January 9, 2015 – Republic of Mining

Will We Mine Asteroids? – by Fraser Cain (University Today.com – January 8, 2015)

January 9, 2015

http://www.universetoday.com/

It’s been said that a single asteroid might be worth trillions of dollars in precious rare metals. Will we ever reach out and mine these space rocks? How hard could it be?

Here on Earth, precious metals like gold and silver are getting harder to find. Geologists are developing more elaborate ways to get at the veins of precious metals beneath the surface of the Earth. And for the truly rare metals, like platinum and iridium, forget about it. All the platinum ever mined in the history of the world would fit inside my basement, and it’s not that big of a basement.

There are asteroids out there, just floating past us, taunting us, containing mountains of precious minerals. There are iron-nickel asteroids made entirely of metal. Comets of water, dirt and organic materials, everything you’d need to make an orbital farm. Just a single 30-meter asteroid, like the recently discovered 2012 DA14, is worth $20 trillion dollars. Now, if you could just somehow get to it.

Bre-X lawyer’s fight in the spotlight – by Rachel Mendleson (Toronto Star – January 9, 2015)

January 9, 2015

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.

Battle continues in court for man who got client acquitted after mining scandal.

The legal community is closely watching the latest round in Bre-X lawyer Joe Groia’s battle to defend himself against a controversial charge of “incivility,” which is raising fundamental questions of judicial independence and freedom of speech.

In Ontario Divisional Court on Thursday, Groia’s lawyer framed the case as an opportunity to preserve the right of all lawyers to vigorously defend their clients without fear of reprisal from an “overzealous” professional regulator.

“No lawyer wants to be the next Joe Groia,” lawyer Earl Cherniak told the panel of three judges. “Groia (has) defended his prosecution, not only for his own sake, but also in the public interest in the profession.”

The judicial review follows nearly five years of legal wrangling over charges of professional misconduct by the Law Society of Upper Canada, which took issue with Groia’s behaviour in the early stages of the insider-trading trial of former Bre-X geologist John Felderhof.

A mining company, Bre-X Minerals announced a promising find of gold in Indonesia in 1995, sending its stock price soaring. But the samples were found to be fraudulent — the largest mining fraud in Canadian history, driving the company into bankruptcy.

Pebble Mine 2014 Year in Review: “And Then There Were Lawyers . . . .” – by Joel Reynolds (Huffington Post – January 5, 2015)

January 9, 2015

http://www.huffingtonpost.com/green/

Joel Reynolds Become is the Western Director and Senior attorney, NRDC, Los Angeles.

When someday the story of the Pebble Mine is told, 2014 may be best remembered as the year when all that remained of the once formidable Pebble Partnership was a bunch of lawyers for hire. By the end of 2014, all of the mining giants and their funding – Mitsubishi, Anglo American, and Rio Tinto – were gone, leaving only Northern Dynasty Minerals to keep the reckless vision of the Pebble Mine alive.

The Partnership’s new CEO is a lawyer from the Washington, D.C. law firm of Steptoe and Johnson, and mining activities have ground to a halt.

By the end of 2014, Pebble’s public face had become lawsuits and lobbying against EPA, targeting its authority to do what Alaskans had petitioned it to do – i.e., to protect Alaska’s wild salmon fishery. Three lawsuits had been filed against the agency, and legislation to constrain the agency’s review of the Pebble project had been introduced in both houses of Congress.

Once again, permit applications – promised by Pebble for years – were never filed.

Some of the highlights of 2014:

This Week in Range History: THE MESABI IRON COMPANY: TACONITE PIONEER – by Donald C. Wright (Home Town Focus – January 9, 2015)

January 9, 2015

http://www.hometownfocus.us/ Northern Minnesota

This week we’re sharing a story written by Eveleth native Donald C. Wright about the Mesabi Iron Company, predecessor to Reserve Mining Company in Babbitt. Although the Mesabi Iron Company operated the plant in Babbitt for only two years (1922 – 1924), they were taconite pioneers who “proved that high grade iron ore could be produced for America’s steel industry from hard, tough Minnesota taconite.”

Wright’s story was originally published in the June 1984 edition of Range History: The Mesabi Perspective, a quarterly publication of the Iron Range Historical Society, and is reprinted here with their permission. All of the photos published with the story here are also courtesy of the Iron Range Historical Society.

Thank you Iron Range Historical Society for sharing your stories of our history. Cindy Kujala HTF Staff Writer

About the time the American Civil War was coming to a close in Wilmer McLean’s parlor in Appomattox, Virginia, Michigan’s bright copper boom was fading and miners began to cast interested glances at the new state of Minnesota. Minnesota’s North Shore had been opened to settlement by terms of the Treaty of LaPointe with the Chippewa in 1855 and prospectors already were drifting in to investigate rumors of gold, silver and copper.

