Republic of Mining

Is BHP looking to escape the nickel market? – by Ryan Newman (The Motley Fool – October 18, 2013)

October 18, 2013

http://www.fool.com.au/

BHP Billiton’s (ASX: BHP) rivals are once again suspecting that the miner could be on the move to offload its largest nickel assets as part of its strategy to heavily reduce costs and increase its focus on core operations.

As reported by The Australian Financial Review, it is believed that the miner had placed its Nickel West and Cerro Matoso mines up for sale earlier in the year. This belief was bolstered when the company’s new CEO, Andrew Mackenzie, notably excluded nickel from his “four pillar” strategy in May, which outlined the company’s core operations and focus areas moving forward.

Speculation has once again heightened that the sale of the assets could be a very real possibility – particularly after the company was forced to impair its Nickel West asset by US$1.2 billion, according to BHP’s annual report.

Meanwhile, many believe that right now could be the bottom of the nickel market which would increase the interest in BHP’s assets. Whilst now may not prove to be the most profitable time to part ways with the mines, it would allow the miner to focus more heavily on reducing operating costs and increasing productivity in other key areas.

Bob Rae says mining will help First Nations – by Kyle Gennings (Timmins Daily Press – October 18, 2013)

October 18, 2013

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – Inclusion, expansion and understanding were the central theme of the Nishnawbe Aski Development Fund’s Mining Ready Summit. The keynote speaker continued to convey the point.

Former Ontario premier Bob Rae spoke about the need to include First Nations in all aspects of development, increasing accessibility to remote Northern communities and spreading the potential wealth found in the Ring of Fire development.

“I think that the current model is ready to be put into action,” said Rae in an interview following his speech. “I think that building sustainability into the approach that companies are taking, I think that we need to look at sustaining communities and sustainability is about the people as well as the environment.”

Rae was referring to the remote First Nations communities like Attawapiskat, Martin River and Moose Factory; communities which have close proximity to current and future economic development.

“We need to recognize that development needs to happen,” said Rae.

Orazietti squares off with [environmental commissioner] watchdog – by Elaine Della-Mattia (Sault Star – October 17, 2013)

October 18, 2013

http://www.saultstar.com/

Ontario’s environmental watchdog issued a warning that the province has changed legislation that will see its natural resources exploited – something Sault MPP and Minister of Natural Resources David Orazietti argues vehemently against. Environmental commissioner Gord Miller states in his annual report that provincial government cutbacks announced during the spring budget will result in the Ministry of Natural Resources having less power to protect Ontario’s resources.  Instead, the powers will be delegated to private companies, which in turn could lead to exploitation of Crown land, wildlife and natural resources, the report states.

He referred to Ontario’s far north as turning into the “wild west,” particularly with the potential development around the Ring of Fire, expected to be the province’s most promising mineral development of chromite and warns that major industrial activities can proceed with few checks.

He also criticized the government for a lack of an action plan to deal with invasive species like the Asian carp and emerald ash borer.

But Orazietti counters that Miller has misinterpreted the rules and that the new power for private companies only deals with minor changes on issues like dredging permits and the removal of vegetation that only has minimal environmental impact.

Analysis: Lurching gold prices mystify traders, undermine confidence – by Frank Tang (Reuters Canada – October 18, 2013)

October 18, 2013

http://ca.reuters.com/

NEW YORK (Reuters) – In the early hours of the New York morning on Thursday, when scarcely a few hundred lots of gold futures are usually traded, a wave of buy orders worth over $2.3 billion surged into the market.

Prices soared 3 percent in just 10 minutes, setting the tone for the next 12 hours of trade – and puzzling many traders and investors who have been rattled by a series of similarly abrupt, and largely unexplained, trade surges over the past two weeks.

While sudden swings in the price of gold are nothing new, the usual causes – a shock in economic data or a “fat finger” erroneous trade – don’t seem to fit. While the U.S. dollar had also tumbled on Thursday, bullion’s move was far more extreme.

Some are pointing at spin offs from today’s predominantly 24-hour electronic trading, with a far smaller number of market makers on the trading floor to match orders and provide liquidity.

