Republic of Mining

Editorial Board: The Mining Industry Has Had It Easy for Far Too Long (Bloomberg News – March 26, 2019)

March 26, 2019

https://www.bloomberg.com/

Economic preferences for hardrock mining stopped making sense about a century ago.

When should modern Americans care about legislation signed into law by President Ulysses S. Grant? When it causes deep environmental damage, deprives the federal treasury of billions, privileges one industry over others, practically gives away public lands, and hasn’t been significantly altered in almost 150 years.

The law in question is the General Mining Act of 1872, which governs the harvesting of gold, silver, uranium, copper, zinc and other minerals from federal lands. To say it’s long overdue for reform is an understatement.

The law was designed to propel westward advancement. So it did a few things that seem antiquated today.

Newmont, under pressure over Goldcorp deal, offers dividend to shareholders – by Niall McGee and Rachelle Younglai (Globe and Mail – March 26, 2019)

March 26, 2019

https://www.theglobeandmail.com/

Newmont Mining Corp. plans to pay its shareholders a one-time dividend worth US$470-million after a number of its biggest investors pushed for the giant miner to redo the terms of its US$10-billion takeover of Goldcorp Inc.

The sweetener makes it more likely that Colorado-based Newmont will win support from its shareholders, who are set to vote on the transaction in a couple of weeks. If Newmont succeeds, it will bypass Barrick Gold Corp. and become the biggest gold company in the world by market value, production and reserves.

In January, Newmont announced a friendly deal buy Goldcorp in a mostly stock transaction, at a premium of 17 per cent. But some Newmont investors argued the offer was too high considering Goldcorp’s poor past performance.

Mindset needs to change in mining: Sudbury risks having “someone else eating our lunch,” says CEMI top executive – by Karen McKinley (Northern Ontario Business – March 25, 2019)

March 26, 2019

https://www.northernontariobusiness.com/

Douglas Morrison says Sudbury’s mining sector has two choices: become a creator of change, or be a victim of it. That message had the attention of a packed auditorium at Dynamic Earth for the March 21 meeting of the Sudbury chapter of the Canadian Institute of Mining.

The CEO of the Centre of Excellence in Mining Innovation (CEMI) explained long overdue major changes in operations are coming fast, but the industry is focusing too much on small areas like replacing machinery and digitization.

What really needs to change is the mindset of how entire mining operations are run. “If we want to make the process more efficient, we have to start at the back, not the front,” Morrison said.

Eskom price hike to cost South Africa 90,000 mining jobs: Minerals Council (Reuters U.S. – March 25, 2019)

March 25, 2019

https://www.reuters.com/

JOHANNESBURG (Reuters) – South Africa’s gold and platinum mines will shed around 90,000 jobs in the next three years as above-inflation electricity price increases by power utility Eskom add to already soaring operating costs, an industry body said on Monday.

“In total, as many as 90,222 jobs would be at risk solely as a result of the MYPD4 tariff increases granted by Eskom,” the Minerals Council South Africa said in a presentation.

Job cuts are politically sensitive in Africa’s most industrialized economy where a quarter of the labor force is unemployed, while power outages and steep price increases by Eskom are set to hurt an already fragile growth outlook.

Back to the Marc Rich Days as U.S. Probes Commodity Traders – by Andy Hoffman, Javier Blas and Mark Burton (Bloomberg News – March 25, 2019)

March 25, 2019

https://www.bloomberg.com/

Executives fear U.S. authorities are zeroing in on the industry once again

Not since the days of fugitive oil merchant Marc Rich has the commodities trading industry faced so much global scrutiny.

The biggest independent oil and metals trading houses, including Vitol Group, Trafigura Group Ltd., Glencore Plc., Mercuria Energy Group Ltd. and Gunvor Group Ltd., are facing bribery and corruption investigations in jurisdictions ranging from Brazil to Switzerland and, most importantly, the U.S.

The multitude of investigations echoes the early 1980s, when then-U.S. attorney Rudy Giuliani prosecuted Rich, founder of the company that became Glencore, for tax evasion and buying oil from Iran in defiance of sanctions. The saga, which brought Rich infamy beyond the obscure world of commodity trading, has long haunted public perception of the industry.

Newmont says shareholders to get special payout if Goldcorp takeover approved – by Niall McGee (Globe and Mail – March 25, 2019)

March 25, 2019

https://www.theglobeandmail.com/

Newmont Mining Corp. intends to pay its shareholders a one-time dividend worth US$470-million after a number of large investors pushed for the giant miner to renegotiate terms of its takeover of Goldcorp Inc.

