Twitter
Boston-Bay-Mines-Announcement

Day: September 15, 2014

Rinehart rejects talk of Korean raid on Roy Hill – by Andrew Burrell (The Australian – September 16, 2014)

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

GINA Rinehart’s Hancock Prospecting has rejected speculation that Korea Development Bank is planning to buy a 5 per cent stake in the magnate’s flagship $10 billion Roy Hill iron ore project in the Pilbara.

A report published yesterday by a Seoul-based industry journal said the state-owned bank was planning to purchase the stake in partnership with Korean pension fund firms and insurance companies for 170 billion won (about $180 million).

The market value of Roy Hill is likely to have slumped in recent months given the weaker outlook for iron ore prices, which have plunged to $US82 a tonne, although the low-cost Roy Hill project would still be profitable at current prices. The report in the Korea IT Times appeared to suggest that Korea Development Bank would buy the stake from Hancock Prospecting.

“There is absolutely no truth to the report,” said a spokesman for Hancock Prospecting, Mrs Rinehart’s private company. Hancock Prospecting owns 70 per cent of Roy Hill, while Japan’s Marubeni has 15 per cent, South Korea’s Posco holds 12.5 per cent and Taiwan’s China Steel Corp has 2.5 per cent.

Sources said Posco would be an unlikely seller of its stake after chief executive Oh Joon-Kwon last month praised Roy Hill as a key asset for the Korean company.

Read more

COLUMN-The real problem for commodity nations is currency, not prices – by Clyde Russell (Reuters India – September 15, 2014)

http://in.reuters.com/

LAUNCESTON, Australia, Sept 15 (Reuters) – The pressing problem for some resource-rich countries isn’t that prices for commodities have dropped sharply, it’s that their currencies haven’t dropped in tandem.

The plight of Australia and Indonesia, the major commodity exporters in the Asia-Pacific region, is driven home by the fact that their currencies have actually gained against the U.S. dollar this year, even as commodity prices have plunged.

This is a body blow to earnings in those countries and defies both economic logic and precedent, which should have seen the Australian dollar and Indonesian rupiah start to drop as revenue from resource exports declined.

While the Australian dollar did slip almost 4 U.S. cents last week to trade around 90 cents early on Monday, it is still stronger than it was at the end of last year, when it fetched 89.03 cents. In contrast, Australia’s two major export earners, iron ore and coal, have dropped dramatically. Spot Asian iron ore .IO62-CNI=SI has fallen 39 percent so far this year, hitting $82 a tonne on Sept. 12, a five-year low.

Thermal coal at Australia’s Newcastle Port, an Asian benchmark, dropped to $66.07 a tonne in the week ended Sept. 5, a five-year low and down 23 percent from the start of the year. What is clear is that commodity currencies have failed to respond this year to weaker commodity prices in the way they did in the 2008 global recession.

Read more

Ring of Fire development picture looks no clearer, strategist – by Ian Ross (Northern Ontario Business – September 15, 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. Ian Ross is the editor of Northern Ontario Business ianross@nob.on.ca.

A management shakeup at Cliffs Natural Resources has some mining analysts believing the possible departure of the Cleveland-based mining giant from the Ring of Fire camp could open the door for other international producers to make a move.

But that’s not the opinion of Bill Gallagher, a leading mining strategist. With competing and divergent stakeholder agendas at play, combined with a muddled development picture, the overall uncertainty in the remote James Bay mineral exploration camp may drive off any new investment or mining entrants.

“You could not get a more polarized set of opinions around a non-existent project,” said Gallagher. “How many (news) reports have to come out that show that everybody’s on a different page? There’s nobody singing a unifying theme.”

Gallagher is a former federal negotiator, a strategist specializing in mining and First Nations negotiations, and a published expert on Native empowerment in the Canadian resource industry.

Cliffs won a major court ruling in July to gain overland access to its Black Thor chromite deposit. But the timing of the decision may be too late for the Ohio iron and coal miner to see its proposed $3.3-billion Black Thor chromite mine and Sudbury refinery project come to fruition.

Read more

Miners face threat of coal ban – by Sarah-Jane Tasker (The Australian – September 15, 2014)

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

AUSTRALIA’S thermal coal miners, already struggling to turn a profit, could be further hit with an import ban on lower quality coal by China.

The price of thermal coal has come under renewed pressure amid fears that the economic powerhouse would implement quality-based restrictions on coal imports, which could impact ­almost half of Australia’s exports to the Asian giant.

Macquarie analyst Stefan ­Ljubisavljevic has outlined that while he remained sceptical that the proposed ban on high-ash, high-sulphur material would be enacted, on a “worst-case-scenario” basis it was Australia’s miners that would suffer.

