June 11, 2015 – Republic of Mining

Commentary: Should we have quotas for women on boards in Canada? – by Catherine Wade (Northern Miner – June 5, 2015)

June 11, 2015

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry.

It’s no secret that the mining industry is behind the curve when it comes to hiring women and appointing female board members. What will it take to get them onboard? Although the last couple of years have seen some increase in women representation at senior executive and director positions, the pace of change is glacial.

There are plenty of rationales provided, but none provide a reason why the typical important factors of improvement to financial, social and general corporate well-being and similar economic considerations are not driving the right decision-making in Canada and in particular in this important sector of the Canadian economy.

But it appears the tide might indeed turn in light of the recent disclosure rules of the Canadian Securities Administrators (CSA) and the recent federal budget — each announcing “comply or explain” policies requiring companies to implement a gender-diversity policy or publicly explain why they haven’t, as well as the increased industry conversation surrounding the importance of engaging women in mining in order to drive positive change and innovation.

Treasuries Collusion Said to Be Hunted in New Wave of Probes – by Keri Geiger and Matthew Leising (Bloomberg News – June 10, 2015)

June 11, 2015

http://www.bloomberg.com/

The Justice Department has begun an examination of trading in the U.S. Treasury market, following the outlines of its successful cases against Wall Street’s illegal practices in foreign currencies and other businesses, said three people familiar with the inquiry.

The government is also continuing to look into possible collusion in gold and silver markets and in trading around certain oil benchmarks, the people said.

Though the latest inquiry into Treasury trading is in its earliest stages, investigators are said to be probing whether information is being shared improperly by financial institutions. Some of the world’s biggest banks and their subsidiaries pleaded guilty after traders were shown to be using chat rooms, which functioned as cartels, to coordinate positions on foreign-exchange markets. These practices violated federal antitrust laws. Some of the same banks were among those that settled fraud and antitrust investigations into manipulating key interest rates.

After the most recent flurry of guilty pleas — from firms including JPMorgan Chase & Co., Citigroup Inc., Royal Bank of Scotland Group Plc, Barclays Plc, Deutsche Bank AG and UBS Group AG — banks are in no position to be anything other than cooperative with investigators.

OPINION: South Africa: The Scandal of South Africa’s Sick Miners – by Pete Lewis (All Africa.com – June 11, 2015)

June 11, 2015

http://allafrica.com/

Human rights lawyers have been engaged for ten years in a bid to secure massive damages for former gold miners who suffer from silicosis and TB. As the case heads for the courts, the mining industry is scrambling to offer its own and much less comprehensive solution.

Too sick to work, cared for by women and families who can barely scratch a living, hundreds of thousands of former gold miners number among the disabled, dying and dead victims of an inadequate compensation system.

This issue, brushed under the carpet during the apartheid era, has become public after 20 years of democracy, against all efforts by the mining companies to keep it buried.

Over the past century, South Africa developed a legislated system for the compensation of workers who are injured at work, or who contract an occupational disease, in line with conventions developed over time by the International Labour Organisation.

Such systems are supposed to provide workers (and their dependent spouses and children) with a lump sum or pension for permanent disability, and lost wages for temporary disability. They are also supposed to cover medical costs of treatment, care, and rehabilitation.

Ferrochrome makers demand reopening of shut chromite mines – by Jayajit Dash (Business Standard – June 10, 2015)

June 11, 2015

http://www.business-standard.com/

The closure of some key chromite mines has triggered acute shortfall of chrome ore and ore concentrates for these units

Bhubaneswar – Faced with serious jeopardy in running their units due to inadequate chrome ore supplies, ferrochrome makers in the state have called for reopening of chromite mines that have remained shut since a Supreme Court order on illegal mining in May 2014.

The closure of some key chromite mines has triggered acute shortfall of chrome ore and ore concentrates for these units. The shortage for non-captive ferrochrome units stands at over one million tonne against their annual requirement of 1.4 million tonne.

“Chrome ore production has dropped drastically due to shutdown of mines. As a result, ferrochrome makers are suffering. We have urged the state government to extend the validity of closed chromite mines like they did for iron ore mines, which were also shut on the apex court’s order.

