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Day: March 15, 2013

Vale $15 Billion Tax Verdict Seen Fueling Gain: Corporate Brazil – by Juan Pablo Spinetto, Raymond Colitt & Ney Hayashi (Bloomberg.com – March 15, 2013)

http://www.bloomberg.com/

Vale SA (VALE5) investors stand to benefit as a decade-long court battle over $15 billion in back taxes that’s been weighing on the miner’s stock nears an end.

The Supreme Court is set to rule by June on a similar case brought by Coamo Agroindustrial Cooperativa, a farming group from the southern state of Parana that’s suing tax authorities to avoid levies on profits from foreign units. A ruling in favor of the group would be in line with the legislation of most other countries, according to Peixoto & Cury Advogados, a legal firm that specializes in corporate law, including tax issues.

The case is being watched as a benchmark for Brazil’s biggest exporters — from Vale to beermaker Cia. de Bebidas das Americas to steelmaker Gerdau SA (GGBR4) — who are fighting a combined $44 billion in tax claims. A win would be a boon for Vale because investors have already priced in much of the tax losses, said Empiricus Research’s Roberto Altenhofen.

“The market is overreacting a bit about the chances of Vale having to pay all the taxes that are being claimed,” the analyst at the Sao Paulo-based consulting firm said in a phone interview. “It’s almost impossible to predict the outcome of this trial, but what we can say is that Vale seems to be willing to negotiate with tax authorities so a deal can be reached. Vale may end up paying something, but not the full amount.”

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Stepping stone: Aboriginal mining training program provides skill, confidence – by Ian Ross (Northern Ontario Business – March 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.

An Aboriginal training program in northwestern Ontario is making strides to address a looming labour shortfall in the mining industry.

Optimism is peaking in the region that there will be a cluster of major mining camps developing over the next 10 years, but in the Thunder Bay area alone, the mining industry will require between 1,110 and 4,150 workers. Where those workers will come from is anyone’s guess.

One possible source for underground workers is from the Mining Essentials program being run through the Anishinabek Employment and Training Services (AETS) in Thunder Bay.

Mining Essentials is the only work readiness training program for Aboriginal people in Canada.  It was developed in concert with the Assembly of First Nations and the Mining Industry Human Resources Council (MiHR), with curriculum input from educators and industry.

“Mining Essentials is a stepping stone to get entry level jobs,” said John DeGiacomo, the proposal and partnership development officer with AETS.

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Barrick gold shipment detained by Dominican Republic – by Reuters (Globe and Mail – March 14, 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.

Barrick Gold Corp., the world’s largest gold miner, said on Thursday that a shipment of gold from its Pueblo Viejo mine in the Dominican Republic had been detained by customs officials in the Caribbean nation.

The delay comes just weeks after Dominican President Danilo Medina demanded that the company renegotiate its operating contract for the rich gold mine and threatened to clamp a windfall tax on profits if the contract was not modified.

Toronto-based Barrick said in a statement it was investigating the cause of the delay and seeking confirmation that the shipment can resume. It gave no further details. Fernando Fernandez, director of customs in the Dominican Republic, said the shipment was halted because of a problem with documentation.

“When it is resolved, the shipment will go out,” he told reporters. Pueblo Viejo, one of world’s largest new gold projects, is jointly owned by Barrick and Canada’s second largest gold miner, Goldcorp Inc.

On Feb. 27, in a speech marking the 169th anniversary of the Dominican Republic’s independence, Mr. Medina said the terms of the contract with the two Canadian miners were unacceptable and demanded more benefits from the mine.

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In conversation with Barrick CEO Jamie Sokalsky – (Beyond Borders – January 29, 2013)

Click Here For: Barrick Gold Beyond Borders

After serving as Barrick’s Chief Financial Officer for more than 13 years, Jamie Sokalsky was appointed President and CEO in June 2012. He quickly set the company on a new course that stresses disciplined capital allocation. At the same time, he has indicated Barrick remains steadfast in its commitment to corporate social responsibility (CSR) and sharing the benefits of mining with host communities. In a wide-ranging interview, Sokalsky talked about his new role and CSR at Barrick.

How are you enjoying your new role as CEO?

Very much. I’m proud to be the CEO of a company that’s an icon in Canada and a world leader in its industry. I’ve been with this company a long time and I know what great assets, people, and opportunities we have. Our goal is to set the bar in terms of responsible mining, where we consistently hit our financial targets while operating in a way that provides benefits to the communities where we operate. It’s exciting, and we have a great future head of us.

