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Is return of metal mining threat to regional economy? – by Stephen Anderson (Houghton Mining Gazette – July 26, 2013)

http://www.miningjournal.net/

HOUGHTON – A recent study, which is part of a larger local education campaign, has concluded that a return to metal ore mining and processing would damage the western Upper Peninsula’s economy.

Dr. Thomas Power of the University of Montana Economics Department, through his organization Power Consulting, Inc., recently completed his 109-page report, “The Economic Impacts of Renewed Copper Mining in the Western Upper Peninsula of Michigan.” Power was contracted in September to do the report by Friends of the Land of Keweenaw.

The study recommends that future economic development in Baraga, Gogebic, Houghton, Keweenaw and Ontonagon counties continue to focus on “economic gardening” – a term coined by the Keweenaw Economic Development Alliance describing a focus on nurturing existing businesses and supporting new start-ups – and the protection and enhancement of a “quality of life” amenity-based economy that has emerged over the last 40 years.

The report, which can be found in its entirety at folkminingeducation.info, summarized the following findings in its executive summary: There are significant costs associated with mining activities that tend to offset the positive impacts of the high pay associated with mining jobs.

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BHP and Rio fork out $3.7 billion for water in Chile – by Brian Robins (The Age – July 26, 2013)

http://www.theage.com.au/

BHP Billiton and Rio Tinto are being forced to spend $US3.4 billion ($3.67 billion) on a water plant at their copper project in Chile, at a time when mining companies globally are curtailling capital spending.

The two miners will lose access to most of their water supply at the Escondida project, the world’s largest copper mine, in 2017.

BHP’s share of the new round of investment is estimated at $US1.97 billion and Rio’s at $US1.03 billion. Construction on the planned desalination plant is to start immediately, with completion planned for 2017.

The partners are in the middle of a $US4.5 billion round of spending which is to be completed next year, primarily on a new ore concentrator at the project, together with ancillary upgrades.

When completed, these upgrades will enable the production of more than 1.3 million tonnes of copper a year from 2015.
When the partners in Escondida disclosed the $US4.5 billion upgrade early last year, they signalled this was the first in a series of programs that could substantially expand capacity at the mine.

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Gold on Earth formed in collision of exotic stars – by Dan Vergan (U.S.A. Today – July 17, 2013)

http://www.usatoday.com/

There’s gold in them thar neutron stars! That’s right, astronomers claim Earth’s gold, the stuff of wedding bands and pricey speaker wires, originated in cataclysmic collisions of exotic stars. The gold glinting on your wedding band was likely born in a cataclysmic merger of two exceedingly exotic stars, astronomers report Wednesday.

Dying stars billions of years ago cooked up most of the lighter elements in the universe, the oxygen in the air and calcium of our bones, and blasted it across the cosmos in their final explosive moments. We are stardust, as the singer Joni Mitchell put it.

But some of the heaviest atoms, including gold, defied this explanation, requiring an even more exotic origin.

A team led by Harvard astronomer Edo Berger now reports that gold is likely created as an aftereffect of the collision of two “neutron” stars. Neutron stars are themselves the collapsed remains of imploded stars, incredibly dense stellar objects that weigh at least 1.4 times as much as the sun but which are thought to be less than 10 miles wide.

While ordinary stars explode about once every century in our galaxy, Berger says, explosive collisions of two neutron stars happen only about once every 10,000 years. And it appears they spew out gold and other heavy elements in the week after their merger.

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For First Nations, Great Jobs in a Controversial Industry -by Katie Hyslop (The Tyee.ca – July 26, 2013)

http://thetyee.ca/

One organization’s success teaching Aboriginal people mining skills isn’t without complications.

Unemployment for Aboriginal people in the province is twice as high as the rest of British Columbians. But Aboriginal people are defying the employment odds in the province’s mining industry, thanks in part to the BC Aboriginal Training Association (BCAMTA), which provides job training for the mining industry to Aboriginal people in B.C.

In a July 22 press conference in Vancouver, the association released a PricewaterhouseCoopers audit of their practices from their start in January 2010 until March 2013. Results show the organization has registered 1,533 training candidates, 500 of which have successfully achieved employment in their field.