The half-dozen mammoth orders whipsawed prices and disrupted trade in the CME Group’s (CME.O: Quote) Comex futures, a market already edgy about bullion’s fading safe-haven appeal and its lackluster performance during the U.S. budget impasse.

Potential Indonesian nickel export ban bodes well for prices, poorly for pig iron – by Freya Berry (Mineweb.com – October 18, 2013)

October 18, 2013

http://www.mineweb.com/

While it is not certain the ban will go ahead unchanged, if it does, analysts say, it would be a game-changer for prices.

LONDON (REUTERS) – A potential ban on nickel ore exports by Indonesia next year and production cutbacks could lift the price of this year’s worst-performing base metal by more than 20 percent off multi-year lows, analysts said.

Indonesia, the world’s top exporter of nickel ore, has said it plans to bring in a ban on unprocessed ore exports from Jan. 1, 2014. Its ore is currently shipped to China to produce nickel pig iron, a cheap substitute for higher grade nickel in stainless steel.

It is not certain that the ban will go ahead unchanged, but if it does analysts said it would be a game-changer for prices. Benchmark nickel on the London Metal Exchange has fallen by around a fifth since January to four-year lows, weighed down by over-supply, and was trading at $13,963 a tonne at 1529 GMT on Thursday.

“It’s such an important swing factor for the market that you could see a decent rally in the nickel market if a ban is strictly enforced – at least 20 or 30 percent,” said Daniel Smith, head of metals research at Standard Chartered.

Rio [Guinea iron ore] rail line will displace 10,000 – by Matt Chambers (The Australian – October 18, 2013)

October 18, 2013

http://www.theaustralian.com.au/business

RIO Tinto’s $US20 billion ($20.8bn) Simandou iron ore project in Guinea will see more than 10,000 people relocated to make way for a railway to move the raw material to the coast, raising potential issues over who will be responsible for their wellbeing.

The extent of the relocations were revealed yesterday by Rio’s iron ore counsel Philip Edmands in a talk to a resources and energy law association conference.

“We need to move in excess of 10,000 people and there is a patchwork quilt of titles that have to be acquired,” Mr Edmands told the AMPLA conference in Adelaide yesterday.

The complex, 670km multi-user railway to take iron ore from the Simandou concessions, which Rio hopes it will start building in 2018, will include two viaducts, 24km of tunnels and 29 bridges, and is expected to help open up the heavily populated hinterland.

The number of displaced people is larger than many were expecting, given the project’s latest social and environmental impact statement says 15 settlements, with a total of just “270 structures”, would need to be physically moved to make way for the railway.

Who monitors the oil sands monitors? – by Peter Foster (National Post – October 18, 2013)

October 18, 2013

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

Oil sands firms have been ‘woefully’ bad at defending industry

With defenders such as Ottawa, Edmonton and the oil industry, oil sands development at times hardly seems to need enemies. “Woeful” doesn’t begin to describe their performance in addressing environmental criticism, which is at the root of one of the most contentious issues in Canada/U.S. relations: presidential approval of the Keystone XL pipeline.

Government and industry long ago gave up on climate science, even if they still argue that the oil sands are statistically irrelevant, but they have been equally bad at countering criticisms of local environmental impacts.

Federal/provincial infighting over monitoring is preventing an effective response to opponents whose media savvy stands in inverse proportion to their objectivity. Industry — itself beset by communications and joint-action difficulties — is concerned that it is being asked to fund a biased monitoring system, but is scared openly to criticize its political masters, or activist “monitors.”

U.S. ‘over-fracked and over-drilled,’ Shell technology official says – by Yadullah Hussain (Financial Post/Vancouver Sun – October 18, 2013)

October 18, 2013

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

Hype ‘Dangerous’

The United States’ oil and gas industry has “over-fracked and over-drilled”, according to Matthias Bichsel, projects and technology director at Royal Dutch Shell Plc.

