September 2, 2014 – Republic of Mining

No Apology From Mining Tycoon German Larrea For Worst Ecological Disaster In Mexico’s History – by Dolia Estevez (Forbes Magazine – September 2, 2014)

September 2, 2014

http://www.forbes.com/

Grupo Mexico, the mining giant owned by German Larrea Mota Velasco, Mexico’s second richest man, has been in the center of a political storm since one of its mines in northern Mexico caused the worst ecological disaster in Mexican history.

According to Mexico’s federal environmental protection agency, Profepa, on August 6 Grupo Mexico’s subsidiary Buenavista del Cobre mine spilled 10 million gallons (40,000 cubic meters) of copper sulfate acid into the Sonora and Bacanuchi rivers, 25 miles south of the border with Arizona.

The contamination turned the waterways orange and affected the water supply of 24,000 people in seven communities along the rivers, forcing schools to close for several weeks while environmental authorities clean up the mess; 322 wells were shut down and more than 3 million liters of water have been distributed in trucks and bottles. Authorities place the cost of the total cleanup in the “hundreds of millions or billions” of Mexican pesos.

“This is the worst natural disaster provoked by the mining industry in the modern history of Mexico,” said Mexican Environment Minister Juan José Guerra Abud on August 26. Profepa said the mine’s leach solution yard is where the spill originated and ordered it partially shut,citing “imminent risk to the environment.”

The government has taken preliminary action to fine Grupo Mexico more than $3 million for the spill and Mexico’s Attorney General’s Office has opened a criminal investigation into top officials at the Buenavista mine, the world’s fourth largest copper mine by output.

After 33 years, uranium riches finally in sight for Cameco at Cigar Lake – by Peter Koven (National Post – September 2, 2014)

September 2, 2014

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

Stepping out of the shaft and into the underground workings at Cigar Lake, it is hard to believe that anything ever went wrong here.

The Northern Saskatchewan mine looks pristine and ready to go. A massive jet boring system 480 metres below the surface has begun extracting uranium ore from the deposit by pumping water upward at supersonic speed. Other tunnels are filled with a dizzying network of storage, piping and processing infrastructure to handle the incredibly rich ore and deal with the incredibly poor ground conditions.

Along with the nearby McArthur River mine, this is easily the richest uranium operation in the world, with grades that are more than 100 times the world average. In terms of complexity, it’s roughly a million times the world average. It took 33 years of work to move Cigar Lake from discovery to production. The very fact it exists is a credit to human technology and engineering.

But until recently, it didn’t feel like such a triumph. When a crew tried to step out of that same underground shaft in February 2010, they could barely take a step.

“They found a metre of mud right through the mine. Just complete mud,” recalls Tim Gitzel, the chief executive of Cameco Corp., which built the mine and owns half of it. “They couldn’t even get the cage down because there was so much mud.”

The crew was the first one to enter the mine after a devastating flood in 2008, that that came on the heels of one in 2006. The two disasters cast a black cloud over Cameco and made a lot of people wonder if the Saskatoon-based company could ever get this mine working properly.

Vale, Glencore break off talks over Canada nickel deal: sources – by Silvia Antonioli (Reuters U.S. – September 2, 2014)

September 2, 2014

http://www.reuters.com/

LONDON – (Reuters) – Vale (VALE5.SA) and Glencore (GLEN.L) have broken off talks over combining their nickel assets in Canada in a deal that could have produced over $1 billion in annual cost savings, sources close to the matter said.

The discussions over linking the two companies’ neighboring nickel mining and processing facilities in the Sudbury basin in southeast Canada broke down partly due to disagreement over how to share the costs and savings and to worries about government and labor union reaction to potential job cuts and shutdowns, the sources said.

At the same time, a recovery in nickel prices has made cost rationalization less urgent, they added.

“Both sides more or less agreed on what the optimum structure of a combined Sudbury business would look like, but to enable that to be created, very difficult decisions needed to be taken, and the appetite or the ability to take those decisions was not there,” a source with knowledge of the situation said.

Glencore and Vale declined to comment. One of the sources said differences in corporate culture — with Swiss-based trader and mine operator Glencore more willing to take risk and Brazilian miner Vale more conservative — also played a role.

A combination of the nickel assets in Canada had already been attempted by their previous owners, Inco and Falconbridge, which in the mid-2000s came close to an agreement before they were acquired by Vale and Xstrata.

