Sunday 27th September 2020

Resource Clips

Week in review

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After discussing the country’s shaky future, inexplicably endemic violence and overall “towering levels of venality,” Hall stated, “Thus, there is something less than $8.5 billion in untraceable gold bullion stashed in an extremely politicized city that’s simmering with grudges and dreams. Should strife erupt in Caracas, thousands would inevitably covet a plentiful supply of metal that’s as liquid as can be when it comes to transactions. Physical gold is modestly short of priceless to a criminal. What mala gente or dissident generals wouldn’t want some of Chavez’s rich legacy?”

As for Venezuela’s oil revenue …

A far-from-fond eulogy posted in Takimag on Sunday said Chavez’s “government-enabled oligarchs … have siphoned anywhere from 20 to 400 billion petrodollars and tucked them away in offshore banks where the humble slum-dwellers of Caracas won’t ever notice it’s missing.”

Which way Avanti?

A mining and exploration retrospect

When it comes to the proposed $938-million Kitsault molybdenum mine in British Columbia, different sides seem to be interpreting B.C. politics differently. A Friday news release from Avanti Mining TSXV:AVT implies a fear that the B.C. government will cave in to native opposition. The day before that, a spokesperson for the natives in question, the Nisga’a of the northwestern coastal region, implied to the Globe and Mail that the province’s May election might sway the government to approve the mine. This week the band formally objected through a dispute resolution provision within its treaty.

In 2011 the BC Liberals promised eight new mines and nine significant mine expansions by 2015. Their latest resource enthusiasm is a supposed trillion-dollar liquefied natural gas industry that would pay off B.C.’s $60-billion debt in six years. Their commitment to any resource development might be questioned by the way they rejected Pacific Booker Minerals’ TSXV:BKM proposed Morrison copper-gold-molybdenum mine. Meanwhile the government is blundering on all fronts. (Just one of the most recent examples is here.)

According to the G&M, two provincial ministries have until April 15 to approve Avanti’s environmental assessment application, reject it or put it off by ordering further studies. The latter might be considered the most politic option by a government widely expected to lose on May 14. That would leave it up to the anticipated New Democratic Party government to, presumably, lay the proposed mine to rest—unless, of course, native opposition can be overcome in the meantime.

(Update: On March 19 the B.C. government actually issued Avanti an environmental assessment certificate. The company hopes to begin construction later this year, pending financing and permitting.)

Greenland election a “backlash” against resources rush

Greenlanders voted in a new government Tuesday, apparently rejecting policies that welcomed resource development, foreign workers and Chinese influence. Aleqa Hammond’s Siumut party won “around 14 seats in the 31-seat parliament,” Reuters stated, after promising to overturn legislation passed by the development-friendly former government. Hammond is expected to form a coalition.

A more measured pace of development might still bring self-sufficiency to the former Danish colony. The mostly Inuit population of 57,000 is subsidized by a $600-million annual grant from Denmark.

But a Chinese government official objected that “some media and individuals have engaged in groundless hype about China’s ‘marching toward Greenland.’” On Friday Foreign Ministry spokesperson Hua Chunying told China Daily that Greenland has issued companies from other countries 20 oil and gas exploration permits and about 100 permits for mineral mining. None of them went to Chinese interests, she said.

The paper also reported, “Feng Zhongping, vice-president of the China Institutes of Contemporary International Relations, said recent speculation stems partly from some Western countries’ lack of knowledge about Chinese investments, adding that prejudice is also a major factor.”

Obsession, reassurance about China

The mining industry’s “obsession” with China, especially in Africa, came up in a Tuesday China Daily story. The article quoted London-based consultant David Humphreys saying, “Any suggestion that China will slow down sends shockwaves through the thinking of the industry.”

More reassuringly, Cape Town investment strategist Michael Power told the paper, “People don’t understand the mathematical mechanics of compound interest. China’s growth might have slowed slightly but the base is huge. Last year China added another Australia to its GDP. By 2018 this will be another Germany and by 2021 another Japan, and that will be every year. The volume demand for resources will not decline.”

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