The Canadian Mining Journal is Canada’s first mining publication providing information on Canadian mining and exploration trends, technologies, operations, and industry events.
Now that the “Annual Report” season is almost over and shareholders are wondering “What the hell happened?” it’s time to look forward and talk about the Canadian mining industry in general and why it’s still a good place to invest.
First of all, as we all know, mining has always been subject to a good beating every once in a while and so far this year, many com¬panies (especially those involved with gold) have been literally pummeled into submission.
Historically, many companies suc¬cumb to the harsh blows of falling prices and rising costs while others, thankfully, dust themselves off and regroup by tak¬ing a serious look at what went wrong.
In many cases, getting ‘punched out’ of the business is the result of something that’s beyond control and unfortunately, it’s something that’s becoming far too common for mining companies.
Losing a fight because of poor planning and incompetent management is one thing, but to be counted out because of dirty tac¬tics is criminal and that’s what I think is partly to blame for more and more compa¬nies going broke.
Never in recent memory have there been so many mining companies forced to walk away from their projects because of cost over¬runs, or even more concerning, because of governments or other local authorities chang¬ing the rules mid-way through the game.
Call it ‘cheating,’ or whatever else you want, but it’s a helpless situation that is taking its toll both on mining companies but moreover, on shareholders who are also losing faith because they feel they’re being robbed of their investments.
As you all know, mining projects don’t happen over night but what’s most disturb¬ing lately is that they can go dark in a minute thanks to the simple flip of a political switch.
Too many governments, particularly in countries where most of the world’s abun¬dant minerals are found, are getting away with hostage-like behaviour once they see what Canadian technology can achieve.
Like I said earlier, it’s almost criminal what some countries are getting away with when it comes to permitting and royalties but moreover, the blatant theft of minerals and their right of ownership.
Rarely do I mention projects and coun¬tries specifically, but I’ll make the exception with Barrick Gold’s Pascua-Lama project on the Chile-Argentina border because I think it serves as a perfect example of what I’m saying about ‘disgraceful.’
I know many people have mixed feelings about Barrick Gold because of some of the issues the company has been accused of in the past, but regardless of what is fact or fiction, there’s no question (in my mind at least) that the world’s largest gold producer is being screwed because of a Chilean court-ordered work stoppage at the mine. And now they’re being fined!
Talk about shooting itself in the foot. As we all know, Chile has deep roots in mining and for it to upset a key player like Barrick is ludicrous.
I know that working in someone else’s backyard has always been a bit of a risky venture because like it or not, greed and sometimes hostility seem to almost always creep into agreements once pro¬duction gets underway.
It’s a basic trait of human nature to resent the prosperity of others and as selfish as that may be, it’s becoming increasingly obvious that foreign owners don’t like strangers coming in and taking their stuff.
Sure they like the idea of foreigners com¬ing in and investing millions to help improve the living conditions for those in the com¬munities where the deposits are found, but the truth of the matter is that many of the people living in those communities don’t even know what’s going on other than their quality of life (in many cases) has improved since the miners arrived.
I wonder what they’ll think when the miners leave and things start to fall apart? Perhaps their government will have a phony excuse for that too!