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Posts tagged ‘AngloGold Ashanti (AU)’

Pushing the boundaries

October 12th, 2016

Technology opens new mining frontiers, sometimes challenging human endurance

by Greg Klein

This is the second of a two-part feature. See Part 1.

“Deep underground, deep sky and deep sea” comprise the lofty goals of Three Deep, a five-year program announced last month by China’s Ministry of Land and Resources. Part 1 of this feature looked at the country’s ambitions to take mineral exploration deeper than ever on land, at sea and into the heavens, and also outlined other countries’ space programs related to mineral exploration. Part 2 delves into undersea mining as well as some of the world’s deepest mines.

Looking to the ocean depths, undersea mining has had tangible success. De Beers has been scooping up alluvial diamonds off southwestern Africa for decades, although at shallow depths. Through NamDeb, a 50/50 JV with Namibia, a fleet of six boats mines the world’s largest-known placer diamond deposit, about 20 kilometres offshore and 150 metres deep.

Technology opens new mining frontiers, sometimes pushing human endurance

Workers at AngloGold Ashanti’s Mponeng operation
must withstand the heat of deep underground mining.

Diamond Fields International TSXV:DFI hopes to return to its offshore Namibian claims, where the company extracted alluvial stones between 2005 and 2008. The company also holds a 50.1% interest in Atlantis II, a zinc-copper-silver deposit contained in Red Sea sediments. That project’s now on hold pending a dispute with the Saudi Arabian JV partner.

With deeper, more technologically advanced ambitions, Nautilus Minerals TSX:NUS holds a mining licence for its 85%-held Solwara 1 project in Papua New Guinea waters. A seafloor massive sulphide deposit at an average depth of 1,550 metres, its grades explain the company’s motivation. The project has a 2012 resource using a 2.6% copper-equivalent cutoff, with the Solwara 1 and 1 North areas showing:

  • indicated: 1.03 million tonnes averaging 7.2% copper, 5 g/t gold, 23 g/t silver and 0.4% zinc

  • inferred: 1.54 million tonnes averaging 8.1% copper, 6.4 g/t gold, 34 g/t silver and 0.9% zinc

Using the same cutoff, the Solwara 12 zone shows:

  • inferred: 2.3 million tonnes averaging 7.3% copper, 3.6 g/t gold, 56 g/t silver and 3.6% zinc
Technology opens new mining frontiers, sometimes pushing human endurance

This Nautilus diagram illustrates
the proposed Solwara operation.

A company video shows how Nautilus had hoped to operate “the world’s first commercial high-grade seafloor copper-gold mine” beginning in 2018 using existing technology from land-based mining and offshore oil and gas. Now, should financial restructuring succeed, Nautilus says it could begin deployment and testing by the end of Q1 2019.

Last May Nautilus released a resource update for the Clarion-Clipperton Fracture Zone in the central Pacific waters of Tonga.

Another deep-sea hopeful, Ocean Minerals last month received approval from the Cook Islands to explore a 12,000-square-kilometre seabed expanse for rare earths in sediments.

A pioneer in undersea exploration, Japan’s getting ready for the next step, according to Bloomberg. A consortium including Mitsubishi Heavy Industries and Nippon Steel & Sumitomo Metal will begin pilot mining in Chinese-contested waters off Okinawa next April, the news agency stated. “Japan has confirmed the deposit has about 7.4 million tons of ore,” Bloomberg added, without specifying what kind of ore.

Scientists are analyzing data from the central Indian Ocean where nodules show signs of copper, nickel and manganese, the Times of India reported in January. The country has a remotely operated vehicle capable of an unusually deep 6,000 metres and is working on undersea mining technology.

In August the World Nuclear News stated Russia is considering a nuclear-powered submarine to explore northern seas for mineral deposits. A government report said the sub’s R&D could put the project on par with the country’s space industry, the WNN added.

If one project alone could justify China’s undersea ambitions, it might be a 470.47-ton gold deposit announced last November. Lying at 2,000 metres’ depth off northern China, the bounty was delineated by 1,000 workers and 120 kilometres of drilling from 67 sea platforms over three years, the People’s Daily reported. Laizhou Rehi Mining hopes to extract the stuff, according to China Daily.

