Anglo American tosses Pebble
After spending hundreds of millions of dollars on the Pebble project, Anglo American has decided to walk away from the massive copper-gold deposit, located
200 kilometres south of Anchorage, Alaska. While a prefeasibility study is expected later this year, the project has encountered strong opposition from
some local environmental and aboriginal groups that have concerns about the project’s potential impacts on water quality and local fish habitat. “Our focus
has been to prioritize capital to projects with the highest value and lowest risks within our portfolio, and reduce the capital required to sustain such
projects during the pre-approval phases of development as part of a more effective, value-driven capital allocation model,” said Mark Cutifani, Anglo
American CEO, in a release. The company announced it expects to take a $300-million writedown due to this decision at the end of the year.
Anglo American Pebble, a wholly owned subsidiary of London-based Anglo American and a 50 per cent joint venture partner in the Pebble project with Northern
Dynasty Minerals, had spent roughly $541 million in exploration work on the proposed open pit project since it became a partner in July 2007. It has also
spent around $150 million on environmental and socio-economic work to support its project development plans. With Anglo American’s move, Northern Dynasty,
which took over the project in 2001, will now become Pebble’s sole proprietor. Pebble contains a Measured and Indicated Resource of 5.94 billion tonnes,
containing 55 billion pounds of copper, 67 million gold ounces and 3.3 billion pounds of molybdenum. Following Anglo American’s exit, Northern Dynasty
announced its intentions to move forward with the project and potentially seek a new partner.
– Herb Mathisen
Outlook for Rosia Montana permits gets rosier
Share prices of TSX-listed Gabriel Resources Ltd. have recovered from their low of 41 cents on September 9, which followed reports that the Romanian
Parliament was suspending reviews of draft legislation required for the company’s Rosia Montana project to proceed. The legislation is now under review by
a special committee, and Gabriel’s shares hovered above 80 cents in October.
Rosia Montana, a world-class gold and silver project, could be one of the biggest gold mines in Europe, with a reported Measured and Indicated Resource of
17.1 million ounces of gold and 81.1 million ounces of silver. Gabriel owns 80 per cent of the project, with the remainder held by a Romanian state-owned
enterprise. The company estimates the project will contribute more than US$24 billion to Romania’s gross domestic product (GDP) over its lifetime and
generate thousands of jobs.
Protests held in Bucharest, in September, opposed the company’s plans to change the topography of the mountainous site, and to use cyanide in the
extraction process. Local miners have come out in support of the project though, and Prime Minister Victor Ponta said Romania has a duty to benefit from
its natural resources.
The committee may conduct site visits and invite representatives from interested parties, including NGOs, to participate in the review process. It will
provide a recommendation to the Senate, with a final decision expected in early November.
– Dinah Zeldin
Gibraltar celebrates completed expansion
In September, Taseko’s Gibraltar mine hosted 600 guests for a grand opening of its new standalone concentrator, the cornerstone of the project’s third
expansion phase. At a cost of $235 million, the new concentrator – commissioned in January and having started production in April – will increase
throughput capacity at the B.C. copper-molybdenum mine by 30,000 short tons per day. As a result of this expansion, Taseko has hired around 150 new
employees at the Cariboo-region mine. “Most of these positions are operations and maintenance-[related],” Brian Bergot, investor relations director. “They
were hired to operate the new facility as well as the new mining equipment to feed the concentrator.” As part of its $325-million expansion, the company
also spent $90 million on a new fleet of haul trucks and a new mining shovel. Since the new standalone concentrator began operation in April, Taseko has
been steadily ramping up production to full capacity and saw a 21 per cent production increase in the second quarter of this year from the previous
quarter. “We expect continued increases until we achieve the new design capacity of both concentrators of 85,000 tons per day,” Bergot said.
Mick Davis to turn mining’s lemons to lemonade
Former Xstrata CEO Mick Davis has secured $1 billion in private funding for a new mining venture, X2 Resources. Davis plans to create a mid-tier
diversified mining and metals group through the acquisition and development of unwanted and orphaned assets.
X2 will aim to acquire projects dropped by majors looking to tighten spending in response to low commodity prices, as well as operations abandoned by
smaller firms that have run out of money. The company plans to focus on commodities like copper, zinc and nickel that remain in demand.
The company received US$500 million each from Noble Group, a Hong Kong-based global supply chain manager, and Texas Pacific Group, a U.S.-based private
investment firm. The X2 team includes former Xstrata CFO Trevor Reid and four other former Xstrata executives. Financial advice is being provided by
Goldman Sachs. Operations will be based in Johannesburg, South Africa.
