Archive | Canada Mining

Kinross reports smaller loss as gold’s ‘defensive appeal’ rises – by Ian McGugan (Globe and Mail – February 11, 2016)

IAN MCGUGAN – As stock markets around the world have swooned, the shares of Canadian gold producers have headed steadily upward.

The strength of that move will be tested this week as major producers begin to unveil financial results.

Kinross Gold Corp. kicked things off on Wednesday, reporting a loss of $841.9-million (U.S.) or 73 cents a share, for the fourth quarter. That compared with a loss of $1.47-billion or $1.29 in the same quarter a year earlier.

The loss included a non-cash impairment charge of $430.2-million related to property, plant and equipment, and a writedown of inventory and other assets of $235-million. Continue Reading →

Feds won’t change Harper-era mining ethics office – by Peter Mazereeuw (Embassy News – February 10, 2016)

The Trudeau government won’t be making changes to the role of a controversial corporate social responsibility counsellor for the mining sector, according to a government spokesperson.

The Office of the Extractive Sector Corporate Social Responsibility Counsellor has been criticized in the past by advocates for tougher action by Canada on human rights abuses connected to Canadian-owned mines abroad.

The office, created by the Conservative government in 2009, was only able to produce reports on five disputes related to corporate social responsibility that were investigated during the four-year tenure of the first counsellor, Marketa Evans, who resigned from the role in 2013. As well, the mining companies involved in three of those disputes refused to take part in the full review process, according to reports published by the office. Continue Reading →

First Nations must be partners in resource development – by Doug Cuthand (Saskatoon StarPhoenix – February 6, 2016)

Under new rules for development of energy projects First Nations must be involved in the discussions on a nation-to-nation basis. The Supreme Court also has mandated that governments have a duty to consult with First Nations on resource projects within traditional aboriginal territory.

Business fears this will constitute a veto, and that First Nations will doom future resource development. We get the same knee-jerk reaction from the business community and right-wing commentators each time our jurisdiction or treaty and aboriginal rights are recognized.

Currently, the federal or provincial governments can deny any environmentally risky resource project, in effect giving them a veto. What’s wrong with allowing First Nations governments the same right? Continue Reading →

Natural resources remain vital to Canadian prosperity – by Livio Di Matteo (Fraser Institute Website – January 29, 2016)

Despite the hardship afflicting Canada’s energy sector, we should remember the long-term importance of Canada’s resource sector and dispel the tendency to write it off. Prime Minister Trudeau’s recent remark at the World Economic Forum in Davos, Switzerland that, “My predecessor wanted you to know Canada for its resources. I want you to know Canadians for our resourcefulness,” unfortunately reflects an attitude of discomfort with Canada’s resource economy.

The last time this attitude came to the fore was the 1990s when the growth of technology and the knowledge economy generated a flood of commentary that the era of rocks and trees was over. Canada was no longer to be a country of “hewers of wood and drawers of water” but was to take its proper place in the fast lanes of the information highway.

The tech sector bust and commodity boom of the early 21st century of course demonstrated that resources were still important. Indeed, the resource sectors of Alberta, Saskatchewan and Newfoundland and Labrador with their focus on energy production, were a key reason why Canada weathered the 2009 recession period as well as it did. Continue Reading →

[Canada] Why equalization no longer works – by Joe Oliver (Financial Post – February 10, 2016)

“Opposition to resource development, unrelated to legitimate environmental
concerns, is a self-indulgence we cannot afford in a period of slow growth,
large deficits and escalating health-care costs. The public may not be
fully aware of the financial and social implications of its choices.
A reduction in equalization payments would be a wake-up call.” (Joe Oliver)

Equalization is about to loom large in federal-provincial relations and will make the prime minister’s promise to meet with his provincial counterparts increasingly uncomfortable.

