Finance Jim Flaherty’s Economic Action Plan 2014, which extends a mining exploration tax credit. Economic Action Plan 2014 proposes no new taxes on Canadian businesses and projects the country’s deficit will decline to C$2.9 billion in 2014-15. A C$6.4 billion budget surplus is anticipated in 2015-16.

The Association for Mineral Exploration BC (AME BC) said it welcomed the extension of the Mineral Exploration Tax Credit contained within the federal budget. David McLelland, chair of AME BC, said, “Many of our members are having difficulty raising capital in these financially challenging times, and the renewal is much appreciated.”

The Mineral Exploration Tax Credit increases exploration financing through providing individuals who invest in companies that are exploring for minerals in Canada with a 15% tax credit on eligible expenditures.

NEWS RELEASE: Casablanca Capital Backs Lourenco Goncalves To Become CEO of Cliffs Natural Resources And Notifies Company Of Intention To Nominate Majority Slate Of Directors For Election To Board

February 12, 2014

Says It Believes Yesterday’s Bloom Lake Announcement Does Not Go Far Enough to Address Fundamental Strategic and Structural Changes Needed to Create Value for Shareholders

February 12, 2014 08:30 AM Eastern Standard Time

NEW YORK–(BUSINESS WIRE)–Casablanca Capital LP (“Casablanca”), one of the largest shareholders of Cliffs Natural Resources Inc. (“Cliffs” or “the Company”) (NYSE: CLF), with beneficial ownership of approximately 5.2%, today announced that it is backing Lourenco Goncalves, former CEO of Metals USA, to fill the currently open position of Chief Executive Officer of Cliffs. Casablanca has also delivered a letter to the Company declaring its intention to nominate a majority of directors for election to Cliffs’ Board of Directors at the Company’s 2014 annual meeting of shareholders.

“In spite of its public statements, Cliffs hasn’t engaged us in any meaningful dialogue on the issues we’ve raised or provided a timetable for doing so.”

Goncalves, a 30-year veteran of the metals and mining industry, is standing as CEO candidate, has agreed to be a Casablanca director nominee, and recently made a personal investment of approximately $1 million in Cliffs shares. Goncalves was most recently Chairman, President and CEO of Metals USA.