July 2012 – Republic of Mining

Contractor says Detour Gold owes them money – by Ian Ross (Northern Ontario Business – August 2012)

July 31, 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. Ian Ross is the editor of Northern Ontario Business ianross@nob.on.ca.

A southern Ontario contractor claims Detour Gold Corp. (DGC) owes them more than $66.4 million for excavation and construction work performed at the company’s flagship Detour Lake gold mine project in northeastern Ontario.

North America Construction (NAC) has filed two statements of claim in the Ontario Superior Court of Justice in Cochrane against the Toronto miner and its affiliated Trade Winds Ventures of Vancouver.

NAC claims it’s owed $58 million for concrete work and $8.4 million for excavation work performed at the massive and remote open pit mine and mill project now under construction, 180 km northeast of Cochrane. The Morristown, Ont.-headquartered general contractor has slapped three construction liens for work performed by the company between November 2010 and April, 2012.

The project marked the 75 per cent construction completion mark in late June. North America Construction provides master building services to civil, municipal, biofuels, energy, mining and industrial sectors across Canada.

Arsenic in [Sudbury’s] Long Lake – by Laura Stricker (Sudbury Star – July 31, 2012)

July 31, 2012

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

With its sandy shoreline and peaceful location, Long Lake, approximately 20 minutes south of Lively, attracts people to swim, relax and fish. Area residents get their drinking water from it.

But members of the Long Lake Stewardship say arsenic is being leached into the lake, and that the ministries of Environment and Northern Development and Mines are blatantly ignoring the problem.

“There’s a gold mine on the westerly end of Long Lake, the Long Lake Gold Mine, and it has a large tailings area that leaches through a creek into Long Lake,” said Stephen Butcher, chair of the stewardship committee. “I read some reports on that mine a few years back, and it said the tailings were heavily loaded with arsenic. Logic put together that it would be creeping in by Long Lake.”

In 2010, Butcher contacted Max Kasper, a project co-ordinator with the Ministry of the Environment (MOE). “Looking at the data we have collected … despite water chemistry results that are above Provincial Water Quality Objectives for some parameters, the drainage from the former gold mine is having little impact on Long Lake,” Kasper told him in an email dated May 26, 2010.

How will Enbridge stem the flow of bad PR? – by Don Martin (CTV News – July 30, 2012)

July 31, 2012

http://www.ctvnews.ca/

As pipeline leaks go, it was just a gooey puddle and barely worth a news brief. But the spillover effect of losing six minutes worth of piped oil from its Chicago line has unleashed a gusher of bad publicity for Enbridge at the worst possible time.

The 158,000 litres of light crude turned a Wisconsin farmer’s field into a black mess, which was easily cleaned up leaving behind no significant environmental damage. Yet media attention on Enbridge has amplified into a frenzy courtesy of its Northern Gateway proposal, a $6-billion pipeline to the west coast now turning the Great Divide into a political as well as geographical watershed between Alberta and B.C.

Premier Christy Clark may have thrown a Hail Mary pass when she demanded a piece of royalty action from Alberta as B.C.’s toll for the pipeline’s unopposed passage, but it’s not without local voter appeal and seems likely to revive a premier whose re-election prospects appeared palliative.

Meanwhile, federal government heavyweights are increasingly weary of carrying the Northern Gateway crusade solo, complaining to me privately that the media-shy company has done a lousy job of spinning its story while leaving difficult public relations to cabinet ministers.

Indigenous worker numbers skyrocket in mining – by Gian De Poloni (Australian Broadcasting Corporation News – July 31, 2012)

July 31, 2012

http://www.abc.net.au/news/

The number of Indigenous people working on major mining projects in Western Australia has skyrocketed over the past five years.

In the resource-rich Pilbara region, big companies like Rio Tinto, BHP Billiton, Chevron and Fortescue Metals are keen to hire as many Aboriginal people as they can, and they are keen to work. Brendon Kelly is a 40-year-old Indigenous man with five children living in Port Hedland.

