February 23, 2015 – Republic of Mining

Deep sea mining hopes hit by New Zealand decision – by Jamie Smyth (Financial Times – February 22, 2015)

February 25, 2015February 23, 2015

http://www.ft.com/intl/companies/mining

Sydney – A decision to block a deep sea mining venture off the New Zealand coast has cast a shadow over an emerging global industry that proponents say could revolutionise how minerals are extracted.

The sea floor is rich in copper, nickel, manganese, cobalt, zinc and a host of other minerals used in technology products. Improvements in undersea extraction technology have now put these within reach of miners.

New Zealand has lead the way in developing sea floor mining. But progress has now stalled following this month’s rejection by environmental regulators of a proposed project by Chatham Rock Phosphate off the coast of Canterbury, the second mine application refused within a year.

The decisions were welcomed by green groups, who fret that mining would damage vulnerable undersea ecosystems, which are relatively underexplored. But their delight is not shared by companies eyeing deep sea prospects.

“To say we are bitterly disappointed is an understatement,” said Chris Castle, Chatham Rock Phosphate’s managing director. “This will make it even harder, if not impossible for companies to attract capital for new projects in New Zealand.”

For almost 20 years deep sea mining has been flagged as a commercial opportunity. David Cameron, UK prime minister, claims it could be worth £40bn to the UK over a 30-year period.

B.C. mines minister aims for right audience with next trip to Alaska – by Tamsyn Burgmann (Canadian Press/Vancouver Sun – February 22, 2015)

February 23, 2015

http://www.vancouversun.com/index.html

VANCOUVER – British Columbia’s mines minister is making plans to visit Alaska’s indigenous fishing community after admitting his first trip to the state following the Mount Polley disaster addressed “probably the wrong audience.”

Bill Bennett spoke at a major mining industry conference last fall, but met with none of the tribal groups in the southeast region presumed most threatened by upstream mining across the border in B.C.

In retrospect, Bennett said people living off the sea in the transboundary region have every right to be concerned about mines in his province, but that he wants to stem the rising anxiety by sharing more information.

“They do not have the kind of information and understanding of how we do things here in British Columbia that they need to have, and that’s probably our fault,” he told The Canadian Press. “I think that we can relieve some of these fears.”

Bennett has asked a binational economic think-tank to consider organizing a symposium to bring both sides together in one of the southeastern Alaska towns at the heart of its multibillion-dollar fishing industry.

Bennett said he hopes the Pacific NorthWest Economic Region will convene a forum in a few months to share best practices and raise awareness about B.C.’s “rigorous” permitting process.

Nearly 500 miners rescued from South African gold mine (Deutsche Welle – February 23, 2015)

February 23, 2015

http://www.dw.de/

All 486 miners trapped after a fire broke out in a South African gold mine over the weekend have been rescued. Some of the miners were trapped at a depth of nearly 3.5 kilometers.

The miners, who had been trapped by the fire, were rescued Sunday, according to officials from the Harmony Gold Mining Company.

“We are extremely grateful that all of our colleagues have been brought to surface, without injury,” said Harmony Gold spokeswoman Charmane Russell. “Fortunately in this instance, things went according to plan.”
The men were at work in the mine near Carletonville, southwest of Johannesburg, when a fire broke out at around 7:40 a.m. local time (0540 UTC). The miners were told to move to refuge bays within the mine.

“Our employees have been trained for this,” Russell said. Rescue teams were called in to contain the fire and then moved from level to level to locate the trapped miners.

South African President Jacob Zuma told his fellow citizens to keep the trapped miners in their thoughts during the rescue operation. “I urge all South Africans to keep the miners in their thoughts and prayers during this difficult period,” Zuma said.

COLUMN-Iron ore can’t go back to the future to annual pricing – by Clyde Russell (Reuters U.S. – February 23, 2015)

February 23, 2015

http://www.reuters.com/

LAUNCESTON, Australia, Feb 23 (Reuters) – Iron ore should go back to the future and reinstate annual contract pricing, according a former executive of top miner Rio Tinto. He’s wrong.

Mal Randall, who spent more than 25 years at Rio Tinto and also helped set up an Australian iron ore miner, said the move to iron ore spot pricing from 2010 onwards was a disaster, the Australian Financial Review reported on Monday.

