November 13, 2012 – Republic of Mining

Ontario continues to be a global mining leader and expects great things from the ‘Ring of Fire’ – by John Chadwick (International Mining – December 2012)

November 13, 2012

International Mining is a global technical magazine written for miners by miners. John Chadwick is the publisher. john@im-mining.com

In November I wrote about one of America’s greatest mining states, Minnesota. This month I and my attention wander across the border to perhaps an even more important region in the global mining industry, Ontario.

In its far north is the Ring of Fire mining camp. At this early stage, Cliffs Natural Resources is looking at an operation there to treat 4.4 Mt/y of crude ore, expected to produce up to 2.3 Mt/y of chromite concentrate. Noront Resources is more into nickel-copper-PGMs – 1 Mt/y throughput producing approximately 150,000 t/y of high grade nickel-copper concentrate containing significant platinum and palladium.

KWG Resources, one of the first players in the area, has earned a 30% interest in the Big Daddy chromite deposit, which, at a 15% cutoff, has a Measured resource of 29.5 Mt, grading 29% Cr2O3. The Indicated resource is 7.9 Mt grading 26.7% Cr2O3, and there are 4.8 Mt Inferred, grading 25.0% Cr2O3. By comparison, Outokumpu’s Kemi mine in Finland has ore reserves of 41.1 Mt averaging 24.5% Cr2O3. The much higher grades of the Big Daddy compare favourably with those deposits whose ore is shipped directly to foundries with minimal processing. This potential is being investigated.

Ontario has 42 operating mines today and is the largest producer of non-fuel minerals in Canada (21% of the nation’s total non-fuel production, worth over C$10.7billion in 2011).

Osisko buying Queenston Mining in all-stock deal – by Craig Wong (National Post – November 13, 2012)

November 13, 2012

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

Canadian Press – Osisko Mining Corp. signed an all-stock deal Monday valued at $550-million to buy Queenston Mining Inc. and its flagship Upper Beaver project in Ontario’s Kirkland Lake region.

Osisko president and chief executive Sean Roosen said work on the Upper Beaver project is coming to a critical stage in its development. “We feel this is the perfect time for us to bring our mine permitting and development teams into the project to back the plan and to make Upper Beaver a successful mine,” Mr. Roosen said on a call with analysts.

“We also have the ability to fund Upper Beaver development from internal cash flow so we don’t anticipate any further dilution as we evolve these projects.”

Queenston also owns several other gold properties in the Kirkland Lake gold camp area as well as interests in projects in Quebec, Manitoba and elsewhere in Ontario.

Queenston president and CEO Charles Page said the Upper Beaver project has the potential for four million ounces of gold. “Osisko’s proven development team can certainly maximize the potential of the Upper Beaver project,” he said.

Correction: Given platinum’s problems, can Xstrata really justify a Lonmin takeover? – by Lawrence Williams (Mineweb.com – November 12, 2012)

November 13, 2012

http://www.mineweb.com/

Speculation that Xstrata will make another attempt to oust the Lonmin Board and take the company over remains rife in London, despite Lonmin’s rebuff of the Xstrata overtures. (Correction on Lonmin rights issue status)

LONDON (MINEWEB) – Despite an official rebuff by the Lonmin Board, Xstrata looks as though it may well be about to make a serious play to take over Lonmin and its South African platinum mines – although the timing could be better for the diversified miner with the Glencore merger vote coming up in just over a week’s time – just a day after Lonmin’s own proposed fundraising plan is due to be voted on.

Xstrata is a logical saviour for Lonmin, although the latter doesn’t seem to think so. It owns 24.6% of Lonmin already, has platinum, chrome and ferrochrome operations in the Bushveld Complex area – where 90% of the world’s platinum reserves are thought to lie and which accounts for 70% of annual global production – but is not a major platinum miner and could view picking up the remainder of Lonmin at a relatively cheap price as an attractive long term play.

It is sitting on a huge loss on its existing holding, but nevertheless probably sees Lonmin’s platinum reserves, resources and operations as a great long term asset, particularly at Lonmin’s current hugely depressed share price. But, perhaps importantly if it doesn’t take up its rights, a large proportion of the the Lonmin fundraising could remain with the underwriters – even though the rights issue price has been set at a substantial discount to make it more attractive to existing shareholders.

