Nova Scotia mining industry shafted in Liberal budget – by Paul Withers (CBC News Nova Scotia – April 20, 2015)

http://www.cbc.ca/news/canada/nova-scotia

Industry claims promise of $2.6M fuel tax break was broken

Nova Scotia Premier Stephen McNeil says his government cannot afford to deliver a fuel tax break to the mining and quarry industry, even though the Liberals promised to phase in the rebate starting in 2015.

“It was our expectation and understanding that we would start getting the fuel tax rebate in the recent budget. Unfortunately the budget did not deliver on that,” said Sean Kirby, the executive director of the Mining Association of Nova Scotia.

The mining industry has argued that like farming, fishing and forestry, it should qualify for the rebate on the fuel used off public highways.

“That amounts to about $2.6 million a year in fuel taxes which we just shouldn’t be paying for the simple reason that we don’t use that fuel on highways,” said Kirby. “We use it on huge mining quarry vehicles that operate off-road.”

McNeil agrees, but said his government cannot afford to lose the revenue right now.

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Iron ore price crash erases $74b in market value – by Tess Ingram (Sydney Morning Herald – April 20, 2015)

http://www.smh.com.au/

The plummeting iron ore price has wiped $74 billion from the value of Australia’s key iron ore mining stocks since January 2014, and analysts expect share prices to continue their decline as the price for the commodity slides.

Investors that held on to the stocks while the price for iron ore sank during the past 15 months are now nursing losses in value of as much as 92 per cent.

Together, BHP Billiton, Rio Tinto, Fortescue Metals Group, Mount Gibson Iron, Atlas Iron, BC Iron, Arrium and Grange Resources suffered enormously as ore prices slumped 60 per cent from $US134 a tonne in January 2014 to $US50.93 a tonne on Friday.

A combined $73.7 billion, or 22 per cent of value, has been erased from their market capitalisations since January 2, 2014.

Excluding the diversified big miners, BHP Billiton and Rio Tinto, the combined market value of the six remaining companies has declined 71 per cent or $17.2 billion.

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Zambia: Cabinet Slashes Mining Royalties to 9 Percent – by George Mwenya (All Africa.com – April 20, 2015)

http://allafrica.com/

Zambia’s Cabinet today announced new changes to the controversial mining tax, slashing royalties for open cast and underground mining down to 9%.

Under the previous government of President Michael Sata, royalties had been bumped up to 20%, sending chills across the investment community as many multinational mining companies threatened to shut down operations.

Shortly after winning last January’s election however President Edgar Lungu suspended the controversial tax pending the new rules which were proposed today.

The suggestions will still await the approval of parliament with the date off effect set for July, 1st should parliament go ahead with the proposals.

The measures approved by cabinet include the following: Mineral royalty tax rate for open cast mining and underground mining operations will be pegged at 9 percent;

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Will solar be the bullet that kills coal? – by Andrew Topf (Mining.com – April 19, 2015)

http://www.mining.com/

For the past few years, it has been assumed that natural gas is the enemy of coal, at least in the United States, where low natural gas prices have eroded marketshare from thermal coal producers. Now, a new adversary is emerging for coal. It comes from silicon wafers, the material used to make solar panels.

According to a post in Saturday’s Quartz, a digital news outlet, a small research facility in Bedford, Massachusetts is helping to perfect a new technique for making silicon wafers, and if successful, it could reduce the cost of solar by 20 percent in the next few years.

“This humble wafer will allow solar to be as cheap as coal and will drastically change the way we consume energy,” Quartz quoted Frank van Mierlo, CEO of 1366 Technologies, the company behind the new method of wafer fabrication.

Quartz continues: The dramatic reduction in cost came from a wide number of incremental gains, says Mark Barineau, a solar analyst with Lux Research. Factors include a new, low-cost process for making polycrystalline silicon; thinner silicon wafers; thinner wires on the front of the module that block less sunlight and use less silver; less-expensive plastics instead of glass; and greater automation in manufacturing.

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BHP Spinoff’s Tailspin Is Dream for X2’s Mick Davis: Real M&A – by Brett Foley, Firat Kayakiran and James Paton (Bloomberg News – April 20, 2015)

http://www.bloomberg.com/

The plunging value of BHP Billiton Ltd.’s planned mining spinoff could hardly be better timed for the man who’s thinking of buying it.

