Gold find means residents will be moved

A mining company says it’s discovered around a million ounces (30 tonnes) of gold beneath two towns in western Liberia and as result thousands of residents will be relocated.

“The re-location exercise is about moving people of the towns of Kinjor and Lajor to a new site because they are sitting on the pit; the mine,” Shirk Sonii, spokesman for the Aureus Mining Company which has the mining concessions in the area, said on Tuesday.

Aureus Mining Inc, a Canadian registered company, is engaged in the exploration and development of gold deposits in under-explored areas of Liberia and Cameroon.

This is the first commercial gold mining operation in Liberia, and Aureus’ Liberty Gold Mine is expected to produce 120,000 ounces per year over an eight-year span with production on track for the first deposits to be recovered in the last quarter of 2013.

In monetary value, it is expected that the company will receive $US120 million ($A129.84 million) from its annual sales.

According to Sonii thousands of residents must be relocated to land about 500 miles (804.5 km) away from the blasting zone.

Scheduled to be resettled October this year, residents of Kinjor and Lajor have agreed to relocate given what the company has promised to them.

“We are pleased to relocate because they are going to build better structures than those we are currently living in… They are now building a school for our children,” Kinjor town head Lasana Sambola said.

Since the end of a civil war a decade ago, Liberia has accrued over $US18 billion ($A19.48 billion) in direct capital investment mainly for the mineral, oil and agriculture sectors.

Niyamgiri: First of 12-village vote rejects Vedanta mining

Vedanta Aluminium’s controversial plan to mine the Niyamgiri hills for bauxite received a major jolt Thursday after local tribal people unanimously rejected the proposal, claiming religious and cultural rights over the entire hills after 200 minutes of high drama and suspense.

In the first of the 12 pallisabhas or village meetings held in Serkapadi on the hills of Rayagada district, 36 registered voters of the village present at the meeting voted against Vedanta’s proposal to mine the Niyamgiri hilltop.

On April 18, the Supreme Court had ordered that the Union environment ministry would take a final decision on the grant of stage II clearance for the bauxite mining project within two months of the decisions of the pallisabhas.

Following the SC order, the Orissa government had notified that pallisabhas would be held in 12 villages in Rayagada and Kalahandi districts between July 18 and August 19.

“Niyamgiri is our God, our parent. It means everything to us. We have been worshiping it for years…our forefathers too. If we are thrown out from Niyamgiri, we would die like fish without water. Does the government want us to die like insects,” asked an emotional Govind Sikaka of Serkapadi, in Kui and Oriya language, echoing the emotions of the Niyamgiri tribal people present at the meeting.

“We can give our head, our blood, but not Niyamgiri. It has given us everything, fruit, water, air,” said Rupu Jakesika, a woman of Serkapadi, who signed two resolutions – one rejecting the proposal to mine Niyamgiri and the second staking a community rights claim over the Niyamgiri mountain.

Tempers soared when Dongaria Kondh tribal men and women insisted that an earlier resolution prepared by the state tribal affairs department restricting their community rights under the Forests Rights Act be scrapped. The earlier resolution on community rights limited the rights of Serkapadi to a few acres. When the tribals of the village refused to sign the resolution, Rayagada district judge Sarat Chandra Mishra, appointed an independent observer, threatened to end proceedings.

Shanghai ETFs flop, premiums plummet: China simply cannot absorb wave of gold selling

The emergence of the gold ETF industry has been a big factor in gold’s uninterrupted 12-year bull run, because ETFs make it so easy to invest in the yellow metal.

When the first gold-backed ETF was introduced in Australia in 2003, the price of gold was around $320 an ounce.

This week gold-backed ETF holdings fell to the lowest levels since May 2010 – a staggering 653 tonnes worth of redemptions since December 2012.

The outflows equate to more than $60 billion wiped off the value of the world’s more than 140 gold-backed ETFs.

The selling has been cited as a major factory factor behind gold’s dramatic fall this year.

The conventional wisdom has been that everything investors are selling in the West is being bought in the East.

Stories about Chinese housewives going on 300 tonne bullion shopping sprees, Indian gold lovers swamping jewellery stores and Vietnamese traders willing to shell out $150 more than the ruling price to get their hands on precious metal, followed gold’s dramatic April decline.

 

There was talk of a structural transformation of the global market for gold with Asia sparking a new bull run.

But there are limits to how much gold Asia can absorb.

This week China’s first gold-backed ETFs to list fell way short of expectations.

The two funds attracted $195 million and $66 million on the Shanghai Stock Exchange respectively, enough to buy around six tonnes of gold. The asset managers were “conservatively” targeting more than $800 million Bloomberg reports:

Buyers who snapped up jewelry, coins and bars in April when bullion slipped into a bear market, are holding back now as prices fall further and as government bonds offer higher yields, according to China Galaxy Securities Co. China is top producer and second-biggest consumer of the precious metal.