Diamond, coal miners take gold
The team from N.W.T.’s Diavik diamond mine took top spot in the underground mine rescue competition for the third straight time, while B.C.’s Coal Mountain
Operations won on the surface mining side at the Western Region Mine Rescue Competition held in September in Fernie, B.C. In total, 18 mine rescue teams
from Alberta, British Columbia, Manitoba, Northwest Territories, Saskatchewan, Yukon and Wyoming, U.S., participated in the biennial event.
“Across Canada, all operating mines are required to have mine rescue,” said Al Hoffman, B.C.’s chief inspector of mines. “Local fire department, ambulance
and other emergency responders are generally some distance away [from mine sites] and they don’t have the expertise to deal with mining [incidents.]” Mine
rescue participants are required to be First Aid-certified and also to have completed – and regularly maintained – necessary mine rescue training. Hoffman
said while the competition, which includes written, first aid and search events, provides mine rescue workers with esprit de corps and builds camaraderie
amongst and within teams, it also serves more pragmatic purposes. It allows regulators to evaluate each team’s mine rescue skills while also ensuring they
comply with recognized standard methodologies and communications methods. For instance, if a mine rescue team was to travel to another operation to provide
assistance, it would want to use the same techniques and communications methods as the local mine rescue teams so that they could operate together
Feds make aboriginal and treaty lands web portal public
Aboriginal Affairs and Northern Development Canada (AANDC) has launched its Aboriginal and Treaty Rights Information System (ATRIS), an information
resource previously available only to government employees now made public. The web-based map tool lets users research the potential and established land
and treaty rights of aboriginal groups across the country. The site informs users of each group’s specific treaty information, local land rights and
agreements and progress on land claims negotiations. When companies propose projects, Canada has a duty to consult First Nations, Métis and Inuit land
rights holders about the potential developmental effects on their traditional lands and, depending on the circumstances, it may accommodate them if there
are impacts to their lands.
“ATRIS provides access to information that will help governments, industry and other interested parties to determine which aboriginal groups they may need
to consult about their activities across Canada,” said Erica Meekes, AANDC press secretary, although she could not say how often the site would be updated
with new information.
Renewable energy moves into mining mainstream
“At the board level, green energy feels better,” Ross Beaty told the crowd gathered for his keynote speech at September’s Renewable Energy and Mining
summit in Toronto. Beaty, chairman of both Pan American Silver and Alterra Power Corp., speaks from experience and his optimism was shared by the small,
but focused, group of about 250 conference-goers.
From Codelco’s recent forays into solar power to Rio Tinto’s wind project at the Diavik mine, there were plenty of real-world examples to prove what seemed
to be the theme of the event: it is not just possible, but profitable, to use renewable energy in many cases.
Rob Lydan, director of solar and wind at Hatch, addressed the need for power reliability in his presentation: “If you want to talk to the most conservative
group of people you’ve ever met, talk to people in utilities, and these technologies are the same as the ones they use. They are proven.”
And while most mining company representatives present were optimistic towards the future of renewable energy on their sites, the majority expressed a
desire to simply purchase energy and not to build utilities themselves. The onus was squarely put on renewable energy proponents to offer power purchase
agreements that are competitive with conventional options.
– Peter Braul
Reed copper mine starts production
Initial production is underway at the Reed copper mine, located 120 kilometres east of Flin Flon, Manitoba. The 1,300-tonne-per-day underground mine, a
$72-million Hudbay Minerals and VMS Ventures joint venture, is on time and on budget for full production to start in early 2014.
VMS Ventures, which discovered the near-surface deposit and owns 30 per cent, reports that current activities include underground development of the mine,
extracting and milling bulk samples, and fine-tuning the mill. The mine will be operated by Hudbay, which holds the remaining 70 per cent stake in the
project. According to Scott Brubacher, director of corporate communications at Hudbay, Reed will create 75 jobs and has an estimated life of five years. It
also promises to have a limited environmental footprint due to its proximity to the operator’s Flin Flon concentrator.
First bulk carrier traverses Northwest Passage
It finally happened. In September, the Danish bulk carrier Nordic Orion, loaded with coal, left Vancouver, and arrived in Pori, Finland, via the Northwest
Passage. Seamar Management, the operator of the Nordic Orion, also started shipping iron ore from Europe to China through the Northern Sea Route, in
Russia’s Arctic, in 2010.