5 gold miners still trapped in Nicaragua – by Luis Manuel Galeano and Olga R. Rodriguez (USA Today – August 30, 2014)

September 2, 2014

http://www.usatoday.com/

BONANZA, Nicaragua (AP) — Rescue workers and trapped miners alike frantically dug away at opposite sides of rock and mud that blocked a Nicaragua gold mine, finally succeeding in freeing at least 20 men. Efforts to reach five miners still missing continued Saturday.

Antonio Diaz said the miners tried to cheer each other up inside the dark, cold shaft, attacking the slide with their picks and shovels by the light of helmet lamps. But after 24 hours, they began feeling hungry and some started losing hope.

“The sadness of feeling yourself trapped in a hole is immense but I never lost hope,” said the 32-year-old miner from a hospital bed in the town of Bonanza, near the El Comal gold and silver mine. “I kept thinking I was too young to die and above all, I thought about my two daughters.”

He said the miners finally cut a hole through the blockage and started shouting, but at first there was no answer. “Hours later, someone heard us, and when he answered us we felt life returning to our bodies,” Diaz said. “God had answered our pleas to keep living.”

Bonanza Mayor Alexander Alvarado, a former miner who participated in the rescue efforts, said it took about 100 men working around the clock to reach those trapped and even then, it took about another two hours to bring the first miner out to safety.

Indian power station coal stocks lowest since 2012 blackouts – by Krishna N Das and Douglas Busvine (Reuters India – August 29, 2014)

September 2, 2014

http://in.reuters.com/

NEW DELHI – (Reuters) – Half of India’s thermal power stations have less than a week’s supply of coal on hand, according to weekly data, the lowest level since mid-2012 when hundreds of millions of people were cut off in one of the world’s worst blackouts.

There was a sharp fall in power output on Thursday from a plant in Gujarat that left India more than 9,000 megawatts short of peak demand, according to two officials at the state grid operator.

Any grid collapse would cast doubt on the crisis management skills of the new government led by Prime Minister Narendra Modi, whose achievement in ensuring 24-hour power supplies as premier of Gujarat helped him to election victory in May.

Commenting on Thursday, Power and Coal Minister Piyush Goyal said: “I don’t know about the possibility of a breakdown … There is a problem, I think, with many of the coal supplies.”

The shortage has come about as a fall in hydroelectricty generation due to weak monsoon rains forced the government to ask coal-based power stations to raise output, an industry source said.

India suffered unprecedented power cuts on July 30-31, 2012, that affected 620 million people – nearly a tenth of the world’s population – in 22 states across the north and east of the country.

Today’s U.S. ’baby’ will consume 3 Mlbs metals and minerals in lifetime – by Lawrence Williams (Mineweb.com – September 1, 2014)

September 2, 2014

http://www.mineweb.com/

The projected lifetime consumption of metals and minerals by today’s U.S. baby extrapolated across the world presents an enormous challenge for the global resource sector.

LONDON (MINEWEB) – That seemingly unstoppable Juggernaut of consumption, the USA, ever continues to increase its demand for metals and minerals – an annual growth rate in likely demand that is certainly being exceeded in developing nations as they aspire to an ever improving lifestyle.

This will put increasing pressures on the global resource industries to keep up with demand as economic mineral deposits are perhaps becoming ever scarcer, although extraction technologies are almost certainly improving.

On this subject, the Minerals Education Coalition (MEC) of the Society for Mining, Metallurgy & Exploration, the U.S.’s professional body for mining engineers, metallurgists and exploration geologists (SME) has thus just released the 2014 “Minerals Baby” graphic. Each year, the amount of metals, minerals and energy fuels needed for the average American is incorporated into this iconic graphic. This year’s statistics reflect an increase of more than 24,000 lbs during a lifetime when compared with the previous year’s per capita usage.

Sudbury must push for place on Ring board: JR – by Jim Moodie (Sudbury Star – September 2, 2014)

September 2, 2014

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

It’s essential that Sudbury has strong representation on a Ring of Fire development corporation, say mayoral hopefuls.

On Thursday, Northern Development and Mines Minister Michael Gravelle announced the long-awaited entity — meant to oversee the creation of infrastructure for ore access and transport — has been legally incorporated, with an interim board of directors and a base in Thunder Bay.