One of the new arrivals was a German immigrant named Christian Wieland who, with his four brothers, hacked out a settlement on the shore of Lake Superior and called it Beaver Bay.

BRICs Will Be Cut to ICs if Brazil and Russia Don’t Shape Up, Warns Phrasemaker (Bloomberg News – January 9, 2015)

January 9, 2015

http://www.bloomberg.com/

Brazil and Russia’s membership of the BRICs may expire by the end of this decade if they fail to revive their flagging economies, according to Jim O’Neill, the former Goldman Sachs Group Inc. chief economist who coined the acronym.

Asked if he would still group Brazil, Russia, India and China together as emerging market powerhouses as he did in 2001, O’Neill said in an e-mail “I might be tempted to call it just ’IC’ or if the next three years are the same as the last for Brazil and Russia I might in 2019!!”

The BRIC grouping will be dragged down by a 1.8 percent contraction in Russia and less than 1 percent expansion in Brazil, according to the median estimate of economists surveyed by Bloomberg News. China is seen growing 7 percent and India 5.5 percent.

The BRICs were still booming as recently as 2007 with Russia expanding 8.5 percent and Brazil in excess of 6 percent that year. The bull market in commodities that helped propel growth in those nations has since ended, while Russia has been battered by sanctions linked to the crisis in Ukraine and Brazil has grappled with an unprecedented corruption scandal involving its state-owned oil company.

“It is tough for the BRIC countries to all repeat their remarkable growth rates” of the first decade of this century, said O’Neill, a Bloomberg View columnist and former chairman of Goldman Sachs Asset Management International.

COLUMN-Lead, a market desperately seeking a good story – by Andy Home (Reuters India – January 9, 2015)

January 9, 2015

http://in.reuters.com/

Jan 9 (Reuters) – Lead was the second worst performer among the major industrial metals traded on the London Metal Exchange (LME) last year. It was close but copper, which came under sustained bear attack over the closing weeks of 2014, just pipped it for the booby prize.

Unglamorous lead is now trading consistently below the $1,900-per tonne level, its weakest performance since the third quarter of 2012.

It’s also trading at a discount of more than $300 per tonne to “sister metal” zinc, so called because both have historically been produced at the same mines.

Trading lead and zinc as a relative value pair is a favoured past-time on the LME “Street” but the gap between the two is now as wide as it’s been since the end of 2008.

APATHY RULES, OK?

Lead’s relative under-performance has caused a good deal of head-scratching among analysts. Or at least those analysts who still care, because this market’s real stand-out feature over the last year or so has been collective apathy.

Proposed Murray River mine to rely primarily on foreign workers – by Wendy Stueck (Globe and Mail – January 9, 2015)

January 9, 2015

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.

VANCOUVER — If the proposed Murray River coal project goes ahead, more than half of its employees would be temporary foreign workers in 2018 – potentially the first year of operation – and it would take nearly a decade for all the hourly jobs at the project to be filled by Canadians.

HD Mining has previously discussed its plan to shift from a work force that is mostly foreign to one that is mostly domestic, saying in 2013 the mine would have a “full Canadian work force” after 10 years of production.

But documents recently filed as part of an environmental-assessment process provide more detail about that transition, and an updated estimate of the cost to build the mine of $554.9-million, compared with a previous estimate of $300-million.

According to an executive summary, the number of temporary foreign workers at the project, for which preparatory work began in 2014, would peak in 2018 at 494 – 382 hourly and 112 management employees – out of a total of 764, or nearly 65 per cent. By 2027, plans call for zero hourly foreign workers and 20 managers out of a total of 764. Those levels are projected to stay the same for the rest of the mine’s life.

The environmental assessment is taking place nearly two years after HD Mining sent more than a dozen Chinese miners home in January, 2013, over uncertainty related to a high-profile court battle.

Big Hydro’s big days are behind it – by Konrad Yakabuski (Globe and Mail – January 5, 2015)

January 9, 2015

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.

To paraphrase what another politician said about another energy megaproject, British Columbia’s plan to build a new $8.8-billion hydro project on the Peace River is hardly a no-brainer.

Depending on your assumptions about future electricity demand, environmental regulations and market trends, you could make a credible case for the 1,100-megawatt Site C power project that Premier Christy Clark has just green-lighted. But Ms. Clark’s refusal to submit her plan to a review by the B.C. Utilities Commission suggests she’s not especially confident of winning the argument.

This raises a broader credibility problem facing all of Canada’s provincially owned electric utilities. They are run by political appointees who answer to politicians who live to cut ribbons. The utilities are fiercely jealous of their prerogatives as near-monopoly suppliers of electricity and fight incursions by the private sector. When they make the business case for a new publicly financed hydro megaproject, it’s hardly an objective exercise.