Now that the government has issued orders for reopening of some iron ore mines, we believe that it will do the same in case of the closed chrome ore mines,” said Vishal Agarwal, vice chairman and managing director, Visa Steel and chairman, Odisha expert committee of Indian Chamber of Commerce (ICC).

Zimbabwe: Govt Lifts Chrome Ore Export Ban – by Conrad Mwanawashe (All Africa.com – June 11, 2015)

June 11, 2015

http://allafrica.com/

Government has lifted the ban on chrome ore exports and scrapped the 20 percent export tax on the mineral in a move expected to improve viability of miners, create thousands of jobs and improve revenue inflows for the fiscus, a Cabinet minister announced.

The Government also raised royalty fees for chrome ore to 5 percent from 2 percent, Mines and Mining Development Minister Walter Chidhakwa said yesterday. The ban on chrome exports was imposed in April 2011 to encourage beneficiation of the mineral.

“The ban on the export of chrome ore negatively affected all small-scale (artisanal) chrome ore producers, who lost their economic ventures and livelihoods,” said Minister Chidhakwa during a Press conference also attended by his Finance and Economic Development counterpart Patrick Chinamasa.

“In addition, the ban on the export of chrome ore did not create opportunities for smelters to invest in new technology for expanded value addition and beneficiation.

“In addition, in order to assist chrome ore producers to operate viably (and) to allow them to create investment capacity in smelting, Government decided to reduce electricity tariffs from eight cents to 6,7 cents per kilowatt hour for chrome ore producers.

Brace for surging BRICs, BHP chief Mackenzie warns – by Scott Murdoch (The Australian – June 11, 2015)

June 11, 2015

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

BHP Billiton chief executive Andrew Mackenzie has warned Australian miners to expect a surge of competition from rival countries selling to China, as the Asian giant strengthens business and diplomatic ties with a number of mineral-producing nations.

In Beijing, Mr Mackenzie told The Australian China’s growing relationship with Latin America, especially Brazil, could be a risk to Australia’s export levels in future.

Mr Mackenzie said Australian producers needed to ensure their Chinese customers were confident that security of supply would not be affected over the next few years.

Mr Mackenzie chaired a high-level meeting with Premier Li Keqiang and 14 top global chief executives at the Great Hall of the People on Tuesday to examine China’s economic transformation. The Chinese government has put in place an official target for the economy to grow by 7 per cent this year.

Belgium’s ‘mining Monaco’ looks fondly on anarchic past after Waterloo – by Barbara Lewis (Reuters U.S. – June 11, 2015)

June 11, 2015

http://www.reuters.com/

KELMIS, BELGIUM – As the field of Waterloo is dressed in battle colors to mark next week’s 200th anniversary, another corner of Belgium is preparing for a less warlike bicentenary.

In one of the more arcane consequences of the new European borders that followed Napoleon’s defeat outside Brussels, a tiny statelet was born. For a century after Waterloo, the square mile that diplomats named Neutral Moresnet, on the present-day Belgian-German border, thrived in a state of virtual anarchy.

Today’s inhabitants of what is now part of the Belgian town of Kelmis fondly recount a largely lawless but prosperous history of freewheeling independence and are gearing up for their own bicentenary celebrations next year.

“We are very proud of the town’s past, particularly its ability to manage its own economy,” said alderman Erik Janssen. “The history of Kelmis is a fundamental part of the history of Belgium.”

Abitibi Royalties Inc gets creative to find mining investment opportunities – by Peter Koven (National Post – June 11, 2015)

June 11, 2015

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

Ian Ball is trying to do something that is almost unheard of in the mining industry: use the Internet in a creative way.

Ball, the president of Abitibi Royalties Inc., launched an online platform this week called the “Abitibi Royalties Search.” The website invites cash-poor junior mining companies to submit data on their projects. If Abitibi likes what it sees, it will cover the cost of the claim fees and taxes on the project, which may be unaffordable for the struggling miners. In return, Abitibi receives a permanent royalty.

“We could provide royalty financing for a portion of the market that’s never qualified before, which (is) the junior explorers,” Ball, 33, said in an interview.

