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Japan Inc. shows it means business in Canada – by Claudia Cattaneo (National Post – September 25, 2013)

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

A major topic loomed large during Tuesday’s first official visit to Canada by Japanese Prime Minister Shinzo Abe: building a long-term energy relationship for the benefit of both.

It’s well known that energy-poor Japan has been eyeing Western Canada’s abundant natural gas deposits as a new energy source, particularly since the Fukushima disaster in 2011 shut down its nuclear industry, and that Canada is equally motivated to sell energy to Japan as a way to diversify its energy markets away from the United States.

The big hurdle to what could be a union made in heaven is price: Japan is struggling to pay the premium prices for imported liquefied natural gas (LNG) that are prevailing in Asia, partly due to its own increased demand since Fukushima, and is bargaining hard for a new energy deal with Canada that it can afford.

While contracts are ultimately the domain of the market, Abe told reporters in Ottawa the two countries agreed to co-operate more closely on natural gas and praised Canada as a stable source that can provide natural gas at competitive prices. Showing it means business, Japan Inc. has moved en masse to Canada over the past two years to sweeten the relationship through investment.

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Fifty Shades of Gold – by Frank Holmes (Frank Talk – Insight For Investors – September 23, 2013)

http://www.usfunds.com/

Goldman Sachs created a stir recently when it forecasted that gold would fall to $1,000 an ounce by the end of 2014, as the firm expected the Federal Reserve to reduce its bond buying program. Goldman also suggested that gold miners might want to hedge their output, locking in 2013 prices.

HSBC analysts have also been bearish on gold, although the firm admits that lower gold prices tend to draw out tremendous demand from emerging markets, especially China. Because of that demand, HSBC believes gold will end 2014 at around $1,435 an ounce, says MarketWatch.

Keep in mind that “Goldman Sachs does things that are good for Goldman, not you,” says Bryon King from Agora Financial. Things can change quickly in the gold market, as investors saw when, only days after Goldman’s assertion, the Federal Reserve surprised everyone by announcing it would continue purchasing $85 billion worth of bonds. Gold investors cheered as the precious metal shot up the most in 15 months.

Unlike many commodities, there are many shades to gold, such as the Love Trade’s buying gold for loved ones and the Fear Trade’s purchasing gold as a store of value.

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Southern Ontario should fix own problems – by John R. Hunt (North Bay Nugget – September 17, 2013)

http://www.nugget.ca/

I sometimes wish Vic Fedeli would stop doing it. Every time the MPP for Nipissing exposes another Liberal plot to rip off the taxpayers to pay for Dalton McGuinty’s follies my blood pressure goes sky high.

For some strange reason he also brings back memories of rabbit hunting on Boxing Day. In many parts of England it was the custom for farmhands to down tools the day after Christmas after the cows were milked. Then armed with ferrets and nets they pursued the elusive bunnies.

Most farm labourers had a pet ferret and when they went to a pub for a drink they often carried it in a vest pocket. When they lined up at a bar for a drink tiny ferret heads with black eyes and pointed noses peered out of pockets to enjoy the proceedings.

The English countryside was divided into fields by hedges growing on banks of earth into which the rabbits tunneled and built their nests. The hunters dropped nets over the exits after putting a ferret inside.

There were bumps and squeaks. The rabbits exploded into the nets and were converted into rabbit stew to supplement wartime rations.

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Tories seek to rescue North from red tape – by Jonathan Migneault (Sudbury Star – September 25, 2013)

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

Government red tape has impeded development in Northern Ontario – especially for the mining and forestry industries – according to a new white paper report by the Progressive Conservative Party.

“We want the government to move a little more efficiently,” said Paula Peroni, the Progressive Conservative candidate for Sudbury.

Peroni said the standstill on Cliffs Natural Resources’ plans to develop the Ring of Fire was a “perfect example” of a company that has been blocked by red tape. “The Ring of Fire needs to be a priority, not just for Sudbury and Northern Ontario, but for this whole province,” she said. “In my opinion, we are 10 years behind on this project.”