The ban, proposed by the China National Coal Association and being scrutinised by the ­National Development and Reform Commission, would prohibit all coal imports above 15 per cent ash and 0.6 per cent sulphur.

“Based on Wood Mackenzie data, almost half of all Australian exportable thermal coal would not meet a 15 per cent ash and 0.6 per cent sulphur cut-off. As a result, implementation of this draft ban would, in our opinion, put at risk about 40 million tonnes per annum of Australian coal volume,” Mr Ljubi­savljevic said.

The Macquarie analyst said that if the ban was enacted, the best-case scenario for the thermal coal market would be that exports from Russia and Indonesia would simply be redirected to China from other destinations.

Read more

Phosphates past being reduced to rubble – by Suzie Schottelkotte (Washington Times – September 14, 2014)

http://www.washingtontimes.com/

Associated Press – MULBERRY, Fla. (AP) – Piece by piece, remnants of Florida’s phosphate mining roots are collapsing into rubble.

Last month, a wrecking ball began crushing a century-old Polk County building that used to store phosphate until the newly mined rock dried out. The massive structure of steel-reinforced concrete, built near Mulberry in 1909, was among the few vestiges of phosphate’s rise as a Polk County economic powerhouse.

Now, the old Prairie Pebble Phosphate Co. building is little more than 28,000 tons of concrete debris, and the sight of its crumbling walls tugged at Richard Fifer’s heart.

“I hate to see these old buildings come down,” said the Mulberry historian. “They represent an era we’re never going to get back. Sure, we still have some remnants of the 1950s and the ‘60s, but there’s really nothing left from the early days in the 1910s and 1920s.”

The 40,000-square-foot Prairie building, called a dry bin, had been shut down since 1964, when newer technology rendered it obsolete.

Scavengers had stripped away most of its steel, leaving it precariously unsafe, said John Simon, president of Tampa-based JVS Contracting, which bought the building and surrounding 17 acres in May.

Read more

Iron Ore Rebound Seen by Morgan Stanley as Vale Sees $100 – by Jake Lloyd-Smith (Bloomberg News – September 15, 2014)

http://www.bloomberg.com/

Iron ore is heading for an end-of-year rally as some high-cost supplies are closed and steel demand picks up, according to Morgan Stanley, which said prices may first extend losses by a few more dollars before rebounding.

The steel-making raw material will drop into the $70s-a-ton range in the near term, then rally toward $90 a ton by the end of the year, analyst Joel Crane said in a report today. The commodity, which slumped to the lowest level in five years this month, last traded at less than $80 a ton in September 2009.

Iron ore fell into a bear market this year as the biggest producers including Rio Tinto Group expanded low-cost output, betting higher volumes would more than offset falling prices while less-competitive mines were forced to close. Morgan Stanley’s forecast for a rally in the final quarter follows a similar prediction last week from Vale SA, the world’s largest supplier, which said prices may be poised for a rebound.

“We are of the firm belief that an adequate proportion of supply from the top end of the cost curve will come out, flatten the curve and ultimately secure levels of cost support,” Crane wrote, referring to the potential loss of output from some of the highest-cost producers. The price should head back toward $90 a ton by year-end, said Crane.

Ore with 62 percent content at the Chinese port of Qingdao fell 36 percent to $85.58 a dry ton this year, according to data from Metal Bulletin Ltd. The commodity is heading for a third quarterly loss in the longest run of declines since 2009 amid forecasts for a surging global surplus.

Read more

De Beers studies [Ontario] Victor extension as end of mine life looms (Northern Miner – September 12, 2014)

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

With a mine life that ends in 2018, the ore is running out at Ontario’s only diamond mine — De Beers’ Victor mine, 90 km west of Attawapiskat.

The open-pit mine, which began production in 2008, produces around 600,000 carats of high-value diamonds a year from a single 15-hectare kimberlite. But with 15 other diamond-bearing kimberlite pipes at the project, there is potential for an extended mine life at Victor.

De Beers has already started an environmental assessment on the Tango Extension kimberlite, the most promising of the other pipes in the Victor cluster. Situated about 6.5 km northwest of the Victor mine, the company believes it could extend Victor’s mine life by seven years.

The company is studying the potential to mine Tango Extension as an open-pit operation at a rate of 3 million tonnes per year. However, the project is not yet economic. The Tango Extension kimberlite is smaller, lower-grade, and contains less valuable diamonds than Victor.

