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Struggling small miners vulnerable to mid-sized rivals – by Stephen Eisenhammer (Reuters India – January 16, 2014)

http://in.reuters.com/

LONDON, Jan 16 (Reuters) – A year of tumbling share prices and a shrinking pool of funding have left smaller mining companies vulnerable to the approaches of medium-sized rivals with cash in the bank and an eye for a bargain.

Investors and executives told Reuters they saw opportunities for mid-caps and turnaround specialists in regions such as Latin America and Africa as some small companies, typically those involved in the capital-intensive early stages of a project, struggle to secure funding from banks or the market.

The gold sector is likely to see the most M&A activity as the metal price languishes 25 percent lower than a year ago, and a number of potential deals are already in the works. Equities were hit even harder than bullion; the Thomson Reuters Global Gold Index of 43 gold miners more than halved in 2013.

Industry insiders said the trend would also spread across base metals and iron ore. Nearly all junior miners were hit last year, with the Thomson Reuters index of 144 resources companies listed on London’s alternative market (AIM) down 33 percent in 2013.

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Kinross defends Tasiast mine layoffs – by Geoffrey York (Globe and Mail – January 16, 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.

JOHANNESBURG — Kinross Gold Corp., dogged by protests and controversy after dismissing nearly 300 workers at its Mauritania gold mine, insists that the layoffs will help safeguard its future at one of its highest-cost operations.

The Toronto-based company, one of the world’s 10 biggest gold producers, is in a serious cost-cutting drive after writing down much of its $7.1-billion cost of acquiring Red Back Mining, owners of the Tasiast gold mine in Mauritania.

But after announcing the layoffs at its mining operation in the West African country last month, Kinross has faced lengthy and bitter protests by the laid-off workers and their supporters. The protests have continued for weeks, triggering a heavy-handed police crackdown.

About a dozen protesters were arrested and a similar number were injured when the police raided the protest last week, according to local reports. Kinross will not comment on the police raid, but it has defended the layoffs, calling them a “difficult but necessary response” to ensure the future of the mine.

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Mining industry confused by mysterious China Gold Stone firm – by Peter Koven (National Post – January 16, 2014)

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

TORONTO – Across the mining world, one question is on everyone’s lips this week: Who is China Gold Stone Mining Development Ltd.?

The mystery began with a press release issued Tuesday morning. The statement claimed a company called China Gold Stone has launched a $780-million hostile offer for Toronto-listed miner Allied Nevada Gold Corp. The press release was retracted hours later, with the sender saying that it was issued “in error and without the advice of counsel.”

Investors and analysts had never heard of China Gold Stone, and this debacle made them take a closer look at it. Before long, they were questioning if the company exists.

The press release calls China Gold Stone a “large-scale mining company” that owns three gold mines in China worth roughly US$15-billion. It also said China Gold Stone is registered in Hong Kong and that it is working with China National Gold Corp. (China’s largest producer) to invest in global mining markets.

While there are an enormous number of little-known mining companies strewn across China, any company with such enormous mineral wealth should be well known.

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UPDATE 1-India PM: POSCO to start work on steel plant in coming weeks – by Krishna N Das (Reuters India – January 16, 2014)

http://in.reuters.com/

NEW DELHI, Jan 16 (Reuters) – South Korea’s POSCO will be able to start work on its planned $12-billion Indian steel plant over the coming weeks, India’s prime minister said on Thursday, ending an eight year delay for environmental and legal clearances.

Manmohan Singh said the firm’s request for an iron ore mining licence – the final regulatory hurdle for the project which would be the biggest foreign direct investment in India – was at an “advanced stage of processing”.

The 12 million-tonnes-per-year plant in the eastern state of Odisha, formerly Orissa, will help world No.4 steel producer India to expand output.

India produced 77.6 million tonnes of crude steel in the past fiscal year, a fraction of top producer China’s nearly 800 million last year. India’s total iron ore reserve was estimated at 28 billion tonnes as of 2010 by the Indian Bureau of Mines.

