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Sudbury – The Republic of Nickel (Part 2 of 4) – Stan Sudol

Thomas A. Edison the famous inventor came to Sudbury in 1901 searching for nickel. He was unsuccessful as he didn’t drill deep enough. Years later Falconbridge would develop a mine on this very claim.

The strategic military importance of nickel attracted major American corporations. In 1902 J.P. Morgan of U.S. Steel helped establish the International Nickel Company by combining the Orford Copper Company’s New Jersey refinery with the Canadian Copper Company’s Sudbury mines. Samuel Ritchie was ousted be his partners back in 1891 giving Robert M. Thompson control. Ambrose Monell, who came from U.S. Steel was the first president.

In 1905, Sudbury nickel production surpassed that of New Caladonia for the first time and would continue it stranglehold on the world’s largest supplies of nickel until the late 1970s.

The growing importance of Sudbury and all of northern Ontario was formally recognized by the provincial government of Premier James Whitney (1905-1914) by appointing Sudbury businessman and former mayor  Frank Cochrane as the province’s first northern cabinet minister. He served as the as the provincial minister of lands, forests and mines from 1905 to 1911. At the turn of the last century northern Ontario’s vast resources were supplying about 25 per cent of Queen’s Park revenues.

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Sudbury – The Republic of Nickel (Part 1 of 4) – Stan Sudol

Since the beginning of mankind, access to important mineral deposits for economic or military applications have changed the destinies of entire civilizations.

The rich gold mines of Thrace gave Alexander the Great the enormous wealth to bankrole a powerfull army and establish one of the greatest empires the world had ever seen. Ancient Chinese metalurgical expertise with iron and steel allowed the Middle Kingdom to become a powerful military and economic force during the prosperous Han dynasty.

For much of the twentieth century, the nickel mines of Sudbury were not only the principle source of this strategic metal, but also had a disproportionate impact on the industrial and military history of the world.
 
As with all good things, this story begins with a bang. Actually, it was one cosmic explosion and two smaller earth-bound blasts. The first happened about 1.8 billion years ago when a massive ten kilometer wide meteor, wider than Mount Everest, and traveling at about 75 km per second, collided with the earth at a site roughly 400 km north of present day Toronto. The impact, equal to the force of about 10 billion atomic bombs, melted the crust and concentrated the nickel-copper mineralization already at the site.

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Sudbury’s Copper Cliff South Mine Suspending Production – by Bill Bradley

Northern Life, Greater Sudbury’s community newspaper, gave Republic of Mining.com permission to post Bill Bradley’s article. www.northernlife.ca

Greater Sudbury’s economy will now be further affected by the growing world economic crisis.

In early November, Xstrata Nickel announced it will cease operations at Craig and Thayer-Lindsay nickel mines, affecting 250 employees. Early retirement options are being pursued by the company and union.

Now the city’s largest employer, Vale Inco, with over 5,000 employees, is stopping production at one mine and mothballing a development project due to slumping prices and demand, said Vale Inco spokespersons Thursday.

Vale Inco announced production cutbacks at its Greater Sudbury operations Thursday morning.

However, for now, the shutdown of the Copper Cliff South Mine and the one year postponement of the Copper Cliff Deep project will not involve layoffs of any Vale Inco employees, said Cory McPhee, director, Vale Inco communications and public affairs.

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SAMSSA Hall of Fame 2008 Winners – Robert S. Lipic and Don Rastall

SAMSSA Executive Director Dick DeStefano at their Annual MeetingThe SAMSSA Hall of Fame recognizes management leaders who have developed and provided mining advancing technologies and/or products and services that  have improved the efficiencies of mining globally and domestically and have built or assisted in building companies in Northern Ontario that have proven to be successful.

The leaders in the mining supply and service industry have proven that mining is only as efficient and productive as the quality of products and services provided from mining supply companies.  Over 400 Northern Ontario mining supply and service companies can boast of their historical influence in mining camps worldwide and their significant employment opportunities for skilled personnel making this sector larger in number than all direct mining and refining jobs in Northern Ontario. – Dick DeStefano: Executive Director.

Robert S. Lipic – President & CEO
Mining Technologies International Inc.

