Republic of Mining

Commodities Escape Worst of Market Rout on Robust Demand Outlook – by Jake Lloyd-Smith and Heesu Lee (Bloomberg News – February 6, 2018)

February 6, 2018

https://www.bloomberg.com/

Commodities are escaping the worst of the global market rout as losses in raw materials are capped by speculation that the bullish outlook for demand remains intact.

The Bloomberg Commodity Index pared its decline to only 0.1 percent by the end of the Asian day as gains in precious metals and U.S. natural gas helped offset lower oil and industrial metals.

While some raw materials were dragged lower as investors eschew risk, the reaction was muted compared with other assets. Stock markets from Hong Kong to Tokyo tumbled more than 4 percent following Monday’s collapse in U.S. equities and bond yields.

Ferrochrome plant decision in 3-4 months: Noront – by Staff (Sudbury Star – February 6, 2018)

February 6, 2018

http://www.thesudburystar.com/

Now, the waiting begins. On Monday, Noront Resources Ltd. confirmed it had received bids from Sudbury, Sault Ste. Marie, Thunder Bay and Timmins to become host for its new $1-billion ferrochrome production facility.

In a release, Noront Resources said Hatch, a Mississauga-based engineering and consulting company, will now help evaluate the bids, which were due Friday.

“Next steps include calculating indicative capital and operating costs and reviewing these alongside community and First Nations support, site appropriateness, environmental factors, access to a skilled workforce and other elements,” Noront said in a release. “Near the conclusion of this detailed analysis, Noront will engage directly with the owners of the favoured site(s) to come to a mutually agreeable commercial arrangement for the use of the property.

COLUMN-African miners, governments talk past each other, threatening boom – by Clyde Russell (Reuters U.S. – February 6, 2018)

February 6, 2018

https://www.reuters.com/

CAPE TOWN, Feb 6 (Reuters) – Africa’s mining industry should be poised on the verge of great things, but instead it appears to be seeking a reset button as miners continue to clash with governments over how best to exploit the continent’s resources.

Africa is home to large reserves of the metals essential to the battery revolution, such as cobalt and copper, and it is also rich in gold, iron ore, high-quality coal and uranium, to name a few.

But similar to last year, the Investing in African Mining Indaba conference in Cape Town was a litany of miners and ministers talking past each other this week, seemingly getting no closer to developing a consistent regulatory framework.

Ottawa to overhaul process for energy project reviews – by Shawn McCarthy (Globe and Mail – February 5, 2018)

February 6, 2018

https://www.theglobeandmail.com/

The Liberal government will introduce sweeping legislation this week to overhaul the environmental assessment system for major resource projects as it faces fierce opposition in British Columbia to a pipeline approved under the current rules.

Prime Minister Justin Trudeau says the existing system, in which the National Energy Board reviews pipeline proposals, has failed to provide credible outcomes that are broadly trusted by the people who would be affected.

The government indicated on Friday that it will give notice of legislation on Monday, meaning the bill will be tabled later in the week.

Stephen de Jong, Catherine Raw win ‘Young Mining Professionals of the Year’ award – by Staff (Northern Miner – February 5, 2018)

February 5, 2018

Northern Miner

The Young Mining Professionals (YMP) — a non-profit group with chapters in Vancouver, Toronto, Montreal and London, U.K. — has awarded its Mining Professional of the Year Awards for 2017 to Stephen de Jong, chairman of Vancouver-based gold-silver junior Integra Resources (TSXV: ITR), and Catherine Raw, executive vice-president and chief financial officer of Barrick Gold. (TSX: ABX; NYSE: ABX).

The YMP Awards, presented in association with The Northern Miner, are intended by the YMP to “recognize two young mining professionals, a male and a female, who over the past year, and during the course of their careers, have demonstrated exceptional leadership skills and innovative thinking to provide value for their companies and shareholders, as well as for themselves.”

Nominees are required to be under 40 years of age in 2017 and be active in some aspect of mining in Canada, the United States or the United Kingdom. Voting on a selection of nominees was held in January by a committee representing the four YMP branches and The Northern Miner.

