Cutting to one furnace at Copper Cliff – by Staff (Sudbury Northern Life – January 10, 2013)

http://www.northernlife.ca/

Citing volatile market conditions and cost challenges, Vale announced today that it plans to move to a single-furnace operation at its Copper Cliff smelter. The move will have immediate effects on the company’s $2-billion Clean Atmospheric Emissions Reduction (AER) project.

In mid-October, facing weaker metal prices, Vale undertook a comprehensive review of all its projects and operations. The first step, announced Oct. 18, was that operations at its Frood site of the Stobie Mine would be suspended as of the end of the year.

Although 85 jobs were affected by the decision, there were no layoffs. At the time, Vale said it remained committed to the Clean AER project, although it shifted the completion date from late 2015 to 2016.

The goal of the changes, said Base Metals CEO Peter Poppinga, was to “deliver a business model that is simpler, self-funding and self-sustaining.” The Base Metals division could no longer expect to rely on financing from Vale’s larger iron ore business, he said. By the end of this year, the division is expected to fund itself entirely.

Today’s statement said moving to a single furnace at Copper Cliff is the next logical step. Vale does not expect that to happen before the end of 2016.

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Vale Statement About Sudbury Clean AER Project – (January 10, 2013)

In the face of volatile market conditions and operating cost challenges affecting the broader mining sector, work began last year to reinvent the business model for Base Metals through a comprehensive review of all projects and operations. A wide range of opportunities are being explored to drive value in the business.

Changes in our asset footprint, such as the commissioning of our Long Harbour project in Newfoundland, together with decisions to optimize and redistribute the flow of raw materials, have made the move from a two-furnace operation to a single-furnace operation at our Copper Cliff Smelter the next logical step for the business. The current and future mine plans in Ontario do not support a two-furnace operation.

A move to a single furnace is years away, but preparation for this move will mean changes to the Clean AER Project in the immediate future. The outcome of this move to a single furnace, combined with adjustments to the Clean AER Project, will be reductions in annual SO2 emissions more than 50% greater than contemplated in the original Clean AER plan at approximately half the capital investment. This represents a significant investment of $1B in our Ontario operations while reducing sustaining capital requirements by $1B over the next two years.

We do expect that over the next several years there will be fewer jobs in the smelter complex with a change to a single furnace – but given the lead time we will look for ways to minimize any impacts.

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Alcoa results: resilient but not shiny – by Martin Mittelstaedt (Globe and Mail – January 9, 2013)

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.

Alcoa Inc. kicked off the U.S. earnings season with figures that matched profit forecasts but provided little encouragement for those hoping for market-moving gains.

The big aluminum producer reported Tuesday that it made 6 cents (U.S.) a share from continuing operations in the fourth quarter of 2012, equalling analysts’ consensus estimates.

Revenue for the Pittsburgh-based company was $5.9-billion, up 1 per cent from the third quarter 2012, but down 2 per cent compared with the year-earlier fourth quarter. The shares gained about 1 per cent in after-hours trading.

As the first component of the Dow Jones industrial average to report numbers, Alcoa historically has been viewed as a market bellwether – hence the widespread interest in its results.

But some analysts are cautioning investors not to read too much into what Alcoa’s announcement may portend for fourth-quarter profits across the entire U.S. economy. Alcoa is just one company, in a sector – materials – that doesn’t have as much impact on the broader market as it once did.

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Petronas taps TransCanada for pipeline – by Kelly Cryderman and Nathan Vanderklippe (Globe and Mail – January 10, 2013)

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.

CALGARY — Buttressing Canada’s position in the global race to export liquefied natural gas, TransCanada Corp. announced Wednesday that it plans to build a $5-billion pipeline to transport B.C. shale gas to the West Coast and onward to lucrative Asian markets.

The deal will see TransCanada build and operate a link to deliver natural gas to Lelu Island near Prince Rupert where Progress Energy Canada Ltd. – now a subsidiary of Malaysian state-owned firm Petronas – plans to build the massive Pacific Northwest LNG export facility.

The announcement shores up national efforts to catch up and compete with established LNG export projects in Australia and the Middle East, and will help Canada take advantage of strong natural gas prices in Asian markets versus depressed levels in North America.

