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Day: March 26, 2015

First Nations oppose Noront, Cliffs deal in Ring of Fire – by Jody Porter (CBC News Thunder Bay – March 26, 2015)

http://www.cbc.ca/news/canada/thunder-bay

‘We’re not in such a rush. We’re willing to do this well,” Eabametoong Chief Elizabeth Atlookan says

Plans by Noront Resources to buy Cliffs’ chromite assets in northern Ontario’s Ring of Fire mining area are a “barrier to future opportunities” and a “threat to aboriginal and treaty rights,” say First Nations chiefs opposed to the deal.

Noront announced the $20-million deal on Monday. The purchase requires court approval and won’t be finalized until at least mid-April because Cliffs’ Quebec subsidiary is in restructuring proceedings under the Companies’s Creditors Arrangement Act.

The Matawa Chiefs Council, representing the eight First Nations closest to the proposed mine sites, went public Wednesday with plans to stall the deal before it is finalized.

“Our rights to the chromite deposit are recognized by the fact that the province and mining companies have already made promises to share revenues and benefits from development,” said Neskantaga Chief Peter Moonias. “We should have had a voice in the sale.”

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Beijing to Shut All Major Coal Power Plants to Cut Pollution (Bloomberg News – March 23, 2015)

http://www.bloomberg.com/

(Bloomberg) — Beijing, where pollution averaged more than twice China’s national standard last year, will close the last of its four major coal-fired power plants next year.

The capital city will shutter China Huaneng Group Corp.’s 845-megawatt power plant in 2016, after last week closing plants owned by Guohua Electric Power Corp. and Beijing Energy Investment Holding Co., according to a statement Monday on the website of the city’s economic planning agency. A fourth major power plant, owned by China Datang Corp., was shut last year.

The facilities will be replaced by four gas-fired stations with capacity to supply 2.6 times more electricity than the coal plants.

The closures are part of a broader trend in China, which is the world’s biggest carbon emitter. Facing pressure at home and abroad, policy makers are racing to address the environmental damage seen as a byproduct of breakneck economic growth. Beijing plans to cut annual coal consumption by 13 million metric tons by 2017 from the 2012 level in a bid to slash the concentration of pollutants.

Shutting all the major coal power plants in the city, equivalent to reducing annual coal use by 9.2 million metric tons, is estimated to cut carbon emissions of about 30 million tons, said Tian Miao, a Beijing-based analyst at North Square Blue Oak Ltd., a London-based research company with a focus on China.

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Barnett, Rio chief join Rinehart to pan Forrest collusion plan – by Matt Chambers (The Australian – March 27, 2015)

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

Gina Rinehart’s Hancock Prospecting has rejected fellow mining billionaire Andrew “Twiggy” Forrest’s call for an Australian iron ore cartel, adding to industry condemnation that has included Rio Tinto chief Sam Walsh calling the scheme “hare-brained”.

West Australian Premier Colin Barnett, who has called for BHP Billiton and Rio to stop flooding the market with excess iron ore and said their strategy was “dumb”, has backed away from the notion of joint action between suppliers, saying it would be ­illegal.

Mr Forrest, chairman and founder of Perth’s Fortescue Metals Group, has come under investigation from the competition watchdog this week for declaring that Rio, BHP Billiton and Fortescue should unite to cut production to drive prices higher.

The plan, labelled “extraordinary” and “concerning” by Australian Competition & Consumer Commission boss Rod Sims and “absolute nonsense” by Mr Walsh, would benefit Hancock’s Roy Hill project if it pushed prices higher, as Mr Forrest claims it would.

But Mrs Rinehart, the nation’s richest person, rejects the call. “There is nothing Australia can do about price other than be ready for it, and from an Australian perspective that means driving down our costs,” Hancock executive director, and Mrs Rinehart’s right-hand man, Tad Watroba, said yesterday from Hong Kong.