China’s deep underground ambitions might bring innovation to exploration but have been long preceded by actual mining in South Africa—although not without problems, as the country’s deplorable safety record shows. Greater depths bring greater threats from rockfalls and mini-earthquakes.

At 3.9 kilometres’ depth AngloGold Ashanti’s (NYSE:AU) Mponeng holds status as the world’s deepest mine. Five other mines within 50 kilometres of Johannesburg work from at least three kilometres’ depth, where “rock temperatures can reach 60 degrees Celsius, enough to fry an egg,” according to a Bloomberg article posted by Mineweb.com.

In his 2013 book Gold: The Race for the World’s Most Seductive Metal, Matthew Hart recounts a visit to Mponeng, where he’s told a “seismic event” shakes the mine 600 times a month.

Sometimes the quakes cause rockbursts, when rock explodes into a mining cavity and mows men down with a deadly spray of jagged rock. Sometimes a tremor causes a “fall of ground”—the term for a collapse. Some of the rockbursts had been so powerful that other countries, detecting the seismic signature, had suspected South Africa of testing a nuclear bomb.

AngloGold subjects job-seekers to a heat-endurance test, Hart explains.

In a special chamber, applicants perform step exercises while technicians monitor them. The test chamber is kept at a “wet” temperature of eighty-two degrees. The high humidity makes it feel like ninety-six. “We are trying to force the body’s thermoregulatory system to kick in,” said Zahan Eloff, an occupational health physician. “If your body cools itself efficiently, you are safe to go underground for a fourteen-day trial, and if that goes well, cleared to work.”

Clearly there’s more than technological challenges to mining the deeps.

By the way, credit for the world’s deepest drilling goes to Russia, which spent 24 years sinking the Kola Superdeep Bore Hole to 12,261 metres, halfway to the mantle. Work was halted by temperatures of 180 degrees Celsius.

This is the second of a two-part feature. See Part 1.

Straight to Phase II

August 18th, 2016

Metallurgy moves Equitas Resources closer than expected to Brazilian gold expansion

by Greg Klein

It’s a case of disappointing results being trumped by findings much more positive. Equitas Resources TSXV:EQT planned to add a gravity plant to its Cajueiro gold project in central Brazil, hoping to increase the modest operation’s recovery. Another stage in the project’s incremental development was to follow—a carbon-in-leach plant for further improvement. But, the company announced August 18, metallurgical tests gave gravity a failing grade. Those studies did, however, find conventional CIL results even better than anticipated. That now puts Cajueiro on the fast track as Equitas skips Phase I, advancing straight to CIL.

Equitas gained the 39,053-hectare property with last spring’s acquisition of Alta Floresta Gold and its 184,410-hectare Brazilian portfolio. Impressed by both the assets and Alta Floresta’s Brazil-based team, Equitas planned a step-by-step process of improving and expanding the flagship operation.

Metallurgy moves Equitas Resources closer than expected to Brazilian gold expansion

Metallurgical progress follows last spring’s drilling,
which focused on two zones of near-surface mineralization.

Currently limited to potential alluvial production of about a kilogram of gold per month, Cajueiro had languished at about 30% to 35% recovery through a sluice box. The company hoped to increase that to about 50% by adding a gravity plant, prior to a Phase II CIL plant and its hoped-for 85%. Metallurgical studies disappointed gravity expectations with a maximum of 22.1%. But surpassing expectations was conventional CIL, with a range of 93.7% to 96.2%.

Work was conducted by Testwork Desenvolvimento de Processo, whose technical director Walter de Moura boasts 30 years’ experience with AngloGold Ashanti NYSE:AU. Bench-scale tests on a 118-kilogram composite saprolite sample point to high recovery with limited grinding, rapid leach times and low reagent consumption, “a direct cyanidation approach to gold recovery,” Equitas stated.

That pushes Cajueiro directly to Phase II. Earlier this week Equitas pronounced itself “very close” to closing an amended $6-million financing. With all figures in U.S. currency, the deal with private equity firm Cartesian Royalty Holdings would bring $5 million in revolving loans and a $1-million warrant exercise.

