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Day: July 17, 2014

UPDATE 3-Indonesia threatens to take over Newmont mine if output stays shut – by Wilda Asmarini and Fergus Jensen (Reuters India – July 18, 2014)

http://in.reuters.com/

JAKARTA, July 17 (Reuters) – Newmont Mining Corp risks its Indonesian mining licence being taken over by a state-owned firm if the U.S. miner does not resume copper production, the Southeast Asian nation warned, escalating a six-month dispute over export rules.

The move represents a hardening of the stance of Indonesia’s outgoing government. The mining ministry earlier this week said it could terminate Newmont’s mining contract in response to the miner stopping production and filing legal arbitration over the export rules.

The developments mark the latest twist in the dispute between Indonesia and U.S. miners Newmont and Freeport-McMoRan Inc that has led to a halt in copper concentrate shipments from Southeast Asia’s biggest economy.

Indonesia plans to soon send a letter to Newmont saying that the company has defaulted on its contract, said Sukhyar, director general of coal and minerals at the mining ministry. “The default is due to the stopping of production, so we can say they are negligent,” Sukhyar told reporters on Thursday.

A Newmont spokesman did not comment on the risk of the company losing its mining licence at its Batu Hijau copper mine but said in an email that the company is eager to resume production as soon as the government issues it an export permit.

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Program trains Aboriginal women in mining – by Lindsay Kelly (Northern Ontario Business – July 16, 2014)

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. 

Her official title is job coach, but in her role with the Temiskaming Native Women’s Support Group, Kelly Lamontagne can, on any given day, also serve as a social worker, mover, relationship guru, personal shopper, addictions counsellor, cheerleader and headhunter.

It’s all done in the name of helping Aboriginal women in Temiskaming and Timmins train for work in the mining industry through the two-year program Aboriginal Women in Mining.

“The group’s purpose is to help as many women as we can,” Lamontagne said. “If you’re making strong women who can make strong decisions and have a good career and have good self-esteem, you’re then making stronger children, stronger families, better men.”

Any woman with First Nations, Métis or Inuit heritage within the catchment area is eligible to apply to the program, although it’s targeted primarily to women who have faced serious life challenges such as trauma, poverty or addictions.

Participants start by developing life skills and move into job training, which includes job interview techniques, resume writing and setting up partnerships with employers.

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Barrick Gold CEO Jamie Sokalsky steps down, replaced by co-presidents – by Lisa Wright (Toronto Star – July 17, 2014)

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.

Management shakeup puts new board chairman John Thornton’s stamp on miner following recent departure of company founder Peter Munk.Management shakeup puts new board chairman John Thornton’s stamp on miner following recent departure of company founder Peter Munk

After two years spent overhauling ailing Barrick Gold Corp., president and CEO Jamie Sokalsky will step down in September as part of sweeping changes to the miner’s management structure.

The announcement Wednesday that two co-presidents will soon share the helm comes just 10 weeks after the departure of Barrick founder Peter Munk, and is clearly new board chairman John Thornton’s first big stamp on the leadership of the world’s biggest gold miner, analysts say.

“He was brought in to bring change, and he’s bringing change,” said John Ing, president of Maison Placements Canada.
Eliminating the role of CEO may also leave the door open for the resumption of merger talks with Newmont Mining Corp., Barrick’s biggest rival, said TD Securities mining analyst Greg Barnes in a note to clients.

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Barrick shakeup signals more changes ahead – by Ian McGugan (Globe and Mail – July 17, 2014)

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.

The unusual new management structure at Barrick Gold Corp. signals two things – that John Thornton is now clearly in command of the world’s largest gold miner, and that more changes lie ahead.

The company announced Wednesday that president and CEO Jamie Sokalsky will be resigning in September, after only two years in the post. He was a favourite of company founder Peter Munk and his departure suggests that Mr. Thornton, who was named chairman only three months ago, is eager to put his own stamp on the company.

The question is precisely what form that stamp will take. One possibility is that Barrick will attempt to reopen merger talks with Newmont Mining Corp. of Colorado. Discussions between the two mining giants blew up in April, with both sides slinging accusations at each other.