So, from Newfoundland to B.C., hydro megaprojects are back in fashion. From Muskrat Falls to Site C – with Quebec’s La Romaine and Manitoba’s Keeyask and Conawapa in between – governments are again betting billions on Big Hydro. But they are confusing economic development with sound energy policy.

Barrick Gold Corp comes under fire, cut to underperform in extensive analyst report – by Peter Koven (National Post – January 9, 2015)

January 9, 2015

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

Barrick Gold Corp. has received plenty of criticism from the investment community over the past few years, much of it deserved. But few have been as thorough and pointed as Macquarie Capital Markets analyst Ron Stewart.

Over the course of a 17-page report released Wednesday, he argued the battered stock should still be avoided, even though it has already dropped more than 70% over the past three years, and pointed to a lot of faults at Barrick: lack of growth, excess debt, poor strategic clarity, operating risk and a head office that appears to be in turmoil.

Nearly every sell-side analyst calls Toronto-based Barrick a buy or a hold. But Mr. Stewart downgraded it to underperform with a target of $11 a share, noting the company has “limited options” to repair its balance sheet and needs more time to regain investor confidence.

“Miners are known for their ability to dig holes; big miners dig big ones,” he said in the report. “Barrick, the biggest gold miner on the planet, however has dug itself into a huge financial hole that is going to be difficult to get out of any time soon unless metal prices improve.”

Of course, he noted the company’s two biggest errors of the last few years: the botched construction of the Pascua-Lama project in South America and the $7.3-billion purchase of the Lumwana mine, which is set to be shuttered because of a massive royalty hike in Zambia.

Harper-Wynne meeting a ‘good discussion,’ but not end of their cold war [Ring of Fire conflict] – by John Ivison (National Post – January 9, 2015)

January 9, 2015

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

The late unpleasantness between Kathleen Wynne and Stephen Harper may appear to have been resolved by their meeting last Monday in Toronto.

But, behind the scenes, all is not well and hostilities may be resumed when the Ontario Premier travels to Ottawa to speak on the state of the federation at a Canada 2020 conference on Jan. 20.

The suspicion at Queen’s Park is that the Prime Minister met Ms. Wynne simply to buy some peace and shut down a source of relentless criticism. The Premier had previously bemoaned the fact that Mr. Harper had refused to meet with her in 2014.

In her media availability following the pre-hockey game summit, she called the meeting a “positive step forward” and refrained from the kind of megaphone diplomacy that has characterized their relationship to this point.

But it is understood that the Premier expects to see some concrete results emerging from the conversation and that if those don’t materialize, she will go back on the offensive. The catalyst for a new cold war is likely to be the Ring of Fire in Northern Ontario.

Ms. Wynne said that she and Mr. Harper had a “good discussion” over the mineral deposit project and the provincial request for $1-billion in federal funding to match the provincial government’s planned investment.

What’s wrong with BHP Billiton? – by Amanda Saunders (Australian Financial Review – January 7, 2015)

January 9, 2015

http://www.afr.com/

What is wrong with BHP Billiton? Well, a lot, according to Bernstein’s senior mining analyst, Paul Gait. London-based Mr Gait says the Big Australian is “a colossus with feet of clay” in a 54-page note that puts BHP through the wringer.

His views are understood to be in line with those held by pockets of the market in London. BHP shares have taken a hammering there in the past five weeks, falling 13 per cent since the start of December to 1324.50 pence on Tuesday. In Australia, BHP has plunged 29 per cent since August to $28.11.

BHP does not deserve the valuation premium it enjoys over its “high-quality” peers, particularly arch-rival in iron ore, Rio Tinto, Mr Gait said.

And he said it is doubtful BHP is ¬willing to take responsibility for capital discipline, including withholding supply. He accuses the mining giant of “hubris” over its potash strategy.

BHP has a set of some of the highest quality, best-run assets in the game across its four pillar commodities – iron ore, copper, coal and petroleum. That quality, combined with low operating costs and broad diversification have made BHP a “must-own” mining stock.

Commodities conundrum a hard one to puzzle out – by Hilary Joffe (Business Day Live – January 7, 2015)

January 9, 2015

http://www.bdlive.co.za/

WILL the positives for SA’s economy of a lower oil price outweigh the negatives of lower commodity prices all round? It’s hard to get economists to agree on the question, let alone the answer.

The new year’s collapse in the oil price has fuelled a raging debate on how low it will go and for how long. What will happen to other commodity prices is the subject of almost as much debate, however, and the balance matters a great deal for SA.

In oil, the fall has been sudden and steep and, at not much more than $51 a barrel yesterday, the Brent crude oil price was about 55% down on its June 2014 level. But the 40% slide in iron-ore prices over the past year or so has been almost as sharp, if more gradual, as was a 40% decline in thermal coal prices since 2011.