Equitas would borrow instalments of the $5 million, repaying each $1-million drawdown with 2,100 gold ounces within a year or 2,300 ounces up to three years. Repayments made within one year could be re-drawn, giving the company a revolving loan capacity of $5 million.

Late last month Equitas closed an over-subscribed private placement totalling C$861,000.

Testwork now has analysis and design underway for a CIL test plant with a capacity of 250 to 400 tonnes per day. Permit applications have been filed to mine 50,000 tonnes per year from each of Cajueiro’s Baldo and Crente zones. The CIL plant would be located about halfway between the two zones, which sit less than two kilometres apart.

With construction expected to begin in Q4, the plant should take six months to build, communications manager Sean Kingsley tells ResourceClips.com. “During that time we expect further exploration and drilling.”

Baldo was the focus of last spring’s campaign of 20 holes for 1,600 metres, along with 700 metres of trenching. Most of the drilling consisted of infill holes targeting mineralized saprolite oxide, highly weathered near-surface material potentially amenable to open pit extraction.

“We expect to have those results very soon,” says Kingsley. “We also drilled the Crente zone, which shows a lot of upside. We drilled below a very shallow former garimpeiro pit and we’re looking forward to those results too.”

Highlights from initial assays reported last month included 24.26 grams per tonne gold over two metres, 18.86 g/t over another two metres and 1.4 g/t over 12 metres (not true widths).

There are other zones on Cajueiro that we haven’t talked about, that have even more prospectivity.—Sean Kingsley, communications manager for Equitas Resources

“There are other zones on Cajueiro that we haven’t talked about, that have even more prospectivity,” maintains Kingsley. “To get our full mining licence we had to do a lot of work on one-fifth of the Baldo zone, a pre-worked area which isn’t the most prospective area.”

A 43-101 report filed in April recalculated 2013 data for four zones of sulphides and of saprolite oxides. Using a 0.25 g/t cutoff, the project’s sulphides now total:

  • indicated: 8.64 million tonnes averaging 0.771 g/t for 214,100 ounces gold

  • inferred: 9.53 million tonnes averaging 0.664 g/t for 203,500 ounces

Using the same cutoff, four zones of oxides total:

  • inferred: 1.37 million tonnes averaging 1.775 g/t for 78,400 ounces

Baldo’s share of the saprolite oxides comes to:

  • inferred: 309,000 tonnes averaging 3.029 g/t for 30,100 ounces

It’s Cajueiro’s near-surface, higher-grade, more metallurgically attractive oxides that remain the focus of exploration and potential extraction.

Kingsley points to a highly experienced team that includes director Kyler Hardy, president/CEO Chris Harris, director David Hodge and VP of exploration Everett Makela, along with long-time Brazil veterans director Alan Carter, director/adviser Michael Bennett, adviser Jon Coates, mining manager Richard Crew and project manager Elvis Alves. “Individually, they’re all people with impressive accomplishments,” says Kingsley. “Collectively, they’re one hell of a team.”

He emphasizes that the project will make Equitas “a growth story. Now’s the time to boost Cajueiro’s production, get cash flow and grow from there.”

More than $7 billion in mining investments stalled in Colombia

January 22nd, 2014

by Cecilia Jamasmie | January 22, 2014 | Reprinted by permission of MINING.com

Colombia, not long ago one of the favourite destinations for mining enthusiasts, is struggling to keep its resources sector healthy, with about $7.3 billion of expected investments currently stalled due to delays in environmental approvals and decreased demand from overseas.

More than $7 billion in mining investments stalled in Colombia

Over 4,000 mining jobs are on the line due to ongoing suspension of Drummond’s exports. (Photo:
Colombian coal miner by Scott Wallace/
World Bank Collection via Flickr.)

In an interview with local paper Vanguardia.com, Large Scale Mining Association representative Claudia Jimenez blamed regulatory holdups for the declining growth of the sector.

Colombia’s economy, mostly driven by oil and mining, grew 6.6% in 2011 but has steadily declined ever since. That’s partly due to the economic state of its biggest trading partners, mainly the U.S.

But Jimenez—who represents 13 of the largest miners of Colombia, such as Cerrejon, Cerro Matoso, AngloGold Ashanti NYE:AU and Drummond—also thinks the decline is related to the lack of support for companies in the country. She told Vanguardia she hoped the situation would improve rather soon, as the country now has a National Mining Agency, created two years ago.