“It’s a huge opportunity for Canada. But to capture that opportunity, we need to compete on a global basis,” TransCanada’s president and chief executive officer Russ Girling said in an interview Wednesday.

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Barrick to Lead Wave of Gold-Mining Asset Sales in 2013 – by Liezel Hill (Bloomberg Businessweek – January 08, 2013)

http://www.businessweek.com/

Barrick Gold Corp. (ABX) and its global competitors are poised to sell assets this year as the companies seek to reverse two years of share-price declines.

Barrick, the largest producer of the precious metal, held talks to sell its majority stake in African Barrick Gold Plc (ABG), which runs the company’s highest-cost mines, before announcing today the negotiations had ended. CEO Jamie Sokalsky is reviewing the company’s other assets, and Newmont Mining Corp. (NEM), the world’s second-biggest gold miner, and Canada’s Kinross Gold Corp. (K) are among other producers that may sell assets, according to Dahlman Rose & Co.

“Every single one of the companies in this industry is looking for ways to create value, whether it be a spin out, or being taken over, or a restructuring,” David Christensen, who oversees about $450 million as CEO of San Mateo, California- based ASA Ltd., said in a Dec. 11 phone interview.

The possibility of increased sales represents an about-face for an industry that spent $69.7 billion on 410 takeovers and joint ventures in the last five years, as companies competed to boost output and reserves. Now gold miners including Barrick say they’re focused on returns instead of growth after equities lagged behind gains by the metal for the sixth straight year.

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‘Clock starts ticking now’ on First Quantum’s Inmet pursuit by Pav Jordan (Globe and Mail – January 10, 2013)

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.

First Quantum Minerals Ltd. has started the countdown on its $5.1-billion hostile takeover offer for Canadian rival Inmet Mining Corp., taking the bid to create a “top five” copper producer directly to shareholders.

The $72-a-share offer was sweetened twice after Inmet, the owner of the massive Cobre Panama copper project, rebuffed friendly approaches by First Quantum at $62.50 in October and $70 in November.

“The clock starts ticking now, today,” First Quantum president Clive Newall said Wednesday, three weeks after announcing the company’s intention to go hostile.

First Quantum wants to get its hands on Cobre Panama, the $6.2-billion project Inmet is building in Central America, which will be the biggest mine in the region’s history.

The bid is a bet that demand for copper has even further room to grow after a decade of ravenous consumption by No. 1 consumer China that pushed prices to record highs last year of more than $4.50 (U.S.) a pound. On Wednesday, copper was trading at about $3.67 a pound.

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Alberta’s tiny Karnalyte takes on potash’s global giants – by Pav Jordan (Globe and Mail – January 10, 2013)

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.

A small Alberta company is readying a deal with a major Asian partner to help finance a potash mine in Saskatchewan, positioning itself to become one of the first new producers of the crop nutrient in Canada in years.

According to sources familiar with the situation, Karnalyte Resources Inc. is expected to ink a $45-million agreement this week that will see the small Okotoks, Alta.-based company sell a 19.98-per-cent stake for $8.15 a share.

The buyer, believed to be either a Chinese or Indian company, has also committed to a subsequent equity injection of $15-million over the next year or so and will buy potash from Karnalyte at market prices for 20 years once production begins.

The dollars involved in the deal are small, but the significance to the industry is great. The deal underscores the growing push by top consumers India and China to distance themselves from Canada’s Canpotex Ltd. and Russia’s BPC, producer groups that have long controlled most of the world’s supply amid strong profits.

Independent producers such as Karnalyte are banking on that trend and are building mines to sell potash directly into those markets. Similarly, BHP Billiton Ltd., the world’s largest diversified miner, is building a $14-billion potash mine in Saskatchewan called Jansen that will be twice the size of any other currently producing mine.

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Waiting on a business plan [Ontario Northland Transportation Commission] – by Ian Ross (Northern Ontario Business – January 8, 2013)

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.

Ontario Northland Transportation Commission

The unions proposing a plan to transfer ownership of the Ontario Northland Transportation Commission (ONTC) to a new operating ‘port authority’ must submit a business plan to participate in the province’s divestment process, said a ministry spokeswoman.

