Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

One the news releases that landed in my inbox last week made me wonder about the advancement of mineral processing technology. Is it going forward … or back?

The item in question came from a Canadian company testing a South American property for its zinc potential. The company and project shall remain nameless. What caught my eye was that the favourable results were obtained in a kiln. That made me wonder why hydrometallurgical methods were not being tested.

Anytime an ore is subjected to heating it gives off gases. The worst case scenario is the burning of sulphide ores and resulting clouds of SO2 and NOx responsible for widespread environmental damage. Such was the case in the early days of smelting nickel and copper ores from the mines near Sudbury, ON.

Fortunately today we have gas containment units, acid plants and various means of controlling particulate and other emissions. These technologies help protect the environment, but they come with certain costs and limitations.

Hydrometallurgical means of metal recovery does not produce such deleterious emissions. Methods have been adapted in recent history to leach almost every kind of ore imaginable and to create the purest metals. Hydrometallurgy is considered far cleaner than roasting ores. Read the rest of this entry »

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

We in the mineral industry often speak of “direct jobs” generated at mines and mills and “indirect employment”, those jobs as suppliers, manufacturers and consultants that spring up to serve the needs of the industry. We know that for every person directly employed by the mining industry there are several others indirectly employed.

Those numbers and others aspects of mining’s importance have been pinned down in a new survey prepared for the Sudbury Area Mining Service and Supply Association (SAMSSA). The Northern Ontario Mining Supply and Services Study looks at about 500 separate firms and organizations in what might arguably be called the “heart” of the mining sector.

The study found approximately 23,000 people are employed in the supply sector. That is a more generous number than the Ontario Mining Association came up with. But the OMA estimate of 480 direct mine jobs and 2,280 supply and services jobs in the province sounds too low by a factor of 10. The difference is probably due to differing definitions of what is a “mine” job or an “indirect” job. Either way, keep the multiplier effect in mind.

The SAMSSA study put a value of $5.6 billion on the supply and services sector in Northern Ontario. Read the rest of this entry »

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Mining companies often speak of having a “social licence” to operate. This reflects the willingness of local communities to support their endeavours. The more the miner and the indigenous people talk, the better their understanding and ability to accommodate one another.

What sounds straightforward is often complicated by unrealistic expectations, earlier history, cultural rigidity and interference by third parties.

The latest company on the verge of losing its social licence is Vancouver’s Goldcorp, that operates the Marlin gold mine in Guatemala. The most recent report to examine Goldcorp’s record there was commissioned by the company in response to charges of human rights violations at the Marlin mine. The report concluded that the company had failed to respect the right of indigenous peoples in that country, but also had brought jobs, healthcare and education to the impoverished western highlands region. Goldcorp further insists that allegations of environmental problems are unfounded.

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Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

I’ve been in the United States these last three weeks, and have been bombarded with news of British Petroleum’s uncontrolled oil spill in the Gulf of Mexico. For readers who don’t already know, BP’s drill rig, Deepwater Horizon, exploded and sank six weeks ago. All of the company’s efforts so far have failed to stem the spread of crude oil from 1,500 metres under the sea onto the coast of Louisiana. Large parts of the fishery on which so many coastal residents depend are closed. A recent report said cleanup workers are falling ill, and workers at rigs near the site of the doomed BP rig, are being sent home because of the noxious smell.

The wall-to-wall news coverage of BP’s woes on American TV has made the tailings ponds of Alberta’s oil sands producers fade into the background. The anti-tar-sands activists have been quieter than usual, perhaps stunned into silence by the spill in the Gulf. The spill is estimated to have released at least 475,000 barrels and perhaps over 1 million barrels of crude oil.

Worse, hurricane season is underway, and expectations are that it could be a very active season. No one knows how far the crude oil could be spread by high-velocity winds. Read the rest of this entry »

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Not so long ago, say 10 years, the Chinese were thought of as a poor, insular nation, mysterious and of a peculiar political stripe. Now we must lay aside those notions and recognize that China is an economic powerhouse. Whatever remains of “communism” in that country is proving to have very capitalistic talents. Hence, the many foreign investments made in the last two years while the rest of the world suffered economic meltdown.

Here are a few of the investments made by Chinese investors outside that country in the past two years:   
 
-Aluminum Corp. of China (Chinalco) attempted to invest US$19.5 billion in Rio Tinto
-China Minmetals made a A$2.6 billion bid for Australian miner Oz MineralsChina Mining United Fund bought into Canadian juniors including

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Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Toronto’s Barrick Gold, being the world’s biggest gold miner, is also on the receiving end of the world’s worst media abuses. “Yellow journalism” has not gone out of style, and today the Internet provides the means of spreading disinformation worldwide at speeds unheard of a century ago.

Case in point. Headline: “Deadly toxin invades Barrick’s Dominican gold mine, Thousands hospitalized.”

Those are eye-catching words, but no more accurate than the picture of artisanal miners identified as the “Barrick Gold mine in Coui, Dominican Republic” used to illustrate the article.

The article posted at www.BusinessInsider.com went on to say that over 1,000 people were felled by an unknown chemical so toxic that health care workers who attended them had to wear masks. It also reported a boiler explosion at the site that may have been the root of the problem.