The Drummond effect

Some analysts believe the recent sanctions against U.S. mining giant Drummond, which saw its coal shipments frozen in early January for not complying with a new environmental law, may damage Colombia’s embattled mining industry even further.

The firm, Colombia’s second-largest coal producer, didn’t meet the government’s deadline for coal miners to build direct ship-loading facilities in their ports by January 1 this year.

“Whilst Drummond clearly overestimated its position as a big contributor for the Colombian arks, the decision to put a stop to the operations is an economical harakiri and demands a careful analysis,” said OPHIR Mining, Resources & Investment earlier this month.

The experts think Drummond negligence could have been managed through sanctions that didn’t harm the economic chain, as has happened with the interruption of all of Drummond’s shipments, which are equivalent to a third of the total coal production in Colombia.

Over 4,000 jobs could face temporary suspension, but the government has warned Drummond that it will not allow layoffs as the company has had seven years to complete the upgrading.

Reprinted by permission of MINING.com

Gold mines output to reach record high

November 20th, 2013

by Cecilia Jamasmie | November 20, 2013 | Reprinted by permission of MINING.com

The world’s gold mines are set to hit record highs in terms of production this year, which won’t help bullion prices recover much from this year’s 25% decline, Reuters reports.

A clear sign of this trend can be seen in the world’s top three gold miners’ latest results, with Barrick Gold TSX:ABX, Newmont Mining NYE:NEM and AngloGold Ashanti NYE:AU all reporting higher production.

Large gold projects put into motion during gold’s 12-year rally are set to start production in the new year, including new mine production and expansion in and around the Nevada gold fields and the Oyu Tolgoi copper mine in Mongolia, whose significant gold byproduct potential is estimated to be 330,000 ounces per year.

Add to the mix the fact that gold output in China, the world’s top producer of the yellow metal, is up 6.8% in the last nine months, as figures published November 20 by the China Gold Association show and the fact that the World Gold Council said recently that Q3 bullion demand hit its lowest level in the last four years. Then the outlook doesn’t look promising for gold bulls.

The Asian superpower has been the world’s top gold producer since 2007, when it churned out 270.491 tonnes of the precious metal and replaced South Africa in the number one spot.

The World Gold Council has forecast that China will overtake India as the world’s largest gold consumer this year. In 2012, Chinese gold consumption jumped 9.35% to 832 tonnes.

Read also: Seven reasons the gold price may not see $1,400 again.

Reprinted by permission of MINING.com

Athabasca Basin and beyond

November 3rd, 2013

Uranium news from Saskatchewan and elsewhere for October 26 to November 1, 2013

by Greg Klein

Next Page 1 | 2

Alpha/Fission hit 5.98% U3O8 over 17.5 metres, including 19.51% over 5.5 metres

With so many scintillometer results announced already, assays for the same holes can be anti-climactic. But that’s the way Fission Uranium TSXV:FCU and Alpha Minerals TSXV:AMW have orchestrated their Patterson Lake South campaign, now giving observers a near sense of déjà vu. Assays from four holes announced October 29 add little to the news of August 8, although results from the lab are much more reliable than those from the hand-held radiation-detecting gizmo. The assays come from R00E, the farthest southwest of the project’s five zones.

Hole PLS13-074

  • 0.13% uranium oxide (U3O8) over 2.5 metres, starting at 65 metres in downhole depth

PLS13-076

  • 0.09% over 2 metres, starting at 178.5 metres

  • 0.08% over 1.5 metres, starting at 183 metres

  • 0.16% over 4.5 metres, starting at 186.5 metres

PLS13-077

  • 0.39% over 11.5 metres, starting at 59 metres

  • 0.13% over 15.5 metres, starting at 73 metres

PLS13-079

  • 5.98% over 17.5 metres, starting at 83 metres

  • (including 19.51% over 5 metres) (Update: On November 4 the JV partners corrected the intercept width from 5.5 metres to 5 metres.)

