Republic of Mining

Continuing commodities super cycle not all about China any more – by Geoff Candy (Mineweb.com – July 18, 2012)

July 19, 2012

www.mineweb.com

Analysts feel the commodities super cycle is not behind us, but global population growth will see the centre move from China to other areas of the developing world.

Groningen – Despite pronouncements that the era of high commodity prices is coming to an end and concerns that China’s economy is finally beginning to show signs of fatigue, there are still a number of commentators that see some legs left to the commodities super cycle.

The commodities super cycle, as a concept, began coming to the fore about a decade ago, around the same time that China began to crouch down in preparation for its massive industrial leap forward. And, over the last 10 years we have seen significant growth in the prices of certain commodities. As the table below from Standard Chartered illustrates – bear in mind that these prices are estimates given that we haven’t yet come to the end of 2012 but the trend has undoubtedly been up.

From the table it is clear that the commodities that have risen the most in price terms over the last decade are the ones most in need during the Chinese industrialisation.

Ontario Mining Association Program shows educators the realities of modern mining

July 18, 2012

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.

The Ontario Mining Association will be involved in the week-long program for the third annual Teachers’ Mining Tour, which is being held at the Canadian Ecology Centre, near Mattawa, Ontario. Thirty five teachers from across the province will participate in the educational workshop being held August 6 to 10, 2012.

OMA President Chris Hodgson is scheduled as the kick-off speaker for the opening night. He will present information on the importance of mining in Ontario, industry support for the teachers’ tour and provide a glimpse of the potential and opportunity offered by the Ring of Fire area in the province. The goal of the workshop is to help educators learn more about the realities of modern, high-tech, solution-providing, environmentally responsible mining in Ontario.

“Seeing is believing. This professional development opportunity presents informed choices for educators,” said George Flumerfelt, President of North Bay based mine contractor and OMA member Redpath. “The Teachers’ Mining Tour brings modern mining into the classroom curricula.”

SOLID GOLD RESOURCES CORP. PRESS RELEASE: Ontario Shuts Down Mining

July 18, 2012

TORONTO, ONTARIO, Jul 18, 2012 (MARKETWIRE via COMTEX) — Solid Gold Resources Corp. (“Solid Gold”)

Mission: Regional Gold Exploration at Lake Abitibi, Ontario, Canada

“Certainty of title and access to Crown land is paramount to our industry, but only the Crown can provide the certainty required to secure major investment to develop projects like the potential new gold camp at Lake Abitibi, Ontario”, states Darryl Stretch, President of Solid Gold. “No obstacle should stand in the way because, like the Ring of Fire, the Solid Gold project may be a once-in-a-century economic opportunity to the benefit of all Canadians.”

The Government of Ontario (the “Crown”) distributed a draft set of guidelines for its Ministries to properly consult and accommodate aboriginals where required.

A rising gold price, an unequivocal ruling from the Supreme Court of Canada (Haida) confirming that third parties have no duty to consult First Nations, and encouragement from the Crown formed the basis for Solid Gold’s decision to conduct a regional exploration program at Lake Abitibi, Ontario, Canada.

Over several staking campaigns, beginning in the fall of 2007 through the summer of 2010, Solid Gold acquired mineral rights to a 200-square-kilometer property on Crown land at Lake Abitibi (the “Property”).

Federal agency finds holes in Taseko mine’s draft environmental report – by Dirk Meissner (Vancouver Province/Canadian Press – July 17, 2012)

July 18, 2012

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

VICTORIA — Taseko Mines has been ordered to rewrite an environmental impact statement about a proposed gold and copper operation in British Columbia’s central Interior after a federal agency concluded a draft was riddled with gaps, deficiencies and missing information.

The Canadian Environmental Assessment Agency detailed its complaint in a report earlier this month dealing with Taseko’s controversial, $1.1 billion mine proposal near Williams Lake.