But mining analyst and Sudbury Star columnist Stan Sudol said the complications for the Ring of Fire project go far beyond government policy. “The Ring of Fire is a very complicated development that includes resource revenue sharing with First Nations, environmental approvals, transportation and power infrastructure challenges, just to name a few issues, on top of Cliffs’ current financial constraints and reduced global demand for all commodities,” he said in an email to The Sudbury Star.

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[Saskatchewan Premier] Wall silent on Cameco tax move – by Murray Mandryk (Regina Leader-Post – September 24, 2013)

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

It’s been six years since Brad Wall was elected Saskatchewan premier, but it was three years ago at this time when he cemented himself as a populist politician.

A proposed takeover of Potash-Corp by multinational South African-Australian mining giant BHP Billiton left Wall on the horns of dilemma: Should he subscribe to his philosophically conservative roots and simply allow the market/shareholders to sort this matter? Or should he act in the best interests of a province whose priority would be PotashCorp’s market share and, thus, royalties?

Compounding matters were BHP Billiton’s eagerness to excuse itself from the marketing cartel Canpotex, which controls offshore potash sales, versus the fact that BHP Billiton was in the early stages of developing what may be the province’s biggest potash mine and one of the first new mines to be built in 40 years.

By setting aside his philosophy and choosing to put the interests of Saskatchewan taxpayers first, Wall established himself as a populist leader voters could look to, to do the right thing … even if that meant sometimes going against his natural inclinations.

However, Wall’s future political and governance success will largely depend on his ability to demonstrate that this wasn’t just a one-off and – when the situation requires – that he is capable of taking on the corporate giants on behalf of the Saskatchewan citizenry.

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NEWS RELEASE: Development and Peace launches campaign calling for an ombudsman for responsible mining

MONTREAL, Sept. 23, 2013 /CNW Telbec/ – Development and Peace is launching a new campaign under the banner A Voice for Justice that is calling on the Government of Canada to establish an independent ombudsman for the Canadian extractive sector that can investigate complaints brought by communities overseas where companies operate.

Development and Peace is launching this campaign in response to reports from mine-affected communities in Africa, Asia and Latin America that are experiencing conflict, pollution, forced displacements and other negative impacts from the presence of Canadian mines.

“There is currently little or no recourse for communities that are facing violations of their rights,” says Michael Casey, Executive Director of Development and Peace. “The laws in their own countries are weak or not enforced. And the mines come at a very high price for these communities, as they are the ones who experience the impacts but gain little from the profits. Having an ombudsman would allow them have their concerns heard by an impartial body who can determine if any violations have taken place.”

Development and Peace has campaigned on this issue before, collecting half a million signatures in support of stronger accountability standards for the Canadian extractive sector, which includes nearly 75 per cent of the world’s mining and exploration companies listed on Canadian stock exchanges.

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PoV: $1-million fine should not be placed in general revenues – by Brian MacLeod (Sudbury Star – September 21, 2013)

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

Whatever happens to the $1,050,000 million fine levied against Vale Canada after the deaths of two Sudbury miners in June 2011, it should not go into the city’s general revenues.

That would be an abomination.

Jason Chenier, 35, and Jordan Fram, 26, died after they were struck by a run of muck that fell from an ore pass on the 3,000-foot level of the mine. Chenier had previously voiced concerns about excess water in the area, which may have loosened the rock.

The company faced nine charges under the Occupational Health and Safety Act, and a supervisor faced six more. On Tuesday, the company pleaded guilty to three charges, admitting it “failed to take reasonable precaution in preventing the movement of material through an ore pass where hazardous conditions existed.” The remaining charges were dropped, as were the charges against the supervisor.

The fine, $350,000 on each count, plus a $250,000 victims surcharge, is believed to be the largest ever of its kind in Ontario. While the $250,000 will go to a provincial fund for victims of crime, the Labour ministry has indicated the $1,050,000 fine goes to the city, which plans to place the money in general revenues.

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Anglo American pulls out; is it because we’re crazy? – by Paul Jenkins (Anchorage Daily News – September 22, 2013)

http://www.adn.com/

British mining giant Anglo American’s abandoning the complicated, expensive and grindingly slow slog to develop the rich Pebble prospect in Southwest Alaska is understandable — but you have to wonder how it must appear to other businesses and industries considering investments in Alaska.

