Republic of Mining

Tensions high as Amplats to unveil South Africa job cuts plan – by Ed Stoddart (Reuters U.S. – May 9, 2013)

May 10, 2013

http://www.reuters.com/

(Reuters) – Anglo American’s (AAL.L) platinum arm, under pressure from South Africa’s government, could announce a restructuring plan on Thursday or Friday that will sharply scale back job losses as it tries to balance out cost cuts and the threat of labor unrest.

Anglo American Platinum (AMSJ.J) had planned to slash 14,000 jobs and mothball two mines to return to profit but industry sources have told Reuters that the final plan would be pared back, with as few as 5,000 jobs cut.

Militant workers have signaled they will launch protest strikes even if the job cuts fall far short of the initial target. Social tensions are running high after violence rooted in a labor turf war killed more than 50 people last year and sparked illegal strikes that hit production.

For Amplats, reining in costs and cutting production to such an extent that it lifts the price of platinum, used for emissions-capping catalytic converters in automobiles, is absolutely crucial after it fell into a loss last year.

“From the point of view of Amplats itself, both numbers will be critical, how many ounces will you produce, but also how many people, because that impacts on the cost base,” said Alison Turner, an analyst at Panmure Gordon.

Bitumen needed statesmen, not salesmen – by Jeffrey Simpson (Globe and Mail – May 10, 2013)

May 10, 2013

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.

Proponents of bitumen oil see a sea of troubles, or at least choppy waters, almost everywhere. An eventual west-east line to Quebec and New Brunswick looks promising. Elsewhere, prospects are uncertain or grim.

The biggest proponents of bitumen oil – the Alberta Progressive Conservatives, the Harper Conservatives and the oil industry itself – have, in some respects, been the authors of these troubles. They could have acted differently and possibly made things easier. But a different course of action would have required a different strategic understanding.

They could have started with a map. Bitumen oil is landlocked. Instead of asking, “What can we do to help other jurisdictions trans-ship our oil?”, the Alberta government and the Harperites assumed that everyone else desperately needed bitumen – that what was good for Alberta would axiomatically be good for all.

The two governments insisted that critics were ill-informed when they said bitumen is dirtier than conventional oil. They swallowed the canard that bitumen oil is somehow “ethical” because Canada has better standards than Iran and Venezuela – standing ethics on its head by defining our practices against the worst, rather than the notional idea of the best.

EU dismisses Canada’s threat to appeal dirty oil designation – by Steven Chase, Paul Waldie and Shawn McCarthy (Globe and Mail – May 10, 2013)

May 10, 2013

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 LONDON and OTTAWA — The EU believes its controversial proposal to label oil-sands crude as dirty would withstand a test at the World Trade Organization after Canada threatened to file a complaint over the measure.

The disagreement over the EU designation – which would effectively impose an import tax on Canadian bitumen – overshadowed talk Thursday by Brussels and Ottawa of a final push to sign a trade pact before the summer.

The Harper government is now fighting for international acceptance of emissions-heavy oil-sands petroleum on two fronts.

Prime Minister Stephen Harper announced Thursday he will go to New York next week as part of his push to win a green light from the U.S. for the Keystone XL pipeline project that would transport bitumen to Gulf Coast refineries but has been heavily opposed by environmental activists.

He’ll participate in a question-and-answer session at an event organized by the Council on Foreign Relations. Mr. Harper said he looks forward to discussing Keystone, among other issues, as a U.S. debate rages over whether to give the energy-intensive oil-sands development a thumbs-down.

[Ontario Premier] Wynne, McGuinty full of … gas – (Toronto Sun Editorial – May 9, 2013)

May 10, 2013

http://www.torontosun.com/home

Premier Kathleen Wynne and past premier Dalton McGuinty were so full of it in their testimony about the Liberals’ gas plant fiasco, that some final observations on their absurd arguments are warranted.

First was Wynne’s statement the government needs to develop better ways of listening to communities when it comes to locating gas plants, and McGuinty’s claim he cancelled the Oakville and Mississauga plants because he listened to local health and safety concerns.

In the real world, if McGuinty and Wynne gave a fig about community concerns, they wouldn’t have rammed industrial wind turbines down the throats of rural Ontarians, while taking away the rights of local municipalities to have any say on the issue.

