July 20, 2015 – Republic of Mining

Podcast: The cavalry is not coming – by Warren Dick (Mineweb.com – July 20, 2015)

July 20, 2015

http://www.mineweb.com/

There’s fear and panic in the market and the commodity super-cycle is over, according to Bloomberg Intelligence’s Global Head of Metal and Mining, Ken Hoffman.

WARREN DICK: Good day, everyone. My name is Warren Dick, the editor of Mineweb.com. And joining me on the podcast today is Ken Hoffman, the global head of metal and mining research from Bloomberg Intelligence, and he is joining us from New York. How are you, Ken?

KEN HOFFMAN: I’m doing very well. How are you?

WARREN DICK: Very good, thanks. I think it might be as cold today in Johannesburg as it is in New York. I don’t know what the weather is like there.

KEN HOFFMAN: Oh, it’s absolutely perfect today, actually. Finally we are getting a little bit of summer here.

WARREN DICK: Well, I think, Ken, what we really wanted to do is just pick your brains. You guys are looking at trends in the market, and you’ve obviously seen the massive sell-off in commodity prices. That’s been pretty much indiscriminate. I think everything from iron ore to some of the precious metals we’ve seen. We’ve just seen platinum going below $1000/oz.

AUDIO: Vale expects to miss 2015 sulpher dioxide emissions target (CBC News Sudbury – July 20, 2015)

July 20, 2015

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

Company says it has some emissions credits banked from past improvements to its process

Nickel giant Vale doesn’t expect to meet its sulphur dioxide emission targets this year, a decade after they were set.

Vale was granted a five-year extension, and has until the end of this year to get its annual emissions down to 66 kilotonnes.

The company reports it’s currently emitting about 150 kilotonnes, but is aiming to be down to 20 kilotonnes by 2018 — when $1 billion worth of upgrades are completed at its Copper Cliff smelter.

“There’s going to be a couple steps,” said Dan Legrand, Vale’s director of process technology. “The big one will occur in 2018 when we start capturing all of the converter gas.”

Vale has made other changes to its emissions process — racking up government credits that allow it to miss the emissions deadline without penalty. The Ministry of the Environment is keeping a close watch.

Flexibility is key if First Nations and companies want to reach a deal – by Mark Hume (Globe and Mail – July 19, 2015)

July 20, 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: Chad Day was just five weeks into his new job as President of Tahltan Central Council when he learned of the tailings pond breach at the Mount Polley mine – and got a crash course in crisis management.

The mine, near Williams Lake, is more than 1,000 kilometres by road southeast of Tahltan territory. But the accident raised alarms in Mr. Day’s communities because the company that runs Mt. Polley, Imperial Metals, is building an even bigger tailings pond at the Red Chris mine near the Tahltan village of Iskut.

In promoting the Red Chris project, Imperial assured the Tahltan of the project’s safety by referring to the great track record the company had at Mt. Polley. Then suddenly, last August, 24 million cubic metres of tainted water and sediment were spilled into Quesnel Lake, raising the spectre of a similar accident at Red Chris, on the headwaters of the Iskut and Stikine Rivers.

Tahltan members reacted by blockading the Red Chris mine site, and a cry went up demanding Mr. Day take action.

Gold price crashes as Chinese offload – by Stephen Cauchi (Australian Financial Review – July 20, 2015)

July 20, 2015

http://www.afr.com/

Nearly $1.5 billion was wiped off the value of Australian gold shares on Monday – including $1 billion from the biggest local gold miner Newcrest – after a price crash sparked by the surprise unloading of tonnes of bullion on the Chinese market.

Australian gold miners suffered huge losses in a market that was already suffering a number of stiff headwinds. Evolution Mining lost 14.5 per cent while Northern Star Resources, Regis and Newcrest Mining were all down between 7 and 10 per cent.

Gold plummeted from $US1132 an ounce to $US1092 in the space of minutes just after 11.30am after 5 tonnes of bullion was unloaded on the Chinese market.

However, the price rebounded to $US1109 shortly after and it stayed around that level for the remainder of the day.

“There was some heavy selling on the Shanghai Gold Exchange this morning,” said Victor Thianpiriya, ANZ precious metals analyst.