You have been with Barrick since its early days. In your view, is it the same company today?

I think the fundamental values of the company are very similar, even though we have grown and evolved and are a much more global company today. The ethics of the company — and the desire for people to conduct themselves with honesty and integrity — have always been there. I’d say the desire to do things the right way has been in Barrick’s DNA since the founding of the company by Peter Munk. Those fundamental core values remain the same.

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Hindalco, Vedanta in race to buy Rio Tinto’s Iron Ore Company – by Dev Chatterjee (Business Standard – March 15, 2013)

http://www.business-standard.com/home-page

Rio Tinto is selling the Canada-based company to reduce its debt

Mumbai – Two of India’s biggest conglomerates, Hindalco, owned by Aditya Birla Group and Vedanta of Anil Agarwal are in race to buy Rio Tinto’s Iron Ore Company based in Canada, bankers say. Apart from these two Indian conglomerates, metal companies from across the world are in the race to buy the company which is valued at close to $1.7 billion.

Bankers said both groups are interested in the company which has iron ore reserves in Canada and a railway line to transport the ore. At present initial talks are on, a banker said. In January, billionaire L N Mittal sold off his 15% stake in several iron ore mines to South Korea’s Posco for $1.1 billion. Rio Tinto has hired Credit Suisse and Canadian Imperial Bank to sell its 59% stake. Rio Tinto is selling the company to reduce its debt.

In an interview to this newspaper, Vedanta Chairman Anil Agarwal had said the group is actively looking at iron ore, oil and gas and coal reserves all over the world. “We want Sesa Sterlite to be as big as Rio Tinto and we will buy energy resources including coal and iron ore reserves wherever we get the right opportunities and valuation,” he had said. Agarwal had not hinted at any specific target but said they are open to all opportunities.

When contacted, a top official of Vedanta group said today they have not made any bid for Iron Ore Company. A Birla spokesperson refused to comment on “market speculation.”

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Iron ore at 3-month lows, headed for worst week since 2011 – by Manolo Serapio Jr. (Reuters India – March 15, 2013)

http://in.reuters.com/

SINGAPORE, March 15 (Reuters) – Iron ore sank to its weakest in three months and was headed for its biggest weekly loss since October 2011, hurt by a drop in buying interest from top importer China amid poor steel demand.

Iron ore, the main steelmaking raw material, has shed more than 10 percent this week given a steel surplus in China that confounded market hopes for a pickup in demand from March.

But a sharp rebound in Shanghai steel rebar futures on Friday, which tracked gains in equities, may help stabilise the
iron ore market.

Chinese mills produced crude steel at a record rate of 2.2 million tonnes a day in February in anticipation of a pickup in construction, which accounts for half of the country’s steel demand, from this month.

But record stockpiles of steel products pointed to slow demand. Inventory of steel products held by traders in China reached a record 22.3 million tonnes as of March 8, with long steel products accounting for about 14.1 million tonnes, according to industry consultancy Mysteel.com.

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The meek shall inherit the earth, but not its mineral rights: Meet mining’s 40 richest billionaires – by Frik Els (Mining.com – April 16, 2012)

http://www.mining.com/

MINING.com counts more than 90 billionaires involved in minerals, metals and mining on the planet with a combined wealth of well over $300 billion.

2012 Mining Billionaires: #1 Eike Batista

Brazil’s Eike Batista is the world of mining’s top entrepreneur with a net worth of $32 billion.

2012 Mining Billionaires: #2 Gina Rinehart

Australia’s ruler of iron ore, coal and the family trust

2012 Mining Billionaires: #3 Lakshmi Mittal

Mining’s biggest loser Lakshmi Mittal is down to his last $17 billion

2012 Mining Billionaires: #4 Iris Fontbona

Chile’s copper widow Iris Fontbona

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Canada set to make hostile takeovers much tougher – by by Euan Rocha (Reuters Canada – March 14, 2013)

http://ca.reuters.com/

TORONTO (Reuters) – Canadian regulators unveiled proposals on Thursday on the use of poison pills as a takeover defense, introducing new guidelines that will make hostile corporate takeovers a lot harder.

Two sets of proposals, laid out by the umbrella group for provincial securities regulators, aim to bring more coherence to Canada’s regulatory regime after conflicting rulings by individual provincial regulators on the “poison pills”, which companies use to fend off unwanted suitors.