Anglo Sees Momentum on S. Africa Policy: Africa Mining Update – by Thomas Biesheuvel, Felix Njini and Thomas Wilson (Bloomberg News – February 5, 2018)

February 5, 2018

https://www.bloomberg.com/

Mining executives, investors and government ministers are meeting in drought-hit Cape Town for the African Mining Indaba, the continent’s biggest gathering of one of its most vital industries.

Recent multiyear highs for many commodities have the world’s biggest miners swimming in cash and new demand from electric vehicles mean once-overlooked metals like lithium and cobalt are grabbing the spotlight.

But it’s not all blue skies, as the industry grapples with regulatory changes and uncertainty in countries including the Democratic Republic of Congo and Tanzania, as well as host South Africa.

Here are the latest developments, updated throughout the day. (Time-stamps are local time in Cape Town.)

Global miners join forces to challenge new Congo code – by Peter Hobson (Reuters U.S. – February 5, 2018)

February 5, 2018

https://www.reuters.com/

LONDON (Reuters) – International mining companies operating in Democratic Republic of Congo are mounting a coordinated campaign against a new mining code they say will stifle investment there, Randgold’s chief executive told Reuters.

Mark Bristow said he expects the DRC government to agree to amend the code, which the Senate passed last month and raises royalties on metals such as gold, copper and cobalt as well as taxes on the companies themselves.

Bristow said on Monday that higher royalties would discourage investment but the key objection was that the new code dispensed with a clause in the previous charter protecting miners from changes for 10 years.

The real cost of tax avoidance – Editorial (Toronto Star – February 5, 2018)

February 5, 2018

https://www.thestar.com/

Corporations that avoid tax, like the mining company Turquoise Hill Resources, are depriving governments of billions of dollars a year in tax revenue — money that could be going to pay for everything from health care to national defence.

Whatever the Vancouver-based mining company Turquoise Hill Resources is paying its tax lawyers, it isn’t enough.

Over the past seven years the company has used a complicated network of subsidiaries, foreign tax havens, and a variety of financial manoeuvres to avoid paying more than half a billion dollars in Canadian tax. It’s also avoided paying another $232 million (U.S.) to the government of Mongolia, where it operates one of the world’s biggest copper mines.

The pipeline war no politician will win – by Gary Mason (Globe and Mail – February 2, 2018)

February 5, 2018

https://www.theglobeandmail.com/

Politics, nothing more, has incited the latest furor around the Trans Mountain pipeline. The fallout from the actions taken by the B.C. government this week could reverberate in this country for years to come. The implications for Prime Minister Justin Trudeau, Alberta Premier Rachel Notley and B.C. Premier John Horgan can’t possibly be overstated.

Let’s start at the top, with the Prime Minister. Mr. Trudeau promised to deliver this pipeline to the good people of Alberta. His government has constitutional authority over construction of the project, power that is being directly challenged by the B.C. government.

Mr. Trudeau is well aware of the time pressures this project is fighting. Project proponent Kinder Morgan is facing mounting costs as a result of delays. If the company is now looking at further court challenges dragging this process out for another year or two longer, it may decide to just walk away, which would be deeply unfortunate.

Ottawa lent $1 billion to a mining company that allegedly avoided nearly $700 million in Canadian taxes – by Marco Chown Oved (Toronto Star – February 5, 2018)

February 5, 2018

https://www.thestar.com/

Critics question whether the government should help companies that don’t pay tax in Canada.

The Canadian government provided more than $1 billion in loans to a mining company that used a complex offshore business structure to allegedly avoid nearly $700 million in Canadian tax.

Turquoise Hill Resources, a Canadian company headquartered in Vancouver and listed on the Toronto and New York stock exchanges, received a loan of $750 million (U.S.) in 2015 from Export Development Canada, a Crown corporation that supports Canadian businesses abroad. The loan is worth more than $1 billion Canadian, according to EDC’s disclosure database.

Between 2010 and 2016, Turquoise Hill ran the finances for its massive Oyu Tolgoi mine in Mongolia through shell companies in Netherlands and Luxembourg.

Expansion would secure Mary River’s future, Baffinland boss says – by Jim Bell (Naunatsiaq News – February 5, 2018)

February 5, 2018

http://www.nunatsiaqonline.ca/

“We will be insulated from the iron ore price”

OTTAWA—If Baffinland Iron Mines Corp. is permitted to build its proposed Milne Inlet railway and expand production to 12 million tonnes of iron ore each year, the company will never again have to worry about plummeting ore prices, Baffinland boss Brian Penney said last week.