Another possibility is that Barrick will strike a deal in China, a country where Mr. Thornton has extensive contacts from his days as chairman of Goldman Sachs Asia and as a business professor at Tsinghua University in Beijing.

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Congo copper output growth to slow in 2014 -mining chamber- by Peter Jones (Reuters India – July 17, 2014)

http://in.reuters.com/

Kinshasa – (Reuters) – Growth in copper production in Democratic Republic of Congo will slow in 2014 from its rapid pace the previous year due to insufficient energy supply and uncertainty over new mining laws, Congo’s mining chamber said.

Copper production leapt to a record 914,631 tonnes last year from 620,000 tonnes in 2012 as new mining projects and expansion plans came online.

In a report on the first quarter of this year, the mining chamber predicted that copper output in 2014 would inch up to 922,000 tonnes, annual growth of just 0.82 percent compared with the 47 percent leap the year before.

“(Congo) still has the potential to produce over a million tonnes in 2014 and even more in following years, if it controls the parameters that influence investment, notably electricity supply and the revision of the mining code,” the report said.

The mining sector helped drive economic growth of 8.5 percent in Congo in 2013, which is forecast to rise further to 8.7 percent this year.

Congo possesses enormous reserves of gold, diamonds, copper, cobalt and tin, but the majority of its 65 million people live in poverty due to corruption, mismanagement and war.

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Toronto’s unique financing role: Accessing creative forms of financing in a cash-constrained environment – by Angela Harmantas and Irina Negoita (Global Business Reports – July 2014)

http://gbroundup.com/

Toronto may be the global epicenter of mining finance, but even Canadian investors – long lauded for their knowledge of the risks associated with the mining industry – have grown wary of investing in the sector. Mining companies have been amongst the worst performers on the Toronto Stock Exchange (TSX) and the Toronto Venture Exchange (TSX-V). For the first time in many years, the first quarter of 2013 did not feature a single mining IPO.

With fewer companies listed and less capital raised, the TMX Group, owner of the TSX and TSX-V, decided to utilize its global reach to access investors outside of Toronto. The Group recently signed an agreement with the Santiago Stock Exchange to create a new venture exchange in Chile that allows TSX-V listed companies to list on its Latin American counterpart and tap into the investor base in South America.

“Our unique two-tier exchange system is at the core of our value proposition and differentiates us from other markets. In Santiago’s case, both the government and the exchange really liked the two-tier model. Many of our Canadian issuers are doing business in Latin America and it seemed like a natural extension of our capabilities for us to be involved,” explained Kevan Cowan, president, TSX Markets and group head of equities.

Closer to home, the TSX eased its rules to allow companies to raise capital at less than $0.05 a share, while the federal government extended mineral exploration tax credit for another year. However, according to Denis Frawley, partner at Ormston List Frawley LLP, these measures are not enough to tackle the funding issue. “The industry expected the tax credit to be extended due to the current financial situations, and the pricing policy has not led to a strong influx of capital on the TSX,” he said.

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Sudbury Basin largely unexplored: geologist – by Jonathan Migneault (Sudbury Northern Life – July 16, 2014)

http://www.northernlife.ca/

But Sudbury’s mining outlook positive with new projects on horizon

Despite occupying one of the most mineral-rich areas of the world, large swaths of the Sudbury Basin have remained unexplored.

Dan Farrow, the Sudbury District geologist with the Ontario Geological Survey, said Vale and Glencore hold a large number of patented mineral claims, for tracts of land in the Sudbury Basin only they can explore.

Because both companies have a number of productive mines in the region, they haven’t yet bothered to explore many of those regions. The patented claims – which lease mineral rights to the companies in question – are in an area geologists refer to as the eruptive.

Researchers estimate a meteor made impact more than 2 billion years ago with what is now the Sudbury Basin. The impact left a crater 200 kilometres in diameter, and brought molten magma beneath the Earth’s crust to surface.

The prevailing theory, said Farrow, is that the magma was rich in minerals, such as nickel and copper. When it hardened, it formed the mineral deposits that have defined the Sudbury Basin.