Gold Rout Sends Global Miners Lower as Commodity Slump Worsens – by Stephen Kirkland and Jeremy Herron (Bloomberg News – July 20, 2015)

July 20, 2015

http://www.bloomberg.com/

The rout in commodities worsened as the prospect for higher U.S. interest rates sent gold to the lowest level in more than five years. Miners posted the steepest losses in benchmark stock indexes around the world, with selling heaviest among resource producers in emerging markets.

Bullion slid 2.4 percent to $1,105 an ounce at 11:40 a.m. in New York, sending the Bloomberg Commodity Index to its lowest since 2002. The euro traded at $1.0854, near a two-month low. The MSCI Emerging Markets Index fell 0.8 percent.

Investors have soured on precious metals as the dollar has emerged as the champion currency with the Federal Reserve closer to raising rates for the first time since 2006. AngloGold Ashanti Ltd. sank to a record in Johannesburg, while Canada’s Barrick Gold Corp. dropped to the lowest since 1990. Better-than-forecast corporate earnings took the Standard & Poor’s 500 Index within one point of a record.

“We’ve seen a resumption of a rally in the dollar and if you do the math, that’s bad for commodity prices,” said Peter Sorrentino, a Cincinnati-based fund manager at Huntington Asset Advisors Inc., which oversees $1.8 billion. “The implications there for the hard asset part of the global economy is pretty abysmal looking out to the rest of the year.”

Asteroid with platinum core worth £3.5 trillion set to pass Earth (The Independent – July 18, 2015)

July 20, 2015

http://www.independent.co.uk/

An asteroid believed to contain a platinum core worth £3.5 trillion is expected to pass Earth at around 10pm on Sunday, attracting the interest of asteroid-mining companies.

The platinum-filled space rock which is also thought to contain other precious materials is only around half a mile wide, but its metallic core is estimated to weigh 100 million tonnes making it hugely valuable.

Asteroid 2011 UW-158 will pass 1.5 million miles away from Earth, meaning it will be 30 times closer than our nearest planet, according to Slooh Community Observatory.

However, it will be six times further away than the moon’s orbit meaning it will be impossible to see with the naked eye.

Sugar Zone could be even sweeter, Harte Gold says (Northern Miner – July 17, 2015)

July 20, 2015

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

Development is picking up speed at Harte Gold’s (TSXV: HRT; US-OTC: HRTFF) Sugar Zone deposit, 60 km east of the Hemlo gold camp, with a major financing and recent bulk sampling and toll milling deals.

Harte has signed a letter of intent with Barrick Gold (TSX: ABX; NYSE: ABX) to process a 70,000-tonne bulk sample from the Sugar Zone Mine at its nearby Hemlo Mill, and inked a deal for a gold loan of up to US$6 million from metal merchant Auramet International. The term sheet with Auramet includes an undisclosed working capital facility on top of the loan of physical gold, and a final agreement is expected by the end of August.

In May, Harte Gold signed a preliminary agreement with Sudbury-based Technica Mining for a $20 million fixed price mining contract, and a final agreement is expected before the end of July. Technica expects to mine the first mineralized rock from the bulk sample in January 2016 at a rate of 300 tonnes per day.

“This will get the project started and cash flowing and then the plan is to construct our own mill on site once we have the permitting completed,” says Stephen G. Roman, Harte Gold’s president and chief executive.

Mitsubishi Materials apologizes for using U.S. POWs as slave labor – by Mariko Lochridge (Reuters U.S. – July 20, 2015)

July 14, 2016July 20, 2015

http://www.reuters.com/

LOS ANGELES – Construction company Mitsubishi Materials Corp (5711.T) became the first major Japanese company to apologize for using captured American soldiers as slave laborers during World War Two, offering remorse on Sunday for “the tragic events in our past.”

A company representative offered the apology on behalf of its predecessor, Mitsubishi Mining Co, at a special ceremony at a Los Angeles museum.

“Today we apologize remorsefully for the tragic events in our past,” Mitsubishi Materials Senior Executive Officer Hikaru Kimura told an audience at the Simon Wiesenthal Center’s Museum of Tolerance in Los Angeles.