BK, as he is known to his mates, decided three years ago he wanted to be a part of the biggest mining boom the country has ever seen. He undertook a course with Ngarda Civil and Mining, one of the largest Indigenous training groups, and now works as a drill and blast engineer at BHP’s Yarrie iron ore mine, about 200 kilometres north-east of Port Hedland.

“There are four Aboriginal people on our crew, it’s pretty multicultural out here on site at the moment,” he said. “It’s a really good thing, the more the better.” BK is urging others to consider getting training. “There’s better security and independence for yourself and your family,” he said.

Native Canadians Fear Mining Boom in “Ring of Fire” – by By Fawzia Sheikh (Inter Press Service News Agency – July 30, 2012)

July 31, 2012

http://www.ipsnews.net/

TORONTO, Jul 30 2012 (IPS) – With accusations that Canadian resource companies and government officials are disregarding the need for indigenous consent in development projects, First Nations leaders have lashed out by approving a resolution calling for a moratorium on mining development in the so-called Ring of Fire until proper consultation begins.

The Ring of Fire includes chromite, nickel, copper, platinum, zinc, gold and kimberlite deposits and is touted as the most promising mineral development opportunity in Ontario in nearly a century.

The resources are located 540 kilometres east of the city of Thunder Bay within the shared territories of a handful of Aboriginal communities around McFaulds Lake. The region is home to more than 100 bodies of water and four major rivers in the James Bay Lowlands in the northern part of the province.

“We haven’t had any meeting that is meaningful with the province,” Chris Moonias of the Neskantaga First Nation told 633 chiefs-in-assembly at the Assembly of First Nations annual conference from Jul. 17 to 19. “Right now, we’re being bullied by a mining company, a giant mining company and a desperate province.”

Ranking the world’s gold mines and deposits – by Marilyn Scales (Canadian Mining Journal – July 30, 2012)

July 31, 2012

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 report is free, courtesy of National Resource Holdings and may be downloaded from http://www.nrh.co.il/i/pdf/NRH_Research_2012%20World_Gold_Deposits.pdf

The idea of knowing how many ounces of gold exist in situ, or how many gold mines there are in Canada, or how rare are deposits with more than a million ounces is fascinating. Now along comes Natural Resource Holdings of Tel Aviv with all that information and more.

For the second year, NRH has pored over public filings from around the world. The information was examined, sifted and compared to highlight trends in future mine supply, depletion, discoveries and in situ grades. The ensuing report makes interesting reading.

NRH said it has identified 439 gold deposits around the globe each of which contain over 1 million oz of gold. The 189 producing gold mines operate with an average grade of 1.06 g/t Au, and the world’s undeveloped deposits have an average grade of 0.66 g/t Au.

The report also ranks the top 50 producing mines by in situ resources. Unsurprisingly Freeport McMoRan’s Grasberg mine in Indonesia holds top spot among producers with 88.1 million oz. Well behind is the No.2 Lihir mine (56.0 million oz) owned by Newcrest in Papua New Guinea.

The Oil Sands PR War – by Chris Turner (Marketing Magazine – August 13, 2012)

July 30, 2012

http://www.marketingmag.ca/

For a column about the dismal image of Canada’s mining sector by Stan Sudol, click here: http://republicofmining.com/2011/11/29/the-horrible-image-of-canada%e2%80%99s-mining-sector-%e2%80%93-by-stan-sudol/

The down and dirty fight to brand Canada’s oil patch – Chris Turner

Not long ago, a half-page ad appeared on page three of The Globe & Mail. Over an image of a bucolic forest glade lit by a golden sunrise, a headline read, “Energy the world needs. The approach Canadians expect.” The ad was short on specifics—a block of smaller type spoke of Canada’s perception in the wider world and “a constant effort to improve our environmental performance.” The only appearance of the word oil was in the URL for the campaign’s website: OilSandsToday.ca.

The ad had been placed by the Canadian Association of Petroleum Producers (CAPP), and it was the latest effort in an ongoing, two-year campaign to improve the public image of Canada’s oil industry—particularly the lucrative but much-maligned bitumen extraction business in the oil sands of northern Alberta. The bucolic forest glade, the ad’s fine print noted, was a “reclaimed mining operation” in Alberta’s vast boreal forest, executed by Syncrude.