BCAMTA’s work has paid off for the economy, too. CEO Laurie Sterritt says a $6.68-million federal government investment to start the program has translated into a $53.4-million annual contribution to B.C.’s GDP.

“This isn’t a one time boost to the economy: this is an amount that will grow as our employee candidates get salary increases, earn bonus payouts, and move up the ladder to more senior positions,” she said.

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SA seventh-largest iron-ore producer – by Yolandi Booyens (MiningWeekly.com – July 26, 2013)

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

South Africa’s position as the number three supplier of iron-ore to China emphasises the strategic importance of iron-ore deposits in the country and its importance as a significant iron-ore contributor worldwide, says minerals adviser Venmyn Deloitte MD Andy Clay.

He adds that this is testimony to the rapid historical development of South Africa’s iron-ore mines, in conjunction with the South African government’s infrastructure development.

South Africa is the seventh-largest producer of iron-ore and has also traditionally been the fourth-largest exporter worldwide. The country increased the percentage of iron it exports because of the suspension of mine operations in Goa, India, in September 2012 , owing to contraventions in terms of mining without licences or beyond licensed areas.

As a result, the global demand that Goa’s iron-ore mining operations used to meet can now be met by South Africa, in addition to other producers, such as Australia. “One of the factors that enables South Africa to export so much ore is the efficient Sishen iron-ore rail line,” notes Clay.

Opened in 1947, the Sishen mine is iron-ore supplier Kumba’s flagship operation and one of the largest openpit mines in the world. It has sufficient resources to sustain 21 years of production. It operates 24/7 and, in 2011, it transported 38.9-million tons of iron-ore.

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Agnico’s spending cuts won’t affect Quebec mines – by Robert Gibbens (Montreal Gazette – July 25, 2013)

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

The three Quebec gold mines of Agnico Eagle Mines Ltd. will probably escape the $250 million in spending cuts the company plans this year and next to offset sagging bullion and base metals income.

Agnico Eagle, which started producing gold north of Val d’Or in 1988 with the launch of its rich LaRonde mine, has since become an international company with operations in northwestern Canada, Finland and Mexico. It targets overall annual output of 1.2 million ounces within three years.

It had planned to invest $600 million U.S. a year on mine development, but with gold down to about $1,350 an ounce from a peak of almost $2,000 and co-products silver and zinc depressed, Agnico Eagle has cut that number to $400 million.

Most of the savings will come from delays in exploration and mine construction activity outside Quebec, CEO Sean Boyd told analysts Thursday. Year-end completion of a new cooling and ventilation system will boost output from LaRonde’s deep higher-grade reserves next year and the mine will produce 300,000 ounces a year for a long time yet.

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A new game aims to help would-be miners find a way into the field – by Leith Dunick (tbnewswatch.com – July 25, 2013)

http://www.tbnewswatch.com/

Cam Meshake knows mining prosperity might be just around the corner. But the Aroland First Nation resident said for many of his twenty-something friends, it’s tough figuring out how to break into the industry.

He’s got a much better idea of how to get there now, thanks to Ohski-Pimache-O-Win Education and Training Institute’s new industry-specific web portal, Learning2Mine.ca.

Designed as a game, along the lines of Facebook favourite Farmville, the site details career possibilities and the path youngsters should take to land not only entry-level jobs, but well-paying mid- to upper-level careers. “It’s a really fun game to play. I just dove right into it,” Meshake said at Thursday’s initial public unveiling of the site.

“The story was interesting and kept me engaged. I learned a lot about the mining industry with this website and all the vast opportunities and the rewards that would come from the mining industry.”

Gordon Kakegamic, the school’s e-learning co-ordinator, said the government-funded project was developed specifically to address Aboriginal youth, many of whom are interested in making mining a career, but without the knowledge to do so.

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Gold earnings season as noisy as expected so far – by Peter Koven (National Post – July 26, 2013)

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

The second quarter gold earnings were expected to be noisy, and they have not disappointed so far. Writedowns, plummeting profits and a vast range of realized prices have been key themes in the reports. Most importantly, the miners are unveiling the cost and capital spending reductions they merely hinted at for most of the year. They are a crucial step to preserve balance sheet strength amid a bear market for gold.

