Republic of Mining

How Russia’s energy sector is eyeing a bigger game beyond the Olympics – by Yadullah Hussain (National Post – January 31, 2014)

January 31, 2014

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

The roads to Sochi are paved with oil and natural gas receipts. Winter Olympians striving for medals at Sochi next week can expect to stay at the Mountain Olympic Village, visit the Mountain Tourist Centre and practice their gold-medal performances at the Biathlon and Ski Complex, all built by Gazprom OAO, Russia’s largest natural gas producer.

Meanwhile, the country’s largest oil producer, Rosneft, pledged US$180-million for the privilege of becoming a top-tier sponsor at the XXII Winter Olympics, and Lukoil OAO is the main sponsor of the country’s cross-country ski team, as Russian President Vladimir Putin’s favourite holiday resort prepares to host the world’s top athletes.

Mining and other Russian oligarchs in Mr. Putin’s inner circle have all chipped in to foot the US$51-billion bill to prepare the Black Sea resort — easily the most expensive Olympics. And even before Hayley Wickenheiser steps into the spotlight as Canada’s flag bearer at the Fisht Olympic Stadium on Feb. 7, Sochi has already had the dubious reputation of being labelled as “the most corrupt Olympics in history.”

Keystone XL pipeline project primed for Obama’s approval, ambassador says – by Claudia Cattaneo (National Post – January 31, 2014)

January 31, 2014

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

As anticipation builds over the imminent release of two major reports that could seal the fate of Keystone XL pipeline, Gary Doer, Canada’s ambassador to the United States, remains confident the long-delayed project is primed for presidential approval.

“I think the president is going to make the decision on the basis of science and facts, and if he does that, that means it goes ahead,” the former Manitoba premier said in an interview Thursday.

CNN reported that the final environmental impact review will likely to be announced on Friday afternoon, citing two senior administration officials and another unidentified source familiar with the timing.

Once the results are out, eight U.S. agencies will examine them, then send their observations to Secretary of State John Kerry. President Barack Obama would then decide whether or not to approve the pipeline.

A final decision may not come for several months, but this study is seen as a critical step in determining whether the project will go ahead.

Is Canada ready for Russia’s hardball approach to the North Pole? – by Rob Huebert (Globe and Mail – January 30, 2014)

January 31, 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.

Rob Huebert is associate director of the Centre for Military and Strategic Studies at the University of Calgary. He has written and researched extensively on Arctic policy and defence issues.

When Russian Arctic scientist Artur Chilingarov – member of the Duma and special representative to President Vladimir Putin for the Arctic – planted a Russian flag at the North Pole in 2007, he created a media storm in Canada. Then-defense minister Peter MacKay was particularly critical of the Russian action, saying that this is no longer the 14th or 15th century.

But somewhat surprisingly, many Canadian commentators were not critical of the Russian action, but instead were very critical of Mr. Mackay and the government’s response. It was suggested that Mr. Chilingarov was only acting as a scientist and that this was not official Russian action. (How exactly these commentators knew this was the case was never disclosed.) They also suggested the planting of flag at the North Pole had about as much meaning as the Americans planting a flag on the Moon. As such, the common wisdom developed that Canada overreacted and that the Russians did not mean anything by this action.

COLUMN-China may not be commodity market driver in 2014 – by Clyde Russell (Reuters U.K. – January 30, 2014)

January 30, 2014

http://uk.reuters.com/

Clyde Russell is a Reuters market analyst. The views expressed are his own.

LAUNCESTON, Australia, Jan 30 (Reuters) – While it’s probably going too far to say the China HSBC Purchasing Managers’ Index can be discounted, there are good reasons to be cautious about the weak January reading.

The final HSBC PMI dropped to 49.5 from December’s 50.5, falling below the 50-mark that separates expansion from contraction for the first time in six months.

The soft start to the year in global industrial powerhouse has raised investor concerns that growth in China, the world’s biggest commodity consumer, may disappoint and struggle to reach 7.5 percent, which is widely expected to be announced as the official target.

Hongbin Qu, chief economist for China at HSBC, said in a statement that the weakness in the PMI was led by weaker new export orders and “slower domestic business activities”. But is this really such a surprise? Export orders are always likely to come off post the year-end holiday season in the West and domestic business would already have been tailing off ahead of the Lunar New Year holidays, which start on Jan. 31.

Zimbabwe: Zimasco to Splurge U.S $300 Million – by Phillimon Mhlanga (All Africa.com – January 30, 2014)

January 30, 2014

http://allafrica.com/

ZIMBABWE Mining and Smelting Company (ZIMASCO), the country’s largest ferrochrome producer, is building a new 600 000 tonnes per annum sinter plant which is expected to boost output, it has been learnt.Sources with intimate knowledge of the company’s expansion plans told the Financial Gazette’s Companies & Markets that the plant, which is the latest technology in ferrochrome production, would cost between US$250 million and US$300 million.

It is understood that funding for the plant will be provided by Chinese majority shareholder, Sinosteel Corporation, which controls a 73 percent stake in the company. ZIMASCO’s spokesperson, Clara Sadomba, said she would not divulge details in the absence of the company’s chief executive who was in China.