Sudbury’s mining giants Inco and Falconbridge – and later Vale and Glencore, respectively – jumped on rich contact deposits of solid ore. “That’s what Inco and Falconbridge mined for years because it was so easy,” Farrow said.

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Liberal paralysis leaves Ontario native band powerless – by Martin Reg Cohn (Toronto Star – July 17, 2014)

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.

It’s a historic tale of politicians ducking for cover while their bureaucrats create new barriers. And a premier who lets them get away with it.

Ever since becoming premier, Kathleen Wynne has opened every speech with traditional aboriginal words of welcome: “Ahnee. Boojoo.” This month, she added a few key words in English — promising new “opportunities for aboriginal peoples” built on “respect and partnership.”

For all her talk of empowerment, however, real power — electrical and economic — remains out of reach for one of Ontario’s most forsaken native bands.

That’s because Wynne’s Liberals have quietly snuffed out a promising hydroelectric project, bankrolled by a Toronto philanthropist, that could generate clean power and economic opportunity for the isolated Lac La Croix reserve perched along the Minnesota border.

The story of the band’s plight, and promise, is a morality tale of cascading betrayals. Unless someone in the Wynne government finds the courage to rewrite the final chapter, it will have an unhappy ending.

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Commentary: What does Aboriginal title mean for mining in BC? – by Robin Junger and Brent Ryan (Northern Miner – July 15, 2014)

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry.

Based in Vancouver, Robin M. Junger is co-chair of McMillan LLP’s aborginal and environmental practices, and co-chair of its oil and gas practice in B.C. Brent Ryan is a student-at-law at McMillan.

The recent decision of the Supreme Court of Canada in Tsilhqot’in v. B.C. has received a great deal of attention and has caused people to ask some important questions. Nowhere has this been more so than in the mining sector. We will address some of those questions.

Does aboriginal title include mineral rights? The law is not completely settled on this point.

In Delgamuukw v B.C. in 1997, then Chief Justice Lamer, when explaining that the content of aboriginal title is not restricted to practices, customs and traditions which are integral to distinctive aboriginal cultures, stated:

122 The [Indian Oil and Gas Act] presumes that the aboriginal interest in reserve land includes mineral rights, a point which this Court unanimously accepted with respect to the Indian Act in Apsassin v. Canada (Department of Indian Affairs & Northern Development) in 1995. On the basis of Guerin, aboriginal title also encompass mineral rights, and lands held pursuant to aboriginal title should be capable of exploitation in the same way, which is certainly not a traditional use for those lands.

This was cited in a decision by the Yukon Court of Appeal in Ross River Dena Council v Yukon in 2012 (a duty to consult case, not a title case) where the court stated:

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I refused to play the Conservatives’ fiscal game. So should Wynne – by Bob Rae (Globe and Mail – July 17, 2014)

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.

Bob Rae was premier of Ontario from 1990 to 1995

Critics on the right are now claiming that Kathleen Wynne’s Ontario government is on the road to fiscal rack and ruin – that it could, in one commentator’s words, push Ontario “back to the Bob Rae years.” That provokes these comments.

One would have thought that the experience of the last few years would have made the right wing narrative look pretty goofy but, no, these guys just can’t help themselves. In 1990, interest rates were kept deliberately high, the dollar rose predictably, U.S. companies shut factories in Canada as the newly minted free-trade agreement encouraged rationalization, and a bloated real estate market plummeted. All in one go, all at one time.

The shock to the Ontario economy was sharper and more severe than in 2009, and, as a direct result, public spending increased and revenues fell. This is what happened to Prime Minister Stephen Harper and Ontario premier Dalton McGuinty in 2009. It would have happened in Ontario even if Mike Harris had been elected in 1990. Remember that Tory premiers Bill Davis and Frank Miller ran deficits after the 1980 recession as well.

So, to compare 1990-91 with 2014-15 is to ignore where we were in the cycle, and what governments since the 1930’s have done when faced with such a drastic drop in prosperity.

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