Kazakhstan and the Emerging Market Gold Rush – by Paolo Sorbello (The Diplomat- February 4, 2015)

http://thediplomat.com/

Kazakhstan produces around 22 tons of gold each year, a figure comparable to neighboring Kyrgyzstan (18 tons), but only a quarter of Uzbekistan’s production (92 tons). Gold is not a major feature of Kazakhstan’s mining industry, which is dominated by chromium, copper, zinc, and uranium, but it is becoming a key asset for the country’s central bank.

All of the gold produced in Kazakhstan for the last two years has been bought out by the central bank, both under the supervision of former chairman Grigori Marchenko and through the orders of his successor, Kairat Kelimbetov. Albert Rau, Kazakhstan’s minister for investments, said that “given the turbulent global economy condition, the National [Central] Bank has been buying out all the fine gold produced.” The reason for this gold rush can be explained by a spiral of financial decisions by central banks across the world.

Gold prices suffered a hit as the U.S. Federal Reserve (Fed) was rumored to increase rates this year for the first time in nearly a decade. Apart from short-term fluctuations, however, the precious metal is still priced at just below $1,300 per ounce. The eurozone instability and the Swiss franc’s decoupling from a single-currency peg have turned gold into a more palatable commodity for investors.

Contextually, China, Russia, Belarus, Malaysia, Iran, Azerbaijan, and Kazakhstan have hoarded gold to diversify their portfolios and avoid excessive competition for the dollar that would only strengthen the greenback against their own currencies. Only countries that are financially stable – or that are trying to recover from shocks, like Russia and other oil-exporters – are in the market for gold. Financially weaker countries, such as Mozambique, Ukraine, and Tajikistan, had to reduce gold reserves to fuel their national economies.

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South Korea’s POSCO faces another setback in India – by Krishna N. Das and Jatindra Dash (Reuters India – February 5, 2015)

http://in.reuters.com/

(Reuters) – South Korea’s POSCO (005490.KS) will have to bid for an iron ore licence to feed its planned $12 billion steel plant in India, a minister said, in a setback for the company that was expecting the government to allocate it a mine without any competition.

The project to be set up by the world’s sixth-largest steelmaker has been caught up in a regulatory maze for the past decade, but the company had waited in the hope of getting preferential access to iron ore in Odisha.

But steel and mines minister Narendra Singh Tomar on Thursday ruled out an exception to an executive order mandating auctions for all new mines. This will mean POSCO’s costs will likely rise if it does manage to win a mine.

“Even I’ll have to bid for a mine if I want one,” Tomar said, as the government looks to overhaul the past practice of handing over mines and reduce chances of corruption. The government’s decision, however, goes against the recommendation of Odisha to grant POSCO a mine without an auction.

“It was an international commitment and we had recommended on the basis of the request made by the (previous) central government,” Odisha’s steel and mines minister Prafulla Kumar Mallik told Reuters. “If POSCO will have to bid, it will be a setback for the project.”

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Currency conspiracy theory wide of the mark with iron ore – by Clyde Russell (Reuters U.S. – February 5, 2015)

http://www.reuters.com/

LAUNCESTON – Some people love conspiracy theories and the latest is that the Australian central bank is deliberately weakening its currency to save the country’s big iron ore miners.

That’s the opinion of Lourenco Goncalves, chief executive of U.S.-based iron ore and coal miner Cliffs Natural Resources but, like virtually all such theories, it fails the test of logic and credibility.

Goncalves argues that the Reserve Bank of Australia (RBA) has manipulated its currency to help his much bigger rivals, the Anglo-Australian pair of Rio Tinto and BHP Billiton.

In comments made on Tuesday, the same day Australia’s benchmark rate was cut by 25 basis points to a historical low of 2.25 percent, the outspoken CEO said the RBA was “taking no prisoners” with the Australian dollar.

“They want to help BHP, they want to help Rio Tinto, they want to help that lady over there, Gina whatever,” Goncalves said, a reference to Australia’s richest person, Gina Rinehart, whose company is due to start up the 55 million tonne a year Roy Hill mine in Western Australia later this year.

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B.C. conservation officers raid two sites in Mount Polley investigation – by Sunny Dhillon (Globe and Mail – February 4, 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 — Conservation officers investigating the Mount Polley mine spill have finished raiding two sites, though it remains unclear what charges could be laid, or when.

Officers executed search warrants at the mine, near Williams Lake, and the company’s Vancouver office on Tuesday. The spill occurred in August, when 25 million cubic metres of water and mining waste breached a tailings pond and entered Polley Lake and Quesnel Lake.