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Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

“Money” was the word on the industry’s lips last week as the federal, British Columbia and Ontario governments brought outlined their spending plans for the future. A mining-friendly government helps keep our industry healthy, so let’s take a look at what we can look forward to.

First out of the gate on March 2 was the Throne Speech from Ottawa. In it the federal government promised to develop a clearer process for project approval and a commitment to both Northern development and Aboriginal Canadians.

The speech was lauded by Mining Association of Canada (MAC) president Gordon Peeling, who said, “These issues in today’s Speech from the Throne will enhance the contribution that the mining industry can make to all Canadians by improving the investment climate, bringing efficiency and clarity to our regulatory processes and strengthening our skilled workforce.”

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Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

ST. JOHN’S — The 66th Mines Ministers Conference was urged once again to take active measures in support of the Canada’s mineral industry. The plea came from the Canadian Mineral Industry Federation (CMIF), a group of 17 mining-related associations headed by the Mining Association of Canada (MAC) and the Prospectors and Developers Association of Canada (PDAC).

First, the ministers were reminded of mining’s economic importance to Canada. It contributed $40 billion to the country’s gross domestic product (GDP) and provided 351,000 jobs in 2008. There are an estimated 3,140 suppliers to the industry. The mining industry paid $11.5 billion in taxes and royalties to all levels of government. 

There are challenges ahead for the industry, and the CMIF brief addressed them.

1. Enhance commitment to the core mandate of natural resource ministers

 Many organizations, government departments and NGOs have adopted an aggressive anti-mining focus. It is critically important that Canada’s natural resource ministers maintain and enhance their dedication to economic development. In this sense, advocacy for infrastructure projects, for more open access to minerals, for northern development, and for tax incentives to encourage increased investment, among other objectives, remains fundamental.

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Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

It is difficult to overstate the importance of gold. It has been prized as decoration as long as humankind has been around. It makes a solid foundation for world banking. It has been fought over. It is the stuff of which legends are made. And gold is undeniably beautiful.

Most of the general public and the mineral industry snap to attention when gold is in the news. Reports of new gold finds are especially welcome. But they may be fewer and farther apart if the findings of Halifax’s Metals Economics Group (MEG) are accurate. (www.MetalsEconomics.com) 

MEG examined the costs of finding and acquiring gold reserves and found that overall the industry is not discovering new deposits fast enough to meet future production demand.

The report looked closely at major gold producers, those with an output of 450,000 oz or more in 2008. They overcame “… rising costs, equipment and labour shortages, electrical outages, wars, permitting hurdles, typhoons, political opposition, and other obstacles,” the report noted to replace reserves at twice the rate they are mining them. Most of these gains were made through acquisitions or upgrading existing resources due to the high gold price, not through grassroots discoveries.

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Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

The following note was posted on the Canadian Mining Journal’s digital edition. It is federal Industry Minister Tony Clement’s reponse/spin to the heated controversy of funding mining research at the University of Toronto’s Lassande Institute (which also includes significant civil engineering programs) instead of focusing scarce resources at the previously established Centre of Excellence in Mining Innovation (CEMI) at Laurentian.

Laurentian is located in the heart of Sudbury, Ontario, the richest mining district in North America and among the top ten most strategic mineral deposits in the world. There are no mines in downtown Toronto and most industry experts confirm that U of T’s mining programs are undersubscribed. In addition, having two major mining research centres in this province further dilutes the limited amount of mining research in Ontario. Tony Clement continues to refuse to give any funding to CEMI’s industry respected research programs while the provincial government and the mining sector has contributed approximately $20 million to the Laurentian institute.

During my research into a previous column – about turning Laurentian in the Harvard of the Mining Sector - many individuals who wanted to remain off the record, agreed that the most economic solution for postsecondary mining education and research in Ontario is to consolidate all programs at Sudbury’s Laurentian University. – Stan Sudol

Canadian Mining Journal

On June 7, I wrote about the new Lassonde mining innovation centre to be established at the University of Toronto, and how that announcement has residents of Sudbury, where the Centre for Excellence in Mining Innovation (CEMI) is located, angry at the snub. On behalf of the Hon. Tony Clement, Canada’s minister of industry, CMJ received the following letter.

“I feel it necessary to set the record straight. I think that everyone needs to be privy to some of the facts surrounding the spin to bring a bit more balance to the CEMI/Knowledge Infrastructure Program [KIP] story. Here are the facts.

“The government of Canada through KIP can only fund new projects that: a) submit a funding proposal; b) have a proposal that qualifies for funding within the program criteria (ex: the funds are used for building and renovation, not operations, and that the project will be completed by March 31, 2011); and c) have matching funds from either the province or the university or college. The KIP program can only match funds for renovation projects up to 50%. Read the rest of this entry »

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Residents of northern Ontario, and Sudbury in particular, are furious with the funding of a new mining innovation centre in Toronto rather than where the industry operates. The $20-million centre will be built at the University of Toronto and named after Pierre Lassonde, president of Newmont Mining. The federal and provincial governments are each putting up $5.5 million. The balance will come from private donations, and Lassonde is said to be the largest donor.