The plans will curb drastically the ability of regulators to overturn a poison pill, and give companies more ammunition to fight hostile bids through the use of the defensive maneuver.

Poison pills, or shareholder rights plans, effectively raise the price of a hostile bid by giving existing shareholders, excluding the hostile bidder, the right to buy more stock in the target company at a discount.

Canadian provincial securities regulators typically quash these pills within two months, giving companies only a narrow window to look for an alternative proposal to the hostile bid.

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Brazil, China, India getting healthier, wealthier while we decline: UN report – by Olivia Ward (Toronto Star – March 15, 2013)

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.

Move over, Canada — and France, Germany, Italy, Britain and the United States.

A new United Nations Development Program report, “The Rise of the South: Human Progress in a Diverse World,” says the “global North” is losing the race with its economic competitors in the rising South at a head-spinning rate.

“For the first time in 150 years, the combined output of the developing world’s three leading economies — Brazil, China and India — is about equal to the combined GDP of the long-standing industrial powers of the North,” says the report, released Thursday. “This represents a dramatic rebalancing of global economic power.”

Canada itself has slipped from 10th to 11th place in the 2013 human development index: a composite of health, education and income figures. Although its overall performance has improved steadily since 1980, its progress in education slowed, and it was outpaced by Japan and Australia.

The top five ratings went to Norway, Australia, the U.S., Netherlands and New Zealand. When gender inequality is factored in, Canada drops to 18th place and the U.S. plummets to 42nd. Netherlands, Sweden and Switzerland have the smallest male-female gaps in health, empowerment and labour market figures. With society-wide inequality accounted for, Canada ranks 13th.

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Obama will block Keystone – by Lawrence Solomon (National Post – March 15, 2013)

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

Not needed for U.S. energy security or employment

Many are surprised that President Barack Obama has not yet approved construction of the Keystone XL pipeline, creating thousands of jobs while reducing America’s dependence on Middle East oil. His reluctance shouldn’t be surprising — no single act that he could take would more undermine his vision for America or his desired legacy as a transformational ­leader.

To a Republican, Keystone would be a solid accomplishment in what otherwise seems a failed presidency. But to a Democrat — and especially to America’s top Democrat — the Obama presidency is on track to achieve momentous accomplishments. Here are the goals Obama announced for his presidency on the night of June 3, 2008, upon winning enough delegates to secure the Democratic nomination for president:

“If we are willing to work for it, and fight for it, and believe in it, then I am absolutely certain that generations from now, we will be able to look back and tell our children that this was the moment when we began to provide care for the sick and good jobs to the jobless. This was the moment when the rise of the oceans began to slow and our planet began to heal. This was the moment when we ended a war and secured our nation and restored our image as the last, best hope on Earth.”

Obama made good on his health-care pledge. The unemployment rate has finally begun to drop. He is making good on ending a war. The one major pledge that remains to be met is climate change, in some ways the most profound because it affects the planet and is the most consequential to his legacy — it would secure his reputation as a transformative figure outside the country as well as within.

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Quebec must exploit its resources – by Yves-Thomas Dorval (National Post – March 15, 2013)

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

Yves-Thomas Dorval is ­president of the Quebec Employers Council.

There are no human activities without risk

Yves-François Blanchet, Quebec’s minister of sustainable development, environment, wildlife and parks, recently announced a bill to formalize a moratorium on shale gas exploration and exploitation in the province of Quebec.

In doing so, he was honouring a promise made by his party during the last election campaign. But he was also heading toward a troubling tendency that has taken root in Québec and which is aimed at suspending, contesting or prohibiting any economic development endeavour, until there is absolute proof such development contains not even the slightest risk.

This same phenomenon is noted in the issue of oil and gas exploration in the town of Gaspé and, soon, in the Îles-de-la-Madeleine, as well as in the Plan Nord development, Enbridge’s Line 9 reversal, and in many other instances.

But are there any human activities that are absolutely risk-free? Shouldn’t we be striving, instead, to responsibly and sensibly exploit to their full potential these enormous natural resources which Québec has, after ensuring this activity can be safely done according to standards applied worldwide, and properly addressing the concerns expressed by the people who are directly affected? Why turn our back on wealth and prosperity any longer?

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Through pristine Jasper Park, Kinder Morgan goes full-speed on Trans Mountain pipeline expansion – by Jeff Lewis (National Post – March 15, 2013)

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

JASPER, Alta. – The smell of crude oil lingers as Rob Scott eases his pickup truck into a pump station and stops next to a tangle of white pipelines and valves jutting from the ground.

