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The Big Australian should strike a deal with Rio Tinto – by Terry McCrann (Melbourne Herald Sun – August 27, 2013)

http://www.heraldsun.com.au/

ALUMINIUM was the ghost at the BHP Billiton profit feast last week.

Although the aluminium, manganese and nickel division generated more than $9 billion of revenue, it contributed just $164 million of EBIT (earnings before interest and tax).

Compare and contrast that with the jewel in the BHPB crown – iron ore, which on a little more than double that revenue, at $20 billion, contributed more than 67 times as much EBIT, or $11.1 billion.

Incidentally, I never – and I’m equally certain, neither would most other commentators – have ever thought, in the good old days pre-China, that we’d end up describing lumpy, plentiful, iron ore as the ‘jewel” in anyone’s crown.

That it is, certainly in the corporate crowns of BHPB and Rio Tinto. It’s also made multi-billionaires of Gina Rinehart and Andrew Forrest. In contrast, aluminium ain’t going to make a billionaire of anyone. Thanks to China continuing to smelt uneconomically, aluminium has a knack of turning billionaires, corporate or otherwise, into mere millionaires.

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NEWS RELEASE: A Letter from Brigus Gold’s Chairman and Chief Executive Officer

HALIFAX, Aug. 27, 2013 /CNW/ – (NYSE MKT: BRD; TSX: BRD)

Dear Fellow Shareholders:

Given the recent volatility of the precious metals markets, I would like to share my perspective on what’s occurred in the sector, while reviewing our progress at Brigus and outlining our strategy and outlook for the quarters ahead.

The second quarter saw a precipitous drop in precious metal prices, including gold’s one day dip of ~9% in April. Lower gold prices led to reduced financial results for gold mining companies compared to the previous quarter, and a significant reduction in the valuation and equity prices for virtually all gold mining companies, including Brigus.

Since hitting a 46 month low of $1,179 on June 27th, spot gold prices have now rebounded to the $1,400 level and equity prices are also beginning to recover. Investor sentiment for the sector, having reached extreme negative levels, is in the process of reverting to a more reasonable range.

Regardless of the short term volatility over the past few months, we at Brigus remain steadfast in our belief that gold will continue to play a very important role as a store of value for investors. We believe high quality gold mining companies will prove to be a worthwhile investment for years to come.

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Mine training fails First Nations people, researcher says (CBC News Thunder Bay – August 27, 2013)

http://www.cbc.ca/thunderbay/

Feds promise $6M to train First Nations people in Northern Ontario’s Ring of Fire.

The federal government’s $6 million in funding to train people from Matawa First Nations in the mining sector is unlikely to improve employment prospects for aboriginal people, an Ontario researcher says.

Lindsay Bell, a university of Toronto researcher, looked at mine training programs in the Northwest Territories. She says after being trained, few aboriginal people found jobs in the mines. The federal government announced earlier this month that 260 people will be trained through the fund.

The money will go to a group of stakeholders called the Ring of Fire Aboriginal Training Alliance, which includes Matawa First Nations, NorOnt Resources and Confederation College.

The program will feature 15 courses including environmental monitoring, heavy equipment operation and several pre-trades courses such as carpentry, plumbing and welding. Other job possibilities range from security guard to camp cook to electrician.

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Potash Collapse Signals Buy Not Build for Vale: Corporate Brazil – by Juan Pablo Spinetto (Bloomberg News – August 26, 2013)

http://www.bloomberg.com/

Turmoil in the global potash market is creating an opportunity for Vale SA to buy assets at a discount as the mining company leads Brazil’s bid to become self-sufficient in crop nutrients.

Vale, whose output at Brazil’s only potash mine dropped for the past three years, should abandon plans for greenfield projects and consider instead purchasing existing producers or their assets, according to Stifel Nicolaus & Co. Potash companies are trading at a “great discount,” making acquisitions a cheaper option for Vale than starting from scratch, said Terence Ortslan, managing director of research firm TSO & Associates.

Vale suspended two potash projects in Argentina and Canada worth $8.9 billion in the past year as cost increases made the ventures unfeasible. Fertilizer producer shares have slumped 14 percent on average since July 30 when OAO Uralkali ended output restrictions through a venture with Belaruskali, triggering speculation prices would tumble. Their average price-to-book ratio fell to 1.69 yesterday from 2.55 at the end of last year.