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THE DEADLY GLOBAL WAR FOR SAND – by Vince Beiser (Wired.com – March 26, 2015)

http://www.wired.com/category/business

THE KILLERS ROLLED slowly down the narrow alley, three men jammed onto a single motorcycle. It was a little after 11 am on July 31, 2013, the sun beating down on the low, modest residential buildings lining a back street in the Indian farming village of Raipur. Faint smells of cooking spices, dust, and sewage seasoned the air. The men stopped the bike in front of the orange door of a two-story brick-and-plaster house. Two of them dismounted, eased open the unlocked door, and slipped into the darkened bedroom on the other side. White kerchiefs covered their lower faces. One of them carried a pistol.

Inside the bedroom Paleram Chauhan, a 52-year-old farmer, was napping after an early lunch. In the next room, his wife and daughter-in-law were cleaning up while Paleram’s son played with his own 3-year-old boy.

Gunshots thundered through the house. Preeti Chauhan, Paleram’s daughter-in-law, rushed into Paleram’s room, her husband, Ravindra, right behind her. Through the open door, they saw the killers jump back on their bike and roar away.

Paleram lay on his bed, blood bubbling out of his stomach, neck, and head. “He was trying to speak, but he couldn’t,” Preeti says, her voice breaking with tears. Ravindra borrowed a neighbor’s car and rushed his father to a hospital, but it was too late. Paleram was dead on arrival.

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[Ring of Fire] Canada’s “Next Oil Sands Miracle” a Bust – by Rich Duprey (The Motley Fool – March 26, 2015)

http://www.fool.com/?source=illsitima0000001

Once billed as the economic equivalent of Canada’s oil sands industry, the vast oil deposits in the country’s western provinces of Alberta and Saskatchewan, where 97% of its oil reserves reside, Ontario’s Ring of Fire chromite region held the promise of being an engine of economic growth in its own right worth somewhere north of $120 billion.

Unfortunately it was also mired in parochial biases and competing interests that served to quench any fire for success.

A fraction of its value

Cliffs Natural Resources (NYSE: CLF ) was once thought to hold the key to unlocking its potential, but after suspending work in 2013 on its $3.3 billion Black Thor chromite deposit, it gave up all hope of the region ever being developed and began an orderly exit from Canada. That culminated earlier this week with the sale of all of its chromite projects to one of the Ring of Fire’s other interested parties, Noront Resources (NASDAQOTH: NOSOF ) .

Six years ago the two had engaged in a protracted bidding for the rights to the chromite properties with Cliffs emerging victorious and agreeing to pay about $240 million.

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Mining analyst weighs in on sale of Cliffs’ Ring of Fire – CBC Sudbury Points North’s Jason Turnbull Interviews Mining Policy Analyst Stan Sudol (March 25, 2015)

http://www.cbc.ca/news/canada/sudbury The mining policy analyst and owner/editor of www.republicofmining.com, Stan Sudol says the Noront Resources got a good deal in its purchase of Cliffs Natural Resources stake in the Ring of Fire. Click here: http://www.cbc.ca/player/Radio/Local+Shows/Ontario/Up+North/ID/2660705564/

Investors pinning hopes on a nickel comeback – by Barry FitzGerald (The Australian – March 27, 2015)

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

Talisman Mining (TLM)

It has got to be of some comfort to the band of ASX-listed nickel ­juniors that despite the price of the metal not going on with last year’s price rally, their market capitalisations have held up well.

Nickel got to $US21,000 a tonne last year on enthusiasm that Indonesia’s ban on the export of unprocessed ores was a big structural change that meant ­prices had to head higher. Prices for the steelmaking ingredient did for a while, but are now back at $US13,680 a tonne.

But again, the values of junior producers like Western Areas (WSA), Panoramic (PAN) and Mincor (MCR) have held up well, at least in the sense that they have not given back all of their gains achieved during last year’s price surge.