“The draft EIS does not meet the requirements of the EIS guidelines,” said the July 6 report. “There is substantial information missing from this draft EIS. The quality of all figures in the draft EIS is very poor.”

Williams Lake-area First Nations immediately seized on the report, saying the critical response from the federal agency confirms their view that the proposed project should be rejected. Tsilhqot’in Nation Tribal Chief Joe Alphonse said in a statement First Nations have known from the start the mine could not work.

Swansong of a sunset industry or the rise of an SA gold mid-tier? – by Geoff Candy (Mineweb.com – July 17, 2012)

July 18, 2012

www.mineweb.com

Just like the landscape of Johannesburg, South Africa’s gold mining sector is undergoing a dramatic change, the question is: what will it end up looking like?

GRONINGEN (Mineweb) – Mine dumps loomed large over my childhood. Growing up in the east rand of Johannesburg, a stone’s throw away from the ERPM mine operations, they were a part of my skyline. When we were kids we went to the drive-in on top of them and, later on, tried to “dune board” down them. But, in the last few years they have gradually begun to disappear.

As the gold price has risen and mines have got deeper, so many of these dumps have been re-drilled and reprocessed but, it is not just the landscape that is changing – the industry that gave birth to Africa’s “city of gold” is changing right along with it.

“The cynical among us might describe it as rearranging the deck chairs on the Titanic,” says Bernard Swanepoel, Joint CEO of Village Main Reef, one of the new class of junior gold miners coming up in South Africa at the moment.

Diamonds hit rough patch as demand falls – Pav Jordan (Globe and Mail – July 18, 2012)

July 18, 2012

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.

Harry Winston Diamond Corp. is grappling with rising diamond inventories and falling prices, as the slack global economy prolongs a year-long slump.

The Toronto-based gem company said on Tuesday that it would likely not sell all of its production in the fiscal second quarter ending this month, and that it expects to have higher-than-normal inventories as diamond cutters encounter difficulties arranging affordable financing.

“The rough diamond market has experienced softened demand since the beginning of the year,” Harry Winston said in a report. The premier diamond jeweller and luxury retailer – with locations in fashion capitals from New York and Beverly Hills to Paris, Beijing and Hong Kong – estimated that market prices have dipped 8 per cent since April.

Diamond prices are still struggling to recover since falling off a cliff over a year ago, when the global economic outlook darkened suddenly, spoiling the plans of speculators who had stocked up in anticipation of a stronger economic recovery after the 2008-09 crisis.

Timmins plans for the future – by Liz Cowan (Northern Ontario Business – July 2012)

July 18, 2012

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.

Timmins 100th anniversary special

While Timmins marks its 100th anniversary this year and celebrates its past, its future is being guided by current needs and challenges. In 2011, a strategic plan – Timmins 2020 – was conceived to provide long-term direction for the city’s economic and community development.

“From a timing perspective, it originally started because it related to the loss of Xstrata (Copper’s Kidd Creek Metallurgical Site),” said Mayor Tom Laughren. “We really need to diversify and this plan will give us a bit of a template as we move forward planning for the next 100 years.”

The Met site’s closure in 2010 resulted in the loss of more than 600 jobs. “One time in Timmins we had both mining and forestry and that was good since when one was down, the other was up. But forestry has been down for a long time,” he said.

Carney warns falling oil price could grease economy’s slide – by Jeremy Torobin (Globe and Mail – July 18, 2012)

July 18, 2012

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.

OTTAWA – The Bank of Canada is adding the downward drift in prices for oil and other commodities to its catalogue of threats to economic growth.

In a one-page statement on his latest interest-rate decision Tuesday, Governor Mark Carney mentioned oil or commodity prices four times. To many economists and analysts, this was a clear hint of growing concern as oil prices, while still historically high, inch downward to $80 (U.S.) a barrel – considered an unofficial breaking point at which investment in energy projects could stall, putting jobs at risk.