“It’s tough to justify the economics of a new project at today’s pricing,” Stifel Nicolaus analyst Paul Massoud said by telephone from Washington.

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A failure of compensation [Mercury Poisoning-Grassy Narrows and Whitedog] (Thunder Bay Chronicle-Journal – August 27, 2013)

Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

THE LONG, sad tale of mercury poisoning among people at two First Nations on the English-Wabigoon River system continued this week with a demonstration at the home of Ontario Premier Kathleen Wynne. Ironically, Wynne was canoeing on a river somewhere in Ontario but protesters say they still intend to remind her that she’s promised to address their concerns.

Ontarians who remember the issue when it arose more than 40 years ago may wonder why it remains an issue, given that two, small communities received more than $20 million in compensation. The answer may lie in interpretation of the details of the settlement. It is also apparent that the amounts distributed to victims of mercury poisoning are small compared with those awarded victims of the world’s first identified cases.

The Northwest issue arose back in 1970 when federal officials notified commercial fishermen and tourist lodge owners that the two rivers were contaminated with methylmercury, a highly toxic form of mercury that renders fish unsafe to eat. The contamination was traced to the former Reed paper mill in Dryden which had dumped more than 20,000 pounds of untreated mercury wastewater into the Wabigoon River between 1962 and 1970. It drifted 250 kilometres downstream.

A tourist lodge was forced out of business. Commercial fishers at Grassy Narrows and Whitedog and those who had been employed as sport fishing guides were forced onto welfare.

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How to fix southwestern Ontario’s economy – by Mike Moffatt (Canadian Business Magazine – August 27, 2013)

http://www.canadianbusiness.com/

No silver bullet, but a salvo of ideas.

While the national unemployment rate currently stands at 7.2%, some regions are suffering more than others. Southwestern Ontario is one such place, with Windsor and London showing 9.2% and 8.6%, respectively. And so, as a business school economist in London, Ontario, it isn’t surprising that the question I’m most frequently asked by non-economists is some variant of “How can we grow southwestern Ontario’s economy?”

My first response is to point to some recommended reading on the topic, including several research papers by the Mowat Institute (see here, here and here). I’m also looking forward to coming recommendations from the Ivey School of Business’ Lawrence Centre which is working on a number of regional research projects. (On the other hand, if I’m at a cocktail party and feeling glib, my response is similar to that which I gave in the middle-class roundtable.)

But there is no silver bullet—it will take a suite of smart policies and a willingness to experiment. That’s the short answer. The longer answer is not policy prescriptions per se, but rather things we should be mindful of when developing and promoting policy ideas.

Support at the industry level should be general and based on real comparative advantages. Identifying the region’s well-positioned industries is an easier task than identifying companies, particularly when examined from the point of view of comparative advantage.

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Mining industry needs to look in the mirror, says Cutifani – by Allan Seccombe (South Africa Business Day – August 27, 2013)

http://www.bdlive.co.za/

THE entire South African mining industry needs to “look in a mirror” and take accountability for the sector, Anglo American CEO Mark Cutifani said at the Mining Lekgotla on Monday.

Mr Cutifani, who is also president of the Chamber of Mines, said the mining sector had faced a “tumultuous” year in 2012 and it remained the industry’s intention to “face with brutal honesty” what needed to be done to improve situations that had led to the unsettled sector.

“The Marikana tragedy was a stark reminder that we as an industry need to do more,” Mr Cutifani said at the second Mining Lekgotla, which draws together participants from labour, the government and the mining sector, as well as community and youth representatives.

The mining companies had looked in the mirror and taken full accountability for the state of the industry, Mr Cutifani said. “We ask our partners to also look in the mirror,” he said. “It remains our absolute intention to address the issues we have faced with brutal honesty and as a sector confronted with myriad challenges, we need to chart a path towards future growth and prosperity.

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NEWS RELEASE: Teachers benefit from their time in mining classrooms

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.

Forty six educators expanded their mineral industry knowledge through active participation in an enhanced Teachers Mining Tour. This was the fourth year for this program and the first year the week-long program had been held twice to help accommodate increased demand for the course.

Elementary and secondary school science and social studies teachers from across Ontario and parts of Quebec were exposed to all facets of mining from exploration and geology through to production and mine site reclamation and environmental activities. Twenty four teachers were in the first workshop from July 29 to August 2 and 22 teachers were in the second program from August 19 to 23, 2013. The base camp for the programs was the Canadian Ecology Centre, near Mattawa.