“Enthusiasm is ebbing with prices dropping further than people expected when they bought in mid-April,” said Zhang Yifan, a strategist at China Galaxy in Shanghai. “Most of them now are taking a wait-and-see attitude before committing to buy any more.”

Another indication that demand in China is not as robust as hoped is evidenced by the premium traders on the Shanghai Gold Exchange are willing to pay for the metal.

Before April’s dramatic $200 fall to $1,400 over two trading days SGE premiums stayed below $10 an ounce, but then shot up to more than $20. Gold’s second gap down in late June to $1,200 following Bernanke’s comments about QE saw Shanghai premiums top out at $37.

In a research note on Friday, South Africa’s Standard Bank said the premium Chinese investors were willing to pay has now fallen back to $22, down a fifth just this week, adding that physical buying is “especially thin on approach of $1,300/oz.”

Buyers in India  have also stopped coming to the party

Buyers in India  have also stopped coming to the party.

Historically the globe’s number one importer of gold,  the country’s imports are now predicted to fall more than 29% in the second half of the year to 372 tonnes compared to the first six months of 2013 as bargain hunters exit the market.

The Indian government is also trying everything to discourage its people from buying gold. And it seems to be working.

Authorities have hiked the gold import tax from 2% to 8% and at the same time adjusted the way it is calculated to make bullion more expensive, banned traders from importing gold on margin and even barred consumers to buy on an instalment basis with credit cards. India may stop state-run entities which are huge players in the market from importing gold at all.

On top of all this, Indians also have to cope with a rupee that continues to hover near record levels, negating much of the impact of cheaper dollar gold.

Gold ends above $1,284 on Fed chief comments

Gold prices settled higher on Thursday, partially recovering from a more than 1 percent loss in the previous session, as market participants felt reassured of the possibility of a gradual pullback in the U.S.Federal Reserve’s stimulus program.

Fed Chairman Ben Bernanke said during his U.S. Congress and Senate testimony this week that the U.S. central bank still expects to start scaling back bond purchases later in the year, but left open the option of changing that plan if needed.

“Tapering is here and we will be living in a different world at some stage … but even if we start seeing less easing that doesn’t necessarily mean that we’ll see an higher interest rates environment,” Credit Suisse analyst Karim Cherif said.

“On the contrary, low interest rates will probably continue and that’s also why there is a base to how much gold could drop,” he added.

Spot gold briefly rallied 1 percent to a session high of $1,288.06 an ounce, as investors found value following a one-percent slide in the previous session, but it pared some gains as the dollar held its ground after strong U.S. jobs data.

(Read More: What Bernanke’s testimony means for gold: Pro)

It was last trading at $1,285, up about 0.8 percent. U.S. gold futures for August delivery settled $6.70 higher at $1,284.20 an ounce.

The dollar extended earlier gains after U.S. weekly jobless claims data showed the number of Americans filing new claims for jobless benefits dropped more than expected last week to the lowest level in four months.

The data could reinforce the view that the Federal Reserve will start winding down its massive stimulus program as early as September, but some traders warned that July’s labour data are usually heavily distorted by seasonal factors.

Bullion has slipped more than 20 percent this year, losing its safe-haven appeal after the U.S. central bank first signaled it would look to rein in its $85 billion in monthly asset purchases later this year and halt stimulus altogether by mid-2014.

 

The Fed’s three quantitative easing schemes have buoyed prices of gold and other commodities, as they kept interest rates low, which weighed on the dollar, making assets priced in the greenback cheaper for foreign investors.

As a gauge of investor sentiment, holdings of the world’s largest gold-backed ETF SPDR Gold Trust fell 1.5 tons to 937.57 tons on Wednesday. The fund has seen outflows of around 370 tons, or about $17 billion at current prices, so far this year.

Miners not benefiting from increased US coal consumption

According to the latest data, coal stockpiles at the country’s power plants has dropped below the monthly five-year average for the first time since December 2011.

The US Energy Information Administration (EIA)reports Thursday inventories have been falling because of a colder than usual winter and rising natural gas prices which prompted some power plants to switch to coal.

While this should be good news for coal miners – total coal consumption was indeed up 11% in Q1 2013 compared to last year – the EIA points out “receipts of coal at electric power plants actually decreased 5%” because of the historically high levels of stored coal that power plants could use.

The situation is not expected to improve much going forward either because US exports of steam and metallurgical coal are falling faster than domestic stockpiles are being depleted.

US coal production is therefore expected to remain flat in 2013 and only show a modest 3% annual rise in 2014.

Coal fuels about 40% of total power generation in the US, an improvement from a low of 32% in April 2012, when natural gas prices were near 10-year lows.