The fall in the dollar has helped. But the bigger reason seems to be that investors are betting that the nickel price is going to come storming back at some point. Macquarie’s equities desk estimates that the share ­prices of PAN and MCR appear to be factoring in a nickel price 50 per cent higher than the current price, and in the case of WSA, 27 per cent higher.

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PRECIOUS-Gold hits 3-1/2 week high as Yemen air strikes rattle markets – by Jan Harvey (Reuters U.S. – March 26, 2015)

http://www.reuters.com/

LONDON, March 26 (Reuters) – Gold rallied to a 3-1/2 week high on Thursday and silver rose nearly 3 percent as escalating tensions in the Middle East knocked stocks and the dollar and drove investors into assets seen as lower risk, like bullion and German bonds.

European stocks tumbled 1.3 percent, the dollar fell and oil prices leapt 6 percent after Saudi Arabia and its Gulf Arab allies launched air strikes in Yemen to counter Iran-allied forces besieging the southern city of Aden.

Spot gold hit a peak of $1,219.40 an ounce and was up 1.2 percent at $1,210.30 at 1028 GMT, while U.S. gold futures for April delivery were up $12.70 an ounce at $1,209.70.

That extended a rally in gold to a seventh session, its longest winning streak since 2012. Soft U.S. data earlier this week boosted expectations the Federal Reserve would keep interest rates low for the time being, lifting gold.

“Overnight we have seen risk aversion because of what’s going on in the Middle East, and the dollar is weak, because data has been weaker,” ABN Amro analyst Georgette Boele said. “The combination of dollar weakness and risk aversion is normally one where gold should do well.”

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Matawa First Nation chiefs voice objection to Noront’s Ring of Fire purchase – by Leith Dunick (tbnewswatch.com – March 26, 2015)

http://www.tbnewswatch.com/default.aspx

Chief-elect Wayne Moonias says it feels like Noront Resources and the Ontario government have put a collective gun to the heads of Northern Ontario First Nations.

Moonias, who will take the reins of Neskantag First Nation on April 1, was reacting to news earlier this week that Noront Resources Inc. was maneuvering to purchase 103 Ring of Fire claims from subsidiaries of Cliffs Natural Resources, meanwhile setting a March 31 deadline to reveal the terms of reference for its environmental assessment process for claims the company had already staked.

Moonias added Matawa First Nation chiefs, who gathered Wednesday in Thunder Bay to unanimously speak out against the sale, believe the company is operating beyond a framework agreement his people signed last year with Ontario and that First Nations should have a say in the transaction.

“We’re trying to ensure that our rights are respected and protected,” Moonias said. “This is a critical time in our communities. Those days are gone when the government and industry came in and took all the resources in our community.”

The Ring of Fire, a multibillion-dollar mother-lode of chromite and other minerals, will never be developed if true partnerships aren’t formed, the chiefs said. That means First Nations must be involved every step of the way, said Aroland First Nation Chief Sonny Gagnon.

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Mining private equity: It’s Davis or bust? – by Frik Els (Mining.com – March 25, 2015)

http://www.mining.com/

The number of mergers and acquisitions in the mining and metals industry declined to the lowest in a decade last year. Big deals were few and far between and the 11 deals worth more than a billion were miners buying mines. Overall 80% of deals in terms of value were made by industry insiders.

After years of talk, the private equity billions destined for the sector remain mostly on the sidelines (or are seeking greener pastures). The deals that have been pushed through from outsiders (or ex-insiders to be more precise) have been small, highly targeted and often go unnoticed (it’s called private equity for a reason).

All eyes are on Mick Davis and his $5.6 billion X2 fund to open the floodgates (or at least set the ball rolling). But the ex-Billiton CFO has so far failed to pull the trigger despite the likes of Anglo-American, BHP Billiton and Vale putting assets up for sale.

With X2 Davis, who is a cricket fanatic, appears to be taking a five-day test approach (which often ends without a result), rather than going for a quick Twenty20 win.

