Republic of Mining

Cuts in China’s rare earth output not enough to revive hard-hit market – by Eric Onstad (Reuters U.S. – November 6, 2015)

November 6, 2015

http://www.reuters.com/

LONDON, Nov 6 (Reuters) – An output cut by six top rare-earth producers in China has spurred a modest rise in prices and is helping to steady a hard-hit market, but a continued glut of illegal output will likely cap any rebound.

Prices of 17 rare-earth elements used in high-tech sectors such as electronics, defence and renewable energy have been sliding over the past four years, hit by heavy oversupply.

Last month, the country’s top producer China Northern Rare Earth High Tech Corp and five other main suppliers said that due to weak prices, they would produce around 10 percent less than their 2015 government-set output targets.

China is the world’s dominant producer of rare earths, accounting for 90 percent of global supplies. “The cuts caused a short-term bump (in prices), but the real problem is that it’s only a small drop in the ocean,” said David Merriman, senior analyst at consultancy Roskill Information Services in London.

Taylor Mine is the newest mine in Ontario (Northern News – November 5, 2015)

November 6, 2015

http://www.northernnews.ca/

KIRKLAND LAKE – St Andrew Goldfields Taylor Mine project is now in commercial production and will increase the company’s gold production.

With the acceptance of the Taylor Mine closure plan the company has three gold producing mines in operation.

“We are pleased to declare Taylor the newest mine in Ontario, one which we anticipate will bolster the company’s gold production profile for 2016 by 40,000 – 50,000 ounces and provide much needed jobs and economic benefits to the communities in the region. I would personally like to thank the SAS team, the provincial government officials, the First Nations and our communities for their hard work and support in helping us bring Taylor into reality.

The mine is expected to be a significant contributor in the future as we are ramping up to full production by the end of this year,” said Duncan Middlemiss, President and Chief Executive Officer. “With the addition of Taylor to the portfolio of producing assets, we are also pleased to raise our 2015 full year production guidance to between 100,000 and 110,000 ounces of gold with the Taylor contributing 10,000 to 15,000 ounces of gold for the balance of 2015.

AUDIO: Mine closure in Red Lake, Ont., surprises mining economist (CBC News Thunder Bay – Novemeber 5, 2015)

November 6, 2015

http://www.cbc.ca/

New strategy required for gold extraction, Lakehead postdoctural fellow says

The news of a temporary closure at the Rubicon Minerals mine in Red Lake, Ont., came unexpectedly to one mining economist at the Centre for Excellence in Sustainable Mining at Lakehead University.

The shutdown of the mine is leaving 330 workers without a job in the northern Ontario town with 5,000 residents.

In a paper highlighting key mining developments, Karl Skogstad said the Rubicon mine was one of the more promising projects in northern Ontario.

“That came as a bit of a surprise to me,” Skogstad said. “That was one of the two projects that we said, ‘this is going to open, you know, relatively on schedule, and it’s doing well.'”

The volatile price of gold is presenting challenges to companies such as Rubicon, he added.

Miners worried: Hydro One sale could spell price troubles – by Jonathan Migneault (Sudbury Northern Life – November 6, 2015)

November 6, 2015

http://www.northernlife.ca/

Electricity-hungry industry depends on competitive power rates

If the controversial privatization of Hydro One results in increased hydro prices, it could spell trouble for the province’s mining sector, says the Ontario Mining Association.

“We’re concerned, obviously,” said Chris Hodgson, the association’s president. “The mining market is not great, so if you want to stay in business you have to be competitive.”

Hodgson and other mining industry representatives were a Queen’s Park on Nov. 3, where they met with various MPPs for the annual Meet the Miners lobby day.

The province’s rising hydro rates were a big topic of discussion during the meetings, Hodgson said. Hydro costs represent around 15 per cent of a mine’s operating costs, and with smelting operations that can increase to 30, or even 50 per cent, Hodgson said.

NEWS RELEASE: Fatal Brazilian mine waste disaster shows modern mining is increasingly dangerous

November 6, 2015

https://www.earthworksaction.org/

November 6, 2015 – Earthworks and Center for Science in Public Participation

New research validated: mining disasters on the rise because of modern mining techniques

Washington, D.C. — A mine waste dam at the Germano open-pit iron ore mine in Brazil’s state of Minas Gerais breached yesterday, flooding the downstream area with mining waste and causing fatalities. The Germano facility is co-owned by two of the world’s largest mining companies, Brazilian Vale SA and Anglo-Australian BHP Billiton.

A recent report, The Risk, Public Liability & Economics of Tailings Storage Facility Failure, demonstrates that catastrophic mine waste failures are increasing in frequency and severity because of — not in spite of — modern mining techniques, and will continue to do so until regulators and mining companies take active steps to prevent them.

“Our research shows that more mining waste disasters like Brazil’s Germano spill are inevitable,” said David Chambers, report co-author and director of the Center of Science in Public Participation.