“The schedule is jam packed with classroom time, site visits and presentations,” said Lesley Hymers, Ontario Mining Association Environment and Education Specialist. “The teachers are a dedicated group of educators who have donated a portion of their summer holidays to gain a first-hand glimpse of one of Ontario’s most important industries and a better understanding of the broad range of career opportunities mining offers.”

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Fracking misinformation on tap – by Peter Foster (National Post – August 27, 2013)

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

There are no examples of chasms, or even cracks, opening as a result of fracking

From Binghamton, New York to the village of Balcombe in England’s rural West Sussex, holding up fracking has joined halting the oil sands as the great cause for anti-development radicals and their celebrity supporters.

Fracking, or hydraulic fracturing, involves pumping water with a tiny proportion of chemicals under high pressure into deep subterranean shale formations to release natural gas.

Last Friday, when President Obama gave a speech in Binghamton, protestors and supporters of fracking jousted outside. In recent weeks, there has been an even mightier ruckus at Balcombe over drilling by a company called Quadrilla, whose activities were brought to a halt by up to 1,200 protestors. The stand-off ended last week after hundreds of police were brought in.

In fact, President Obama has embraced the shale gas boom, but New York Governor Andrew Cuomo has been hemming and hawing on state approval, concerned both about the power of environmental NGOs and the good opinion of anti-frackistas such as Yoko Ono and Lady Gaga. Nevertheless, the shale gas train has left the station in the U.S., which is the reason why radicals are keen to pull the wheels off before the industry can establish itself in Europe.

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Uralkali CEO’s ‘bizarre’ arrest in Belarus will heighten potash tensions, analysts say – by Peter Koven (August 27, 2013)

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

TORONTO – The potash industry has become engulfed in political intrigue, as a Russian executive at the centre of a cartel-busting plan has been detained by the autocratic government he used to do business with.

OAO Uralkali confirmed on Monday that CEO Vladislav Baumgertner was detained by authorities in Belarus. He is accused of abuse of power, according to reports. The timing is not coincidental.

Just three weeks ago, Uralkali threw the potash market into chaos by dismantling Belarusian Potash Co. (BPC), a cartel-like marketing company controlled by Uralkali and Belaruskali, its state-owned Belarusian counterpart. Uralkali vowed to end its practice of withholding production to prop up prices, prompting speculation that potash prices will fall dramatically. They are already under pressure.

Belarus is very unhappy with this development, but industry experts suggested that this arrest will only push the two sides further apart. It is the most dramatic political intervention in the potash business since Canada rejected the takeover bid for Potash Corp. of Saskatchewan Inc. in 2010. “It is certainly a bizarre development. You’ve got to think Russia and [President] Vladimir Putin will respond,” said Joel Jackson, an analyst at BMO Capital Markets.

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Honourable Joe Oliver: Minister of Natural Resources Canada – Speech at the 2013 Energy and Mines Ministers’ Conference (August 26, 2013 – Yellowknife, Northwest Territories)

This speech was given by the Honourable Joe Oliver, Minister of Natural Resources Canada, at the 2013 Energy and Mines Ministers’ Conference in Yellowknife, Northwest Territories on August 16, 2013.

Thank you Minister Ramsay, and good afternoon everyone. Thank you Premier McLeod and the people of Yellowknife for your hospitality and welcome. It’s wonderful for me to be back. “Spectacular” is an apt description of the Northwest Territories – and this city – and I am delighted that we are here for our important meetings.

Let me take this opportunity to recognize the great work of Premier McLeod’s government in developing a land use and sustainability framework that will guide planning in the Territories. I am pleased that my Department, Natural Resources Canada, was able to contribute to this initiative.

Le Nord est un élément fondamental du patrimoine, de l’identité et de l’avenir du Canada. En effet, le Nord s’avère l’endroit idéal pour tenir nos discussions en raison de tout ce qui entoure ses possibilités de développement économique et pour l’importance qu’on y accorde au respect de l’environnement.

The North is fundamental to Canada’s heritage, identity and future. Indeed, the North is the perfect setting for our discussions because of its history in both pursuing economic opportunity and respecting the environment. And its people know more than most about taking the long view. Honouring and preserving their inheritance. And building a vibrant economy for their children and grandchildren.