“We will be insulated from the iron ore price,” Penney, the company’s CEO, told delegates at a mining industry panel held during the Northern Lights trade show in Ottawa.

That’s because the Mary River ore body, where a range of hills hold massive quantities of ore that are around 65 per cent pure iron, the greatest degree of purity that the laws of chemistry will allow, might be the richest iron ore deposit on the face of the earth, Penney said.

Pile-of-Cash Dilemma for Mining Industry Once Crippled by Slump – by Thomas Biesheuvel and Thomas Wilson (Bloomberg News – February 5, 2018)

February 5, 2018

https://www.bloomberg.com/

Three years after a commodity slump left their finances in shambles, mining companies are swimming in so much cash that investors aren’t sure where the industry will spend it all.

With metals from zinc to palladium trading at multi-year highs, four of the world’s top producers generated combined free cash flow last year of about $87 million a day. Some of the unprecedented windfall is earmarked for dividends, which companies including BHP Billiton Ltd. and Glencore Plc cut or eliminated during the slump.

Where the rest of the money goes — into new mine projects, acquisitions or a bank account — remains one of the big unanswered questions for executives, investors and bankers attending Africa’s biggest mining conference, which begins Monday in Cape Town. Companies may be reluctant to spend too much, given the disastrous results of rapid expansions a few years ago.

The ferrochrome plant bids are in: Noront Resources hires Hatch to help decide which city will host Ring of Fire chromite smelter – by Staff (Northern Ontario Business – February 5, 2018)

February 5, 2018

https://www.northernontariobusiness.com/

Noront Resources expects to reach a decision on the site for a ferrochrome smelter in the next three to four months.

The leading mine developer in the Ring of Fire has hired Hatch consulting engineers to assist them in evaluating the bid packages from Sault Ste. Marie, Sudbury, Thunder Bay-Fort William First Nation, and Timmins.

All four cities are vying to be the host community for the $1-billion production facility. The cities submitted their bid packages by Noront’s imposed Feb. 2 deadline. With the submission period now closed, the adjudication process now begins.

COLUMN-South African coal loses Europe, but gains South Asia – by Clyde Russell (Reuters U.K. – February 4, 2018)

February 5, 2018

https://uk.reuters.com/

CAPE TOWN, Feb 5 (Reuters) – A decade ago South Africa sent the bulk of its coal exports to Europe, a market now disappearing right before its eyes.

But far from being worried, South Africa’s coal exporters are confident that they can increase shipments in coming years by becoming the supplier of choice to new markets in Asia, particularly Pakistan and India.

The common theme among speakers at last week’s South African Coal Export Conference, hosted by IHS Markit, was that South Africa is in pole position to take advantage of growth in South Asia.

Sudbury Accent: No ‘weakness’ in city’s bid for Noront’s ferrochrome plant – by Mary Katherine Keown (Sudbury Star – February 3, 2018)

February 3, 2018

http://www.thesudburystar.com/

Sudol believes Sudbury is the right choice for the ferrochrome
smelter. “The facility in Finland does not have a detrimental
effect on their local environment or workers. It will be the
same in Sudbury,” he said. “Sudbury is serviced by two class
one rail lines, has a number of brownfield sites that can be
used to construct and expand the facility and has no issues
with power availability.

“With strategic clusters of mine supply and services, mining
education – two colleges and a university – and a wide assortment
of underground, metallurgical, environmental, and health and safety
research in the community, Noront can take advantage of more than
135 years of mining expertise that is unmatched anywhere else in
Northern Ontario or the entire country for that matter. (Stan Sudol)

On the heels of his fact-finding mission to Finland, Mayor Brian Bigger is really excited about Sudbury’s bid to host the Noront Resources ferrochrome production facility.

For one thing, there is already a skilled and knowledgeable work force in Sudbury that supports eight mines, two smelters and two mills.

“There is a lot of expertise within our community to support that kind of operation,” Bigger said this week. “We’re familiar with these types of operations in Sudbury. We understand what’s required to support that kind of business.”