“The minister was clear that the next task is to identify and recruit business and First Nations leaders, along with representation from the federal government,” John Rodriguez said in a release. The former mayor, who is seeking to reprise his role through October’s municipal election, suggested now is the time to make the case for a Sudbury presence at the table.

“I implore Mayor (Marianne) Matichuk to call an immediate meeting of our area leaders from the business and First Nations communities to develop a slate of qualified persons as candidates for consideration to the board,” he stated. “Please act now before Sudbury is left on the outside looking in.”

Dan Melanson, who is vying with Rodriguez and eight others to fill Matichuk’s shoes, agreed it’s important Sudbury is in the mix, particularly since “Thunder Bay is better situated in both geography and representation.”

Mine sleuths keen for their nickel – by Paul Garvey (The Australian – September 2, 2014)

September 2, 2014

http://www.theaustralian.com.au/business

BILL Amann and Adrian Black have been involved in many of the key nickel discoveries in Australia’s recent history, but the pair has one major regret: not loading up with shares in the companies for which they were working.

The exploration resumes of the two geology and geophysics consultants make for impressive reading. Their consultancy, Newexco, was involved in the early stages of major nickel discoveries such as Western Areas’ Spotted Quoll and Flying Fox deposits and the barnstorming Nova nickel discovery of Sirius Resources.

Their work has helped create billions in shareholder wealth, but their exposure to those riches has generally been limited to their consulting fees.

Now the pair is backing themselves to continue their magic run of exploration success, and have opted to ease their long-held policy of not taking shares in their clients.

The Newexco founders are taking shares in little-known company Mining Projects, a minnow gearing up for a nickel exploration program east of Kalgoorlie. So far, Mining Projects has found little love beyond the technical boffins — it has a paltry market capitalisation of just $10 million.

[British Columbia tailing] Mine Disaster: Who Will Investigate Gov’t Failings? – by Rafe Mair (The Tyee.ca – September 1, 2014)

September 2, 2014

http://thetyee.ca/

Mount Polley panel picked to be expert in engineering, not legal, technicalities. The blue ribbon panel team set up by the provincial government to investigate the Mount Polley mine disaster will find out what caused the tailings pond dam to collapse.

The second and critically important question, however, is what, if any, role the government of British Columbia played or should have played. In fact, this is the most important aspect, because B.C. had a longstanding legal, not to mention moral, duty which it appears from all the evidence was not fulfilled — and which, if fulfilled, may well have stopped the catastrophe from happening in the first place.

In the probe the government has set up, there is mandated virtually no investigation of the role of the mining or environment ministries. There are 14 terms of reference, 13 of which deal strictly with the collapse itself, one of which may be interpreted as giving the panel members the right to look at the government’s role if they feel so inclined.

It does not take brain surgery to recognize that this panel is unsuited to look at any regulatory role the government should have played. That’s not their bag. They are picked for their skills at investigating mining methods, not regulation enforcement.

To look at a government role and the law and regulations requires a specific sort of person, and it’s difficult to think of anyone suited other than a highly experienced lawyer or judge. To even begin to know the right questions requires a training that a scientist doesn’t, by nature, have. He or she may be highly skilled and trained, but not for this purpose.

COLUMN-Indonesia plays winning hand with global miners – by Clyde Russell (Reuters U.S. – September 1, 2014)

September 2, 2014

http://www.reuters.com/

LAUNCESTON, Australia, Sept 1 (Reuters) – In the high-stakes poker game being played between the Indonesian government and mining companies, it has come as a bit of a surprise that Jakarta appears to be playing the winning hand.

So far the Indonesian government has successfully stared down two U.S. mining giants, imposed a ban on exporting some raw metal ores and is deaf to the squeals of the beleaguered coal industry as it tightens rules on what had been a cowboy sector.

When the government started down the path of changing the laws and regulations in order to ensure a greater share of the Southeast Asian nation’s mineral wealth stayed at home, it was widely assumed that it would lack the resolve and the ability to stand up to the powerful mining industry.

Previous attempts had resulted in compromises that favoured miners and the government was widely viewed as inefficient, inconsistent and largely ineffectual. But in recent weeks the government has been shown to be holding a stronger hand than its opponents, and it has been willing to call their bluffs.

First, U.S. mining major Freeport McMoRan signed a memorandum of understanding with the outgoing administration of President Susilo Bambang Yudhoyono that should result in the government getting what it wanted, without giving up much in return.