Abitibi is a tiny player in the mining royalty space, which is dominated by Franco-Nevada Corp., Royal Gold Inc. and Osisko Gold Royalties Ltd. Those firms will always get first crack at the most promising royalties, and they have billions of dollars to spend on them. Abitibi only has about $35 million to play with, and needs to think creatively and target early-stage projects if it wants to find opportunities that the big players overlook.

Alberta’s oil sands take a hit as scientists, academics call for halt to development – by Shawn McCarthy (Globe and Mail – June 11, 2015)

June 11, 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.

OTTAWA — Alberta’s oil sands producers have suffered another hit to their reputation, as a group of prominent scientists and academics called for a moratorium on further development due to environmental concerns.

Decisions on oil sands development “add up to a social and environmental legacy that will last for generations,” Simon Fraser University ecologist Wendy Palen said on a conference call Wednesday. Ms. Palen said the group pulled together scientific research on oil sands development from their various fields and reached a consensus: “We offer a unified voice, calling for a moratorium on new oil sands projects.”

In a statement signed by 110 researchers from across North America, the group says the planned growth in oil sands production is inconsistent with efforts to cut greenhouse-gas emissions and avert the worst impacts of climate change, and also threatens the ecosystem of a vast stretch of the boreal forest.

“No new oil sands or related infrastructure projects should proceed unless consistent with an implemented plan to rapidly reduce carbon pollution, safeguard biodiversity, protect human health and respect [aboriginal] treaty rights,” their statement said.

[Sudbury] Laurentian prof says it’s time for the ‘40% mine’ (CBC News Sudbury – June 9, 2015)

June 11, 2015

http://www.cbc.ca/news/canada/sudbury

Reducing energy usage by 60% has multiple benefits, Dean Millar says

Energy conservation is the key to maintaining the viability of older mines and ensuring the profitability of new ones, a professor at Laurentian University says.

Dean Millar, who was recently named a distinguished lecturer by the Canadian Institute of Mining, Metallurgy and Petroleum, will be touring the country to spread the word that employing modern technology in the age-old business of extracting minerals from the ground has multiple benefits.

“The 40-per-cent mine is shorthand for the idea that we could reduce energy consumption to support mine production to a level of 40 per cent of what it currently is by the year 2040 by using renewable energy technologies, by embracing energy efficiency and the state of the art in poly-generation (the sequential production of electricity and thermal energy in the form of heat or steam, or useful mechanical work, such as shaft power, from the same fuel source) and other modern technologies which are routinely used in other industries and bring them to mining,” said Millar.

People in the industry scoff at the notion initially as a “load of rubbish,” Millar said.

Mining Investments in Chile to Soar Over the Next Decade – by Anne Lu (International Business Times – June 11 2015)

June 11, 2015

http://www.ibtimes.com.au/

Chile will continue to be the most attractive Latin American country to foreign mining investors, as mining investments in the country are expected to reach a value of about US$64 billion [$82 billion] by 2025, said state copper commission Cochilco.

Cochilco head Alex Matute Johns noted that Chile’s copper output is expected to jump up to around eight million tons per year by 2025. He also predicted that foreign investments would soar from US$23 billion last year to about US$28 billion by 2017. State-owned copper giant Codelco is expected to carry out 47 percent of Chile’s portfolio of planned mining investments.

But aside from copper, Chile is also a top producer of titanium, with the likes of White Mountain Titanium Corporation (OTCQB: WMTM) operating in northern Chile’s Atacama region. Its flagship Cerro Blanco project currently consists of 41 registered mining exploitation concessions and 34 mining exploration concessions over approximately 17,041 hectares of mineral sand. As of March 2015, nine prospects have been identified along a four-kilometre strike length, with an estimated rutile resource of 112 million tonnes at 1.73 percent titanium dioxide and 69 million tonnes at 1.37 percent titanium dioxide.

Another Chilean mining company, Mineria Activa, aims to develop Chile’s rare earth minerals market based on a recent survey that showed that there are major concentrations of neodymium and dysprosium south of Chile’s capital, Santiago.

Miners Wait Years to Get U.S. Permits as Republicans Push Reform – by Stephen Stapczynski (Bloomberg News – June 9, 2015)

June 11, 2015

http://www.bloomberg.com/

The $6 billion Resolution Copper Project in Arizona was discovered almost two decades ago and is slated to become North America’s largest copper mine. Don’t expect production to start any time soon.