Bob Lipic has had an extensive career in the mining industry and is well known in international mining circles.  As President and CEO of Mining Technologies International (MTI), Bob Lipic has spent more than 30 years building, consolidating, expanding and adapting his company to the challenges of the mining industry.  This Canadian owned company was established in 1995 as a result of a merger of several companies, with names familiar to the mining industry: Drillex International of Canada, Continuous Mining Systems, LHD Equipment, John Clark Inc., Drillex U.S. Inc., CMS Pacific, and Drilco Australia PTY.

Robert S. Lipic - President and CEO of Mining Technologies International Inc.Although the company has not been immune to industry recessions, MTI’s push for innovation has allowed the company to prosper and compete in both domestic and international markets.

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OMA President Addresses North Bay CIM Members

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.

Ontario Mining Association President Chris Hodgson encouraged members of the Canadian Institute of Mining´s Northern Gateway Branch in North Bay to help the public gain a broader appreciation of what mining does for society and the economy.  In speaking to about 120 members of the CIM Branch at a luncheon meeting on December 3, he saluted many of the innovative communications initiatives carried out in North Bay including activities during the city´s Mining Week and reminded them of the many tools the OMA has developed to support these efforts.

“We need to encourage more people to recognize the value of mining to support the industry´s social license to operate,” said Mr. Hodgson.  “Mining benefits all regions of the province and people need to see mining as a benefit to their communities. The outdated image of mining is not something one person, or one company, can change.”  He provided a brief history of the OMA and its origins in 1920. 

In striving to promote our industry, Mr. Hodgson provided the audience with a catalogue of communications tools developed by the OMA — most of which are available on the OMA website www.oma.on.ca.  He mentioned the representative mine study conducted by economists at the University of Toronto “Ontario Mining: A Partner in Prosperity Building” which illustrates the local benefits in employment, Gross Domestic Product and tax revenues from one mine.  This study follows through with the direct, indirect and tertiary level benefits.  One representative mine can generate more than 2,200 well paying jobs on different levels, contribute $278 million to the GDP and provide $84 million in taxes annually.

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Deal With Ontario Aboriginal Groups or No Deal? – by Marilyn Scales

Deal or no deal? – by Marilyn Scales Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators. The long-simmering dispute between Frontenac Ventures of Oakville, Ontario, and the native bands with claims on a stretch of wilderness north of Sharbot …

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Postponements to Ontario Mining Act Revisions Best for Industry and Aboriginal Groups – by Gregory Reynolds

Gregory Reynolds - Timmins ColumnistWhen it comes to timing mining cycles or stock movements, when everyone believes something it usually turns out that they are wrong.

The 10-year boom in commodities turned out to be less than four years and no one knows when it will resume.

Yet, there is a bright side for the Canadian mining industry, and especially the Ontario segment. The provincial government has postponed its planned revisions to the Ontario Mining Act.

Bowing to several pressure groups, the McGuinty government had intended to ram through major changes before the New Year. The world-wide meltdown in credit facilities brought the Liberals to their senses.

Ontario has four major industries, new vehicle and parts manufacturing, mining, forestry and tourism. Even before the housing crisis in the United States spread into every sector of the world economy, the forestry industry was written off by Queen’s Park.

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Debt Reduction Begins at Teck – by Marilyn Scales

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Teck Cominco of Vancouver has announced the first steps of its debt reduction plans by suspending the 2009 dividend on its Class A common shares and Class B subordinate voting shares. The move is expected to result in annual savings of $486 million.

“Current global economic and financial market conditions dictate that we take all prudent steps available to us to significantly reduce spending,” said Don Lindsay, president and CEO. “The measures announced today, combined with previously announced tax savings, amount to $2.4 billion and should significantly enhance our ability to address our near-term debt obligations and better position Teck to refinance the bridge loan when conditions improve.”

The large number of cuts Teck is making is a measure of just how deep current global economic woes are. But management has a plan to conserve cash and prepare for better conditions in the future. From its news release dated Nov. 20, 2008, here are the details of its plan.

Sustaining Capital: Company-wide spending will be reduced to approximately $250 million for 2009, down from a forecast of $580 million for 2008. Teck’s operations have been well capitalized in recent years, creating an opportunity to defer sustaining capital costs while ensuring operations are maintained to a high standard.

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Realities Surrounding Nuclear Energy Ensure Prosperity for Uranium Miners for the Rest of this Century – by Paul Stothart

Paul Stothart - Mining Association of CanadaPaul Stothart is vice president, economic affairs of the Mining Association of Canada. He is responsible for advancing the industry’s interests regarding federal tax, trade, investment, transport and energy issues.