Up to a few years ago, iron ore had been priced through annual talks between steelmakers and their largely Australian suppliers. This changed, largely at the behest of former BHP Billiton chief executive Marius Kloppers, who wanted to take advantage of a shortage of supply to generate higher returns for his iron ore mines.

“It was orchestrated and brought in by a guy that has no responsibility now, Kloppers who used to run BHP,” the newspaper quoted Randall as saying. “It’s great to make these changes and then he’s gone.”

Randall, who now chairs mineral sands company MZI Resources, is correct insofar as the spot market pricing is no longer working in the favour of the big miners.

Growing demand for cheap minerals, energy opening up high-yielding investment opportunities – by Henry Lazenby (MiningWeekly.com – February 23, 2015)

February 23, 2015

http://www.miningweekly.com/page/americas-home

NTO (miningweekly.com) – In a world where the economic outlook is uncertain and opinions diverge at best, the overarching trend of divergent lifestyles around the world is providing fuel for a new generation of critical-thinking miners have undergone a paradigm shift in approaching the business in a much cleverer, even holistic, way.

It is currently hard to pinpoint whether economies are at inflationary or deflationary inflection points, stabilising or destabilising, and a host of investors have all but written off the mining and exploration and production industries for not providing financial returns in a low-price environment.

While North Americans experience some of the highest-quality lifestyles in the world, this was not the case in places such as China, Indonesia and elsewhere in the developing world, New York-based House Mountain Partners founder and co-author of The Disruptive Discoveries Journal, Chris Berry recently told resource investors in Vancouver. But, they were gaining, and they were gaining fast.

According to him, the burgeoning global middle class and the inevitable economic growth it brought could not be supported without reliable access to cheap commodities and cheap energy, which was opening up a brave new world for shareholders trying to find high-yield investment opportunities, when bond yields globally were at historic lows or, in many cases, negative.

BHP Chief to Shed Light On Mining-Spinoff Plan – by Rhiannon Hoyle (Wall Street Journal – February 22, 2015)

February 23, 2015

http://www.wsj.com/

Coming Earnings Release Is Also Expected to Highlight Challenges Facing Company

BHP Billiton Ltd. ’s diversification across commodities from aluminum to oil earned it darling status in an industry where many of its rivals were shackled to the fortunes of a single commodity. This week, though, investors expect CEO Andrew Mackenzie to shed more light on his proposal to tack away from that strategy as BHP completes plans for one of the largest spinoffs in mining history.

The release of BHP’s fiscal first-half earnings after the U.S. market closes on Monday will also highlight the challenges facing the Anglo-Australian miner as it carves off better-performing assets such as nickel pits to focus on four commodities including iron ore and oil, the prices of which halved in value last year.

As the slide in some resources markets deepens, investors and analysts have questioned whether the timing is right any longer for a roughly $15 billion demerger that would leave BHP with four units, all of which are forecast to report an on-year decline in first-half earnings.

The miner had long championed the benefits of digging up a variety of commodities, as they often don’t rise and fall in tandem. “The diversification of our portfolio of commodities, geographies and currencies is a key strategy for reducing volatility,” the miner repeated in recent annual reports.

Barrick rides the DeLorean – by Kip Keen (Mineweb.com – February 23, 2015)

February 23, 2015

http://www.mineweb.com/

Barrick’s quest for greater relevancy.

Under the heading “Taking Barrick ‘Back to the Future’” Barrick Gold touted a plan to transform itself into a leaner, meaner cash machine with management and operational changes along with debt reductions in its forth quarter overview. Most who were around in the 1980s will get the movie reference at play. Back to the Future was a trilogy of movies that features Marty McFly, played by Michael J. Fox, who rides a time machine built into a DeLorean DMC-12 car, famously featuring gull-wing doors, to make his and his family’s present better than the past.

The nut of the first and subsequent movies is that things have not turned out as they should have, or as McFly would have them turn out. The first movie is about McFly and Doc Brown, played by Christopher Lloyd, going back to the 1950s by accident, and then their subsequent attempts to get back to the future (i.e. the 1980s) harnessing the power of lightning to run the DeLorean which, depleted of fuel, needs lots of energy to time travel. In the process, McFly rights – or rewrites – history for his family.

He helps his Dad, in a moment of confrontation, upstage Biff and save Lorraine from the then teenage bully’s advances. Soon thereafter McFly returns to the future – or the present 1980s. And what he finds is nicer than what he previously knew. His dad is no longer a loser and his mum is happy. Biff is a deadbeat.