On Thursday, Goldcorp Inc. announced it is slashing spending by US$200-million in 2013, and reiterated mine closures are a possibility if gold sinks below US$1,200 an ounce for an extended period. It also cut exploration and general and administrative expenses. Rival Agnico Eagle Mines Ltd. plans to cut more than US$200-million from next year’s budget.

The moves come just as credit rating agency Moody’s warned the gold producers “must take action” to protect their ratings and minimize earnings deterioration. Miners in virtually every commodity are trying to slash costs and spending right now, but there is a greater urgency in gold because of the rapid decline in price.

“They’re starting to show the first signs of capital discipline,” said Greg Taylor, a portfolio manager at Aurion Capital. While they have announced some aggressive measures to preserve cash, Veritas analyst Pawel Rajszel said that details have been limited so far, and that companies are largely pushing spending into the future rather than cutting it.

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Gold may be Dryden’s new economic generator – by Ian Ross (Northern Ontario Business – July 2013)

Established in 1980, Northern Ontario Business provides Canadians and international investors with relevant, current and insightful editorial content and business news information about Ontario’s vibrant and resource-rich North. Ian Ross is the editor of Northern Ontario Business ianross@nob.on.ca.

Mining and Dryden have not always been synonymous. But this area of northwestern Ontario is continuing to gain some profile with junior miners to continuing to advance gold projects despite challenges to raising exploration capital.

“There’s a lot of buzz around the mining sector and I’m getting more calls on that side of things from companies looking to jump in ahead of the curve,” said Nicole Gale, office manager at the Dryden Development Corporation (DDC).

For years, the community’s economy has always been impacted by the highs and lows of the forestry industry, namely the fortunes of the Domtar pulp mill. However, ongoing exploration work from area junior miners like Treasury Metals, Manitou Gold and Tamaka Gold has stirred up excitement in the small city of 7,600.

Located on the Trans-Canada Highway between Thunder Bay and Winnipeg, Dryden has always been a retail shopping hub for neighbouring communities. Now it’s aiming to be a local service hub for mining outfits.

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Akin to railroads of the 1880s, oil pipelines poised to spur Canadian growth – by Henry Lazenby (MiningWeekly.com – July 26, 2013)

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

TORONTO (miningweekly.com) – Canada is expecting a boom in oil production from its prolific Alberta oil sands deposits; however, production from the world’s third-largest proven oil reserves, after Saudi Arabia and Venezuela, is hampered by a lack of sufficient transport to markets, resulting in lower prices for Canadian crude.

In much the same way as the transcontinental railroads of the 1880s acted as economic enablers and opened up the Canadian hinterlands of Manitoba, Saskatchewan and Alberta to settlement and agriculture, so new oil pipelines transporting crude to coastal refineries and markets, and refined petroleum products back inland, are expected to have an enormous economic impact on Canada, driving economic growth.

Canada is desperately seeking alternative oil transport networks to its inadequate rail infrastructure to boost an industry that last year accounted for C$100-billion in exports of oil and natural gas, Al Monaco, the country’s largest pipeline operator Enbridge’s president and CEO, said at a recent Bloomberg Canada Economic Summit, in Toronto.

“It’s a very exciting time to be in the pipeline business. It’s not too often that you get the supply fundamentals and the demand fundamentals lining up extremely well. So, at this point, you’ve got a producer push of volume that wants to get to market. You’ve also got a market pull,” he said.

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Editorial: [British Columbia’s] Prosperity’s temerity – by Gwen Preston (Northern Miner – July 24, 2013)

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

I visited Taseko Mines’ Gibraltar mine north of Williams Lake, B.C., in 2008. The company bought the shuttered operation in 1998 and restarted it in 2004. Four expansions later, Gibraltar now employs 700 people, churns out 90 million lb. copper annually and is a major regional economic driver. It’s been a great story for a part of the province that has struggled with mill closures and unemployment.