If Globe readers didn’t come away from their morning scan thinking of CAPP’s golden meadow, that might be because it wasn’t the only story about Canadian oil in the front section of the paper that day. “Spate of spills pushes Alberta to harder look at pipeline safety,” read a front-page headline.

BHP said to delay Olympic Dam expansion – Bloomberg News (National Post – July 30, 2012)

July 30, 2012

The National Post is Canada’s second largest national paper.

BHP Billiton Ltd., the world’s biggest mining company, will delay approval of a $33 billion mine expansion in Australia for two years because of falling commodity prices, The Australian newspaper reported.

The company will delay a decision until 2014, the newspaper said, citing a document prepared by an unidentified consultancy. The document was prepared with knowledge from BHP staff, the Australian said.

The board of Melbourne-based BHP Billiton has been due to decide on proceeding with the Olympic Dam copper-uranium-gold mine expansion by the end of this year. Chief Executive Officer Marius Kloppers warned in May that rising costs and easing commodity prices may change the economics of certain projects.

“We will inform the market when decisions have been taken,” Antonios Papaspiropoulos, a spokesman for BHP Billiton, said by phone today. He declined to comment on the boards’ previously stated end-year decision deadline.

Fresh anger in U.S. as Enbridge races to clean up Wisconsin oil spill – by Brendan O’Brien (Reuters/Globe and Mail – July 29, 2012)

July 30, 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.

GRAND MARSH, Wis. — Reuters – Canada’s Enbridge Inc on Sunday worked to repair a major pipeline that spilled more than 1,000 barrels of oil in a Wisconsin field, provoking fresh ire from Washington over the latest in a series of leaks.

The spill on Friday — almost two years to the day after a ruptured Enbridge line fouled part of the Kalamazoo River in Michigan — has forced the closure of a major conduit for Canadian light crude shipments to U.S. refiners and threatens to further damage the reputation of a company that launched a more than $3 billion expansion program just two months ago.

On Sunday, an Enbridge spokesman said the company was working diligently to carry out inspections to Line 14 and repairs to ensure a safe restart. The company did not say what had caused the incident and provided no estimate on when the 318,000 barrels-per-day Line 14 would resume service.

Q&A with ‘Anti-Bono’ Zambian economist Dambisa Moyo [China resource competition] – by Rick Westhead (Toronto Star – July 29, 2012)

July 30, 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.

Q: How long did you research and report your book?

A: It took me about three years. I did probably 80 interviews with hedge funds, policy makers. Of those, probably 30 interviews were with Chinese officials. I spend about 80 per cent of my time in developing markets. I’m in Africa once a quarter and China two or three times a year. So over the course of writing the book, I probably spend three or four months in China. I felt like I had a good connection with people. I’ve seen Chinese mines, been on their oil rigs.

Q: China’s Prime Minister Wen Jiabao has said that without reforms China could face another Cultural Revolution. It’s very strong language from such as prominent leader. Did you get a sense from your time in China of what kind of opposition the government faces?

A: Not in the way you or I think about it, but there’s been a lot of transformation in China’s political system while we haven’t been watching. We are all sort of hyper-focused on issues like: are they going to have democratic elections where every Chinese stands in a line, queues around the block and elects a president? While we’ve been focused on that, there have been a whole lot of reforms going on.

Only Harper can end pipeline politicking – by John Ibbitson (Globe and Mail – July 30, 2012)

July 30, 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.

Stephen Harper is going to have to talk to the provinces about energy. And he hates that sort of thing.

In Saturday’s Globe, Premier Christy Clark succinctly outlined her key demands before the British Columbia government will support the Northern Gateway pipeline proposal. Most of them are eminently reasonable: The project must clear the National Energy Board review; there must be the most stringent possible controls to prevent and mitigate spills; first nations in B.C. must benefit from the project.

The final demand, however, is the deal-breaker: “B.C. must receive its fair share of the fiscal and economic benefits,” from the pipeline. B.C. wants a piece of the action.

