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.

Unless you are recently returned from a remote, primitive tropical island, you are inundated daily by doom and gloom reports, not only for the mining industry but for a broad range of banking, retail, real estate, automobile and more sectors.

“Dismal” is what the latest PricewaterhouseCoopers study calls last year for juniors.

The numbers tell a “sobering tale”, Ernst & Young said of the toll the global credit crisis is taking on the market capitalization of TSX-listed companies.

The Fraser Institute called the outlook “gloomy”, expecting at least 30% of exploration companies to fail.

“The mining industry, generally, is gripped by panic and the vast majority of firms are in lock-down mode,” says Jon Wylie, managing director of Proudfoot Consulting in Canada. “They have reacted to sharply lower commodity prices by scaling back and closing older, higher-cost mines.”

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(L to R) Ontario Deputy Minister of Northern Development and Mines, Kevin Costante; Timmins Mayor, Tom Laughren; Ontario Minister of Northern Development and Mines, Honourable Michael Gravelle; Ontario Mining Association President, Chris Hodgson; Ontario Prospector Association Executive Director, Garry Clark

What a difference a year makes at the Prospectors and Developers Association of Canada (PDAC) annual convention, the largest on the planet. The PDAC is where the world’s mining analysts, investors, prospectors, exploration managers, government representatives and anyone else connected to this industry come to meet, do business, attend lectures and of course party. There is also a large Investor’s Exchange that the general public can attend to find out about the newest exploration plays or interrogate company presidents about their stock performance.

Needless to say, the mood was somewhat somber as everyone is trying to cope with commodity prices and metal demand that over the past six months have fallen off the proverbial cliff. The rapidness of the crash, along side with the unprecedented turmoil in credit and capital markets that has dried up funding for most exploration and development work has sent a legitimate fear throughout the entire junior mining sector.

A PricewaterhouseCoopers survey found that the market capitalization of the top 100 TSX-V junior mining companies plummeted from $20.2 billion on June 30, 2007 to $4.1 billion by November 2008. Investors are shunning higher risk exploration companies like the plague.

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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.

March 3, 2009, is another black day in the employment history of the mining industry in Sudbury, ON. That was the day Vale Inco announced it was cutting 261 local jobs as part of its worldwide restructuring that will result in 900 terminations. At its Thompson, MB, operations, the company let 24 non-union supervisors go.

“Unfortunately the tough decisions announced today are necessary in these exceptional times” said Tito Martins, Vale Inco CEO and president, said in a news release. “The declining nickel price and reduced demand for nickel make it clear that continuing to operate in our current fashion is simply not sustainable. The measures we’re announcing today are intended to address the immediate health of the business and help reshape the organization for a long-term, successful and sustainable future.”

The announcement comes three weeks after the second largest miner in the area, Xstrata Nickel, announced the layoff of 686 workers. The combined cutbacks are a huge blow to the Sudbury community.

To its credit, Vale Inco released background information about its employment practices in Sudbury and Thompson, MB, since it took over operations in October 2006. The figures are an attempt to put the cuts in perspective in several areas.

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

Mining giant slashes 900 jobs globally, 261 locally

Greater Sudbury is having to face the realities of the global economic maelstrom full force, say Vale Inco officials, unionists, city councillors and members of the community.

First it was Xstrata laying off 682 employees. This week Vale Inco announced 261 non-production job cuts. The Vale Inco workforce reductions are mostly focused on corporate, management and business support operations, according to a Vale Inco press release. The company employs 14,000 people worldwide.

“We are cutting jobs across the board, but none in our production operations in Greater Sudbury,” said Cory McPhee, manager of corporate communications for Vale Inco.

Sixty-five members of Steelworkers 2020 office and technical workers are affected by the cuts, said McPhee. Local 6500 members are not impacted by the announcement, he said.

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Toronto, Ontario
March 2, 2009

Check Against Delivery

Introducation

Thank you for that introduction.

I am pleased to be here, and extend a warm welcome to everyone – especially those of you visiting Canada for the first time.

The Prospectors and Developers Association of Canada (PDAC) is one of the premier mining associations in this country. It hosts the largest conference on mining exploration and development in the world.

I’m grateful for the opportunity to comment not only on the challenges your industry currently faces but also on the action that our Government is taking with industry and with mining communities to weather the current economic recession.

This collaborative approach will see us emerge from the current downturn to take advantage of the rebound.

Major Assets

As you know, mining is a mainstay of the Canadian economy and is vital to some 150 rural northern and Aboriginal communities across the country.

The industry directly employed over 363,000 people in 2007, and contributed $42 billion to Canada’s GDP from mining to downstream processing.

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TORONTO, CANADA
March 4, 2009

The three winners were announced yesterday in the Meet the Mining Mogul contest, a first of its kind, put on by the Women in Mining (WiM) networks in Toronto and Vancouver. Each has won a one-hour private meeting with one of the three mining financiers who agreed to be the “prizes” in the contest, which is part of a fund-raising effort by the Women in Mining for The Townships Project.