[Noront] Junior miner wants faster government action on providing Far North infrastructure – by Ian Ross (Northern Ontario Business – November 6, 2015)

November 6, 2015

Established in 1980, Northern Ontario Business provides Canadians and international investors with relevant, current and insightful editorial content and business news information about Ontario’s vibrant and resource-rich North. Ian Ross is the editor of Northern Ontario Business ianross@nob.on.ca.

Noront Resources president-CEO Alan Coutts isn’t enamoured with the provincial government’s glacial pace of infrastructure planning in the Ring of Fire, but his junior mining company has no immediate intention to mothball its nickel project in the region.

“We don’t have any plans to stop activities at this time,” said Coutts, a day after Noront announced the start of a modest $650,000 step-out exploration program, three kilometres from its flagship Eagle’s Nest nickel deposit.

A rather upbeat Coutts was beating back a Toronto newspaper report that the main mineral developer in the Ring of Fire was threatening to suspend exploration in an effort to speed up a government commitment to build mining-related infrastructure in the Far North.

The article, citing unnamed sources close to the company, said Resource Capital Funds, Noront’s main financier, is supportive and that such a work stoppage could be made within weeks.

Exclusive: First Quantum hires Jefferies to sell nickel assets – sources – by Euan Rocha and Freya Berry (Reuters U.S. – November 5, 2015)

November 6, 2015

http://www.reuters.com/

TORONTO/LONDON – First Quantum Minerals has retained Jefferies to explore a sale of its two nickel mines as the Canadian base metal miner looks to trim debt levels and double down on its bets in copper, three sources familiar with the matter said

The sources, who declined to be named as details of the plan are not public, said the move to sell the assets would help the company achieve its goal of reducing its debt levels by over $1 billion.

A spokeswoman for First Quantum declined to comment on the plan. A spokeswoman for Jefferies was not immediately reachable.

Two of the sources said the assets on the block are Kevitsa, a nickel-copper-platinum mine in Finland and Ravensthorpe, a nickel mine located in Western Australia that the company bought back in 2010.

Cure for low commodities prices is staring us in the face – by Merryn Somerset Webb (Financial Times – November 6, 2015)

November 6, 2015

http://www.ft.com/

Low Chinese demand is blinding us to the obvious

China’s gross domestic product growth is slowing. It might even have stalled completely. That means China’s demand for all industrial commodities is falling and is going to keep falling. And that means you shouldn’t invest in any of the big mining companies ever again.

Without China importing 50 per cent of every commodity produced everywhere to build its millions of miles of super-fast railways, prices can’t rise, profits can’t rise and share prices can’t rise.

Sound like a familiar argument? It should do. It’s been in every paper and on every analyst’s lips all year. If you look at a couple of charts of commodity demand and prices you can see why.

China’s global metal imports were flattish until the late 1990s. They then soared into 2009 (the 10 per cent a year “miracle” growth period) before slowing and flattening again into 2011, when growth started to slow.

[Timmins] 2 local derelict mine sites among those cited in ECO report – by Alan S. Hale (Timmins Daily Press – November 5, 2015)

November 6, 2015

The Daily Press is the city of Timmins broadsheet newspaper.

TIMMINS – Ontario’s environment watchdog has released a report slamming the provincial government and the mining industry for not putting in place adequate financial assurances to prevent the government from footing the bill for any clean-up after mining operations.

Such provisions are legally required in all mining project closure plans, but the Environment Commissioner of Ontario found that in July there were five idle operations in Ontario without sufficient financial assurance measures in their closure plans. Two of those projects listed in the report are in the Timmins area.

One is the Carshaw-Malga Mine and Mill property located in Shaw and Carman Townships, approximately 25 kilometres southeast of Timmins. The site, owned by Marshall Minerals Corp., was mined and milled gold-bearing ore in the mid-1980s. In 1990, the mill was reactivated to process nickel ore.

Brazil community flooded after dam burst at BHP and Vale-owned iron ore mine – by Matt Chambers (The Australian – November 6, 2015)

November 6, 2015

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

At least 17 people are dead in Brazil following a mudslide unleashed after the collapse of a tailings dam at a mine half owned by BHP Billiton.

More than 50 people were injured, said local fire chief Adao Severino Junior, who added: “The number of missing is going to surpass 40 but that is not official.”

Television footage showed a torrent of industrial muck several hundred metres long that had swamped houses and ripped off their roofs in the southeastern state of Minas Gerais.

The structure that failed is a tailings dam, used to hold water and discarded minerals from a nearby iron-ore mine operated by Samarco Mineração, a company owned 50-50 by BHP Billiton (BHP) and Brazil’s Vale.

The village of Bento Rodrigues near the dam was practically buried in mud, the fire chief said.

COMMENT: New NRCan minister Jim Carr of Winnipeg – by Marilyn Scales (Canadian Mining Journal – November 5, 2015)

November 6, 2015

http://www.canadianminingjournal.com/

What a lovely day in Ottawa on Nov. 4 to swear in a new Prime Minister and his Cabinet. It was all warm sunshine and a renewed hope for better days ahead for PM Justin Trudeau’s Liberal government.