Laura Blondeau said the ‘New Deal’ group must submit a qualified proposal of its capabilities to Infrastructure Ontario, something the government has yet to see, as of early December.

Blondeau said that was the message sent in an Oct. 31 meeting between Northern Development and Mines Minister Rick Bartolucci and Roy Hains, CEO of a proposed entity called the James Bay & Lowlands Ports Trustee Corp.

The ‘New Deal’ group is spearheaded by the General Chairperson’s Association, representing unionized employees at the Ontario Northland Transportation Commission (ONTC). Its ambitious plan is to transfer the ONTC’s assets, including the railroad, to a ‘port authority’ available under the Canada Marine Act.

The James Bay & Lowlands Ports Trustee Corp. proposal has been endorsed by KWG Resources, a chromite junior miner in the Ring of Fire, and Nipissing-Timiskaming MP Jay Aspin.

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Southern Ontario overlooks Northern Ontario at its peril – by Bruce Stewart (Troy Media – January 8, 2013)

http://www.troymedia.com/

Troy Media Syndicated Columnist Bruce Stewart is a management consultant located in Toronto.

TORONTO, ON, Jan. 8, 2013/ Troy Media/ – Most of Ontario’s landmass is in the north; most of its people are in the south. Northern Ontarians often find this frustrating. Southern Ontarians seldom think about the north at all.

There isn’t even agreement as to where “Northern Ontario” begins. Some people argue that anywhere the Canadian Shield can be seen should be thought of as “The North”. Others hold to a particular set of municipalities, or the dividing line of a highway (typically, Highway 17 as it goes from North Bay westward to Sault-Ste-Marie).

Ask people in Toronto what they know about Northern Ontario. You will get answers like “they’ve got lots of mines, don’t they?”, “isn’t that mostly logging country?”, “isn’t that mostly Indian reserves?” – and most commonly “gee, I dunno”.

Northern Ontario, to me (along with many others), has mostly been a fly-over experience. Half of the time spent flying from Toronto to Vancouver is spent getting out of Ontario – and all but the first 20 to 30 minutes are spent flying over “the North”.

From the air, it appears to be what the Kingston, Ontario musical comedy trio the Arrogant Worms sing about in their eponymous song: “We’ve got rocks and trees, and trees and rocks . . . and water.”

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Excerpt from “The History of Mining: The events, technology and people involved in the industry that forged the modern world” – by Michael Coulson

To order a copy of The History of Mining please click here:http://www.harriman-house.com/products/books/23161/business/Michael-Coulson/The-History-of-Mining/

HOW THE PROSPECTORS GOT TO CALIFORNIA

The experience of those taking part in the California Rush was easier than the privations that would be experienced by those making it to the Klondike in that later rush. However, getting to the Californian gold fields was no picnic. Whilst today there are many road and rail routes across and through the great Sierra Mountains into the Pacific USA, in the 19th century the overland crossing from the eastern and central states into California was fraught with danger.

The other routes used were sea routes, first the long voyage down to the tip of South America, round Cape Horn and up to San Francisco, before the relatively short land journey south to the gold fields. The time this route took and the considerable dangers posed by the huge storms that often blew around Cape Horn led to a third route being established, sailing to the Panama Isthmus and then going by land to the Pacific side to board ships to San Francisco at the Gulf of Panama. Whilst this latter route was obviously faster than the Cape Horn route it was not without danger as Panama’s climate harboured diseases such as malaria and yellow fever, which led to many fatalities amongst the travellers.

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Project Focus: Ring of Fire – by John Chadwick (International Mining – January 2013)

http://www.im-mining.com/

There is a very exciting new mining camp developing in Canada, John Chadwick reports

According to the Ontario Government, “The Ring of Fire is one of the most promising mineral development opportunities in
Ontario in almost a century. Located in Ontario’s Far North, current estimates suggest the multigenerational potential of chromite production,as well as significant production of nickel, copper and platinum.”

The projects will open up economic opportunities in an extremely remote and undeveloped area, an 80 km by 100 km swath of
muskeg, especially for local First Nations communities. Any new infrastructure (community, social, etc.) will further benefitlocal communities. The region will require significant investment in mine and processing infrastructure, the construction and operation of transportation infrastructure and the provision of energy. Rail and all-weather road options are currently being assessed for the transportation corridor.