The significant regional restructuring of economic fortunes, resulting from the precipitous decline in resource-based revenue, will reallocate billions of dollars in transfer payments — some from previously “have not” to “have” provinces. Continue Reading →

Black Swans Circling Canada’s Resource Sector – by Dennis Boyko (Seeking Alpha – February 9, 2016)

Ottawa Policies Are Shifting Under The New Leadership of Prime Minister Trudeau

“Times have changed, my friends,” Trudeau told the Calgary Petroleum Club. “Social licence is more important than ever. Government may be able to issue permits. But only communities can grant permission.”

The prime minister didn’t help defuse matters last week in Davos when he told international investors that his government wanted them to focus more on Canada’s resourcefulness than its resources.

“The fact is the future of our global economy will be low carbon. That is what was agreed in Paris,” he said in an interview with CBC Radio. Continue Reading →

Why ‘flow-through shares’ are a flop – by Kevin Libin (National Post – February 9, 2016)

You’d be hard pressed to find bigger fans of “flow-through shares” than the Bay Street lawyers and bankers using them to finance roughly a half-billion dollars in mining and energy deals every year.

But they’re hardly alone. Once dubbed by the Financial Post as “Canada’s quirky tax innovation,” flow-through shares were given high praise recently, in another national news outlet, by Richard Sutin, senior partner at Norton Rose Fulbright, who called them a “spectacular success, positioning Canada’s capital markets as a global leader in resource finance.”

And in its “Action Plan for Prosperity” a few years ago, the Coalition for Action on Innovation in Canada, chaired by Liberal big-thinker John Manley, urged policy-makers to build on the “success” of the flow-through share program — which “has helped make Canada a global leader in resource financing” — and expand them to other industries. Continue Reading →

Debt risks mount as Canada’s base metal miners sink deep in the hole – by Peter Koven (Financial Post – February 6, 2016)

As one base metals mining executive after another took the stage last week at the TD Securities Mining Conference in Toronto, they knew almost everyone in the audience had the same question: What are you going to do about the balance sheet?

Right now, it’s the only topic that matters. The crash in copper, nickel and zinc prices, which began in 2011 but picked up steam in the past eight months, has torn into miners’ revenues and raised serious concerns about their ability to repay debt.

Canada’s biggest base metal miners assumed they would enjoy long-term metal prices far above current levels when they borrowed hundreds of millions (in some cases, billions) of dollars to build and acquire mines. Now the grim reality of the situation is taking hold, and companies need to take action to avoid disaster. Continue Reading →

It’s time to buy mining stocks, says Ross Beaty – by Lesley Stokes (Northern Miner – February 5, 2016)

VANCOUVER — Mining financier and entrepreneur Ross Beaty told an audience at the Vancouver Resource Investment Conference in late January that it’s a “phenomenal” time to buy resource stocks.

“The tide is way out and it’s a buyer’s market everywhere across the board from oil, mining, currencies, and real estate,” Beaty said. “Every so often cycles get to the point where they’re at today and it’s just hard to lose. It’s a wonderful time to be in the market.”

He admits the vast majority of his money has always gone into companies he either manages or is otherwise involved with, but in recent years, he’s been beefing up his stake elsewhere in the junior resource sector. Continue Reading →

Miners and aboriginals in Canada: I’ll see you in court (The Economist – February 6, 2016)

Indigenous groups are suing loggers, miners and pipeline-builders

Ottawa – “YOU want certainty? Knock at our door and ask our permission.” Dean Sayers, chief of the Batchewana First Nation of Ojibways, a Canadian indigenous group, delivered this blunt advice to a room packed with mining executives last year.

He came to the industry’s annual convention because he was tired of “the hillbilly attitudes” of developers “who want to do business in our neck of the woods”, on the north-eastern corner of Lake Superior. In 1849 Ojibways fired a cannon into a copper mine that had gone ahead without their approval.

These days Canada’s aboriginal groups use public pressure, backed by legal action, to protect their lands against exploitation by outsiders. Continue Reading →

Equity analysts signal there’s tremendous profit potential in bonds of miners – by Ian McGugan (Globe and Mail – February 5, 2016)

Equity analysts see lots of potential in beaten-up base-metal miners. The bond market begs to differ.