In all, about 12,000 American prisoners of war were put into forced labor by the Japanese government and private companies seeking to fill a wartime labor shortage, of whom more than 1,100 died, said Rabbi Abraham Cooper, an associate dean at the Simon Wiesenthal Center.

Six prisoner-of-war camps in Japan were linked to the Mitsubishi conglomerate during the war, and they held 2,041 prisoners, more than 1,000 of whom were American, according to nonprofit research center Asia Policy Point.

NEWS RELEASE: Exploration and mining industry calls for government collaboration on key challenges

July 20, 2015

Industry highlights top priorities at the Energy and Mines Ministers’ Conference

HALIFAX, July 20, 2015 /CNW/ – As Canada’s Energy and Mines Ministers meet for their 72nd annual conference, Canada’s exploration and mining industry is asking governments to turn their attention to several areas that are challenging the sector during this period of economic downturn and uncertainty.

A brief submitted by the Canadian Mineral Industry Federation (CMIF), prepared by the Mining Association of Canada (MAC) and the Prospectors & Developers Association of Canada (PDAC), detailed three policy priorities that will help the industry overcome current challenges and capitalize on the opportunities before it:

1) Address challenges in the transition to Canada’s new regulatory regime and clarify the duty to consult

Ensure sufficient capacity across federal departments to conduct timely environmental assessments and improve federal-provincial coordination.
Clarify and improve the Crown’s duty to consult and accommodate Aboriginal communities, particularly issues related to ambiguity, unpredictability, discrepancies between Crown consultation policies / guidelines and consultation in practice, and provincial/territorial-federal coordination.

Global miners face succession crisis as old guard nears retirement – by Susan Taylor and Nicole Mordant (Reuters Canada – July 20, 2015)

July 20, 2015

http://ca.reuters.com/

TORONTO/VANCOUVER (Reuters) – As if slumping commodity prices and unhappy shareholders were not enough, global mining companies are also facing a looming succession crisis.

Several mining CEOs have reached or are nearing retirement age and industry executives, recruiters and analysts worry that there is not enough people with the right skills and experience to replace the old guard.

It is the price of a ‘lost generation’ – those now in their 40s who failed to find jobs in the industry during a mining downturn in the 1990s and early 2000s and have drifted elsewhere.

“There is a shortage of potential CEOs because the industry doesn’t invest in people,” said Mark Bristow, the 56-year-old Chief Executive of mid-tier gold miner Randgold Resources RRS.L.

As a result, companies may need to promote relatively green management or recruit outsiders, raising the risk of costly strategic mistakes at a time when the industry can least afford them.

Netolitzky Drills For Wealth Creation Hat-Trick In B.C.’s Golden Triangle – by Tommy Humphreys (Ceo.ca – July 20, 2015)

July 20, 2015

http://ceo.ca/

“In our business, you make it taking shots.”
Ron Netolitzky, 2014 Canadian Mining Hall of Fame inductee

Prospector Ron Netolitzky found his footing exploring for uranium in the northern Saskatchewan muskeg while oil patch consulting on the side, but it was in the mountains of northwestern British Columbia that he found his fortune.

In the late 80s, the geologist discovered the rich Snip and Eskay Creek mines in northwestern B.C.’s Golden Triangle, sparking both a staking rush on the ground and a trading frenzy on the old Vancouver Stock Exchange. Here—through a junior called Delaware Resources—Netolitzky and his partners optioned the Snip property from Cominco, who had held it for around twenty years but had never drilled it.

Commodities crash could turn Australia into a new Greece – by Andrew Critchlow (The Telegraph – July 19, 2015)

July 20, 2015

http://www.telegraph.co.uk/

The commodities boom made Australia the lucky country but rising debt and a slump in Chinese demand for resources signal tough times ahead Down Under

Last month Gina Rinehart, Australia’s richest woman and matriarch of Perth’s Hancock mining dynasty delivered an unwelcome shock to her workers in Western Australia: accept a possible 10pc pay cut or face the risk of future redundancies.