The investigation is being led by the B.C. Conservation Officer Service, a government agency that focuses on natural resource law enforcement and human-wildlife conflicts.

Chris Doyle, an agency inspector, said Wednesday he could not indicate when the investigation would be complete. “We don’t have a firm timeline, just due to the complexity of the investigation. The goal is obviously to gather the best evidence possible,” he said in an interview.

Mr. Doyle was tight-lipped when asked what officers were hoping to recover from the raids. More than 70 officers were involved, he said.

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Crashing Ruble Means Russia Has Cheapest Costs for Gold – by Andrey LemeshkoYuliya Fedorinova (Bloomberg News – February 3, 2015)

http://www.bloomberg.com/

(Bloomberg) — The ruble is crashing. Oil is at a five-year low, and economic sanctions have slammed the brakes on the economy. It’s a good time to mine gold in Russia.

With gold typically priced in dollars, and labor and other expenses paid in rubles, Russian mining companies led by Polyus Gold International Ltd. are gaining from the weak currency. It doesn’t hurt that the price of gold has climbed about 7 percent this year as slowing world economies spur demand for the metal.

Russia is the biggest producer after China and its mining companies now have the lowest costs in the world, according to BCS Financial Group, a Moscow-based investment company. What’s more, the country’s central bank is buying up gold from domestic companies as efforts to curb the economic crisis decrease its foreign currency reserves.

“This year may become historically best for the Russian gold producers in terms of margins,” said Kirill Chuyko, head of equity research at BCS Financial Group, in a telephone interview. “Despite the double-digit inflation, their costs may decline as much as 25 percent this year.”

Still, the gains may be less pronounced in the future, according to Natalia Orlova, chief economist at Alfa Bank in Moscow. The central bank’s gold reserves may now be adequate, she said, and its purchases may not climb at the same pace as in 2014.

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Will this year’s Mining Indaba be changing for the better? – by Lawrence Williams (Mineweb.com – February 4, 2015)

http://www.mineweb.com/

Jonathan Moore, MD of one of the world’s biggest resource investment conferences, talks to Mineweb on how this this major event is still evolving.

The exodus of people from the mining financial and investment capitals of the cold northern hemisphere to Cape Town’s balmy summer climate is already under way, and will become something of a flood as the week continues. They will be heading to the Investing in African Mining Indaba and the satellite events springing up around Africa’s, and one of the world’s, biggest mining investment conferences. What changes are they likely to see this year following the event’s change of ultimate ownership to the London-based Euromoney empire.

Talking to Jonathan Moore, the Mining Indaba’s MD for the past five years (although ownership has changed the specific Indaba conference organisation group continues under his direction), we are already beginning to see changes as the event continues.

Maybe it has plateaued in numbers of attendees for the moment, but that is more a function of the big downturn in the global mining sector as much as anything conference-specific. And anyway Cape Town is perhaps hard pressed to accommodate many more people at this the peak of its tourist season.

Overall the conference organisers are expecting around 7,000 attendees – and with accompanying spouses, ‘very good friends’, and those attending satellite events, or just hanging around on the conference periphery to take advantage of possible networking opportunities without paying for conference attendance, there will probably be some 10,000 plus related people heading south and thus helping boost the Cape Town economy.

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City eager to work with chiefs on rail link to Ring of Fire – by Len Gillis (Timmins Daily Press – February 5, 2015)

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – Mushkegowuk Grand Chief Lawrence Martin says the chiefs and Elders who gathered in Kashechewan last week agreed to the idea of taking over Ontario Northland Railway and extending rail service to the Ring Of Fire.

Along with that, Martin said he wants Timmins to be included in the venture with this city becoming the site of a new chromite ore refinery. Timmins Mayor Steve Black said he supports the Mushkegowuk initiative.

The idea, which was first revealed by The Daily Press two week ago, seeks to expand the Ontario Northland rail link north beyond Moosonee, to include other communities on the James Bay coast and on to the Ring of Fire.

Martin, who is meeting with government officials in Toronto this week, said he was more than pleased with the fact that the Mushkegowuk Tribal Council annual general assembly, held in Kashechewan last week, gave full support to the railway expansion idea.

“Yes, it went very well,” Martin said. “What we did first is show the people all the activity in and around the area, all the mining claims in our territories, some of the exploration work that is going on now and the expansion of De Beers and, of course, all this talk of the Ring Of Fire.”