A one-hour meeting with Frank Giustra of Fiore Financial will be the prize claimed by Guy Saucier. U.S. Gold’s Rob McEwen will meet with Karen Sutherland for an hour’s chat. And Eric Sprott of Sprott Asset Management will meet with Virginia Heffernan.

The Meet the Mining Mogul contest was part of an ambitious fund-raising effort by the Canadian WiM branches to support microloans for impoverished people in the township areas of South Africa. Their goal is to raise $250,000 this winter for the Toronto-based registered charity. Every donation in the campaign up to the time of yesterday’s draw was an entry in the contest. The amount of money raised for the charity at press time was $75,035, but that amount was expected to rise with the publicity that has been generated for the campaign during the Prospectors and Developers of Canada annual convention in Toronto this week, with an attendance of 18,000.

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With 35 years of institutional investing and money management experience in the United States and Canada, Donald Coxe has a unique background in North American and global capital markets. www.donaldcoxe.com

Due to illness, Mr. Coxe could not give this keynote address at the PDAC convention. PDAC and Mr. Coxe have graciously allowed Republic of Mining.com to post the speech. www.pdac.ca

“WHEN YOU COME TO A FORK IN THE ROAD—TAKE IT”
Don Coxe,
Chairman, Coxe Advisors LLC.

Hello Toronto—I truly wish I were with you. This is a desire that goes back a long way.

Nearly 6 decades ago, when I started reading The Northern Miner, I concluded that the Prospectors and Developers Association convention must be the neatest convention in the world, and the biggest thrill would be to be giving the keynote address to that convention. I could never aspire, then, to that happening. I had to live a long time, and then I proceeded to get sick.

In that sense, it’s an abbreviation of what has happened to us all, which is that, as of a year ago, it seemed that we’d got what we wanted. It was all coming true—and all of a sudden, a financial collapse hit Wall Street. As you know, for the last 6 years, I’ve been telling people that “We are living through the greatest simultaneous efflorescence of personal economic liberty in human history.”

By that, I mean people who for the first time, (after having led lives of privation and poverty) are moving into dwellings with indoor plumbing, electricity, basic appliances, and acquiring access to private motorized transportation. The people who have those things have more personal economic freedom than 99% of the people whom have ever lived.

What’s happened in this decade is simply that a whole section of the world began to catch up to where we in the industrial world had long been, thereby transforming the outlook for the mining industry.

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

Two hundred sixty one of the 900 job cuts announced at Vale Inco Mar. 3 are in Sudbury. The rest are at the company’s operations worldwide.

The workforce reductions are mostly focused on corporate, management and business support operations, according to a Vale Inco press release. Vale Inco employs 14,000 people worldwide.

“We are cutting jobs across the board, but none in our production operations in Greater Sudbury,” said Cory McPhee, manager of corporate communications for Vale Inco.

Sixty-five members of Steelworkers 2020 office and technical workers are affected by the cuts, said McPhee. Local 6500 members are not impacted by the announcement, he said.

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(left to right) Chief Glenn Nolan, AFN National Chief Phil Fontaine, Don Bubar-PDAC

March 3, 2009

CHECK AGAINST DELIVERY

I want to thank the PDAC – in particular Chief Glenn Nolan and Don Bubar – for inviting me here to provide an update on the Corporate Challenge and our work with the mineral industry.

It was exactly one year ago tomorrow – March 4th, 2008 – that I attended this convention for the first time and signed an MOU with then President Patricia Dillon resulting in PDAC joining the AFN Corporate Challenge.

As I look back to that signing, I wonder who could have foreseen then that the global economy was in for the transformative change we are witnessing today?

As we gather today on this anniversary, I come in the spirit of friendship on behalf of the AFN.  Amongst my peoples these bonds are strongest when times are difficult when times are difficult for our friends.

Although, economic forecasters differ on the pace and timing of the rebound in the global economy, there is no uncertainty that prices and demand will recover and grow.

With this in mind, let us discuss our common purpose in fostering relationships of strength and common prosperity as between First Nations and the mining industry, now and for tomorrow.

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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 incurred huge loans ($10 billion) at the worst possible time (October 2008) for the acquisition of Fording Coal. Hit with the double whammy of plummeting commodity prices and a huge debt load, management in Vancouver is digging in to ensure that the company not only survives, but prospers.

Teck told investors at the recent BMO Capital Markets that it will cut sustaining capital needs by $330 million and capital projects by $400 million this year from 2008 levels. It has slowed the development of the Fort Hills oil sands project and withdrawn from the Petaquilla copper project. Zinc production at the Trail metallurgical complex has been reduced by 20%, and the Pend Oreille zinc mine has been temporarily closed.

Teck is selling its 50% share in the Williams and David Bell gold mines at Hemlo, Ont., to Barrick Gold, its joint venture partner. The deal is worth $US65 million.

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