Newmont shareholders who own stock as of April 17 will be entitled to US$0.88 per share. The dividend is payable only if shareholders on both sides approve Newmont’s US$10-billion takeover of Goldcorp.

Last week, Paulson & Co said Newmont should pay about 23 per cent less for Goldcorp in light of its recent joint venture (JV) agreement with Barrick Gold Corp. The hedge fund argued that the JV had materially increased the value of Newmont and as a result it should pay less of its own stock for Goldcorp.

‘We’re not getting it’: Liberals sprinkle $700 million in Arctic but a strategic plan remains elusive – by Naomi Powell and Gabriel Friedman (Financial Post – March 23, 2019)

March 25, 2019

https://business.financialpost.com/

The federal government needs to set a long-term strategy to truly unlock the economic potential of the region as Russia and China get a head-start

Finance Minister Bill Morneau’s pre-election budget took steps to tackle the gaping infrastructure deficit in Canada’s north, but offered no timeline for when a highly anticipated long-term development strategy for the region will be complete.

In his last budget before the fall election, Morneau earmarked $700 million for Northern and Arctic initiatives, including $18 million for a hydroelectricity project in the Northwest Territories, $75 million for economic development programming and $400 million over eight years for infrastructure projects in the sparsely populated area.

Though Tuesday’s budget also reaffirmed Prime Minister Justin Trudeau’s 2016 commitment to co-develop an “Arctic and Northern Policy Framework” with local residents and stakeholders, it did not set a date for when it will be unveiled.

OPINION: Doug Ford’s repeal of the Far North Act won’t gain the respect of Indigenous communities – by Dayna Scott (Globe and Mail – March 25, 2019)

March 25, 2019

https://www.theglobeandmail.com/

Dayna Scott is York University Research Chair in Environmental Law & Justice in the Green Economy and associate professor at Osgoode Hall Law School and the Faculty of Environmental Studies.

Late last month, Ontario’s Progressive Conservative government confirmed that it plans to repeal the Far North Act, seeking to reduce “red tape” and increase “business certainty” in the Ring of Fire – a mineral deposit located near James Bay. While Premier Doug Ford is not the first to think he has found a key to unlocking the resource potential of Ontario’s north, this strategy is sure to backfire.

Ontario’s far north is inhabited almost exclusively by Indigenous peoples with ancestral homelands in the area covered by Treaty 9. It is a vast landscape of swampy boreal forest, a gigantic carbon sink that is also home to rare creatures such as the woodland caribou and the wolverine.

Except for the De Beers diamond mine near Attawapiskat, there has been almost no industrial scale development in the whole region, which is why mining the hyped-up nickel and chromite deposits in the Ring of Fire region will require major new roads and other infrastructure.

Russian control of US uranium supply is a huge national security problem – by Spencer Abraham (Fox News – March 24, 2019)

March 25, 2019

https://www.foxnews.com/

The Trump administration is to be commended for its “energy dominance” policy with respect to oil and natural gas production, but on domestic uranium mining, used for nuclear power generation and national defense purposes, it is the United States that is being dominated. Fortunately, the administration is considering new corrective measures to address this vulnerability to ensure America’s energy and national security.

The U.S. has become overdependent on foreign uranium. Today, we have the world’s largest commercial nuclear reactor fleet, but our domestic mining industry supplies less than 2 percent of its uranium needs.

Instead, foreign uranium accounts for the vast majority of our uranium supply with imports from Russia and countries of the Former Soviet Union (FSU) amounting to over 40 percent of the uranium loaded into U.S. nuclear power reactors.

Every year on ‘Día Del Mar,’ Bolivia celebrates the coastline they lost – by Chantelle Bacigalupo (PRI.org – March 22, 2019)

March 25, 2019

https://www.pri.org/

This year marks the 140th year that “Día Del Mar” or “National Day of the Sea” is celebrated in Bolivia.

Yes, Bolivia is one of two landlocked countries in South America, but every year on March 23, this holiday remembers the “historical injustice” of the 250-mile Pacific coast that Bolivia lost to Chile in the War of the Pacific. It’s a day where the whole country rallies together to remember its determination to reclaim access to the Pacific Ocean once again.

To understand the origins of the holiday, it’s important to note the complex history of the coast. The 250 mile-coast along the Pacific was a great economic advantage for Bolivia since it possessed the natural resources of saltpeter and guano, a source of nitrates used in explosives and fertilizers until the early 1900s. However, the country’s sights were set on the mining business as its sole means of economic growth before the war.

In fact, Rafael Puentes, the author of “Recuperando la Memoria: Una Historia Crítica de Bolivia,” explains that the birth of the country itself is credited to the tremendous mining wealth found in Potosí, Bolivia.