Few energy sources attract the controversy that is associated with nuclear energy and the fuel it requires – uranium. The spectre of potential radioactive accidents and leakages has long been presented by environmental groups as a cause for opposition, as has the technical and social challenge of long-term waste management. A number of governments over the years, ranging from nations such as Germany to provinces such as British Columbia and Nova Scotia, have introduced policies specifically prohibiting uranium mining and/or nuclear reactor development.

Available evidence suggests that these opponents are generally engaging in exercises of political hypocrisy. No energy source is without environmental and social consequence. Fossil fuel combustion has links to smog, acid rain and attendant health concerns. Wind energy requires large land masses, creates noise pollution and poses a hazard to birds — all to generate minor amounts of unreliable power. Hydro-power requires large-scale flooding, ecosystem destruction and resultant mercury releases. Even supposedly clean ethanol is proving to be disruptive to world food prices while presenting a marginal (or by some studies, negative) benefit regarding greenhouse gas (GHG) emissions relative to gasoline. On the health and safety front, in terms of worker and population impacts, few if any major energy sources measure up to the record of nuclear energy.

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Long and Sad Mining History With Canada’s Aboriginals Keeps Repeating Itself – by Juan Carlos Reyes

Juan Carlos ReyesJuan Carlos Reyes is the organizer of the annual Learning Together conference and an aboriginal consultant with Efficiency.ca. He is passionate about human rights and works tirelessly to help improve the lives of Canadian aboriginal people.

Let me begin this article by testing your knowledge of a famous case involving the mining industry and aboriginal communities.

Do you remember the Mica Bay incident — the one where a group of aboriginal leaders, dissatisfied with the federal government’s decision to grant inappropriate mining permits and its disregard to local aboriginal land claims, decided to forcibly take over a mine?

The events unfolded when a band of Indians and Métis, led by the renowned Chief Shinguakouse, travelled from Sault Ste. Marie along the shores of Lake Superior for about 200 miles to Mica Bay, where they assailed the mining installations of the Quebec Mining Company. This armed initiative by a group estimated at between 30 and 100 strong inclined the company agent, John Bonner, to surrender without resistance. The incident shocked the government, who proceeded to send a force of 100 rifles to suppress this “Indian uprising.”

If you don’t remember, it’s OK. I am certain that you are not alone — this incident took place in 1849, predating even confederation. I wanted to highlight this occurrence, however, to illustrate how long the mining industry’s relationships with aboriginal peoples have been strained. At the time of the Mica Bay incident, Lord Elgin, the Governor General of Canada, had said: “I cannot but think that it is much to be regretted that steps were not taken to investigate thoroughly and extinguish all Indian claims before licenses of exploration or grants of land were conceded by the government in this territory. This omission is the pretext for the present disturbances and renders the Indians much more difficult to treat with.”

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Kevin Costante – Deputy Minister of Northern Development and Mines SAMSSA Speech – Sudbury, Ontario

Kevin Costante - Deputy Minister of Northern Development and Mines at the SAMSSA Annual MeetingSudbury Area Mining Supply and Services Association (SAMSSA) Speech
 
November 26, 2008
Sudbury, Ontario

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INTRODUCTION

While the mining sector has seen unprecedented growth, driven by high commodity prices, it is not immune to the current economic climate.

No one understands that better than the mining community in Sudbury.

Accepting the reality of boom and bust cycles and dealing with them over the course of a century has made Sudbury’s mining industry competitive and a cut above the rest.

The minerals industry knows it cannot depend solely on high commodity prices to drive business. What it can and does depend on are the perseverance and innovation that characterize the industry, at all times, good and bad.

It is the strength developed during the lean times that gives industry the efficiencies that lead to profitability during the good times.

Commodities demand has definitely slowed, but it has not disappeared.

Growth trends may recede for a while but they will not grind to a halt. 

Demand from growing countries like China and India will not evaporate.  China’s GDP is still above 7 per cent.  Chinese demand for oil and most key commodities is still growing.