While Victor is a low-grade mine at around 0.23 carat per tonne, its diamond values are among the highest in the world at more than US$400 per carat. So far, samples from Tango Extension indicate the quality is good, but they won’t fetch the same kind of price per carat as Victor diamonds, says Tom Ormsby, De Beers Canada’s director of external and corporate affairs,

Read more

‘Building our society and economy’: Government and industry should be open to new approaches, Webequie chief says – by Bryan Phelan (Onotassiniik Magazine – Fall 2014)

http://onotassiniik.com/

Cornelius Wabasse says he has focused his three terms as chief of Webequie First Nation on community development; on finding ways for his community to prosper.

At the same time, “We have a lot of community needs, social problems as well,” Wabasse said as a panelist at the Ontario Mining Forum. It would take $28 million to bring infrastructure for the 765 people in Webequie up to the Canadian standard, according to a band study finding made public last year.

Webequie is located 540 kilometres north of Thunder Bay, where the Mining Forum took place June 18-19. It’s also close to the Ring of Fire, a geologically rich area of minerals.

Wabasse and leaders of eight other First Nations that make up the Matawa Chiefs Council signed a framework agreement with Ontario in the spring to guide regional negotiations for mining development in the area.

“We must enter into enduring agreements, new relationships, with both (the federal and provincial) governments and industry as part of the Ring of Fire development,” Wabasse said of the challenges ahead. “We must be involved in ways that respect our treaty rights, support our communities, protect our culture, and build our society and economy. We expect both government and industry to be open to new and innovative ways for these benefits to be realized.”

Read more

A giant of the past [U.S. Steel] resurrected as newest Wall Street hot stock – by Tim Shufelt (Globe and Mail – September 15, 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.

After years of despair that left shareholders reeling, United States Steel Corp. is regaining at least some of its former might.

Once a pillar of the American economy, the company’s long-slumping stock has been one of the hottest large caps over the past three months. That could be just the beginning of a return to form for a stock riding an organizational and industry transformation.

“The potential for transformational change at U.S. Steel is one of the most intriguing stories in the U.S. steel sector at the moment,” Credit Suisse analyst Nathan Littlewood said in a recent note. “The company’s raw material cost advantages as well as privileged steel price environment should position U.S. Steel as one of the most profitable steel makers in the world.”

A century ago, U.S. Steel was known on Wall Street simply as “The Corporation” by virtue of its size alone. More recently, the company benefited from the demand for resources fuelled by China’s rise. The vast quantities of steel required for the building of cities and infrastructure kept prices high through the early 2000s.

The financial crisis snuffed out the global growth needed for a buoyant steel market. And with China consuming half of the world’s steel, a slowdown in Chinese growth over the past couple of years has extended price weakness.

Read more

Conflict minerals and the integral role of everyday Canadians – by Kristen Pue (The Varsity – September 14, 2014)

The Varsity is the University of Toronto’s student newspaper.

Kristen Pue is the Advocacy Director at STAND CANADA, a youth-led anti-genocide organization. She is a student in the Faculty of Law.

When consumers contribute to humanitarian crises

We all know about the crisis in Ukraine. We all know about the Ebola outbreak, and we are all aghast at the advance of ISIS in the Middle East. But are you aware of the single deadliest conflict since the World War II? More importantly, do you know if you are inadvertently contributing to this humanitarian catastrophe?

Although it is rarely in the news, the conflict in the Democratic Republic of the Congo (DRC) has claimed 5.4 million lives since 1996 and remains one of the world’s worst active crises. In addition to its high death toll, it is notable for its rampant sexual violence: an average of 48 rapes are committed per hour.

The conflict in the DRC is multifaceted, but here is the gist: the Rwandan genocide provided the trigger for the First Congo War, but the despotic rule of Mobutu Sese Seko certainly was an underlying factor. Following the genocide, Tutsi rebels took control of Rwanda. Two million refugees flooded into the DRC, most of them Hutu. Hutu extremists were among civilian refugees and used the eastern DRC as a base to continue the Rwandan civil war.

This stoked instability, and eventually resulted in an uprising. Rwanda and Uganda joined to help depose Mobutu.

Read more

Wabauskang First Nation set to appeal after Ontario Superior Court rules against band – by Alan S. Hale (Kenora Daily Miner and News – September 12, 2014)

http://www.kenoradailyminerandnews.com/

Wabauskang First Nation says it will attempt to appeal a ruling by the Ontario Superior Court that the provincial government had not unlawfully delegated its constitutional responsibility to consult with the First Nation to Rubicon Minerals which wants to open a gold mine near Red Lake.

The local aboriginal community has applied to the Ontario Court of Appeal for permission to launch an appeal of the decision released by the superior court on Aug. 28 which ruled the province had fulfilled its obligation to consult Wabauskang and so its approval of the closure plan for Rubicon’s mine project was valid.