What makes the deal such a bitter pill for northern residents to swallow is that it sets up a new mining innovation centre in direct competition with the Centre for Excellence in Mining Innovation (CEMI) already established in Sudbury. The new institute’s mandate is reported to be the same as CEMI, its name is so close as to be confusing, and its technology will duplicate what is already available.

“The decision by the federal government to deny funding to CEMI is a deliberate, calculated snub to the city of Sudbury, its provincial member [Rick] Bartolucci … and, most assuredly, [FedNor executive director Louise] Paquette,” Michael Atkins, president of Northern Life, wrote in that newspaper last week. “The willingness to quickly invest in a competing institution in Toronto just adds incredulity to the inside story.

“Either Sudbury sees its future as an international mining cluster, or it doesn’t. There will be no help from the province unless you demand it. There is a choice. Cower in the corner praying for the next grant or demanding the respect that is due a cluster that is more respected in Argentina, South Africa and Australia than it is in its own province,” he concluded.

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Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

The latest news from PricewaterhouseCoopers (PwC) is very gloomy. The survey, titled Mine: When the going gets tough, is full of bad news.
 
Unfortunately, PwC reports a market capitalization of the world’s top 40 mining companies has dropped by 65%. The cutoff for inclusion in the top 40 was a capitalization of $2.3 billion in 2008 rather than $9.0 billion as was the case in 2007. The firm blames the fall of commodity prices and the impact of the global economic crisis on investor confidence for the decline.

Gold companies were least affected. Their market capitalization decreased by only 20%, thanks to the perception that gold is a safe haven during economic turmoil. There are now 14 gold companies in PwC’s top 40, and together they comprise 26% of the total market capitalization. 

Investor returns were lower last year, too. In 2008, only three of the top 40 companies reported positive total shareholder returns. The four companies reporting the greatest decline dropped 75% or more. The picture is even gloomier when compared to the 2007 numbers. Fourteen of the previous year’s top 40 had returns of more than 100% and four reported a whopping 400%.

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Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Readers are advised to get out their chopsticks and start practising because the Chinese are coming to Canada. In two separate deals since the beginning of this year, Jilin Jien Nickel Industry has shelled out cash to gain a toehold in potential new nickel producers.

In April, Jien agreed to advance $30 million to Edmonton’s Liberty Mines. Liberty has suspended work at its Redstone nickel mine, but it is hoping to reopen the McWatters nickel-copper mine and make a development decision on the Hart nickel-copper-PGE project. These projects are all near Timmins, ON, and all have measured and/or indicated resources.

For its investment, Jien has received 51% of the issued and outstanding Liberty common shares. The Chinese partner also holds close to 187 million convertible and redeemable preferred shares. If all the preferred shares are converted, Jien will hold 76.8% of Liberty. Jien will also appoint four of the seven Liberty directors.

Separately, Jien has become a joint venture partner with Vancouver’s Goldbrook Ventures on Goldbrook’s Raglan Belt property in northern Quebec. Read the rest of this entry »

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

The first gold mine in Kirkland Lake, ON, is reopening this summer, not as a producer but as a monument to the early days of prospecting in Ontario’s North. The hunt for gold was filled with characters — “Swift” Burnside, the Tough brothers, Sir Harry Oakes and Bill Wright — all eager to make a profit on the next great gold mine. Part of their legacy is the headframe of the Toburn mine that began commercial production in 1913.

The Toburn mine struggled along with a 90-t/d stamp mill from 1913 to 1931. Then Toburn Gold Mines Ltd. was incorporated and installed a new, larger mill, which operated until 1953. A total of 1.1 million tonnes of ore grading almost 17.0 g/t Au (0.5 opt) was treated. 

The site was abandoned after mining ceased and reverted to the Crown. In 2006 the Northern Prospectors Association set about acquiring the last remaining original headframe on the “Mile of Gold”. Project funding was contributed by individuals, corporations and public institutions. Two years later, the Town of Kirkland Lake acquired the property and the Toburn Operating Authority was created to oversee its rebirth as a tourist and learning destination.

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Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

I had a lengthy and most interesting phone call from Michael Leahy last week concerning the proposed changes to the Ontario Mining Act. First, he said, the Mining Act passed in 1873 was never a static document. It has been amended many times, including a complete rewrite in 1990. Leahy knows whereof he speaks because he was involved in the revisions two decades ago, and until 2006 he sat on (and chaired) the Minister’s Mining Act Committee.

Still actively prospecting from his home in Kirkland Lake, Leahy says enforcement of the Mining Act will come through the passage of various regulations as set out in the Act. Until these regulations are written, much of the practical application of the Act is uncertain. 

The Ontario government has also significantly broadened its powers of regulation with this Mining Act. Leahy is correct to point out that regulations are passed without the public readings and procedures necessary to get bills through the provincial parliament. That leaves me wondering if regulatory changes will be made arbitrarily, with no notice and less consultation.

Leahy pointed out that the concept of ‘native traditional lands’ is unclear. Read the rest of this entry »