India’s new Environment and Forest Minister Veerappa Moily last week gave approval to the plant but asked POSCO to spend 5 percent of the total investment on social commitments, which would raise the project’s cost to $12.6 billion.

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Afghanistan’s rare earth element bonanza – by Alan Dowd – Fraser Institute (Mining.com – January 15, 2014)

http://www.mining.com/

After more than a decade of war and nation building, members of the International Security Assistance Force (ISAF) in Afghanistan are heading for the exits. Although what ISAF will leave behind is better than what was there in 2001, Afghanistan remains a battered land. However, the resources Afghanistan’s land holds — copper, cobalt, iron, barite, sulfur, lead, silver, zinc, niobium, and 1.4 million metric tons of rare-earth elements (REEs) — may be a silver lining.

U.S. agencies estimate Afghanistan’s mineral deposits to be worth upwards of $1 trillion. In fact, a classified Pentagon memo called Afghanistan the “Saudi Arabia of lithium.” (Although lithium is technically not a rare earth element, it serves some of the same purposes.)

Of course, the fact that Afghanistan is rich in minerals is not necessarily new information. The Soviets identified mineral deposits in Afghanistan during their decade-long occupation. What is new is the volume and precision of mineral-related information. Afghanistan has been mapped using what is known as “broad-scale hyper-spectral data” — highly precise technologies deployed by aircraft that, in effect, allow U.S. military and geological experts to peer beneath Afghanistan’s skin and paint a picture of its vast mineral wealth. According to Jim Bullion, who heads a Pentagon task force on postwar development, these maps reveal that Afghanistan could “become a world leader in the minerals sector.”

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Why the odds are increasing for Keystone XL pipeline approval – by Claudia Cattaneo (National Post – January 16, 2014)

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

The U.S. State Department is expected to release a final environmental impact report around the last week of January that will support the Keystone XL, bolstering the odds that President Barack Obama will approve the controversial Alberta-to-Texas oil pipeline.

After more than five years of review, State is expected to release a voluminous Final Environmental Impact Statement that will include a major analysis of the surge in oil transportation by rail, growing markets for oil sands crude and climate change impacts. Observers expect the report to conclude that Canada’s oil sands will get to market with or without Keystone.

The report is expected to influence the President’s final word on the project, which would come after a 90-day national interest determination. There are conflicting views on the timing of that final decision and worries the final phase could drag on.

Some believe the President should move quickly and avoid making Keystone a mid-term election issue. Others argue the President could take until the summer to conclude his review to demonstrate the project was carefully considered and prevent legal challenges.

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Oil industry rebuts ‘trash-talking’ celebrity critics – by Shawn McCarthy and Richard Blackwell (Globe and Mail – January 16, 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.

OTTAWA and TORONTO — Two of Calgary’s most prominent oil executives delivered a scathing rebuttal to celebrity critics such as rock star Neil Young, as the industry attempts to win support for pipeline projects that are essential to its ambitious growth plans for the oil sands.

Cenovus Energy Inc. chief executive Brian Ferguson and TransCanada Corp. chair Russ Girling brought an aggressive message to a joint presentation at Toronto’s Canadian Club, in which they defended the country’s current approach to environmental protection and resource development.

Their appearance came just three days after Mr. Young launched a cross-country “Honour the Treaties” concert tour with a press conference that slammed the oil-sands development as an environmental catastrophe, ruinous to the health of local populations and an abrogation of treaty commitments.

Without specifically mentioning the singer, Mr. Ferguson said celebrities have been “trash-talking” Canada’s oil industry.

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NEWS RELEASE: New Framework Clears Path for Transparency in Canada’s Mining Sector

OTTAWA, ONTARIO–(Marketwired – Jan. 16, 2014) – Canadian exploration and mining associations, in collaboration with civil society organizations, have released recommendations for the development of a payment transparency standard for all publicly-traded mining companies in Canada.