The exploration and prospecting involves some 16,400 claim units, covering an area of 2,630 km2, with 21 companies currently holding claims in the Ring of Fire belt. The area of most intense exploration is about 20 km long running northeast from Noront’s Eagle 2 prospect to Spider-KWG’s McFauld’s #2. Discoveries include chromite, nickel, copper, zinc, gold and kimberlite.

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Anglo American: The house that Oppenheimers built, now led by Mark Cutifani – by J Brooks Spector (The Daily Maverick – January 10, 2013)

http://dailymaverick.co.za/

Late last year, the Daily Maverick described the giant company’s travails in its story, “Anglo American: A giant corporation between a big rock and a very hard place”, and this week Anglo’s board took its decision to end the uncertainty about its new leadership.

For decades, Anglo was South Africa’s pre-eminent industrial and mining enterprise. At one point more than half the value of listed shares on the JSE were Anglo American-controlled enterprises. After the end of Apartheid’s isolation, Anglo began to spin off many of its enterprises that were not part of its core focus on mining. In 1999, Anglo changed its primary listing from the JSE to London. More recently still, Anglo American spun its gold mining interests into a separate corporation that merged with Ghanaian mining interests into AngloGold Ashanti – the same company Cutifani now heads.

Overall, reaction to Cutifani’s selection, so far at least, is generally optimistic. Many analysts are saying plainly Cutifani is probably the best person around for this job, based both on his broad international mining experience and his knowledge of South Africa’s specific social-political-economic circumstances. There are doubters, of course. The National Union of Mineworkers (NUM) was publicly disappointed that Anglo’s board couldn’t find a single black or female South African to head the multinational.

A deeper, and so-far unanswered, question is why, given the government’s obvious interest in, and the company’s frequently expressed support for, South Africa’s economic transformation, there seems to have been no visible, organised process for grooming a local, black successor generation for Anglo’s top management spots.

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Demolition planned for Shania centre [for gold mine] – by Ron Grech (Timmins Daily Press – January 9, 2013)

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – The Shania Twain Centre and Underground Gold Mine Tour will be history in more ways than one if Goldcorp Canada completes a deal to purchase the land where those attractions are located.

“If an agreement can be reached, our plans are to demolish both,” Domenic Rizzuto, manager of human resources and corporate social responsibility for Goldcorp’s Porcupine Gold Mines, told The Daily Press.

Goldcorp’s interest in the property comes at a time when the company is developing an open pit mine in an area pocked by subsidances from the old Hollinger mine workings.

The original proposed layout of the open pit saw the exterior wall or berm curving around the property where the Twain centre and mine tour site are located. If the land sale goes through, there will be less need for Goldcorp to prevent the berm from encroaching in that area. “Goldcorp is in discussions with the city to purchase the Shania Twain Centre and Gold Mine Tour because there is an economic case to so,” said Rizzuto.

Timmins council announced on Monday the city was close to finalizing an agreement to sell the Twain centre and mine tour property to Goldcorp.

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Growth golden at Brigus projects – by Kyle Gennings (Timmins Daily Press – January 9, 2013)

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – The coming year holds the promise of further expansion for Brigus Gold operations in the Black-River Matheson area. The Black Fox mine is slated to expand production while the Grey Fox mine will continue operational prep for full production in 2015.

For Brigus CEO Wade Dawe, 2013 will be yet another landmark year in growth for the mid-level operation, one that will see the residents of Timmins benefit.

“In 2012 we made great progress, we built the underground portion of the mine (Black Fox) and that is wrapping up very well,” he said. “We are on track to increase production in 2013 to between 90,000 and 100,000 ounces compared to the 77,347 ounces in 2012.”

This increase will continue to lay the ground work needed to allow Brigus to focus on further expansion of the Grey Fox operations. Dawe said that 2013 should be a stable year.

“Right now, we have approximately 377 employees at the Black Fox mine,” he said. “In 2013 our employment numbers will be reasonably stable. We may add up to 5% of additional personnel, although we are essentially stable in 2013.” Operations will ramp up even further in 2014.

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