“Unfortunately, I can’t officially comment on the developments because my CEO (Li Jinqian) is away on business in China but he is coming back after the second week of February,” said Sadomba. The plant, which will be built in Kwekwe, would process chrome fines into balls that can be processed by other existing blast furnaces.

Metal is mined for myriad applications – by Brian Morton (Vancouver Sun – January 29, 2014)

January 30, 2014

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

Metals are used in just about everything from the family car to your $10,000 road bike, to computers, door handles, windshields and smartphones, even tooth fillings and food.

Mining is an essential fact in our modern world and that isn’t likely to change soon or even in the very distant future. Gold, silver, copper and lead have been around for thousands of years and, while their uses occasionally change, they’ll likely be around and extensively used for thousands more years.

The bicycle — that greenest form of transportation — is completely manufactured from materials obtained by mining: steel processed by burning metallurgical coal, along with specialized metals such as titanium.

Your computer, tablet or smartphone contains iron, titanium, aluminum, copper, zinc, nickel, gold, silver, lithium, magnesium, mercury, yttrium, palladium, tin, cadmium, indium, lead, samarium, tantalum, gadolinium and dysprosium.

That DVD? Aluminum, gold, silver, nickel, polycarbonate petroleum derivatives and acrylic lacquer.

PRESS RELEASE: SNC-Lavalin, Cementation Canada and the Morris Group sign MOU with First Nations to launch the First Nations Mining Corporation

January 30, 2014

MONTREAL, Jan. 30, 2014 /CNW Telbec/ – SNC-Lavalin (TSX: SNC), in partnership with Cementation Canada Inc., the Morris Group Limited, Flying Post First Nation, Lac Seul First Nation, Mattagami First Nation and Wahgoshig First Nation, today announced the signing of a Memorandum of Understanding (MOU) regarding the intent to capitalize the First Nations Mining Corporation (FNMC).

FNMC will form joint venture partnerships with local Aboriginal communities to promote, develop and carry out engineering, construction, environmental and other services for mining companies in Ontario throughout the project life cycle. FNMC will also work to strengthen ties between Aboriginal communities and mining companies in order to facilitate the training and hiring of Aboriginals and the procurement of goods and services from Aboriginal suppliers.

“We are very pleased with this new partnership, which is a solid model for sustainable development in First Nations communities,” said Stephen Lindley, Vice-President, Aboriginal and Northern Affairs, SNC-Lavalin Group Inc. “Our partners have worked diligently with Aboriginal leadership, companies and organizations across Canada to create business opportunities which contribute to sustainable social and economic development throughout Ontario’s Aboriginal communities. Through strategic alliances and partnering, we will ensure we meet these goals while also providing top-tier services to the mining industry.”

Editorial: Falling loonie resets expectations (Northern Miner – January 29, 2014)

January 30, 2014

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry.

The free fall of the Canadian dollar, which has only accelerated in 2014, undoubtedly has the CFOs of Canada’s mining companies breaking out the spreadsheets and tallying up the pluses and minuses of the new, low-loonie environment. Goodbye simple calculations that assumed parity between the Canadian and U.S. dollars, as the loonie has slid over 9% in the past year.

At press time, the Canadian dollar was trading at US90¢, and on Jan. 27, the Canadian dollar slipped below that level for the first time since July 2009, as the U.S. dollar surged and currencies of emerging-market and resource-exporting countries contracted sharply.

These currency devaluations triggered round after round of selling in emerging countries’ stock and bond markets, and a simultaneous flight to safety in U.S. dollars, stocks and bonds.

Turkey grabbed the biggest headlines worldwide, as the lira hit a record low against the U.S. dollar, prompting the Turkish central bank to convene an emergency meeting and vow to defend the lira with steep interest-rate hikes.

Rather than lay claim to the North Pole, the federal government should tap gas in our Arctic islands – by Michael H. Bell (National Post – January 30, 2014)

January 30, 2014

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

Michael H. Bell, now retired, was Senior Vice President of Fednav Ltd, and the President of Melville Shipping Ltd, a partner in the Arctic Pilot Project.

In a recent New York Times article entitled “Rushing for the Arctic’s Riches,” Professor Michael Klare of Hampshire College used 1,076 words, only one of which was “Canada,” within a list of nations that have an Arctic coastline. It is no surprise Canada was deprived of any recognition of its desire and ability to develop its “Arctic Riches,” let alone “rush” to them. The lack of any development activity within our High Arctic is the current Canadian position.

This was not so a few decades ago when Canada boasted the most northerly mines in the world: Polaris on Little Cornwallis Island and Nanisivik in Admiralty Inlet, Baffin Island. Both are now closed.

In 1978 Fednav of Montreal, in collaboration with the Canadian government, designed, built and operated the M/V “Arctic,” the world’s first ice-breaking bulk carrier. Between 1977 and 1983, Canada, through PetroCanada, pioneered an Arctic Pilot Project (APP) designed to liquefy gas on Melville Island for delivery to Quebec. The APP was at the regulatory stage when, in the 1980’s, the energy market collapsed and it became clear that it could not proceed. In 2006, PetroCanada revived an enlarged version of the APP, the Arctic Island Gas Project (AIGP), with Europe as a prime market. The AIGP was terminated at the sale of PetroCanada to Suncor in 2008.