OPINION: Osgoode Hall professor will argue Canada should investigate assassination of Mexican activist – by Jennifer Wells (Toronto Star – March 25, 2019)

March 25, 2019

https://www.thestar.com/

The assassination of Mexican activist Mariano Abarca stands little chance of gaining the spotlight in Ottawa given all the tumult in the nation’s capital. But Monday’s judicial review before Federal Court Justice Keith Boswell deserves attention, reminding us of the tragic events of a decade ago and the present day oversight, or lack thereof, of Canadian mining companies operating abroad.

There’s no disputing the fundamental facts. Abarca had assumed a primary role in protesting Blackfire Exploration’s open-pit barite mine in the southern state of Chiapas.

The U.S. Geological Survey’s minerals yearbook for 2008 noted that the Canadian junior mining company planned to extend its operations underground, with the company trumpeting the La Revancha mine as the largest high-grade barite deposit in North America. In other words, Blackfire saw a long, bright mining future in Mexico ahead of it.

Australian miners see some impact from two cyclones, clean up begins – by Melanie Burton (Reuters U.S. – March 25, 2019)

March 25, 2019

https://www.reuters.com/

MELBOURNE (Reuters) – Mining giants Rio Tinto, BHP Group and Fortescue Metals said their Australian operations had suffered some impact after two cyclones hit the country over the weekend, with clean up starting on Monday in the wake of the storms.

Cyclone Veronica has been weakening after battering Australia’s northwest, while further east, Cyclone Trevor was downgraded to a low pressure system on Sunday.

Businesses affected included those in the iron ore export hubs of the Pilbara region, as well as Rio Tinto’s bauxite operations in Weipa to the east.

Why Rinehart, Forrest, BHP and Newcrest are sweet on Ecuador – by Brad Thompson (Australian Financial Review – March 25, 2019)

March 25, 2019

https://www.afr.com/

The mining executive who prepared the ground for a tenement tug-of-war between BHP and Newcrest in Ecuador is convinced a lot more copper and gold will be found in the exploration hot spot.

Malcolm Norris, who secured the Cascabel tenement a decade ago while calling the shots at SolGold, said it was no surprise that Andrew Forrest’s Fortescue Metals Group and Gina Rinehart’s Hancock Prospecting had also taken a shine to Ecuador.

Mr Norris, now the chief executive of ASX-listed junior explorer Sunstone Metals and chasing the third major copper-gold discovery of his career, said Cascabel might turn out to be big enough for both BHP and Newcrest. “I think it is a very big system and the resource that have been drilled so far, that’s not the end of the story. There’s more to come, I’m sure,” he said.

Vale’s Sul Superior Dam in critical condition – by Valentina Ruiz Leotaud (Mining.com – March 23, 2019)

March 25, 2019

http://www.mining.com/

Brazilian mining giant Vale (NYSE:VALE) announced this weekend that the Sul Superior Dam at the Gongo Soco mine is in a critical condition when it comes to stability. This, following the work of an independent auditor, hired to evaluate the state of the structure.

The dam is located in the municipality of Barão de Cocais, in the southeastern Brazilian state of Minas Gerais. This is the same region where, back in January 2019, a dam at Vale’s Córrego do Feijão iron ore mine collapsed killing hundreds and causing massive environmental destruction.

With the idea of avoiding a similar tragedy, the company launched a protocol to initiate level 3 of the Mining Dams Emergency Action Plan for Sul Superior, which is inactive and is scheduled to be decommissioned together with other nine dams.

Opinions: Don’t buy the alarmism about the Pebble Mine – by Ron Thiessen (Anchorage Daily News – March 24, 2019)

March 25, 2019

https://www.adn.com/

Ron Thiessen is President and CEO of Northern Dynasty Minerals Ltd., owner of the Pebble Limited Partnership and the Pebble Project.

There’s at least one thing I can agree on with the Bristol Bay lodge owners who recently published an op-ed in the Anchorage Daily News. Well, maybe two.

The lodge owners faithfully report in the opening paragraph of their screed: “The most important document on the Pebble Project’s path to a key permit to mine … has been released by the Army Corps of Engineers.” They go on to say, quite rightly, “that document, the draft environmental impact statement, is often considered the linchpin of permitting.”

These things are exactly correct. But from that point forward, the views and opinions of the ardent anti-mining authors don’t only diverge from mine. They diverge sharply, even radically, from the professional judgment of the independent engineers and scientists employed by the US Army Corps of Engineers as expressed in the Pebble draft EIS.