For centuries, explorers have seen the Northwest Passage as a potentially quicker way to transport goods between Asia and Europe. But only relatively
recently, due to the longer ice-free season, has the Arctic shipping corridor seemed a viable route. Since the SS Manhattan, an oil tanker that was
retrofitted as an icebreaker, sailed through the Northwest Passage in 1969, the marine route has also been the source of great debate. Canada claims
sovereignty over what it calls internal waters of the Canadian Arctic archipelago, but Americans dispute this claim, stating the passage is subject to
international shipping rules.
Still, it is early days and it remains to be seen whether shippers will increasingly look to Canada’s North, plagued by minimal port, navigational and
search-and-rescue infrastructure, as an alternative shipping corridor.
Officials prevent TB outbreak in Saskatchewan
Last summer, the Saskatoon Health Region notified Cameco Corporation that a contract worker at its Cigar Lake uranium mine in northern Saskatchewan had
tested positive for active tuberculosis. The worker had contracted tuberculosis off site. Public health workers began tracing his contacts, starting with
the person’s immediate household and continuing with his workplace. The process identified more than 100 people who were potentially exposed but tested
negative for tuberculosis.
Tuberculosis is a rare condition in Canada. The active, symptomatic form of the disease has an average prevalence of 4.7 cases per 100,000 people. Johnmark
Opondo, medical health officer for the Saskatoon Health Region, said the province has had only two prior cases of active tuberculosis in mining workplaces
in the last 10 to 15 years.
Carey Hyndman, senior communications specialist at Cameco, said the company does not screen employees for any infectious diseases before or after they
arrive on site. Its prevention strategy includes employing health care workers on site and inviting public health officials to do training on
sleeve-coughing, handwashing and other basic hygiene practices.
That cooperation is important, according to Opondo. He cited the H1N1 influenza pandemic of 2009 as an example. “Most mine sites worked with their local
public health on strategy,” he said. Mines partnered with local health authorities to plan how to deal with immunizing workers against the flu or where to
secure antiviral drugs should they need them. “Even during the pandemic, I don’t think our mining operations stalled, mainly because they were proactive in
planning,” he said. “I think it is really strategic for mines to always work with their local public health when it comes to trying to plan around
prevention of any infectious disease.”
– Eavan Moore
Baffinland decides to build Mary River
Following the successful negotiation of an impact and benefit agreement with the Qikiqtani Inuit Association on September 6, Baffinland’s brass officially
announced it would proceed with construction of its massive open pit Mary River iron ore mine on northeast Baffin Island, Nunavut.
Since then, the company has completed its summer sealift, shipping fuel and cargo north with four ships from Valleyfield, Quebec, in order to supply the
mine during the winter. Baffinland, 70-per-cent-owned by ArcelorMittal and 30-per-cent-held by Nunavut Iron Ore Holdings, decided last year to build the
project in phases, rather than build the entire mine at once, which would include constructing a railway 150 kilometres to the south to connect to a
yet-to-be-built port at Steensby Inlet.
The Mary River project has a resource of roughly 365 million tonnes of high-grade iron ore, which will be shipped directly to customers in Europe. The
company expects to begin production in early 2015.
Kinross opens fourth mine in Russia
Kinross Gold Corporation’s $350-million Dvoinoye underground gold mine, located in Russia’s Chukotka region, began commercial production in October, with
CEO Paul Rollinson commending mine staff for reaching the important milestone on time and on budget.
Dvoinoye, Kinross’ fourth mine in Russia, is located some 100 kilometres north of its Kupol mine. The mill at Kupol has been expanded to accommodate 3,500
to 4,500 tonnes per day, allowing it to add feed from the Dvoinoye mine that will contribute up to 1,000 tonnes per day. The mine has Proven and Probable
Resources of 1.1 million gold ounces, and the company expects it to be profitable due to its high-grade ore, averaging 17.8 grams per tonne. The estimated
mine life is seven years.
According to Rollinson, the moderately sized, low-cost project “reflects the company’s focus on maximizing margins and cash flow.”
Quebec funds Labrador Trough railway study
The government of Quebec announced plans to invest $20 million in a prefeasibility study for the construction of a third railway link from the Labrador
Trough to the Sept-Iles port. The announcement is good news for iron developers in the region, who were left with limited transport options after CN Rail
suspended plans to invest in a project earlier this year.
CN’s study was originally shelved due to market volatility and uncertainties around the completion of iron ore projects in the region. But with Champion
Iron Mines Ltd.’s Consolidated Fire Lake North project slated to start production in 2016, and more projects in the pipeline, a rail line will be needed to
transport iron ore to ports for export to Asian consumers.
Champion Iron CEO Thomas Larsen said the project will benefit mining companies, local communities and the province. “This type of message will further
attract foreign investment that is essential to turn the Labrador Trough into a more cost-efficient iron ore centre,” he said.