Rushing for the Arctic’s Riches – by Michael T. Klare (New York Times – December 7, 2014)

January 30, 2014

http://www.nytimes.com/

AMHERST, Mass. — WHILE many existing oil and gas reserves in other parts of the world are facing steep decline, the Arctic is thought to possess vast untapped reservoirs. Approximately 13 percent of the world’s undiscovered oil deposits and 30 percent of its natural gas reserves are above the Arctic Circle, according to the United States Geological Survey. Eager to tap into this largess, Russia and its Arctic neighbors — Canada, Norway, the United States, Iceland and Denmark (by virtue of its authority over Greenland) — have encouraged energy companies to drill in the region.

For Russia, which recently seized a Greenpeace ship and is prosecuting 30 of the group’s activists for attempting to scale an oil platform, the temptation to exploit the Arctic Ocean is especially powerful. Russia’s economy is heavily dependent on exports of oil and gas, and the government relies on these sales for much of its income. Until recently, the Russians could draw on reservoirs in western Siberia to satisfy their needs, but now, with many of these fields in decline, they are counting on Arctic supplies to maintain current production levels. “Our first and main task is to turn the Arctic into Russia’s resource base of the 21st century,” Dmitri A. Medvedev, then the president, declared in 2008.

The Russians have explored drilling options in several offshore areas of the Arctic. In the Pechora Sea, above northwestern Siberia, the Russian energy giant Gazprom has installed its Prirazlomnaya platform — the one protesting Greenpeace activists attempted to board.

Goldcorp says ‘significant number’ of Osisko investors back hostile bid – by Bertrand Marotte (Globe and Mail – January 30, 2014)

January 30, 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.

MONTREAL — Goldcorp Inc. says a “significant number” of Osisko Mining Corp. shareholders support its $2.6-billion hostile offer to take over Osisko and that the targeted company appears to have nothing to offer investors as an alternative.

Vancouver-based Goldcorp made the statements in a news release Thursday responding to Montreal-based Osisko’s launch of legal action in Quebec Superior Court on Wednesday to block the bid.

Osisko also alleges that Goldcorp misused confidential information it got in on-and-off merger talks going back more than five years.

“Goldcorp’s offer reflects the current market environment for gold and gold equities and provides a strong premium based on any reasonable valuation metric,” Goldcorp president and chief executive officer Chuck Jeannes said.

“Osisko has communicated its intention to explore value-maximizing alternatives but without new information their only strategy appears to be to wait and hope for an improved valuation.”

Cliffs Natural Resources Walks Away From Ring of Fire – by James Murray (Netnewsledger.com – January 30, 2014)

January 30, 2014January 30, 2014

http://www.netnewsledger.com/

THUNDER BAY – Breaking News – Cliffs Natural Resources first stepped back from the Ring of Fire officially last November. The company explained in shutting down its operations in Northwestern Ontario that the company was “suspending operations”.

Now it appears the company is taking another big step back from the chromite discovery in Northern Ontario. Cliffs Natural Resources has been facing pressure from an investor who is seeking to break up the company.

Moody’s is saying that would not be beneficial. Moody’s says that Cliffs’ actions in the past twelve months that have including cost cutting spending reductions along with reducing debt levels. Those efforts have resulted in a stronger credit portfolio for Cliffs.

Moody’s reports that Cliff’s Asian-Pacific operations are providing the company with diversification and cash flow to the company which are helping to reduce Cliffs Natural Resource’s $3.9 billion debt load.

Moody’s states in a report reduced on January 28 2014, “Given its strategic objectives for positioning the company for future growth, we believe Cliffs will continue to exhibit a conservative approach to its capital structure and remain focused on cost reduction and managing to a neutral cash flow position while making necessary capital investments.”

Coral or coal decision looms for Australia’s Great Barrier Reef – by Sonali Paul (January 30, 2014)

January 30, 2014

http://in.reuters.com/

MELBOURNE – (Reuters) – Australia’s Great Barrier Reef watchdog is to decide by Friday whether to allow millions of cubic metres of dredged mud to be dumped near the fragile reef to create the world’s biggest coal port and possibly unlock $28 billion in coal projects.

A dumping permit would allow a major expansion of the port of Abbot Point for two Indian firms and Australian billionaire miner Gina Rinehart, who together have $16 billion worth of coal projects in the untapped, inland Galilee Basin.

The Galilee Basin could double Australia’s thermal coal exports and see it overtake Indonesia as the world’s top coal exporter, further fuelling China’s power plants and steel mills that have underpinned Australia’s decade-long mining boom.

If the permit is not granted it would add to uncertainty over $28 billion in proposed Galilee Basin projects, already delayed due to difficulty raising funds with coal prices down.

The plan has sparked protests from environmentalists and scientists who fear the sensitive marine park will be damaged by the dumping and an expanded port, would nearly double shipping traffic through the reef, increasing the risk of accidents.