 

The World’s 3 Largest Gold Mines

Gold is a rare commodity. Although estimates vary, recent data from Thomson Reuters GFMS suggests that there are only 171,300 tonnes of the precious metal in the world. Despite that fact, gold mines can be found in numerous countries.

Here’s a look at the three largest gold mines in the world.

Grasberg mine

Operated by Arizona-based miner Freeport-McMoRan Copper & Gold (NYSE:FCX), the Grasberg mine is considered by most experts to be the biggest gold mine in the world. It is also one of the largest copper mines.

Grasberg is located in the province of Papua in Indonesia. Open-pit operations at the mine began in 1990 and the company expects that they will continue through 2016. As of December 31, 2012, the Grasberg open pit’s recoverable proven and probable gold reserves sat at 6.5 million ounces.

The mine’s targeted gold output for 2013 is 1.25 million ounces, but recent setbacks may cause it to only produce 80 percent of that estimate. A mine tunnel collapsed May 14, forcing Freeport to shut down operations, and production did not resume until July 9.

There are still expansion projects in progress in the Grasberg mineral district, including the development of large-scale, high-grade underground ore bodies, according to the company’s 2012 annual report.

Yanacocha mine

Located in the Andes Mountains in Peru, the Yanacocha mine is the largest gold mine in Latin America. It opened in 1993 and contains three active pits. Since its inception, the mine has produced more than 26 million ounces of gold.

Yanacocha is owned and operated by Colorado-based gold producer Newmont Mining (NYSE:NEM,TSX:NMC). The company holds a 51.35-percent interest in the property and the rest is claimed by Compania de Minas Buenaventura (NYSE:BVN).

In 2012, Yanacocha produced 1.346 million ounces of gold. As of December 31, 2012, the asset had 3 million attributable ounces of gold reserves. It is part of a joint venture with Newmont’s Conga Project in Peru. Together they are known as Minera Yanacocha.

The Yanacocha area has recently seen a number of protests from Peruvian residents who do not want the Conga project to proceed, as reported by The Peruvian Times. The opposition is due to the fact that the new mine will require Newmont to drain three lakes in the Cajamarca region.

Goldstrike mine

The Goldstrike mine is located on the Carlin Trend in Northeastern Nevada and is run by Barrick Gold (NYSE:ABX,TSX:ABX). Mining at Goldstrike began in 1987. The property is a compilation of the Betze-Post open-pit mine and the Meikle and Rodeo underground mines.

In 2012, it produced 1.17 million ounces of gold at a total cost of $541 per ounce. This year, Barrick expects to deliver between 0.87 and 0.94 million ounces of the precious metal at a total cost of $680 to $700 per ounce. As of December 31, 2012, Goldstrike’s proven and probable gold reserves sat at 12.3 million ounces, according to Barrick’s website.

At the end of June, the company announced that it will be downsizing its workforce by 55 people in Nevada and Utah because of lower gold prices, higher operating costs and a suffering stock price, The Associated Press reported.

Athabasca oil sands: A blessing or nuisance

Athabasca oil sand deposit (AOSD) is world’s largest unconventional reserves of crude bitumen with a potential of about 1.69 trillion barrels of crude bitumen making up 98% of the total Canadian oil reserves.

These reserves enable Canada standing third in the world after Saudi Arabia and Venezuela as we talk about crude oil reserves. Crude oil accounts for 40% of Canada’s energy demand and 15% of Canada’s merchandise exports.

The total production of AOSD is estimated to be 3.858 thousand barrels per day showing minimum life expectancy of 125 years if extracted at the same rate (Figure1).

Right now, Canada exports 2.130 million barrels per day in addition to 1.8 million Canadian consumption. The oil sands are adding sufficient revenue to the economy and proved the main survival of the economy in the worst case scenario (recession period – 2008).

Everyone should agree with Keith Schaefer statement that “many of the oil sands workers are Maritimes, but it’s also true that the jobs in “Fort Mac” have saved rural areas across all of western Canada from big unemployment”. Alberta mining, oil & gas industry is providing 151, 110 jobs related to multi-disciplinary professions.

It is forecast that the employment in the mining and oil and gas extraction is expected to raise an average rate of 2.2% from 2011 to 2015.The capital spending is $17.2 billion and the industry collects $36.7 billion revenues.

The total proved reserves of crude oil in North America are estimated to be 208.91 billion barrels including Canada; 175 billion barrels, United States of America (USA) ; 23.267 billion barrels and Mexico;0.42 billion barrels.

USA  is one of the world’s largest consumer of crude oil with a consumption of 18.8 million barrels per day (MMbd) but poor reserves (3%). The life expectancy of USA resources is very low in comparison to other oil producing generation (Figure 1).

Canada is the leading US’s crude oil supplier exporting  25% (2.23 MBpd) of its oil need (2011) and then Saudi Arabia 14%.

In the case, the USA entirely relies upon its own resources  and it may not survive long enough if no exaggeration in the expected reserves.