“I am persuaded that the institutional process established by Ontario by which it assessed the potential or actual impact of a claim was reasonable,” reads the judgement. “I am also satisfied that the assessment made by Ontario regarding the mine production stage in this case was reasonable: it recognized that (Wabauskang First Nation) had rights under Treaty 3 (and) it considered all potential effects deriving from (Wabauskang’s) Treaty 3 rights.”

Not surprisingly, the chief of Wabauskang, Martine Petiquan, does not agree with the court’s assessment, and so they intend to continue taking the issue to the next level.

“Our Treaty rights and our relationship and responsibilities with our lands and territory must be respected,” said Petiquan.

Read more

Anger and confusion after worst disaster in Canadian mining history darkens prosperous B.C. town – by Brian Hutchinson (National Post – September 13, 2014)

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

“Check your knives at the bar,” reads a sign inside this village’s only watering hole. In hard times, before the Mount Polley mine opened 17 years ago, there wasn’t much work to be found, and folks sometimes turned as sour as the cheap beer and boxed wine. Things could get rough inside the Likely saloon.

Likely has enjoyed much better days lately, thanks to the mine and the wealth it was generating. But one morning in early August, a section of the tailings pond dam up at the Mount Polley mine crumbled, releasing 10 million cubic metres of dirty mine water and almost five million cubic metres of finely crushed rock, known as tailings.

The water and tailings formed a thick slurry that roared down Hazeltine Creek, knocking down trees and anything else in its way. It poured into Quesnel Lake, one of the largest — and the deepest — fresh water lakes in B.C.

Since that cataclysmic event, the worst of its kind in Canadian mining history, a cloud has hung over little Likely, a village of perhaps 350 huddled at the top of Quesnel Lake, 600 kilometres north of Vancouver. There is anger here, and resentment. Divisions have formed and blame is assigned. But confusion reigns.

Some local residents and First Nations members claim their lake is now fatally toxic, that the water is peeling skin from fish and is even burning human flesh. Others say that’s just wild fear-mongering. The fact is, no one knows what the accident really means for their lake and their town, even four weeks later.

Read more

NEWS RELEASE: Barrick Named Mining Industry Leader by the Dow Jones Sustainability Index

TORONTO, September 15, 2014 — Barrick Gold Corporation has been named to the Dow Jones Sustainability World Index for the seventh consecutive year and has been ranked as the top performer in the mining industry category.

“We are honored to be included in this highly-respected index once again this year. Our goal is to be a responsible partner in resource development, ensuring our operations generate positive and sustainable benefits for all of our stakeholders, including governments, communities and investors,” said Co-President Kelvin Dushnisky.

“Achieving industry-leading social and environmental performance is a critical element of how we define operational excellence at Barrick,” said Co-President Jim Gowans. “This recognition is a testament to our people around the world, who make responsible mining a focus of what they do every day.”

Barrick was also included on the Dow Jones Sustainability North America Index for the eighth year in a row.
In 2013, Barrick contributed $15.2 billion in economic value-add to its host countries and communities through wages and benefits, royalties and taxes, local purchasing of goods and services and community investments. This included $7.1 billion in developing and emerging countries.

The Dow Jones Sustainability Index evaluates more than 3,000 companies annually using rigorous sustainability criteria to identify top performers.

Read more

Gold Industry Needs ‘Cleansing’ of Weakest, Fidelity Says – by Liezel Hill (Bloomberg News – September 15, 2014)

http://www.bloomberg.com/

The gold industry, recovering from the worst slump in prices in 30 years, needs more mergers to help improve investor returns and eliminate unprofitable mines, Fidelity Investments said.

About a third of gold production is probably money-losing when the price of the metal is lower than $1,250 an ounce, said Joe Wickwire, who manages more than $1.8 billion of assets including the Fidelity Select Gold Portfolio. (FSAGX) With gold trading at about $1,235, it “might not be a bad thing” if the number of producers was reduced by a similar percentage.

“It’s part of the life cycle of industries that every so often you need to have a cleansing of that which is not working,” Wickwire said in a phone interview last week from Boston, where Fidelity is based.

Gold producers, which are gathering for the annual invitation-only Denver Gold Forum that began yesterday, cut budgets, sold assets and adjusted mine plans after the metal plunged 28 percent last year, prompting more than $26 billion of writedowns. The industry already has started a consolidation process, Wickwire said.

“The industry did a very poor job from a capital-allocation standpoint, from a risk-management standpoint and from an operational-execution standpoint,” he said. “For long-term oriented investors it would be better for the industry to get more right-sized where companies are focused on generating profit at a conservative gold price assumption.”

Read more