On the eastern edge of Jasper National Park in Hinton, Alta., the aroma serves as a pungent reminder of the hidden pipeline network that cuts through the surrounding evergreen forest here, under glacier-fed rivers, around wetlands and over two mountain ranges en route to Canada’s West Coast.

The pump station, located about 300 kilometres west of Edmonton, offers a final glimpse of a 36-inch jumbo pipeline — the same diameter as TransCanada Corp.’s controversial Keystone XL project — that passes unseen through Jasper, a UNESCO World Heritage site, and Mount Robson Provincial Park to Rearguard, B.C. Built over a two-year window beginning in 2006, the so-called Anchor Loop is now the linchpin of a $5.4-billion expansion proposed by Kinder Morgan Canada Inc. to its half-century-old Trans Mountain pipeline system, Canada’s lone oil outlet to the Pacific.

“Most people don’t even know there’s a pipeline there,” said Mr. Scott, an operations liaison with Kinder Morgan, pointing out of his truck window to a grassy ditch beside the highway. “In fact, when we were originally looking to expand, lots of people didn’t even realize there was an existing pipeline running through the park to the coast.”

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Ontario Mining Association Teachers mining tour doubles in capacity for 2013

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.

For the past three summers, the Ontario Mining Association has been involved in a week-long educational program called the Teachers’ Mining Tour. This year, the program is being held twice, which doubles the number of teachers to 60 who will gain a first-hand glimpse of modern mining in Ontario.

The programs are being held at the Canadian Ecology Centre, near Mattawa. Thirty teachers from across the province will participate in each of the educational workshops being held July 29 to August 2 and from August 19 to 23, 2013.

“Seeing is believing and this fully sponsored professional development opportunity presents informed choices for educators,” said Bill Steer, General Manager of the Canadian Ecology Centre. “The Teachers’ Mining Tour is an opportunity to bring modern mining into the classroom curricula.”

Lesley Hymers, OMA Environment and Education Specialist, will be supporting the program and making presentations throughout both weeks on OMA education and outreach initiatives. These include the OMA’s high school video competition So You Think You Know Mining and the OMA’s collaborative activities with Skills Canada Ontario, which promotes trades and technologies as career options for students and other organizations.

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State intervention risking return of 70s-type resource sterilisation – by Martin Creamer (MiningWeekly.com – March 14, 2013)

http://www.miningweekly.com/page/americas-home

JOHANNESBURG (miningweekly.com) – Current African policies intended to capture a greater share of the resource rent through increased State intervention run the risk of bringing back the resource sterilisation of the 1970s, mining risk analysis company Eunomix warns.

The resource sterilisation risk, says the company, which specialises in de-risking resources and commodities projects in Africa – a destination of ever greater global strategic value – is already becoming evident in many countries facing mining disinvestment.

Headed by MD Claude Baissac, Eunomix has just completed a major study on African economic advancement through resource development.

Based on World Bank data, the study analyses the role of mining and oil and gas in Africa’s economic growth between 1970 and 2010 and tracks the relationship between economic growth, resource rent and commodity prices.

It says that Africa’s post-2000 “boom” was rooted in the private sector-friendly policies implemented in the 1990s and that, as in the era of 1970s sterilisation, the current rent-seeking State intervention is arriving post-super-cycle, and is as likely to produce the opposite of its intended effects.

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[Sudbury labour activist] Homer still battling – by Carol Mulligan (Sudbury Star – March 15, 2013)

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

Homer Seguin has fought formidable opponents before — governments reluctant to enact legislation to protect workers, companies unconcerned about the health and safety of employees, union members vying for the same job.

Seguin, 80, has a new enemy — lung cancer — a disease he believes is related to the 6 1/2 months he worked at Inco’s notorious Copper Cliff sintering plant more than 60 years ago.

A former president of United Steelworkers Local 6500 and USW staff representative, Seguin is best known for fighting for safer workplaces and recognition that diseases like the cancer and chronic pulmonary obstructive disease he suffers are often caused by where people work.

Seguin has been in hospital for six weeks, mostly because of complications relating to dialysis. His health is so poor he isn’t able to undergo surgery, or have chemotherapy or radiation treatment for the two tumours lodged in his lungs.

But he’s determined to recover and get back to championing his latest cause — convincing the provincial govern-m ent to set a standard for nickel and other heavy metals dust in homes.

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