Today’s launch by the Resource Revenue Transparency Working Group provides Canada’s federal and provincial governments, alongside provincial securities commissions, with a blueprint for a payment reporting framework. This framework will better serve the needs of the data’s end-users, such as citizens, governments and investors, but also those of the reporting companies.

Government implementation of these recommendations will provide citizens around the world with valuable information about payments from companies to governments in countries that produce minerals. Increased transparency will allow citizens and media to hold their governments to account for the revenues generated from mining activities and help to ensure that these revenues contribute to sustainable development and poverty reduction.

For example, the Africa Progress Panel suggests that Africa is home to 30 percent of the world’s mineral reserves, yet resource-rich African states still lag in almost all development indicators. Enhanced payment transparency is critical to ensuring that governments mobilize natural resource revenues to fight poverty and promote development.

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Pioneering Manitoba woman to enter Mining Hall of Fame – by Chris Purdy (Canadian Press/Global – January 15, 2014)

http://globalnews.ca/toronto/

Kate Rice was so brilliant she could have done anything, and her family was so wealthy she could have done nothing at all.

The adventurous, tough-as-nails beauty from southern Ontario set out for the rugged Manitoba wilderness 100 years ago with a shotgun and snowshoes in search of treasure.

She never struck it rich, but she did discover the first nickel deposits in the province and made headlines across the continent as Canada’s first “girl” prospector.

“Living in the middle of nowhere, depending solely on yourself … I know how hard it is to work in a man’s world,” says Toronto businesswoman Linda Rice, 60, who recently found the mining legend’s name on a branch of her family tree.

She says she can’t even imagine what life would have been like for such a woman a century ago. “I was gobsmacked … I was very excited that I was related to such a pioneer.”

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Takeover bids cut both ways in Quebec – by Peter Hadekel (Montreal Gazette – January 15, 2014)

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

There’s long been a circle-the-wagons mentality in Quebec about corporate takeovers. When a buyer from outside the province is interested in a Quebec company, a protectionist reflex often kicks in and calls are made for government action.

We saw it again this week when Vancouver-based mining giant Goldcorp Inc. made a $2.6-billion hostile takeover bid for Montreal-based Osisko Mining Corp., operator of the big Canadian Malartic gold mine in Abitibi.

The Board of Trade of Metropolitan Montreal was quick to ring the alarm bells, calling on the Quebec government to ensure that if the transaction goes through “it won’t harm the economy of Quebec and the metropolitan region.”

But for every Quebec company that gets taken over by outside interests, there’s one making a deal abroad. That’s how the market works in a global economy.

Widely-held Osisko is one of the few Quebec-based mining firms with operations and production in the province, said Board of Trade president Michel Leblanc.

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Bennett resists calls for wider review of coal project – by Wendy Stueck (Globe and Mail – January 14, 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 — British Columbia will review parts of a proposed coal export project under its jurisdiction but is unlikely to weigh in on other concerns, including whether Port Metro Vancouver should export more U.S.-mined thermal coal, provincial Mines Minister Bill Bennett said.

“As a minister who believes in natural resource extraction and understands the very important connection between resource development and the Canadian economy in general and the B.C. economy in particular, I don’t think we can pick commodities or pick particular industries and say, ‘Well, we don’t like that – we’re not going to do that one,’” Mr. Bennett said Tuesday.

“The rules and regulations and standards apply to everyone,” he added. “And if you want to build something or do something in B.C. and you can meet those rules and regulations and standards, then it doesn’t matter what industry you’re in or what commodity you’re dealing with – if you meet those standards, you should get a permit for what you want to do.”

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NEWS RELEASE: Future demand for mineral and metal products

This article was provided by the Ontario Mining Association (OMA), an organization that was established in 1920 to represent the mining industry of the province.

Okay, it looks like all the votes have been counted. It appears that experts, pundits, industry insiders and outsiders alike are almost unanimous in concluding that 2013 was not a great year for the mining industry around the world. Canada’s mining industry did not escape from the grips of downward trends.