Trudeau’s Cabinet includes Jim Carr (Winnipeg South Centre) as Minister of Natural Resources Canada. Educated at the University of Manitoba and McGill University, Carr has been an oboist and a trustee with the Winnipeg Symphony Orchestra.

He won his first seat in the Manitoba legislature in 1988, and served as deputy leader of the provincial opposition. He resigned his seat in 1992 and became a columnist for the Winnipeg Free Press and CBC Radio. He is also the president of the Business Council of Manitoba. Carr made his successful first foray into federal politics this year.

Carr seems to have lots of business and political experience, but does any of it align with the mining industry?

Liberals killing $60M project – NDP – (North Bay Nugget – November 5, 2015)

November 5, 2015

http://www.nugget.ca/

Northern Development Minister Michael Gravelle came under fire in the provincial legislature Thursday for inaction at the Ring of Fire, with the NDP charging that the Liberals are on track to kill a $60-billion mining project.

The questioning followed a report earlier this week from the Financial Post that Noront Resources Ltd. warned the province that it will stop work unless they can show some progress has been made on First Nations agreements and infrastructure for the remote mining development.

The company has spent millions on the Eagle’s Nest project in the Ring of Fire but work and spending could stop by end of December if progress isn’t made.

“Minister, we attended Meet the Miners Day and you boasted of your government’s commitment to mining in Ontario. Last year, mining giant Cliffs, which spent $550 million in the Ring of Fire, said they can no longer do business with this Liberal government and sold their claims at a massive loss to Noront for $20 million,” charged Algoma-Manitoulin NDP MPP Michael Mantha.

[Lonmin Plc] The Rise and Fall of a Mining Company That Tried to Buy Harrods – by Rodney Jefferson and Kevin Crowley(Bloomberg News – November 5, 2015)

November 5, 2015

http://www.bloomberg.com/

From Cecil Rhodes’s legacy in southern Africa to takeover battles gripping the British public and a massacre at one of its mines, the 106-year-old epic that’s Lonmin Plc risks entering its final act.

The company, whose businesses spanned gold mining, hotels, textiles and newspapers in the 1980s, later focused its efforts on platinum and is the world’s third-largest producer of the metal. Management warned on Wednesday that it might have to shut down should shareholders reject a $400 million stock sale as it succumbs to the slump in commodity prices.

Should investors decide not to cough up the money, one of Britain’s most prominent companies of the 20th century and a symbol of the country’s blend of imperialism and capitalism would be consigned to history less than two decades after the death of the man who built it.

“It’s gone from darling of the stock market to completely distraught,” said Bernard Swanepoel, who has been in the mining industry for 30 years and was chief executive officer of Harmony Gold Mining Co.

Goldcorp’s Jeannes: ‘We’re close to the end of the gold bear market'(Northern Miner – November 2, 2015)

November 5, 2015

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

VANCOUVER — Despite posting a US$192 million net loss during the third quarter, Goldcorp’s (TSX: G; NYSE: GG) management team is telling investors to focus on what it labels “strong fundamentals.”

The company churned out record quarterly gold production and generated around US$243 million in free cash flow over the past three months. President and CEO Chuck Jeannes pointed out that successful cost control measures and promising macro-economic conditions should contribute to brighter days ahead.

Goldcorp produced 922,200 oz. during the third quarter at all-in sustaining costs of US$848 per oz. Assuming an average realized gold price of $1,114 per oz., the company reported adjusted revenues of US$1.3 billion and adjusted operating cash flow of US$374 million for the quarter.

Excluding unrealized losses from the foreign exchange translation on deferred income taxes, Goldcorp’s adjusted net loss totalled US$37 million, or 4¢ per share, during the quarter, which compares to adjusted earnings of US$65 million, or 8¢ per share, in the previous quarter.

Diamonds Aren’t Forever for Botswana as Mining Boom Fades – by Michael Cohen (Bloomberg News – November 5, 2015)

November 5, 2015

http://www.bloomberg.com/

The honeymoon is over in Botswana, where the diamond industry that led the world has fallen on hard times.
The discovery of the gems nearly half a century ago transformed the southern African nation from a dusty farming backwater into one of the continent’s wealthiest societies.

Thousands of miles of dirt roads were paved and schools and clinics built in every town. The capital, Gaborone, once a rural village, is now dotted with office blocks and malls occupied by South African chains like Shoprite Holdings Ltd. The country’s finances were in such good shape that Botswana earned the highest credit rating in Africa.

Now the diamond mining industry is floundering as jewelry sales stagnate amid a slowdown in China. An index of rough diamond prices hit a five-year low last month. With most diamonds near the surface having been extracted from Botswana’s mines, the gems are also becoming increasingly inaccessible.

Last year Botswana was overtaken by Russia as the world’s top producer.