Ms Rinehart, whose family have accumulated vast wealth from iron ore mining, has seen her fortune dwindle since commodity prices began their inexorable slide last year. The Australian mining mogul has seen her estimated wealth collapse to around $11bn (£7bn) from a fortune that was thought to be worth around $30bn just three years ago.

This colossal collapse in wealth is symptomatic of the wider economic problem now facing Australia, which for years has been known as the lucky country due to its preponderance in natural resources such as iron ore, coal and gold. During the boom years of the so-called commodities “super cycle” when China couldn’t buy enough of everything that Australia dug out of the ground, the country’s economy resembled oil-rich Saudi Arabia.

BHP Billiton’s coal king Mike Henry digs in for a challenging time – by Matt Chambers (The Australian – July 18, 2015)

July 20, 2015

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

After 25 years working in and around the mining industry, Mike Henry has been given his first major role managing operations. And it’s a beauty.

In January, the former BHP Billiton marketing boss was made coal president, heading the mining giant’s lowest-margin business at a time when forecasts and prices for the commodity seem to be getting relentlessly worse and in which chief executive Andrew Mackenzie says he will not allocate capital.

But the 48-year-old Henry, who is regarded by company-watchers as a potential internal candidate to succeed Mackenzie, sees plenty of positives.

“I like a challenge and there’s lots to like here,” Henry tells The Weekend Australian from BHP’s coal headquarters on the Brisbane River. “In the first half (of 2014-15), we generated a 2 per cent return on capital and 2 per cent of BHP’s earnings before interest and tax,” he says, explaining coal’s current limited prospects for investment funds.

“My job is to take what we have and make sure that we’re getting the most we possibly can out of it.

CANADA MINING HISTORY: Gold, Greed and Glory – by John Stackhouse (Report on Business Magazine – November 1990)

July 20, 2015July 20, 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.

High in the Skeena Mountains of northern British Columbia, Ron Netolitzky stands nervously atop a 90-metre bluff. Netolitsky is a geologist from the Prairies, utterly out of his element. “I’m afraid of a 10-foot stepladder,” he confides. From the grassy peak, he surveys the remote river valleys and snow-capped mountains that lie 200 kilometers south of the Yukon border.

The only movement in sight is a heard of mountain goats on the next ridge. Summoning his courage, Netolitzky pulls a hammer out of his pocket and cautiously skates down the rust-coloured slope towards his latest mineral discovery.

To the untrained eye, all the rocks sliding underfoot look the same. But partway down, Netolitzky stops, cracks open a chunk of porphyry with his hammer and spits on the inside. After rubbing the sample clean, he wipes his hand on the same pair of ripped, orange coveralls he’s been wearing in the bush for eight years. “There,” he says, studing the core with an eyeglass. “That’s copper. And where there’s copper, you stand a good chance of finding gold.”

Put that way, it all sounds so simple. But the Skeenas, alongside the Alaska Panhandle, have been a formidable shield against prospectors and miners. The surrounding 20,000 square kilometres is known invitingly as the Golden Triangle, but it is an inhospitable place of dense spuce forest, stubborn glaciers, thick muskeg and towering cliffs formed 200 million years ago.

Coal India aiming to double output to one-billion tons a year by 2020 – by Ajoy K Das (MiningWeekly.com – July 17, 2015)

July 20, 2015

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

KOLKATA (miningweekly.com) – Coal India Limited (CIL) dreams of producing one-billion tons of coal a year by 2020, and, as the sixth-largest miner in the world, having big dreams is not unusual. However, if past performance is seen as an indicator of future performance, then it has a lot of sceptics to prove wrong.

“CIL’s major challenge is to meet the rising demand from the power sector . . . and this is how the dream of achieving the one-billion-tons-a-year coal production [target] began,” the miner states in its Roadmap for Enhancement of Coal Production.

“The idea of ramping up production germinated at grassroots level and traversed up, growing bigger as the possible potential was realised,” the vision document adds.

With a current production of 494-million tons a year, the target centres on achieving a 15% compound average annual growth rate (CAGR). However, the road ahead may not be that easy as, over the past five years, CIL’s yearly growth rate has averaged between 0% and 7%, with the latter achieved only in the previous fiscal year.