Weeks from listing, the valuation of the new company, called South32, has plunged by almost half to as little as $7 billion, based on current prices for its products including alumina, manganese and nickel, Deutsche Bank AG estimated this month. That’s a gift for Mick Davis and his X2 Resources fund, which is weighing an eventual bid for South32, according to people familiar with his plans.

Davis, the former head of mining giant Xstrata Plc, has an untapped $5.6 billion fund that could be bolstered with debt to swallow a larger business. Amid the worst commodity slump in half a decade, South32 is still a target, with some analysts expecting its earnings to rebound when prices recover.

“They are good assets in challenged industries,” said Paul Phillips, a Melbourne-based analyst with Perennial Investment Partners Ltd., which manages about A$18.5 billion ($14 billion) of assets. “They have a lot of attractive features.”

BHP is carving off the business to focus on a smaller group of commodities and South32 is set to start trading May 18 in Australia, South Africa and the U.K. The newly formed company will include an Australian mine that’s the world’s largest silver and lead operation, a nickel mine in Colombia and aluminum assets in three countries.

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Highly anticipated Sudbury inquest opens Monday – by Carol Mulligan (Sudbury Star – April 20, 2015)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

Vale Ltd. officials say they can’t turn back the clock to before June 8, 2011, when two workers were killed at the company’s Stobie Mine.

But they said they hope the families of Jason Chenier, 35, and Jordan Fram, 26, find some comfort “in the significant work done since that night to ensure this kind of tragedy never occurs again.”

Vale issued the statement three days before the start Monday of a coroner’s investigation into the men’s death. Regional supervising coroner Dr. David Eden will preside at the inquest, at which a five-member jury will hear evidence from several witnesses at what is expected to be a 10-day hearing.

Vale said in its statement that the purpose of the inquest is to review the circumstances around the fatality so that future deaths can be prevented.

Chenier and Fram died after being overcome by a run of 350 tons of muck while they were working at the 3,000-foot level of the mine.

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Canadian miners grapple with security risks in Mexico – by Ian Bickis (Canadian Press/Winnipeg Free Press – April 19, 2015)

http://www.winnipegfreepress.com/

OAXACA, Mexico – The recent theft of $10.7 million worth of gold from a mine in Mexico has cast a spotlight on the risks of operating in the country.

The armed robbery of McEwen Mining’s El Gallo mine in Sinaloa State follows several other large mine robberies in the past five years, including multimillion-dollar heists at Pan American Silver and First Majestic.

“That’s a part of doing business in Mexico,” says Andrew Kaip, a research analyst at BMO Capital Markets. “It happens a couple times a year; a couple of these producers get hit. In most cases it’s covered by insurance.”
But it’s not just theft that’s plaguing mining companies in Mexico.

They’re now dealing as well with kidnappings and murder. Last month, four employees from Canadian-based Goldcorp were kidnapped while heading home from the mine site in a personal vehicle. One was freed, but three were later found dead.

And in February, four workers at Torex Gold Resources, also a Canadian company, were among 13 people kidnapped near the company’s Morelos gold project. All of the victims in that case were eventually freed.

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Short seller activities come to light in B.C. regulator’s probe of Silvercorp Metals Inc affair – by Peter Koven (National Post – April 18, 2015)

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

On Sept. 13, 2011, Silvercorp Metals Inc. was set to present at an investor conference in New York. And Jon Carnes and Carson Block wanted to disrupt it.

Both men were shorting Silvercorp shares, betting the stock would slide. And Carnes, who runs a hedge fund called Eos Funds, was preparing to publish a negative report on the company using the name “Alfred Little,” one of multiple pseudonyms he used. In a series of emails, the men agreed the best time to publish it would be shortly before Silvercorp’s presentation at the annual Rodman and Renshaw Global Investment conference — forcing the company to respond to questions about the report, with little time to prepare.

“Would be fantastic to start passing around paper versions of the report during the preso (presentation). Ballsy, but would be hilarious,” Block wrote in an email unearthed by regulators.

A couple of days later, Carnes emailed back and said their plan was a success. “Great idea publishing before their Rodman presentation. It was a disaster for them,” he said.