Co-owners Rio Tinto Group and BHP Billiton Ltd. waited 10 years to get federal approval in December to gain access to the land. It will probably take another five years to get permits from various federal, state and local agencies for the mile-deep shaft in Arizona.

The tortuous bureaucratic process to approve new mining projects in the U.S. is among the slowest in the world, hindering access to mineral resources that the National Mining Association values at $6.2 trillion. It’s drawing criticism from mining executives and has spurred a Republican-backed push to reform mining laws.
“The U.S., by and large, is the longest of the permitting exercises,” said Diane Garrett, chief executive officer of Romarco Minerals Inc.

Romarco began applying for permits for its Haile gold mine in South Carolina in January 2011 and got federal approval in November. Because the mine is on private land, fewer agencies get to weigh in on permits than for projects on public land, and the process is typically faster. Yet, in one case, a federal agency asked the Toronto-based company to duplicate a study it had already completed for Haile, delaying the process by a year.

Fitch downgrades outlook on BHP Billiton and Rio Tinto on iron ore price (Sydney Morning Herald – June 11, 2015)

June 11, 2015

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

Rating agency Fitch downgraded its outlook on BHP Billiton and Rio Tinto from stable to negative, after revising down its price assumptions for iron ore, copper and nickel earlier this month.

BHP Billiton, the world’s largest mining firm, held its A+ rating but Fitch said on Wednesday the spin-off last month of some of its assets into a new company named South32 would have a marginally negative effect on its credit rating in the near term, weighing on projected free cashflow generation.

The outlook downgrade on A- rated Rio Tinto, the world’s second-largest mining firm, was on the back of weaker price expectations for iron ore, its main product.

“Although Rio Tinto benefits from a leading iron ore cost position, the high percentage of revenue and (earnings) generated by that single commodity exposes the company to significant risks,” Fitch said in a statement.

The rating agency confirmed its negative outlook on BBB- rated group Anglo American.

BHP Billiton’s Andrew Mackenzie defends coal in battle with gas (Australian Financial Review – June 9, 2015)

June 11, 2015

http://www.afr.com/

The Group of Seven’s ultimately unremarkable commitment to phase out fossil fuels over the next 85 years only partially reveals the dynamics of commercial self-interest and tactical first-world politics that have successfully driven a wedge between big petroleum and diminishing coal.

The idea that gas sits as a transition fossil fuel that will smooth the world’s embrace of a low carbon future has long been part of the seaborne gas industry’s pitch for long-term relevance. But it is a view that now clearly distinguishes the drillers from the miners in the debate over how the world should manage its carbon dioxide problem.

Pretty plainly, folks like Woodside chief executive Peter Coleman are saying that the gas industry has been weak-kneed about differentiating nice clean gas from its dirty cousin in carbon, thermal coal.

Coleman’s pitch to the World Gas Conference in Paris last week was strident, almost convincing and very certainly crowd pleasing. Nuclear-fuelled Paris, you see, sits at the epicentre of the rapidly shifting tectonics of coal.

France is making a rapid exit from the coal cycle.

Car czar plans to keep Ontario in auto hunt – by Peter Epp (North Bay Nugget – June 11, 2015)

June 11, 2015

http://www.nugget.ca/

That Ontario would appoint an auto industry czar speaks volumes of how quickly this province’s once-mighty auto industry has been diminished.

Ray Tanguay, a former Toyota executive, was given the nod Tuesday. He’s tasked with bringing focus to Ontario’s efforts to not only secure the industry as it exists today, but to help ensure this province remains in the hunt.

It wasn’t that long ago Ontario produced the most automobiles of any jurisdiction in North America. But Michigan and Mexico have surpassed Ontario’s output, and new investment is pouring into Mexico and several southern U.S. states.

In 2014, Ontario produced 2.1 million vehicles, down substantially from the three million produced only a few years ago. Currently, our province is ranked 10th in the world for auto production, down from seventh.

Automobile manufacturing helped build Ontario in the post-war years. To see our relevance within the global manufacturing community diminished is alarming. It speaks to lost jobs, lost taxes and lost opportunities.