Ring of Fire a chance to build it right – by Carol Mulligan (Sudbury Star – August 30, 2014)

September 2, 2014

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

The Ring of Fire Infrastructure Development Corporation is an opportunity to “create a vision from the moon” of what one of the first planned mining camps in Ontario will be like. Maurice (Moe) Lavigne, for one, is eager to get going on that.

The vice-president of exploration and development for KWG Resources Inc., has ideas for what the development corporation should do first when it is up and fully running.

Northern Development and Mines Minister Michael Gravelle announced Thursday it would start with an interim board of public servants and “transition” to a more mature board of partner members from first nations, industry and governments.

Some were critical that is taking too long to happen. “In my biggest fantasy, I would have liked to have seen the Ontario government start that particular process five years ago, but they didn’t,” said Lavigne on Thursday.

Still he considered the official establishment this week of the “devco” — headquartered in Thunder Bay — a step forward.

Planning the infrastructure to support development in the Ring of Fire chromite deposits, an undeveloped area of the province located 540 kilometres northeast of Thunder Bay, is something new for just about everyone.

Ring of Fire Announcement Draws Fire on Ontario Government – by James Murray (Netnewsledger.com – August 30, 2014)

September 2, 2014

http://www.netnewsledger.com/

Latest Announcement on Ring of Fire Shakes Webequie

WEBEQUIE FN – THUNDER BAY – The announcement of a Ring of Fire Development Corporation by Minister of Northern Development and Mines Michael Gravelle has generated some controversy. “The Province’s decision to unilaterally move ahead with the economic development corporation for the Ring of Fire is disappointing,” states Webequie First Nation Chief Cornelius Wabasse. “We have been clear that we are willing to work with Ontario about Ring of Fire issues, but it has to be in a true spirit of partnership. Decisions of this magnitude cannot be made by Ontario behind closed doors.”

Minister Gravelle made the announcement this week saying, “The development corporation is a vital step towards building the much-needed infrastructure that is critical to realizing the full potential of the Ring of Fire,” states Michael Gravelle, the Minister of Northern Development and Mines. “It is a key building block to achieving our mutual goals of unlocking regional economic growth and benefiting from value- added opportunities like mineral processing and job creation”.

“I have confidence that this team will guide us through this initial, and necessary phase of the ROF Infrastructure Development Corporation, and I am encouraged by the work that is already underway to bring together First Nations, key industry players, communities and the federal government as partners. Together we can find the best ways to move forward so we can all tap into the extraordinary potential of the Ring of Fire.”

In a media statement, Webiquie First Nation says, “The Ontario Government’s announcement of its establishment of the Ring of Fire Infrastructure Development Corporation violates clear commitments made to Webequie First Nation”

When the Levee Breaks [Mount Polley and Pebble mines] – by Bill Carter (Huffington Post – August 28, 2014)

September 2, 2014

http://www.huffingtonpost.com/the-blog/

Bill Carter is the author of Boom, Bust, Boom: A Story About Copper, the Metal That Runs the World and Red Summer: The Danger and Madness of Commercial Salmon Fishing in Alaska. Carter is an assistant professor of practice in documentary studies at Northern Arizona University in Flagstaff, Arizona.

Mother Nature has a way of reminding us that humility is a trait that humans too often lack. Take, for instance, the engineering firm Knight Piesold, which stated that “modern dam design technologies are based on proven scientific/engineering principles and there is no basis for asserting that they will not stand the test of time.”

Until they don’t. Earlier this month a tailings dam designed by Knight Piesold at the Mount Polley copper mine breached, dumping up to 10 million cubic meters of heavily contaminated water into surrounding streams, rivers and lakes in central British Columbia. Since the accident aerial photographs show a massive mudslide attacking the tranquil waters of a nearby salmon stream and dumping into Quesnal Lake. The salmon run will most likely perish, along with the entire ecosystem that the salmon and other species rely on for life.

Even so, the company is probably off the hook. Full disclosure: The quotation at the beginning of this essay is not related to the Mount Polley mine; Knight Piesold offered up the above assurance in defense of the proposed Pebble mine in southwest Alaska.

The Pebble mine would be one of the largest mines ever built. The deposit is huge, with a market value ranging from $350 billion to $500 billion of copper and gold.