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I’ll be back – juniors, exploration trends, and a major change – by Kip Keen (Mineweb.com – August 27, 2013)

http://www.mineweb.com/

MinEx’s Richard Schodde discusses the changes to global exploration trends seen over the last few years and why he is not quite as pessimistic as some about the future.

HALIFAX, NS (MINEWEB) – In this two part series Kip Keen unpacks the trends developing within the exploration sector, with the people that know it intimately.

This is not a tonic for those sick to the stomach as they contemplate the state of exploration spending and discovery trends. But then neither is it poison, exploration hemlock, taking you on the path to oblivion. It’s an interview with Richard Schodde, an academic and the owner of MinEx Consulting. He thinks and presents on exploration trends and recently produced a wide ranging synthesis on the exploration sector in a presentation entitled, “Long Term Outlook for the Global Exploration Industry ‘Gloom or Boom.’” (Outside link to presentation here; and full acknowledgement to the blog incakolanews.com for inspiration.)

Lots will strike you in the presentation. Some of it we show you here: Like China’s expenditures booming from almost next-to-nothing to 14% in the past decade. Or global exploration expenditures reaching near $30 billion in 2012, far up from under $5 billion back during hell days in the early 2000s. And – spoiler alert – Schodde doesn’t see them going back there either.

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Students funded in memory of Sudbury labour icon Homer Seguin – by Carol Mulligan (Sudbury Star – August 27, 2013)

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

A day doesn’t go by that Dan Seguin doesn’t think of his father, Homer Seguin, and the work he did over several decades to improve the health and safety of workers on the job.

Two students at the Centre in Occupational Safety and Health (CROSH) at Laurentian University will carry on the work of the elder Seguin, in part with bursaries funded by donations pledged after Homer Seguin died April 26.

Seguin, 79, died after years of complications from chronic obstructive pulmonary disease and eventually lung cancer, partly due to his early days working in Inco’s storied — and deadly — sintering plant.

During his last days spent at Ramsey Lake Health Centre, Seguin expressed his desire for a new generation to carry on the work that was his passion for 60 years.

His son and four daughters heard that message and asked for donations when their father died, and they will fund bursaries to two students this fall. Dan Seguin, who works in management for Vale, said he and his family are very proud of all their father did “for workers, and the safety and health of people.

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Ex-Im loan request pits Caterpillar against iron ore miners – by John Myers (Prairie Business – August 26, 2013)

http://www.prairiebizmag.com/

DULUTH, Minn. — It’s not that Minnesota’s congressional delegation doesn’t like Australia, mate. But the idea of a U.S. government bank loaning money to an Australian iron ore mine that will compete with Minnesota taconite?

That’s what they don’t like.

U.S. Sens. Al Franken and Amy Klobuchar and U.S. Rep. Rick Nolan, all Minnesota Democrats, are on record opposing a plan in front of the U.S. Export-Import Bank to invest in equipment for the giant Roy Hill iron mine in Australia’s northwestern Outback.

The Export-Import Bank is considering a request for $650 million in long-term financing to aid the export of $522 million of U.S.-made mining equipment to mine and process ore at Roy Hill. The rest of the money could be going to install the U.S. equipment on site at the mine.

Cleveland-based Cliffs Natural Resources, with four mines in Minnesota and Michigan, has led the charge to stop the loan, saying it threatens U.S. mining jobs and, with new Asian steel produced from Australian ore, eventually threatens U.S. steel industry jobs.

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CEMI in running for $10 million research grant – by Norm Tollinsky (Sudbury Mining Solutions Journal – August 2013)

This article was originally published in the August 2013 issue of Sudbury Mining Solutions Journal.

The Centre for Excellence in Mining I n n o v a t i o n (CEMI) is one of seven finalists vying for four $10 million research grants from the federal government’s Business-Led Networks of Centres of Excellence program.

The program funds large-scale collaborative research networks that bring a wide range of research expertise to bear on specific challenges identified by industry. CEMI’s proposal is for an Ultra Deep Mining Network that will address challenges impacting resource extraction at depth.

More than 120 applications were whittled down to 54 in the first round of cuts, and then to seven. Matching funds from industry will provide CEMI with $20 million for the proposed four-or five-year research program.

“There are only two places you can go for a new mine,” said CEMI president Doug Morrison. “You can go to a remote location like the Ring of Fire (in northwestern Ontario), or you can go deep. Unfortunately, when you get down to around 2.5 kilometres, the heat and the logistical problems become very significant, so we see a need for changing the way we do things.”

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