The common factor is weak global growth, and in particular the slowdown in China’s economic growth rate and the shift in the composition of China’s growth away from the heavy investment and infrastructure-led pattern of the past. That’s the underlying factor in what most would agree is a structural shift in global commodity markets over the past couple of years — some would call it the popping of the commodity supercycle bubble.

SA and other emerging market commodity exporters benefited hugely from that supercycle in the years leading up to the crisis.

China challenges India’s polished diamond throne – by Tanya Ashreena (Reuters U.S. – December 25, 2015)

January 9, 2015

http://www.reuters.com/

NEW DELHI, Dec 26 (Reuters) – India’s long-held position as the world’s top diamond polisher is being challenged by soaring output from China, compelling the south Asian country to seek help from ally and top rough diamond supplier Russia to defend its market share.

India has traditionally relied on the middlemen in trading hubs of Antwerp, Tel Aviv and Dubai for its supply of rough diamonds, which mainly come from Russia or Africa. Most of the world’s diamond output is sent to India for cutting and polishing before being retailed around the world.

But China has managed to break the established trade route by getting diamonds directly from African mines in which Chinese companies have a stake. This has boosted the value of China’s net exports of polished diamonds by 72 percent in the past five years to $8.9 billion.

While India’s exports, supplied by firms such as Asian Star , Gitanjali Gems Ltd and Venus Jewel, rose 49 percent to $14 billion over that time, shipments have seen a sharp drop this year.

“China’s active procurement of rough supply from African countries was reducing the supply available to Indian manufacturers,” said Sandeep Varia, an executive of Indian industry body Assocham. “Many units across the country had to lay off workers due to losses.”

History of Mining: The evolution of shaft sinking systems (Part 5 of 7) – by By C. Graham and V. Evans (CIM Magazine – February 2008)

January 9, 2015

http://www.cim.org/en/

Shaft sinking from 1940 to 1970: The Golden Age

The period between 1940 and 1970 can really be called the golden age of shaft sinking. It was during this period of time that the shaft sinking records, which still stand today, were in a number of countries around the world. Listed below are the shafts which were sunk at record-breaking speeds:

January 1960: President Steyn #3 shaft (South Africa) — 1,020 feet (311 metres)
March 1962: Buffelsfontein shaft (South Africa) — 1,251 feet (381 metres)
September 1964: Staric main shaft (Czechoslovakia) — 1,053 feet (321 metres)
April 1964: Proletarskaya (USSR) — 1,280 feet (390 metres)
May 1969: 17–17 Bis mine (Ukraine) — 1,316 feet (401 metres)

Shaft sinkers from the Republic of South Africa generally claim to hold the shaft sinking record for their sinking project at the Buffelsfontein mine in 1962; however, as can be seen from the list above, both the Russians and the Ukrainians were faster.

The South Africans used much larger sinking crews than Europe or North America. Table 1 compares statistics on some of the shafts sunk during this period. Note the number of persons employed on the Buffelsfontein project.

History of Mining: The evolution of shaft sinking systems (Part 4 of 7) – by By C. Graham and V. Evans (CIM Magazine – February 2008)

January 9, 2015

http://www.cim.org/en/

Shaft sinking from 1900 to 1940: start of the Modern Era

Mine shafts sunk during 1900 to 1940 in North America were almost all rectangular, timbered shafts while in Europe nearly all were circular and lined with brickwork or concrete. The reason for this was ground conditions. The majority of North American shafts were sunk in hard, competent rock. In Europe, on the other hand, the majority of the shafts sunk were in soft sedimentary rock, often with major water-bearing strata.

This was a busy period for shaft sinkers in a number of areas in the world. In the Ruhr district of Germany alone over 200 shafts were sunk: 124 shafts (1904–1914); 71 shafts (1915–1932); 13 shafts (1933–1940).

This was also an exciting time for the Canadian mining industry, with many of the famous mining camps opening up from 1900 to 1940. After the discovery of silver in Cobalt, Ontario, in 1903, prospectors ranged widely over the Precambrian areas of Ontario, Quebec, Manitoba, Saskatchewan and the Northwest Territories. In Ontario and Quebec, Abitibi and Larder Lake were discovered in 1906, Porcupine in 1909, Swastika in 1910, Kirkland Lake in 1911, Matachewan in 1916, Rouyn-Noranda in 1924 and Red Lake in 1925.

In Manitoba, the Rice Lake district was discovered in 1911, and in the Northwest Territories the deposits in the sediments in the Yellowknife area were discovered in 1933 and those in the greenstones in 1935. In Saskatchewan, the Box and Athona mines were discovered in 1934 and three shafts were sunk at these properties in the La Ronge gold belt.