McGuinty’s hypocrisy is particularly astounding, given that he called anyone who objected to industrial wind turbines a “nimby”, unless they were doing so for legitimate safety and environmental reasons, all of which his government rejected as invalid.

In fact, people claiming adverse health symptoms caused by noise and low-level vibrations from wind turbines were told by the Liberal government they were the only ones complaining, when in actuality hundreds of complaints were pouring in from across the province.

The terrible truth about the B.C. Liberals’ B.C. Jobs Plan – by Jim Sinclair (Vancouver Province – May 9, 2013)

May 10, 2013

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

Jim Sinclair is president of the B.C. Federation of Labour.

It is perhaps one of the more twisted ironies of this election that Premier Christy Clark and the B.C. Liberals are running on their record of job creation, a record they would probably be smarter to run away from.

Their much touted B.C. Jobs Plan has been discredited by the facts — more than 30,000 jobs have been lost since its inception. The latest figures show that B.C. lost 15,000 full-time jobs in March, setting off the largest rise in Canada. What to do when the facts don’t add up? Answer: buy ads.

While the last provincial budget cut money from programs that train workers, the Liberals could find $16 million of taxpayers’ money to try and sell us on the failed jobs plan.

But perhaps the most blatant example of the betrayal by this government on the critical issue of jobs has been its role in promoting the use of temporary foreign workers in British Columbia. Today, our province is breaking Canadian records for growth in the use of foreign workers — more than 74,000 — while at the same time more than 200,000 British Columbians are struggling to find a job and thousands cannot get the training they need.

Chromite project delays may jeopardize miner’s plans – CBC News Sudbury (May 9, 2013)

May 9, 2013

http://www.cbc.ca/sudbury/

Cliffs Natural Resources president remains optimistic, but has reasons for ‘concern’

A year after it was announced that a chromite smelter and hundreds of jobs were coming to Sudbury, there is still no deal in place. And the mining company behind the project, Cliffs Natural Resources, now says the delays could put the whole thing in jeopardy.

The province and the mining company have yet to sign an agreement that lays out the specifics of the mine access road, how much of the ore will be processed in Sudbury and how much Cliffs will pay for electricity.

After being in daily contact last year, the two sides haven’t met since January. But the new mines minister, Michael Gravelle, said there’s no reason to worry. “It’s not a question of apportioning blame at all, I think this is just a complex project,” he said.

Cliffs’ vice-president Bill Boor said he remains optimistic, however long delays could mean no mine and no smelter. “The project does have risk when it’s stopped like this,” he noted. “And that causes me concern.”

No meetings planned

While the chromite isn’t going anywhere, the market conditions have to be right for a complicated plan like this to work, Boor said.

Illegal mining Colombia’s new bane – by Paul Harris (Globe and Mail – May 9, 2013)

May 9, 2013

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.

Canadian junior miners on front lines as criminal gangs, demobilized paramilitaries and guerrilla groups mine gold outside the law

MEDELLIN, COLOMBIA — In Segovia, a prosperous Colombian town of 50,000 people in northeastern Antioquia, the shops are closed by 6:30 p.m. and the streets empty. Segovia is a boom town, one of the country’s richest gold production centres, but tension is in the air as criminal gangs, demobilized paramilitaries and guerrilla groups flock to the area to mine gold illegally.

In Colombia, gold is the new cocaine as outlaw groups increasingly move into mineral-rich parts of the country on their own terms to take advantage of the metal’s strong price.

“The relatively high price of gold, the fact that the final product is legal and its production sources cannot easily be traced, means that illegal groups can operate large, profitable operations without the risks involved in the drug trade,” said Daniel Linsker, vice-president of global services for Latin America, at Control Risks, an international business risk consulting firm.

It’s estimated that illegal mining accounts for most of Colombia’s gold production. Production was an estimated 66 tonnes in 2012, according to the country’s National Mining Agency. About 10 tonnes comes from legal mines and about 10 tonnes from scrap such as old jewellery, meaning more than 40 tonnes is produced illegally, estimates CIIGSA, one of Medellin’s gold refineries.

Oliver threatens trade fight if EU taxes oil-sands crude – by Steven Chase (Globe and Mail – May 9, 2013)

May 9, 2013

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 — Canada’s Natural Resources Minister is raising the prospect of a trade fight with the European Union over its proposal to label oil-sands crude as dirty even as both sides try to seal a major deal to liberalize two-way.