“The reservoirs don’t need that many wells. The reservoirs don’t need that many stages of fracks, because not all the pieces of the rocks are as good,” Mr. Bichsel said in a telephone interview from Vancouver last week, where he was speaking at a company event.

The United States is on course to become the world’s largest oil supplier, according to PIRA Energy Group, a New York-based energy consultancy. “The U.S. shale liquids growth of 3.2 million barrels per day over the last four years has been nearly unparalleled in the history of world oil; only Saudi Arabia in 1970-74 raised its production faster,” PIRA said in a statement.

But it has not translated into a boost in profits of all companies, especially as natural gas prices have slid amid a production surge. Shell came late to the U.S. shale boom and has been left disappointed by the performance of its Eagle Ford shale assets.

‘Nobody is leaving,’ N.B. native protesters vow after clash with RCMP turns violent [shale-gas protest] – Gloria Galloway and Jane Taber (Globe and Mail – October 18, 2013)

October 18, 2013

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.

A native protest against a shale-gas project in New Brunswick has exploded in violence, sending dozens of people to jail and reducing five police cars to smouldering ruins.

The clash between the RCMP and the Elsipogtog First Nation, north of Moncton, began early Thursday morning when a large number of officers arrived at a compound where SWN Resources Canada stores equipment. The police intended to enforce an injunction against a native blockade that has prevented SWN, a natural gas and oil exploration company, from conducting seismic testing.

The protesters refused the demands to disperse, and the confrontation devolved into a melee of tear gas and rubber bullets. In the end, at least 40 people, including Elsipogtog Chief Arren Sock and several council members, had been arrested and five police cruisers had been set ablaze. The situation had calmed by early evening with news that Mr. Sock and some of the other protesters had been released.

“But nobody is leaving,” said Susan Levi-Peters, a former chief. “We don’t want shale gas here. We have been asking for consultations for three years now and nothing has happened. Instead they just put our people in jail.”

Rock hard opposition to quarry – by Mary Katherine Keown (Sudbury Star – October 18, 2013)

October 18, 2013

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

David Villard, a consultant with Bruce Tait Construction Ltd., was in the proverbial hot seat on Thursday night. The Wanup Community Hall played host to a packed house of more than 100 concerned citizens at an open house Tait’s firm organized to present plans for a proposed quarry, which will sit adjacent to Rock Lake, a picturesque recreational spot along Highway 69 surrounded by about 70 seasonal and permanent homes.

Thursday’s open house was an acrimonious affair and attendees expressed their opposition to the proposed quarry on a number of points. James Gomm, president of the Rock Lake Property Owners’ Association, and his wife, Catherine, are spearheading the opposition movement.

Of particular concern was the lack of information circulated to area residents, water quality and possible noise disruptions. Gillian Groves, a seasonal cottager, pointed out the industrial noise could disturb the lake’s residents, many of whom are retirees.

“These people worked for their lives to get these places and what you’re proposing is taking away time from what they’ve worked their lives to enjoy,” she said.

Fewer junior miners in BC could help spur sector – by Henry Lazenby (MiningWeekly.com – October 17, 2013)

October 18, 2013

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

TORONTO (miningweekly.com) – Having fewer junior firms in British Columbia’s mining sector could help to breathe new life into an ailing industry segment, a group of 15 senior executives told a study commissioned by the British Columbia Securities Commission (BCSC).

The report compiled by professional services firm KPMG and entitled ‘BC Junior Mining at a Crossroads: Executive Management’s Perspective’, found that senior mining companies should also clean up their balance sheets to increase investors’ confidence in the mining sector, after which a recovery of junior mining companies would follow.

From the start of the year to August, about 85, or 5%, of the 1 673 mining companies listed on Canada’s TSX and TSX-V failed, compared with about 6% in the oil and gas industry. These did not include companies taken off the exchanges owing to merger and acquisition activity, going-private transactions or those companies that have graduated to bigger exchanges.

Author of the Mercenary Geologist website Mickey Fulp recently told Mining Weekly Online it would take a lot of time to “wash out the bad” companies and many were, by now, merely hanging on, creating danger for the unsuspecting investor.