During that Gibraltar tour, talk kept veering towards the Prosperity project, 175 km south. I remember Taseko president and CEO Russell Hallbauer downplaying the challenges of permitting the new mine. He figured Taseko had earned respect from the locals through Gibraltar and that, combined with a dire need for new economic activity locally, would mean enough support to dial down any voices of discontent.

What Hallbauer could not have predicted was that Prosperity, which happens to sit on lands involved in Canada’s most significant aboriginal land claims court case, would become a rallying cry for almost every anti-mining voice in the province.

Prosperity is a copper-molybdenum porphyry that Taseko wants to open pit mine. There’s a lake beside the deposit — known as Fish Lake, or Teztan Biny — that is one of 13,000 lakes in the Caribou region in the 100- to 150-hectare size range.

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Vale sweetens pot in push to finish Long Harbour (CBC News Newfoundland – July 24, 2013)

http://www.cbc.ca/nl/

Vale is putting on a big push to finish the nickel processing facility in Long Harbour, pledging more cash to workers if they meet revised targets. The company says the project is 90 per cent completed, but finishing the job has been a challenge.

The processing facility is behind schedule. It was supposed to be commissioned by the end of June. The new target is Oct. 31.

Vale spokesman Bob Carter says the project has been plagued by shortages of skilled workers and absenteeism. “Resources that were here, and scheduled to be here, are now moving on to other projects,” Carter said.

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Vale may hire foreign workers to solve Long Harbour crunch (CBC News Newfoundland – July 23, 2013)

http://www.cbc.ca/nl/

Mining giant Vale admits it may have to look outside the country to hire specialized workers to finish its massive nickel processing facility in Newfoundland’s Placentia Bay.

However, Vale says it wants to explore other options first to find such skilled workers as welders and pipefitters for its site at Long Harbour, where the company ultimately intends to process nickel mined at Voisey’s Bay in northern Labrador.

To accomplish that, the company is moving skilled workers from its port site to its main construction site, which the company calls the upper tier. “Because we are short some of those resources, we thought it was best to redirect those resources to the upper tier,” Bob Carter, Vale’s director of corporate affairs, told CBC News.

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Miners pull back on project amid weak commodity prices Vanessa Lu (Toronto Star – July 25, 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.

With prices still weak, Canadian miners like Teck and Goldcorp are looking for ways to tighten the purse strings, or delaying projects altogether.

With commodity prices still weak, major Canadian mining companies are looking for ways to tighten their purse strings, and in some cases are delaying costly projects.

Teck Resources has pushed back production plans at a coal mine in British Columbia until demand for metallurgical coal recovers. It also announced a copper mine in Chile has been slowed by environmental permits so construction won’t begin until 2016 at the earliest.

“Teck is adapting to current market conditions,” president and chief executive Donald Lindsay told analysts during a conference call Thursday. “We are prudently deferring projects and capital expenditures.”

Patricia Mohr, vice-president and commodity market specialist at Scotiabank, said long-planned copper production is starting to come on stream, after years of no growth, so the move is affecting prices.

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Top 10 gold miners: Shaky earnings and more billion dollar write-downs – by Lawrence Williams (Mineweb.com – July 26, 2013)

http://www.mineweb.com/

As the gold majors begin issuing their latest quarterly statements it is becoming apparent how shaky earnings are at current gold prices regardless of the massive writedowns being taken.

LONDON (MINEWEB) – Yesterday we saw World No. 4 gold miner Goldcorp writing $1.96 billion off its asset values during Q2 and World No. 2 Newmont $1.8 billion. This follows on notice of huge writedowns for the year of around $6 billion at Australia’s Newcrest, the World’s No. 6, and a statement from World No. 3, AngloGold Ashanti, that it would be writing its assets down by between $2.2 and 2.6 billion. The other gold majors yet to report will also likely be taking huge writedowns which will significantly impact June quarter financials.

But it’s not the writedowns which are necessarily the most significant factors to be taken into consideration by shareholders and the gold market itself. It is the actual decline in operating profits, and the all-in sustaining cost of production which should be a primary focus. Write-downs are just book adjustments on asset valuations, but the underlying financial health of the companies, and what they can afford to pay out in dividends, depends on ongoing profitability virtually regardless of the kinds of book financial adjustments that are being seen.

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