Anglo American, which poured more than $541 million into the Pebble effort, points to its deep backlog of projects waiting for development. It says it is looking at higher-value, lower-risk undertakings, planning to cut by a third the nearly $950 million it spends annually on keeping afloat pre-approval stage, complicated, from-scratch projects such as Pebble.

All that may be a dodge, a way of saying Anglo American could see the handwriting on the wall and grew weary of trying to win anything resembling a fair hearing for Pebble in Alaska. With the Environmental Protection Agency poised, if not panting, to block Pebble ostensibly to protect Bristol Bay salmon — based, mind you, on an assessment that could not even pass muster with its own peer review panel — the $300 billion project’s future must have seemed sketchy.

It is notable that Anglo American did not sell, likely because there were no takers in the current environmental and regulatory atmosphere. It simply folded its cards and opted to eat a $300 million post-tax penalty for pulling out.

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Boom towns could tax resources: municipalities – by Jeff Lee (Vancouver Sun/Canadian Press – September 19, 2013)

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

While the federal and B.C. governments are pushing hard to open up Canada’s liquefied natural gas reserves for export to Asia, local municipalities are raising concerns about the impacts the dramatically rapid developments will have on them.

Whether it is the pressure on local policing, health care and community resources that pop-up boom towns will have on neighbouring cities to the impact on infrastructure such as roads and sewers, municipalities in the northern half of B.C. are tepidly raising a caution flag at this week’s Union of B.C. Municipalities Convention.

“We’re not saying we don’t want the economic investments. We do,” said Oliver Ray, executive director of the North Central Local Government Association. “But with investment in LNG will come some heavy pressures on our municipalities, and we’re worried about the impact that can have on us.”

A third of the association’s 30 resolutions to the UBCM deal with concerns over the impacts caused by rapid resource development. The association represents all local governments in the northern half of B.C., including more than 400,000 residents.

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The gold rush for commodities isn’t over yet, despite claims the super-cycle is dead – by Christopher Silvester (Spear’s.com – September 24 2013)

http://www.spearswms.com/

Demand from governments and private investors for gold and other commodities suggests that, contrary to popular opinion, the latest super-cycle has plenty of life left in it

WE’VE BEEN HERE before, haven’t we? Perhaps the clamour of Cassandra-like voices was not so great in 2011 when Spear’s previously wrote about the supposedly imminent demise of the commodities super-cycle, but it was nonetheless already a clamour. The past nine months or so have heard that clamour amplified several times over.

The Financial Times declared that the super-cycle was dead at the end of June, only to declare about ten days later that rumours of its death were greatly exaggerated. Most recently, the Wall Street Journal reported that the broad consensus of analysts and investors has called the end of the super-cycle.

But super-cycles tend to die slowly. The first identifiable commodities super-cycle in modern times lasted from 1894 to 1932, peaking in 1917, according to academics Bilge Erten and José Antonio Ocampo. The second lasted from 1932 to 1971, peaking in 1951, and the third lasted from 1971 to 1999, peaking almost as soon as it began.

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Canadian uranium sector prepares for rising tide – by Simon Rees (MiningWeekly.com – September 20, 2013)

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

TORONTO (miningweekly.com) – Uranium is back on the radar for many in the Canadian investment community. At first glance, this might seem counterintuitive: effective September 2, the uranium oxide spot price stood at $34/lb, while short-term market sentiment remains muted.

But uranium marches to a different, longer-term beat. Bullish analysts and commentators highlight wider macro factors that will eventually act as key supports for output, spot prices and fixed-term supply contracts. Canada is poised to reap great rewards as the world’s second-largest producer of uranium, they argue.

However, others urge caution; long-term macro expectations have the nasty habit of falling flat, while the junior spectrum – so critical for broadening the pipeline of available projects – continues to suffer from strong economic headwinds. Then there is the question of the possible effect that Quebec’s moratorium on uranium exploration and exploitation may have.

Canada’s two main uranium producers are Cameco and Areva, and both have significant footprints in the prolific Athabasca basin region of northern Saskatchewan.

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Potash Shake-Up Takes Toll as Agrium Sees Drop in Sales – by Gerrit De Vynck (Bloomberg News – September 24, 2013)

http://www.bloomberg.com/

Agrium Inc. is the latest North American potash producer to cut its sales forecast as the breakup of the world’s largest marketing bloc for the crop nutrient begins to take its toll.