Still, the caution seems somewhat uncharacteristic. Davis built Xstrata over less than a decade through a series of billion dollar transactions into a company with 70,000 employees in 20 countries. Xstrata’s market value peaked in 2008 at $85 billion.

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Creative destruction, eh! Why there’s no reason to fear the demise of Canadian companies – by Joe Martin (National Post – March 26, 2015)

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

Don’t worry about the demise of Canadian companies. Others will replace them and become world beaters in their fields

Some observers are concerned by the destructive nature of capitalism in Canada that has seen the demise of Nortel, the near demise of BlackBerry, and the flight of automakers to Mexico. The list goes on and on. Most educated observers are aware of the problems, fewer are aware of the creative processes that continue to breathe life into the Canadian economy.

A recent Economist article noted “A lack of larger firms means fewer jobs, and a less resilient economy.” So what has happened in the Canadian corporate sector in the past 30-plus years in terms of larger employers?

In 1980 the 10 largest non-financial corporate employers had nearly 650,000 employees. In 2013, the most recent year for which there is comparable data, the top 10 employers had over 1.1 million employees, an increase of 72% at a time when the Canadian population grew at a rate of 43%. Not all of these jobs are in Canada because Canadian businesses have become more globally oriented, but then not all the jobs were in Canada in 1980.

Eight of the 10 companies on the list in 2013 were nowhere near the top 33 years ago. Let us first look briefly at the two largest: Onex, a Canadian private equity (PE) firm and Walmart Canada, the Canadian subsidiary of the American retail colossus, and then at Magna and Alimentation Couche-Tard.

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Corporate Brochure: Vale leading with innovation and out of the box thinking (Endeaver Magazine – January 2015)

http://www.littlegatepublishing.com/category/business-profiles/

Headquartered in Brazil, Vale is a global mining company that has set themselves a mission to transform natural resources into prosperity and sustainable development. Standing as the second largest producer of nickel, they are also the leaders in the production of iron-ore and present in over thirty countries across the world. The company’s footprint is as indelible as the minerals they mine and with their recent construction of the Valemax ships, their footprint is set to deepen and extend even further.

“Our operations span five continents,” Claudio Alves, Global Director Sales and Marketing says, “And are diversified across several sectors including metals, coal, fertilisers, logistics, shipping, energy and mining.”

“The industry is one of the most important in the world,” he says, “And it is up to Vale to establish parameters to determine how we conduct ourselves ethically and sustainably.”As the head of marketing and sales, Claudio is a key figure in a highly competitive and at times, controversial industry.

With much being said about the ethics of sourcing and mining limited minerals from the earth, what is seldom mentioned is that ores and the refinement of them provides vital materials for a number of indispensable items such as mobile phones, computers and even large-scale airplanes. Manufacturers of these valuable assets rely on companies like Vale to provide them with high quality ore, which Vale takes great care to source ethically and sustainably.

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Ring of Fire still emerging – Editorial (Thunder Bay Chronicle-Journal – March 26, 2015)

Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

When the bottom fell out of iron-ore giant Cliffs Natural Resources last year and the company’s big plans for Northern Ontario began to unravel, a competitor remarked that development in the Ring of Fire would still happen one day, “not just on Cliffs’ timetable.”

The remark was unfair because, up until the fall of 2013, Cliffs was the real deal: It had spent $500 million in pre-development work on its RoF properties, and was very close to operating the remote region’s first mine.

Few will forget Cliffs’ thoughtful RoF point-man, Bill Boor, especially his candour and willingness to field questions from all comers.

But many got carried away by the idea that Cleveland-based Cliffs, an established company that floated the prospect of 1,000-plus jobs, could pull it off, even as metal prices dropped.

Earlier this week, Noront Resources announced the move that many expected — the potential purchase of Cliffs’ RoF properties. The US$20 million deal, which includes the big Black Thor chromite deposit, is expected to close next month.

In announcing the plan, Noront president Alan Coutts wisely cautioned against any expectations that his company would be able to quickly pick up where Cliffs left off.

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