Impacting Ontario’s mining industry particularly hard was the 20% decrease in nickel prices through 2013 and the 30% drop in gold prices. By value in recent years, gold accounts for about 42% of Ontario’s total metal production and 28% of the province’s total mineral production (metals and non-metals). Also, in recent years by value, nickel in an average year accounts for 22% of Ontario’s metal production and 13% of total mineral production.

On a global basis, the general consensus was that the slowdown in China’s economy in 2013 cast a broad shadow over global mineral production. Lessening demand lead to lower prices and companies found themselves struggling with controlling costs and boosting productivity.

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NEWS RELEASE: ROM’s New Interactive Gallery Explores the World of Modern Mining: Barrick Gold Corporation Gallery Opens At the ROM

(Toronto, Ontario – January 14, 2014): The Barrick Gold Corporation Gallery is now open at the Royal Ontario Museum (ROM). The gallery, located in the ROM’s Teck Suite of Galleries: Earth’s Treasures (Level 2), is an interactive 600 square foot space, with multi-touch, animated displays, multi-media presentations and more.

This new permanent gallery showcases a range of mineral specimens as well as presentations on the global mining industry, including stories about mining, and how the mining industry impacts our daily lives. The digitally enhanced games and other interactives, such as a touch wall are the most advanced, hands-on, user-driven visitor experiences in the ROM.

“The ROM is delighted to share the Barrick Gold Corporation Gallery in our Teck Suite of Galleries with our visitors and inspire them to discover more about mining. From the interactive games to specimen displays, this gallery illustrates the importance of mining in our daily lives and discusses the social and environmental responsibilities surrounding mining as well as our responsibilities as consumers of products of the Earth. We are grateful to our partners and sponsors, including Barrick Gold Corporation and our Advisory Council, for their valued support,” said Janet Carding, ROM Director and CEO.

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Hot Propects in a Cold Climate – by Russell Noble (Canadian Mining Journal – January 2014)

Russell Noble is the editor for the Canadian Mining Journal, Canada’s first mining publication.

It’s the largest island in Canada, the fifth largest in the world, and it contains some of the most beautiful land and seascapes on the planet, but Baffin Island is also one of the harshest and most unforgiving places on earth when it comes to Mother Nature and her weather conditions.

It’s a place where trees can’t grow, songbirds are rare, and perhaps most of all, it’s an extremely cold place where the sun comes in seasonal divides.

From November to January, the island experiences nearly 24 hours of darkness with less than two hours of twilight. On the flip-side of the calendar, there is continuous daylight from May to August. During the spring and fall months, it’s a gradual fade from dark to light and light to dark, respectively.

At first glance, Baffin Island seems to be an uninviting place, but look a little closer at the more than 11,000 people who live there because they love this massive rock at the top of the world that they have always called “Our Land.” It’s the only home they know, because most of the residents represent generations of Inuit people who have always lived on the island.

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Too many Obituaries, not enough Want Ads – by Russell Noble (Canadian Mining Journal – January 2014)

Russell Noble is the editor for the Canadian Mining Journal, Canada’s first mining publication.

Obituaries, unlike Want Ads, are taking up more space in our newspa¬pers lately and sadly, so too are the number of deaths involving mining com¬panies and subsequently, the job opportunities they once offered to skilled and willing workers.

Barrick Gold’s and Cliffs Resources’ recent issues involving their grand projects in South and North America respec-tively are perfect examples of ‘death-and-hope’ situations (much like Obituaries and Want Ads) because they have resulted in headlines around the world that have not only cast doubt on the individual companies, but they have also caused disappointment within the ranks of shareholders and future investors alike.

And by ‘future investors’ I don’t mean people with money to gamble on mining shares, but people in our schools right now who are contemplating their futures in careers that once included mining as an industry offering a lifetime of opportunities.

Fortunately for the most part, it still does because as we all know, the industry isn’t going to dry up and blow away like many of the jobs at Barrick and Cliffs did recently.

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