Mr. Carney, who left his main interest rate at 1 per cent Tuesday and will release a full quarterly forecast on Wednesday, noted that the “sizable reduction” in commodity prices owing to slower global growth is keeping inflation in check and could mean cheaper gasoline well into next year. However, he also cut his 2012 and 2013 projections for the economy, in part because the consumption and business investment he is counting on to drive growth will be held back by “the effects of lower commodity prices on Canadian incomes and wealth.”

Native leaders ponder the path of most resistance – by John Ibbitson (Globe and Mail – July 18, 2012)

July 18, 2012

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.

The Assembly of First Nations, in conclave, inhabits a world not easily recognized by those outside the native community: one of occupation, sovereign rights and resistance. Native leaders passionately embrace that world, which informs the campaigns of the seven challengers seeking to unseat Shawn Atleo as national chief.

But the odds appear to favour Mr. Atleo nonetheless, for the reason expressed by one chief from a Prairie province who was listening at the back of the room. “We have to live with what we’ve got,” he said.

Chiefs speaking candidly in exchange for not being on the record criticized Mr. Atleo for acting as though the AFN were a government and he its first minister, able to speak on behalf of the first nations in negotiations with Ottawa.

He has too often co-operated with the Harper government, they said, when the national chief should be asserting the treaty rights of first nations and their rightful claim to a share of any natural resource wealth.

NEWS RELEASE: Gold discoveries not keeping pace with mined production

July 17, 2012

Gold in Reserves, Resources, and Past Production in Major Gold Discoveries by Country, 1997-2011 (Total Reserves, Resources, and Past Production of 743 million oz of gold)

http://www.metalseconomics.com/

Strategies for Gold Reserves Replacement: The Costs of Finding and Acquiring Gold

Halifax, Nova Scotia, July 17, 2012 – Metals Economics Group’s (MEG) recently released study, Strategies for Gold Reserves Replacement: The Costs of Finding and Acquiring Gold, reports that 99 significant gold discoveries (defined as a deposit containing at least 2 million oz of gold) have been reported so far in the 1997-2011 period, containing 743 million oz of gold in reserves, resources, and past production as of year-end 2011. Assuming a 75% resource-conversion rate and a 90% recovery rate during production, these 99 discoveries could potentially replace only 56% of the estimated gold mined during the same period, if they are economical to mine. Then again, the economic viability of the discovered gold relies to a large extent on location, politics, capital and operating costs, and market conditions, which will inevitably further reduce the amount of resources that will reach production.

The case for a new gold rush – by Martin Mittelstaedt (Globe and Mail – July 17, 2012)

July 17, 2012

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.

When it comes to gold, Warren Buffett doesn’t know what he’s talking about, according to one of the metal’s most ardent European fans. Gold is likely to hit a record high of $2,000 (U.S.) an ounce over the next year, driven by fears over government deficits and worries that central banks will be forced into more money printing, according to Erste Group, an Austrian bank.

The bank believes the precious metal will eventually rise even further, reaching at least $2,300 an ounce, which would match its high from the early 1980s if inflation is taken into account. In a recent report to clients the institution says that given the instability in the global financial system, its price forecast “could be on the conservative side.”

Erste Group has been producing annual forecasts of gold prices since 2007, and has been bullish over the period – an accurate call, given gold’s surging fortunes over the past five years.

This year’s 120-page report includes such quirky measures as how many litres of beer can be purchased at Munich’s Oktoberfest each year with an ounce of gold. It also features a lengthy discussion on Mr. Buffett’s well-known antipathy toward gold, which the bank views as an irrational form of “aurophobia.”

NDP Leader Tom Mulcair stands his ground in Harper’s hometown – by Gillian Steward (Toronto Star – July 17, 2012)

July 17, 2012

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.