Huizenga Introduces Bipartisan Dredging Legislation

The U.S. Rep’s Bill Huizenga, Dan Benishek and Candice Miller, joined by two New York State colleagues, introduced a bill to have the U.S. Corps of Engineers treat the Great Lakes and St. Lawrence Seaway as one unit when it comes to dredging makes sense.

This legislation would establish a single, comprehensive Great Lakes Navigation System for budgeting purposes. It would take all the individually authorized commercial and recreational navigation projects in the Great Lakes and recognize them as a unified entity to ensure adequate funding. This legislation also creates a program to help reduce the harbor maintenance backlog.

Miners unsure about Rudd’s carbon tax announcement

The Australian resources sector seemed ambivalent to the announcement that the Kevin Rudd-led government would fast-track the move to a floating carbon price, saying it gave little comfort that fundamental flaws eroding the competitiveness of the country’s industry would be fixed.

Over the weekend, Rudd announced that his newly instated government would axe the fixed carbon tax and accelerate an emissions trading scheme, saying it would take the cost-of-living pressures off Australians, while still protecting the environment.

The fixed-price carbon tax, which the government approved under Julia Gillard’s watch in 2011, puts a price on emissions of A$24.15/t and would have moved to a floating price in July 2015.

Details of the new scheme are yet to be released.

Queensland Resources Council CEO Michael Roche said that the industry body could not pass definitive judgement on the new carbon pricing plans in the absence of answers to some questions of detail.

He noted that some of the issues that needed clarification included: the adoption of the European carbon price, whether the new coal pricing would continue to apply to fugitive emissions from coal mines and whether Australian firms would be locked into trading at least 50% of their carbon emissions locally.

“If the federal government’s answers to each of these questions is no, then clearly the intent is no more than a political fix in the shadow of an election, not the fundamental re-think that is so badly needed to ensure Australia’s trade-exposed industries can be internationally competitive,” said Roche.

He added that the Rudd government had the opportunity to lift a discriminatory burden on the Australian coal industry at a time when coal producers were facing the most difficult market conditions in more than a decade.

The Association of Mining and Exploration Companies also noted that the changes to the carbon tax were not enough to address the sector’s concerns.

CEO Simon Bennison has called on the government to fully rescind the Clean Energy Future plan, saying, also, that the part removal of the diesel fuel credit arrangement should be reinstated to pre-carbon-tax levels as soon as possible.

“This will go a long way to recovering some of the lost competitiveness that has occurred over the past few years, as a direct consequence of this and other public policy announcements targeting the Australian mineral exploration and mining sector. These announcements have also dented much needed investor and banking confidence in the industry.”

Bennison pointed out that diesel was a major business input, as it is a primary source of energy for mining and exploration companies, representing between 4% and 7% on typical mining projects. The cost was, however, more pronounced for smaller miners and mineral exploration companies, which, in many cases, have no other option than to use diesel fuel for their essential energy requirements.

Opposition leader Tony Abbott, who continues to call for the complete scrapping of a carbon tax, described the plans to move forward the planned changes to the carbon tax by one year as a “con”. 

“Mr Rudd can change the name but whether it is fixed or floating, it is still a carbon tax.”

Sundance faces court action over 2010 plane crash

Iron-ore developer Sundance Resources told shareholders on Monday that it would defend itself against legal action being taken on behalf of the estate of the late James Cassley.

Cassley lost his life in the 2010 plane crash that claimed the lives of the entire Sundance board. He was an employee of investment company GMP Securities Europe.

The proceedings allege that both Sundance and GMP Securities had a liability for negligence in relation to the plane crash, and the claim is for an amount of £6.23-million.

 

 

 

Ralated Article:Sundance Energy raises capital

Energy explorer Sundance Energy has completed a A$48.1-million share placement to professional and sophisticated investors to accelerate development of its Eagle Ford and Mississippian/Woodford acreage.

Sundance said on Friday that the placement was priced at 86c per share, representing an 11.8% discount to the closing price on May 28, and an 8.7% discount to the five-day volume-weighted average price of Sundance shares.

“This is an exciting time for our shareholders. The proceeds from this capital raising will allow us to accelerate our pace of activity, driven by faster-than-expected drilling times in the highly economic Eagle Ford,” said Sundance MD Eric McCrady.

“This acceleration will bring forward both production growth and reserve value,” he added.

After settlement of the placement, Sundance would offer its shareholders in Australia and New Zealand an opportunity to participate in the capital raising through a share purchase plan, which would be capped at A$15-million.

The placement would also be set at 86c a share, with shareholders allowed to subscribe for up to A$15 000 in new shares.

Sundance Energy is focused on the development of its oil and natural gas projects in North America, which include activities in the Eagle Ford, Williston, Denver-Julesburg and Anadarko basins.