UPDATE 2-Outotec to cut up to 500 jobs as miners slash spending – by Ritsuko Ando (Reuters India – October 17, 2013)

October 18, 2013

http://in.reuters.com/

HELSINKI, Oct 17 (Reuters) – Finnish mining technology company Outotec lowered its full-year sales and profit margin forecasts and said it planned to cut up to 500 jobs as a sluggish global economy forces miners to rein in spending.

In a further sign of tough times for Finland’s industrial firms, its warning on Thursday came just after engineering company Metso said it faced a fall in sales and profit due to weakness in its pulp, paper and power unit.

Shares in Outotec, whose job cuts represent 10 percent of the workforce, slid 15 percent by 0930 GMT while Metso lost 6 percent.

Outotec said it was seeing delays in customer payments. One project, worth 30 million euros ($40.5 million) in its order backlog, was cancelled in September.

Mining companies have over the past year been pulling back on spending in the face of weaker prices as many boom-year projects turned sour, and many have scrapped or delayed plans.

AFRICA INVESTMENT-South Africa’s migrant mine labour conundrum – by Ed Stoddard (Reuters U.S. – October 17, 2013)

October 18, 2013

http://www.reuters.com/

LUSIKISIKI, South Africa – Oct 17 (Reuters) – South Africa’s system of migrant mine labour has come under renewed scrutiny, with government and company officials blaming it for a host ills bedeviling the industry and the country, including last year’s wave of violent wildcat strikes.

But there is no easy fix for such an entrenched feature of the social fabric and the cure is proving as bad as the disease as it means job losses on a grand scale with devastating consequences for what are now called the “labour-sending areas.”

This migrant labour force, which built a gold industry that has produced a third of the bullion ever mined, was sourced from “homelands” far from the shafts where most black South Africans were forced to to eke out an existence under apartheid.

Many have also come from neighbouring countries such as Lesotho and Swaziland. It generated vast profits, not least because migrants were paid bachelor wages even if they had families to feed, and controlled the movement of Africans as the workers were confined to hostels on mine property.

5 Endangered Elements That America Needs – by Michael Silver (Huffington Post – November 29, 2012)

October 18, 2013

http://www.huffingtonpost.ca/

Michael Silver is the CEO of American Elements

2012 marks the second year American Elements has published its annual Endangered Elements List (EEL12): a list of elements which by their scarcity and technological importance threaten America’s long-term prospects. America is about to face a crisis that will determine whether it will hold its place as the largest economy and most powerful nation in the world.

Today it is a constant refrain that the way out of our present fiscal difficulties is for America to get back in the business of making things. Manufacturing generates the needed jobs and resulting prosperity that have pulled us out of each recession for the last 150 years.

American innovation, particularly in the area of green technology, it is said will foster whole new industries, jobs and economic growth at the beginning of the 21st century similar to the impact made at the beginning of the 20th century by the inventions of Alexander Graham Bell (telephones), Thomas Edison (electricity) and Henry Ford (cars).

While much of this is true, innovation is in fact only the starting point. To manufacture the products flowing from great ideas, a nation must also have access to the critical materials on which the discoveries are based.

Stephen Harper ignores Canada’s First Nations at own peril – by Thomas Walkon (Toronto Star – October 17, 2013)

October 17, 2013

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.

The prime minister must curry favour with Canadian aboriginals if his resource agenda is to succeed. Why then is he so obdurate?

Historically, the Canadian government has catered to aboriginals only when it needed them. It needs them now. Specifically, Prime Minister Stephen Harper needs First Nations on side if his government is to push through its ambitious resource development plans and reap the requisite political awards.

British Columbia’s native communities have the capacity to tie up — perhaps indefinitely — Harper’s proposed oil pipeline to the Pacific Coast. They have promised to do just that. Mining development in northern Ontario’s so-called ring of fire can take place only if First Nations there agree.

So far, the Ontario government has been carrying out the ring-of-fire negotiations. But Ottawa too wants those minerals developed and the federal government’s approach to native people is bound to have an effect on any final deal.