Gillian Steward is a former managing editor of the Calgary Herald. Her column appears every other week. gsteward@telus.net

NDP Leader Tom Mulcair strode into the heart of Calgary last week wearing full cowboy regalia — white hat, blue and white plaid shirt (with just a hint of orange), a huge bronze belt buckle (under a bit of a paunch), jeans and black boots.

With his beard he looked more like a grizzled range rider than Stephen Harper ever will. The Quebec MP was even pronounced the best-dressed politician at the Stampede by a keen observer of cowboy fashion.

“He seems to have nailed it with a good western outfit and he looks like he belongs, looks like he’s stepping into the role,” said Brian Guichon, owner of Riley & McCormick Western Stores. Guichon named Harper the runner-up for his outfit, which was topped by a black hat. Mayor Naheed Nenshi garnered third place. During his short visit Mulcair showed that he had much more going for him than an acute fashion sense.

Sudbury-born mine tech assists in Elliot Lake mall excavation [Penguin Automated Systems] – by Lindsay Kelly (Northern Ontario Business – July 2012)

July 17, 2012

Robot recon

There’s an unwritten code adhered to by people working in the mining industry: when emergency strikes, you do whatever you can to help. That’s why Greg Baiden didn’t hesitate to offer up a pair of $2-million reconnaissance robots when he got word that part of the roof had collapsed at the Algo Centre Mall in Elliot Lake, potentially trapping people inside.

Baiden, chair and chief technology officer of Penguin Automated Systems Inc., was actually in Charlotte, N.C., en route to Florida to test a new optical communications system, when he got the call, but co-ordinating from afar, a team was mobilized from his Sudbury office.

The crew arrived in Elliot Lake on the evening of June 27, a day after the Heavy Urban Search and Rescue (HUSAR) team tasked with sifting through the rubble had reached the end of its capabilities. Though originally created for use in underground mines, Penguin designed the robots with mine rescue in mind.

Public money should not prop up asbestos mining – by Alana Wilson (Winnipeg Free Press – July 17, 2012)

July 17, 2012

http://www.winnipegfreepress.com/

Alana Wilson is senior research analyst in the Fraser Institute’s global centre for mining studies www.miningfacts.org

Canada’s mining industry is globally competitive, and has long succeeded without much in the way of government subsidies. It even thrived in the last recession by responding to market demand. Yet instead of letting markets drive mining investment in Quebec, the provincial government is bailing out the asbestos industry using taxpayer money — and this for a product that is harmful to human health.

In recent years, market demand for chrysotile asbestos produced in Canada shrunk dramatically which lead to a halt of chrysotile mining. But instead of letting mines stay closed, taxpayer funds will reopen an unprofitable chrysotile mine.

Quebec Premier Jean Charest recently approved a $58 million loan to allow the closed Jeffrey asbestos mine to reopen. Even before the announced bailout, the mine struggled and operated infrequently in recent years. All other Canadian asbestos mines have closed; the last one was shuttered in November.

The demise of Canada’s asbestos industry reflects a declining demand for asbestos, driven by health concerns.

The justification for Munk’s influence at Barrick wanes – by Boyd Erman (Globe and Mail – July 17, 2012)

July 17, 2012

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.

Barrick Gold Corp. shareholders have a chance to get answers next week to some of the most pressing questions about the ouster of Aaron Regent as chief executive officer, but one key question about the future of the world’s largest gold producer will almost certainly remain.

Barrick releases earnings July 26, and senior management will address its investors for the first time in any depth since the surprise June 6 CEO change that installed Jamie Sokalsky, a long-time company man.

Investors can expect to hear what the company’s new direction is going to be under Mr. Sokalsky, the subtext being that whatever he outlines will be what the Barrick board wanted from Mr. Regent and wasn’t getting. Barrick has started by reviewing all of its projects to maximize returns.

Of course, when you say “the Barrick board,” what most people hear is “Peter Munk,” the charismatic and iconic founder of the company. Mr. Munk casts a huge shadow over the Toronto-based mining company, and wields a lot of power as Barrick’s co-chairman.