Alberta Premier Alison Redford made it abundantly clear at last week’s premiers’ meeting that Ms. Clark can have all the revenue she wants, so long as not one penny of it comes from Alberta’s take.

Oil-patch ironies aside, many questions for Harper – by Jeffrey Simpson (Globe and Mail – July 28, 2012)

July 30, 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.

Those who have discussed the issue with him report that Prime Minister Stephen Harper has been worried a state-owned company, likely from China, would take a run at a major Canadian energy producer.

Now that the massive China National Offshore Oil Corp. (CNOOC Ltd.) has bid $15.1-billion for Nexen Inc., it’s easy to understand the Prime Minister’s uneasiness. His initial statements were properly guarded, as befits the complexity of the file and his own apparent hesitations.

It has been said that the CNOOC bid is a standard business transaction: one company taking over another, in this case with the support of the Nexen board. CNOOC trades on stock exchanges. It has made commitments about keeping headquarters in Calgary, maintaining staff and conducting business pretty much as before.

National energy strategy must address B.C. pipeline worries – by Christy Clark (Globe and Mail – July 28, 2012)

July 30, 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.

CHRISTY CLARK is the Premier of British Columbia.

This week, my government outlined five bottom-line requirements that must be met for British Columbia to consider support of any heavy oil pipeline project, including Enbridge’s Northern Gateway. We know that Alberta’s oil sands are an important resource and getting them to new markets represents a great economic opportunity for that province and our country. But as a premier, I am focused first and foremost on what’s best for my province, and Northern Gateway currently contains far too great an imbalance of risks over benefits for B.C.

British Columbia’s five bottom lines are as follows:

1. Successful completion of an environmental review process. In Enbridge’s case, this means a recommendation by the Joint Review Panel that the project proceed.

2. World-leading marine oil-spill prevention and response systems to protect our coastlines and ocean. With the Enbridge project, British Columbia is taking 100 per cent of the marine risk. We need to make sure we improve our response and resource capacity. That means the federal government and industry are at the table and prepared to step up their support.

CSIS said to be probing financial links between First Nations, China – by Jen Gerson (National Post – July 25, 2012)

July 28, 2012

The National Post is Canada’s second largest national paper.

CALGARY — Canadian intelligence services appear to have probed financial links between First Nations groups and Chinese companies as scrutiny continues to mount on China’s interest in this country’s natural resources sector.

This week, Chinese oil company CNOOC Ltd. announced a $15-billion takeover bid for Calgary-based Nexen, a proposal that will have to pass scrutiny under the Canada Investment Act. The deal seems to be raising warning flags among politicians who fear the energy-hungry superpower’s influence in Canada’s oil patch. But scrutiny of China’s investment reach appears to stretch back several years.

Vancouver-based lawyer Merle Alexander said he was approached by Canadian Security Intelligence Service agents twice, in 2010 and in 2011, after presenting seminars on a memorandum of understanding signed between the Kaska Nation and Silvercorp., a B.C. company with Chinese links.

He said they identified themselves with CSIS badges and “appeared interested in determining whether there is direct involvement or influence between the Chinese government and First Nations governments,” he said.

China’s “Race for Resources”: Dambisa Moyo Sees Commodity Conflicts and Scarcity Ahead – by Aaron Task (Daily Ticker – July 23, 2012)

July 28, 2012

Much has been made about China’s huge investments in resource-rich Africa in recent years and Chinese President Hu Jintao pledged another $20 billion in loans during his visit last week.

But it’s not just Africa where China is looking to secure access to commodities, notes international economist Dambisa Moyo. “There’s not a single region left untouched,” she says in the accompanying video, noting China’s extensive trade with Brazil, its recent “laptops for pork” deal with Canada, pacts with Kazakhstan and Russia for uranium and oil, as well as land-development in Australia. And on Monday, Canada’s major oil producer Nexen announced it has agreed to be acquired by China’s CNOOC in a $15.1 billion deal, giving the Chinese oil company a strong position in the North American oil market.

“Simply put, the Chinese are on a global shopping spree,” Moyo writes. “And its voracious commodity appetite is unlikely to abate significantly even if China’s economic growth rates were to cool.”