Many producers of basic industrial materials – including Freeport McMoRan Inc. of the United States, and First Quantum Minerals Ltd., HudBay Minerals Inc., Sherritt International Corp. and Teck Resources Ltd. of Canada – have seen their bonds hit by a stampede of selling in recent months as prices for copper, nickel, iron ore and other key raw materials have ground relentlessly lower.

The yield of a bond moves in the opposite direction to its price, so the outburst of selling has driven the expected payoff on the sector’s bonds into the stratosphere. Nearly all of Teck’s bonds now offer yields-to-maturity north of 10 per cent, while the corresponding payouts for issues from First Quantum, Freeport, HudBay and Sherritt have shot even higher – above 20 per cent in some cases. Continue Reading →

Meet the new [resource environmental] regulations. Same as the old regulations – by Melanie Paradis (National Post – February 5, 2016)

On the heels of the federal government’s new principles for environmental assessments, the Conservatives were quick to condemn the changes as obstructive to industry and the economy. This was rather cheeky of them, given that it was their government that rewrote our environmental legislation to include many of the very same principles.

To their credit, the Conservatives did make significant strides in improving and streamlining environmental approval processes. Streamlining did not mean diminishing regulation; quite the opposite. Harmonization with the provincial regulators removed redundant bureaucratic processes.

Previously, developers would need to produce multiple versions of reports that shared the same information but in slightly different formats while meeting slightly different specifications. Harmonization meant both levels of government would agree to use a single format and eliminate duplication. This may seem like a painfully obvious step, but it was only taken in 2012. Continue Reading →

Canada’s Centerra given go-ahead to mine Mongolian gold deposit (Reuters U.S. – February 4, 2016)

Feb 4 Canada’s Centerra Gold Inc has been given the go-ahead from Mongolia’s lawmakers to mine the Gatsuurt Gold deposit after a five-year delay, as the resource-rich country looks to bolster its economic activity and gold reserves.

Mongolia’s once-booming economy has taken a steep slide, with the Asian Development Bank estimating growth in 2015 at less than 3 percent compared with 17.5 percent in 2011. Mongolia hopes to rake in greater revenue this year and stimulate growth by green lighting projects such as Gatsuurt, despite a backlash from some citizens.

The parliament passed a bill granting the country 34 percent ownership of the mine with 1.6 million ounces of probable gold reserves, a government website says. Centerra, which also owns the Boroo mine in Mongolia, will hold the remaining 66 percent of equity. Continue Reading →

Editorial: Aboriginal think tank calls for ‘bold’ infrastructure development in Far North – by John Cumming (Northern Miner February 2, 2016)

With the new federal government having vowed in its election platform to improve the lives of Aboriginal Canadians and spend tens of billions on infrastructure projects to offset the economic downturn, it’s a perfect time for aboriginal groups to lobby governments to step up their investments in infrastructure investment in northernmost Canada.

And that’s exactly what the National Aboriginal Economic Development Board (NAEDB) is doing with its new report, “Recommendations on northern infrastructure to support economic development.”

Founded in 1990, NAEDB says its goal is to help Aboriginal Peoples in Canada become economically self-sufficient, and full participants in the Canadian economy. The NAEDB board is made up of 10 First Nations, Inuit and Métis business and community leaders from across Canada, with Clarence Louie, chief of the Osoyoos Indian Band in B.C., serving as chairperson. Continue Reading →

NEWS RELEASE: Mining’s contributions to Canada strong despite downturn

New report details industry’s economic contributions, challenges and opportunities

OTTAWA, Feb. 3, 2016 /CNW/ – Despite market volatility and downward pressure on commodity prices, the mining industry’s economic contributions to Canada remain strong during the downturn, according to a new report from the Mining Association of Canada (MAC).

“The findings of this report serve as a reminder that even during a downturn, the mining industry plays a vital economic role in Canada’s rural and remote communities and in our largest cities,” said Pierre Gratton, President and CEO, MAC.

MAC’s latest annual Facts & Figures report revealed the industry directly employed more than 375,000 people in 2014. Continue Reading →