In Brussels on Wednesday, Natural Resources Minister Joe Oliver said Ottawa would consider launching a complaint with the World Trade Organization, the global referee for commercial disputes, if the EU proceeds with a fuel-quality directive that singles out crude from Canada’s oil sands as the most harmful to the planet’s climate.

The directive would effectively slap an import tax on oil-sands crude because refiners who use it would face extra costs. EU refiners are required to cut carbon content in fuels by 6 per cent or pay a penalty.

Ottawa fears the directive would hurt Canada’s ability to open new markets for its oil and depress prices for North American crude. “This fuel-quality directive is discriminatory towards Canadian oil and not supported by scientific facts,” Mr. Oliver said.

A spokesman for International Trade Minister Ed Fast said that Ottawa believes Canada’s campaign for better treatment for the oil sands will not affect trade talks with Brussels.

Webequie celebrates Mining Essentials graduates – by Rick Garrick (Wawatay News – May 8, 2013)

May 9, 2013

http://wawataynews.ca/

Webequie’s Angeline Shewaybick is looking forward to a career in mining after graduating with the highest marks in Oshki-Pimache-O-Win’s Mining Essentials program.

“I tried really hard to study because I really wanted to do well,” said Shewaybick, who was awarded a laptop computer for her high marks during the May 2 graduation ceremony in Webequie. “My goal after this is finishing my education and hopefully getting into the mining industry. That’s where I want to work — it’s so close to home.”

Although Shewaybick was the only woman in the 12-week pre-employment training program, she encouraged other women to consider mining as a career. “It was a great experience for me,” Shewaybick said. “All I can say is take it — it was a great experience and I’ve learned a lot and you don’t have to be a guy to do it.”

Shewaybick enjoyed the hands-on pre-trades training activities in the Cambrian College mobile trades training trailer and the week-long job shadowing placement at the Cliffs Esker Camp in the Ring of Fire. “It was more hands on and I really enjoyed that part,” Shewaybick said.

Alec Wabasse, Amos Jacob, Brandon Shewaybick, Cody Mekanak, Corey Neshinapaise, Dylan Jacob, Edgar Jacob, Lewis Sofea, Leroy Troutlake, Luke Meekis, Robert Jacob, Rudy Mekanak and Simon Shewaybick, all from Webequie, also graduated from the program.

What On Earth Are “Commodity Super-cycles” And Why Do They Matter? – by Marcelo GiugaleWorld (Huffingotn Post – May 9, 2013)

May 9, 2013

http://www.huffingtonpost.ca/

Marcelo GiugaleWorld is the World Bank’s Director of Economic Policy and Poverty Reduction Programs for Africa

The average developing country lives off exporting commodities like oil, gas, copper, cocoa or soybeans. The sale of these resources brings both revenue to the government and foreign currency to import what is not produced at home–which, in these places, tends to be most things. So whatever happens to the price of those commodities matters a great deal for development and, even more, for the war on poverty. The problem is that those prices are famously volatile.

They can jump up and down seemingly at random, from year to year, month to month, even within a single minute. This makes life miserable for those who have to plan public investments in schools, hospitals or roads. Statisticians and investors have studied the problem to death, not least because there is a lot of money to be made if you can find a predictable pattern. And despite all their efforts, they have come up mostly empty-handed.

Mostly. There has always been suspicion that, if you took a really long view–we are talking centuries here–you might uncover periods of about forty years when commodity prices steadily climb for a decade or two, only to fall slowly back to where they were. That is, you might uncover “super-cycles”. It may sound crazy but, before anyone could actually find one, plenty of theories were put forward to explain why super-cycles happened and what to do about them.

NEWS RELEASE: Royal Nickel Announces $15 Million Royalty Financing from Leading Global Mining Investor

May 9, 2013

(All amounts expressed in U.S. dollars unless otherwise indicated)

TORONTO, May 9, 2013 /CNW/ – Royal Nickel Corporation (“RNC”) (TSX: RNX) is pleased to announce that it has signed a royalty purchase agreement with RK Mine Finance (“Red Kite”). Under the terms of the agreement, Red Kite will acquire a 1% Net Smelter Return (“NSR”) Royalty in the Dumont Nickel Project for a purchase price of $15 million.