Perhaps golfers should be thanking miners

November 13, 2012

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.

As the last leaves fall from the trees and we head into winter, all golfers should perhaps take a little time to thank mining. Yes, before heading to the first tee, or when you are lining up your next putt, or storing your clubs for the winter think about what enables you to play this game. Without mining, there are no pars, birdies or bogeys.

We know mining provides us with the building blocks essential to society in the 21st century. Our modern communications, transportation, electrical, business, health care and educational systems could not exist without products from mining. But mining is also vital to recreation — fun.

Canada, on a per capita basis, has more golfers than any other country in the world. In Canada, approximately six million people play, or attempt to play, golf on a regular basis. In Ontario, there are 2.3 million golfers, more than any other province. Canadians will play 90 million rounds of golf this year and spend more than $1 billion in green fees alone. Add in clothing, equipment, carts, lessons and refreshments for rehydration and it is multi-billion dollar activity.

Golf is big business in Canada. There are about 2,500 golf courses in the country. Each facility has an average of 31 employees – at least on a seasonal basis. Average annual capital expenditures per course can be in the $250,000 range and operating budgets can be more than $500,000 at each course.

[Timmins] Council approves [Goldcorp] pit plan – by Benjamin Aubé (Timmins Daily Press – November 12, 2012)

November 13, 2012

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – City council unanimously approved the site plan agreement for the Hollinger Project on Monday, giving Goldcorp formal permission to proceed with the open pit mining operation that was first proposed back in 2007.

The decision did come after Bill Hughes, owner of the Senator Place apartments, and Rick Dubeau of the Hollinger Project Community Advisory Committee (HPCAC) expressed concerns they said are still being raised by the public.

Hughes, representing reportedly close to 250 people living at the Senator apartments and other locations within 300 metres of the pit, said that there are still many questions left unanswered about the project, despite the many reports and committees that have raised concerns.

“The plan of action should be to step back, consider what (HPCAC) has said, what I have said, what engineers have said, what environment lawyers have said,” expressed Hughes, when asked what he thought the proper course should be.

He asked, “Are we there or are we not there?”, expressing confusion as to whether any action was being taken despite the city’s comments that the public was being fully engaged in the process.

Canada sees risk in U.S. oil boom – by Shawn McCarthy and Nathan Vanderklippe – (Globe and Mail – November 13, 2012)

November 13, 2012

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.

OTTAWA, CALGARY – The United States is on track to become the world’s biggest oil producer by the end of the decade, a stunning turn of fortune that threatens to stifle the growth prospects of Canada’s oil exporters.

America’s rising oil output is “nothing short of spectacular” and will exceed that of Saudi Arabia or Russia by 2020, the International Energy Agency said in a report that starkly illustrates why the Canadian industry – and the federal and Alberta governments – are determined to build pipelines that would serve Asian markets.

The U.S. currently imports about 10 million barrels per day of crude, and Canada accounts for nearly 30 per cent of that total. But oil companies are using new technologies to extract vast amounts of crude from the U.S. Midwest. The IEA forecasts the Americans will be producing 11.1 million barrels per day by 2020, up from 8.1 million last year.

At the same time, the IEA expects American demand for petroleum products to decline significantly. The double-edged forecast has the potential to cause upheaval in the oil patch in Western Canada, which drew $40-billion in investment last year and is a major driver of economic growth and jobs in the country.

Canada must get its oil to emerging markets – by John Ibbitson (Globe and Mail – November 13, 2012)

November 13, 2012

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.

OTTAWA – Canada may be unique among nations: It possesses a scarce and valuable resource hugely in demand that it’s unable or unwilling to sell, putting the country’s economic future at risk.

This conclusion arises out of World Energy Outlook 2012, published Monday by the Paris-based International Energy Agency. The report projects a radically different energy future from the conventional assumptions that many Canadians still embrace.

“Energy developments in the United States are profound,” the report observes. Hydraulic fracturing and other unconventional forms of extraction, coupled with improving energy efficiency, will make the world’s largest economy also the world’s biggest oil producer by the end of the decade.

Within two decades, the U.S. will be virtually energy self-sufficient and a net oil exporter. The most reliable market for Canadian oil could soon become much less reliable. Even if President Barack Obama does approve the revised Keystone XL pipeline proposal next year, a continued American market for oil sands bitumen is uncertain.