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Canadian’s trust in corporate leaders drops to lowest level since 2008, report says – by Theresa Tedesco (National Post – February 3, 2015)

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

Canadians want more government regulation of the food and beverage, banking and health industries at a time when public confidence in business and corporate leaders is waning, according to global research released by public relations giant Edelman.

Trust levels declined dramatically in the past year in Canada to thresholds not seen in this country since the financial crisis in 2008, according to the annual Edelman Trust Barometer. Only 47% of Canadian respondents said they trusted business, down significantly from 62% in 2014, while confidence levels for chief executive officers dropped to 28% in Canada in early 2015, down from 33% in 2014.

“These numbers signal the economic recovery may be over,” said Richard Edelman, chief executive of Edelman, which publishes the survey results. “Certainly Canada’s economy is softer this year than it was last year.”

In total, 33,000 people were surveyed in 27 countries and, overall, 57% of the respondents said they trusted business, slightly down from 59% in 2014. However, businesses’ credibility slide below the 50% threshold on a global scale was registered in more than half of the countries surveyed by Edelman– the worst reading since 2008. The largest double-digit declines of 10 percentage points or more were found in Canada, Germany, Australia, and Singapore.

The opposite was true in the U.S., where confidence in business rose to 60% from 58% in 2014, as the American economy continues its recovery.

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NEWS RELEASE: [Edelman Trust Barometer] Trust in Institutions Drops to Level of Great Recession

 

http://www.edelman.com/insights/intellectual-property/2015-edelman-trust-barometer/

2015 Edelman Trust Barometer Finds Overly Rapid Pace of Change in Business Innovation

PUBLISHED JANUARY 19, 2015

The 2015 Edelman Trust Barometer reveals an alarming evaporation of trust across all institutions, reaching the lows of the Great Recession in 2009. Trust in government, business, media and NGOs in the general population is below 50 percent in two-thirds of countries, including the U.S., U.K., Germany and Japan. Informed public respondents are nearly as distrustful, registering trust levels below 50 percent in half of the countries surveyed.

“There has been a startling decrease in trust across all institutions driven by the unpredictable and unimaginable events of 2014,” said Richard Edelman, president and CEO, Edelman. “The spread of Ebola in West Africa; the disappearance of Malaysian Airlines Flight 370, plus two subsequent air disasters; the arrests of top Chinese Government officials; the foreign exchange rate rigging by six global banks; and numerous data breaches, most recently at Sony Pictures by a sovereign nation, have shaken confidence.”

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FORD MOTOR COMPANY NEWS RELEASE: WHY BARRICK GOLD CORP. HAS ORDERED 35 ALL-NEW FORD F-150S AFTER SECRETLY TESTING F-150 ALUMINUM CARGO BOXES


 

FEB 2, 2015 | DEARBORN, MICHIGAN

  • Barrick Gold USA, one of three Ford customers chosen to blindly test two prototype F-150 pickups with experimental aluminum-alloy cargo boxes, has placed an initial order for 35 all-new 2015 F-150 trucks
  • Barrick testing helped improve the all-new, high-strength, military-grade, aluminum-alloy-bodied F-150 – the toughest, smartest, most capable F-150 ever
  • Barrick accumulated more than 100,000 miles on its two F-150 test vehicles, putting the trucks through the harshest challenges daily; workers would literally throw heavy pieces of equipment into the cargo bed, including large pumps, motors and specialty tools

After helping Ford torture test prototypes of aluminum pickup truck boxes, Barrick Gold USA is placing an initial order for 35 all-new F-150s – the toughest, smartest, most capable F-150 yet.

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TransCanada CEO says Canada needs to resolve conflicts over pipelines – by Jeff Lewis (Globe and Mail – February 5, 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.

CALGARY — Canada’s push to become a global resource powerhouse is at risk of failing unless government leaders take action to resolve the many conflicts holding up key projects, the head of the company behind the Keystone pipeline says.

TransCanada Corp. chief executive officer Russ Girling said Wednesday that Canada faces fundamental choices about the future of the country’s economy, including questions around aboriginal relations, resource extraction and pipeline development.

Those issues have pitted industry against opponents, transforming once-staid pipeline hearings into a forum for oil sands critics. Meanwhile, infrastructure projects are shouldering long-standing aboriginal grievances with the federal government, Mr. Girling said in a meeting with The Globe and Mail’s editorial board.

“We’ve got to quit the little bickering that goes on between us and get to the bigger picture and let the institutions that we charge with managing the public good get on with doing their job,” he said.

His comments point to the growing frustration in the energy sector as Alberta’s oil patch braces for an extended slump due to the dramatic plunge in crude prices.

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