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Ontario Deputy Minister of Northern Development and Mines – Kevin Costante – An Introduction

Prior to joining the Ministry of Northern Development and Mines, Kevin was the Deputy Minister and Associate Secretary of the Cabinet, Policy, Cabinet Office. He served as Deputy of the Ministry of Community and Social Services (MCSS) twice from June 1999 to August 2000 and mostly recently from February 2004 to May 2007. He has …

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HudBay, Lundin Combo Under Fire – by Marilyn Scales

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

I wonder who first said, “No good deed goes unpunished.” Wherever that bit of wisdom came from it would seem to apply perfectly to the proposed friendly business combination of Toronto’s HudBay Minerals and Vancouver’s Lundin Mining. Major backers are weighing in with their opposition, and shareholders have voted with their wallets.

On Nov. 21, HudBay and Lundin announced their intention to create “a new Canadian leader” in the mining sector. Lundin would become a wholly owned subsidiary of HudBay with each Lundin shareholder receiving 0.3919 of a HudBay common share. The offer represents a 32% premium over Lundin’s 30-day average trading price. HudBay CEO Allen J. Palmiere will be CEO of the combined company. Other members of the HudBay board will be Philip J. Wright, Lukas Lundin, M. Norman Anderson, Colin K. Benner, Donald K. Charter, Ronald P. Gagel, R. Peter Gillin and William A. Rand.

The combined company will be Canada’s second-largest base metals producer as measured by market capitalization. It will have a portfolio of mining assets in Canada, Portugal, Sweden, Spain and Ireland. It will have development projects in the Democratic Republic of Congo and Guatemala.

If all goes according to plan, HudBay will have cash-on-hand of $900 million and a total debt of US$240 million (as of Sept. 30, 2008), it says. HudBay will then loan Lundin $135.8 million for capital investments and general corporate purchases. Lundin will issue 97.0 million common shares to HudBay in return.

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Sudbury Basin Mining Cluster Still Awash With Opportunities – by Bill Bradley

Northern Life, Greater Sudbury’s community newspaper, gave Republic of Mining.com permission to post Bill Bradley’s article. www.northernlife.ca

Times may not be as bad as they may seem for the mining cluster, said participants at a mining cluster meeting Wednesday morning at the Howard Johnson Hotel on Brady Street.

The Sudbury Area Mining Supply and Service Association (SAMSSA) was holding its annual general meeting. Association members employ an estimated 15,000 workers locally.

Though executive director Dick DeStefano has admitted several hundred layoffs have occurred, in general, the mining cluster remains healthy.

Access to financing, a key component of business health, still remains viable so far.

Denis Goupil, associate director of northern Ontario operations of Roynat Capital, said while the chartered banks may be tightening up their lending practices in the short term, other long term finance companies like his organization and the Business Development Bank, have a longer outlook.

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Is the KI – Platinex Conflict Canada’s own Tibet? – by Juan Carlos Reyes

Juan Carlos ReyesJuan Carlos Reyes is the organizer of the annual Learning Together conference and an aboriginal consultant with Efficiency.ca. He is passionate about human rights and works tirelessly to help improve the lives of Canadian aboriginal people.

During a recent teleconference call with associates in Central America, someone made a comment regarding the imprisonment of aboriginal leaders from Kitchenuh¬maykoosib Inninuwug (KI) and how this showed that the government of Canada will go to any length to advance its industrial agenda, even if it means the oppression of aboriginal people. This individual went on to compare the policies of our government to those of China imposed in Tibet. I found that I couldn’t really counter these comments because, although extravagant, they were partially factual.

On March 18, 2008, six KI band members, including the community’s Chief and Deputy Chief, were sentenced to six months in jail over an ongoing dispute between the community and Platinex, an exploration company conducting work in the region. This decision did not take place overnight. I have been closely following this case since 2005 when KI First Nation and other communities in the region first declared a moratorium on mining exploration in the Far North.

Around the same time as the moratorium was announced, Platinex made a deal with Inco to acquire a number of mine leases in the Big Trout Lake region, which is in the traditional territory of KI. Even though there was a moratorium in effect, Platinex carried on with its exploration work, claiming its rights under the Ontario Mining Act, which provided the permission required to carry out this exploration. KI community members and leadership began peaceful protests that escalated to the point where the workers had to leave the exploration site. This continued until Platinex launched a $10 billion lawsuit against the community and an injunction to prevent KI from interfering in the company’s exploration program. Initially, the court sided with the community, noting that the company knew the risks involved in carrying out work in the region and mandated both parties back to the negotiation table.

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