Agrium, the third-largest North American producer, expects to sell 30 percent less potash in the third quarter and forecast a 64 percent drop in profit from its wholesale fertilizer division, the Calgary-based company said yesterday. U.S.-based Mosaic Co., the second-biggest producer, cut its sales forecast by about 20 percent on Sept. 16.

The two companies form an export group, Canpotex Ltd., with Potash Corp. of Saskatchewan Inc., North America’s biggest producer. Potash Corp. won’t be spared the drop in demand, said Peter Prattas, an analyst at Cantor Fitzgerald LP in Toronto.

“They’re all going to hurt equally given the fact that they’re a collected group,” Prattas said yesterday in a telephone interview.

The potash market has been roiled since OAO Uralkali, the world’s largest producer, announced it had pulled out of an export sales venture with its Belarusian counterpart on July 30.

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Supreme Court of Canada’s ruling on Yukon mining to affect entire country – by Ana Komnenic (Mining.com – September 23, 2013)

http://www.mining.com/

Last week the Supreme Court of Canada decided that it would not challenge a Yukon court’s ruling that current land-staking practices defy the constitution. The final legal decision has the industry riled up as it assesses what this means for the mining sector. By the looks of it, the ruling could change the way miners operate across Canada.

The Supreme Court last week rejected an appeal by the Yukon government over a lower-court’s ruling that Class 1 mineral exploration programs must “consult with” and “accommodate” the Ross River Dena Council – a First Nation – before allowing exploration to take place. The provision will amend the Territory’s Quartz and Placer mining acts.

Most Canadian jurisdictions operate under a “free entry” system whereby companies can acquire exploration rights by ground-staking – a process which requires no advance government approval.

Last year the Yukon Court of Appeal ruled that “free entry was incompatible with the Crown’s duty to consult aboriginal people before making rights to Crown land available,” explains Barry Barton, an internationally recognized expert in mining law and author of Canadian Law of Mining.

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Sandvik’s Customer Day – From start to Finnish – by Cole Latimer (Mining Australia – September 24, 2013)

http://www.miningaustralia.com.au/home

It’s not everyday that a new piece of equipment is launched. But when a company does, it’s unusual, even in these times of a downturn, not to do so without some fanfare. So when a company launches not one, but multiple pieces of equipment it has to make a serious statement.

This is exactly what Sandvik did following the release of not only two new drill rigs, but the world’s largest drifter, new underground drilling equipment, multiple new drilling threads and bits, and the latest developments in its automated and tele-remote mining systems.

It brought together more than 300 people from ten countries to demonstrate its new equipment in the flesh during its massive customer day. The group gathered at its Tampere facility in Finland to see the latest developments.

The facility itself was also on show, asthe visitors tramped across the site which Sandvik claims is the largest mining machinery manufacturing facility in Europe. As we crossed through the gates a little piece of Australiana welcomed the groups, a ‘beware of kangaroos’ sign, greeting visitors. Quickly the group was ushered in, where we were given a first hand demonstration of its AutoMine system.

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COLUMN-Commodity markets sceptical of China PMI boost – by Clyde Russell (Reuters India – September 24, 2013)

http://in.reuters.com/

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

LAUNCESTON, Australia, Sept 24 (Reuters) – What does China’s factory sector growing at its strongest pace in six months have in common with the U.S. Federal Reserve’s decision to keep buying bonds? Both failed to boost commodity prices much.

The flash HSBC Purchasing Managers’ Index (PMI) rose to 51.2 in September from August’s 50.1, the highest level since March and strengthening the view that economic growth in the world’s largest commodity consumer is regaining momentum.

The PMI improvement came days after the Fed surprised market watchers by keeping its bond purchases at $85 billion a month, judging that it is still too early to taper monetary stimulus, given the nascent economic recovery in the United States.

Both developments should be positives for commodity prices, as both point to the likelihood of stronger growth in the next few months in the world’s two largest economies.

While the Fed decision did give a small boost to some commodity prices, it didn’t last, with London benchmark copper CMCU3 having given up more than half of the 2.1 percent rally on Sept. 19, the day after the Fed announcement.

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