“This commitment by Red Kite is a significant endorsement of the Dumont project by a recognized global mine finance firm. This royalty sale provides an attractive form of financing, particularly in current capital market conditions. The additional capital will allow us to continue to aggressively advance the project once the feasibility study is completed by mid-year. We look forward to working further with Red Kite as we advance the project,” said Tyler Mitchelson, President and CEO of RNC.

Pursuant to the agreement between RNC and Red Kite, on closing RNC will receive $15 million and Red Kite will be entitled to receive 1% of the net smelter return from the sale of minerals produced from the Dumont Nickel Project. Closing is expected to occur on May 10, 2013.

RNC’s Dumont project contains the third largest nickel reserve in the world1 and is expected to be among the largest 5 nickel sulphide operations in the world. RNC is on track to release the results of a feasibility study for the Dumont project by mid-2013 and the permitting process is well underway with necessary permits expected to be received by the second quarter of 2014.

Poor Decisions Are Sending This Company [Cliffs Natural Resources] Downhill – by Mike Thiessen – (Motley Fool – May 8, 2013)

May 8, 2013

http://beta.fool.com/

Mike is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

Once a darling of fund managers and retail investors alike, Cleveland-based Cliffs Natural Resources (NYSE: CLF) has suffered an epic share-price collapse as well as a number of strategic setbacks. Buffeted by low market prices for its core iron ore and coal products and slackening demand from emerging-market customers in China and elsewhere, the company has had to implement several painful cost-control measures to shore up its finances.

Even worse, its much-touted acquisition of the Bloom Lake mine complex in Quebec has thus far provided disappointing results. Cliffs has delayed a key expansion at the mine and has given only vague guidance about when these activities might resume. Given the high hopes that the company expressed for Bloom Lake as recently as June of 2011, this comes as a serious setback. Shareholders have punished the firm by pushing its price-to-book ratio below 0.6. If Cliffs cannot turn around its fortunes soon, more drastic steps may need to be taken.

Financial Comparison with the Competition

As a major producer of basic raw materials like iron ore pellets, coking coal and lump ore, Cliffs competes with some of the largest and most recognizable names in the mining industry. These include London-based Rio Tinto (NYSE: RIO) and Melbourne-based BHP Billiton (NYSE: BHP).

PQ presents ‘North for All’ plan – by Kevin Dougherty (Montreal Gazette – May 8, 2013)

May 8, 2013

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

First Nations feel blindsided by plan

MONTREAL — The Plan Nord was launched by Jean Charest as the “project of a generation,” with the short-term hope of generating votes for his Quebec Liberals.

Two years later, in a fly-in, fly-out news conference in Chibougamau, the Parti Québécois government has launched its Nord pour tous (North for All) plan. Despite similarities, Premier Pauline Marois insists her government’s plan is not at all the same as the Plan Nord.

In fact, the PQ has scaled down the size of public investments in the north and Marois avoided any mention of Charest’s 25-year target of $80 billion in investments.

Marois stressed that unlike the Liberal Plan Nord, her North for All vision is focused on protecting the environment and takes into account the concerns of native and non-native people living in the north. But environmentalists and aboriginal leaders expressed disappointment, and said they felt blindsided by the government.

Ghislain Picard, Assembly of First Nations chief for Quebec and Labrador, said he received a “maladroit” email invitation last Friday to the Chibougamau news conference.

Quebec’s mining operators need a boost from the province, not a hand reaching into their pockets – by Peter Hadekel (Montreal Gazette – May 7, 2013)

May 8, 2013

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

MONTREAL — Most observers are describing Quebec’s new regime on mining royalties as a retreat from the election promises made last year by the Parti Québécois.

But while the damage isn’t as bad as first feared, the new policy adds up to a missed opportunity. At a time when mining investment is slowing down because of tumbling metal prices and weak interest from the financial community, mining operators need a boost from the Quebec government, not a hand reaching into their pockets.

Industry officials are disappointed that the new policy fails to take stock of the uncertain economic context facing the mining business.

“The cost of doing business is constantly increasing and adding another layer of taxation is certainly not the best policy,” said Michel Rathier, a consultant at KPMG Secor.

During the election campaign, the PQ promised to double the royalties on mining operations, arguing that companies were getting too sweet a deal compared with other jurisdictions around the world.

The party proposed a five-per-cent royalty on the value of production from each mine, whether it made or lost money, and a 30-per-cent “supertax” on profits above eight per cent.