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What is on the Cards for the Coal Industry in 2015? – by Aleksandra Tomczak (Cornerstone: The Official Journal of the World Coal Industry – April 2015)

http://cornerstonemag.net/

Aleksandra Tomczak is the Policy Manager, World Coal Association.

Last year the coal industry saw a number of important changes to policies and regulations, both nationally and internationally, that directly affect coal demand and the business of mining coal. Among the most important were the repeal of the carbon tax in Australia, the EPA’s CO2 emission limits on new and existing power plants in the U.S., the EU’s initial agreement on the 2030 energy and climate package, and the election of a new prime minister in India.

Following a year that saw over 40% of the world’s population voting in national elections and major new policy developments in the key coal demand and production regions, what is on the cards for the coal industry in 2015? Undoubtedly, the major event that could structure policy and regulatory developments of interest to the coal industry in 2015 is COP21 in Paris. COP21 is expected to bring about the world’s first comprehensive climate deal.

In fact, some of the most important jurisdictions—including the EU, China, the U.S., Australia, South Africa, Australia, and Japan—will see national climate policies debated as part of the preparations for the international climate negotiations. This makes 2015 a year of strategic importance to the coal industry as it continues to make its case for the sustainable use of coal and cleaner coal technologies as part of the global mitigation strategy.

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Three pension funds oppose Barrick Gold’s executive compensation – by Lisa Wright (Toronto Star – April 18, 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.

Pension plans in Ontario, B.C. and the Netherlands say they will vote against the re-election of the miner’s board of directors at annual meeting April 28

Three of the world’s largest pension funds say they won’t support the re-election of Barrick Gold Corp.’s board of directors or its executive compensation plan that includes a pay hike of 35 per cent for the board chairman.

The Ontario Teachers’ Pension Plan, British Columbia Investment Management Corporation and the Netherlands’ PGGM Vermogensbeheer B.V., which is one of Europe’s biggest pension funds, said Friday they will oppose the Toronto gold miner’s controversial pay scheme that awards $12.9 million U.S. ahead of the board’s annual meeting April 28.

The pension funds join two major proxy advisors who recently recommended shareholders vote against a boost in executive compensation after a year in which Barrick reported a net loss of $2.9 billion and lost a third of its market value as the gold price tanked.

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Noront COO dies suddenly – by Carol Mulligan (Sudbury Star – April 20, 2015)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

The man who was the face of Noront Resources Ltd. in Northern Ontario died suddenly last week.

Paul Semple, Noront’s chief operating officer, was known and respected in the towns of Northern Ontario, First Nation communities and in the halls of government, the company said in a news release.

Semple helped shape the culture and philosophy of Noront, and his guidance and leadership will be sorely missed,” Noront said in a news release.

“As a company, we will honour his legacy by continuing to forge strong relationships and dealing honestly and inclusively with all our stakeholders,” the company said.

Noront is focused on developing the high-grade Eagle’s Nest nickel, copper, platinum and palladium deposit, and the high-grade Blackbird chromite deposit, both located in the James Bay Lowlands of Ontario in the Ring of Fire.

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The Worth of Rubies – by Thomas Biesheuvel (Bloomberg News – April 16, 2015)

http://www.bloomberg.com/

Ian Harebottle, who’s made his career from mining colored gemstones, has an emerald the size of a pineapple locked away in a safe. He’s not sold the unique bright-green rock because it’s so rare nobody really knows what it’s worth.

Welcome to the topsy-turvy world of colored gems, where abundance can mean higher prices and scarcity makes spectacular stones untradable. It’s a very different business from diamonds, the world’s most popular precious stone, traded in a liquid global market that makes pricing relatively transparent.

For colored stones, prices often increase with supply as jewelers acquire enough stock to justify marketing the gems to customers. Take regular emeralds: their value has appreciated 1,000 percent in five years as Harebottle’s Gemfields Plc and peers expanded mines, while marketing campaigns fronted by Hollywood star Mila Kunis gave demand a boost.

Now Harebottle wants to bring the same game to rubies. Gemfields’ Montepuez in Mozambique, estimated to contain as much as 40 percent of the world’s known supply of the deep-red stones, could triple output from the 8 million carats targeted for this year, according to the executive.

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