True widths were unavailable. Three of the holes were vertical, while 079 dipped at -75 degrees. That hole expands the zone’s high-grade southern area, the companies stated, while all four holes confirm R00E’s east-west strike at 165 metres. The zone remains open in all directions.

With the summer barge-based campaign complete, attention now turns to a land-based program west of R00E. Fission acts as project operator on the 50/50 joint venture until its acquisition of Alpha closes. Fission shareholders will vote on the deal’s spinout aspect on November 28.

(Update: On November 4 the JV announced a sixth PLS zone west of the discovery. Read more.)

Rio Tinto plans winter drilling at Purepoint’s Red Willow

Purepoint Uranium Group TSXV:PTU announced plans on October 29 by Rio Tinto Exploration Canada for 2,500 metres of drilling at Red Willow, a 25,612-hectare property on the Athabasca Basin’s eastern edge. Rio identified targets based on historic drill logs and more recent geophysical and geochemical work. The company built a 28-person camp last summer.

Depth to unconformity in the area varies from zero to 80 metres, Purepoint stated. The company says five major deposits—JEB, Midwest, Cigar Lake, McArthur River and Millennium—“are located along a NE to SW mine trend that extends through the Red Willow project.”

Rio has so far spent about $2.25 million out of a $5-million commitment to earn an initial 51% interest by December 31, 2015. The giant’s Canadian subsidiary may earn 80% by spending $22.5 million by the end of 2021.

In early October Purepoint announced a winter drill campaign for the Hook Lake JV held 21% by Purepoint and 39.5% each by Cameco Corp TSX:CCO and AREVA Resources Canada.

Strong Q3 financials surprise Cameco shareholders

Despite historic low uranium prices, Cameco came out with Q3 earnings far beyond the same period last year. In his October 29 statement, president/CEO Tim Gitzel attributed the success to a contracting strategy “providing us with higher average realized prices that are well above the current uranium spot price.”

Uranium news from Saskatchewan and elsewhere for October 26 to November 1, 2013

Rabbit Lake was one of three Cameco operations that received
10-year licence renewals the same week that the company
surprised investors with an especially strong quarterly report.

Adjusted net earnings for three months ending September 30 came to $208 million, a 324% increase over Q3 2012 or, at 53 cents a share, a 342% increase. Year-to-date figures came to $295 million (up 48%) and 75 cents a share (up 47%).

Gitzel added that Cameco’s “starting to see some of the cost benefits of the restructuring we undertook earlier” and plans to “take advantage of the opportunity we see in the long term.”

However the company’s statement noted “there have been some deferrals of future projects due to uranium prices insufficient to support new production. The deferrals will not directly impact the near-term market, but could have an effect on the longer term outlook for the uranium industry. Complicating the supply outlook further is the possibility of some projects, primarily driven by sovereign interests, moving forward despite market conditions.”

The company forecast strong long-term fundamentals, mostly to China which has “reaffirmed its substantial growth targets out to 2020 and indicated plans to pursue further growth out to 2030. Their growth is palpable as construction on two more reactors began during the third quarter, bringing the total under construction to 30.”

As for Cameco’s long-delayed Cigar Lake mine, the company’s sticking to its current plan of Q1 2014 production and Q2 milling.

But while junior exploration flourishes, especially in the Athabasca Basin, the major plans a 15% to 20% cut in exploration spending this year.

Three Cameco operations get 10-year licence renewals

Licences for Cameco’s Key Lake, McArthur River and Rabbit Lake operations have been renewed for 10 years, the Canadian Nuclear Safety Commission announced October 29. The CNSC granted the extensions after three days of public meetings that heard from the company, 27 interveners and CNSC staff. The commission agreed to Cameco’s request for 10-year renewals, twice the previous term.

MillenMin finds radioactive outcrops on east Basin properties, reports AGM results

MillenMin Ventures TSXV:MVM completed initial field work at two eastside Basin properties, the 2,759-hectare Highrock Lake NE and 1,648-hectare Smalley Lake W. Work included prospecting, outcrop mapping and examination of previously found mineralization, the company announced October 28.

Grab samples from radioactive outcrops on both properties have been sent for assays. MillenMin first announced its foray into uranium last May and has staked 11 claims totalling about 18,983 hectares in and around the Basin.

On October 31 the company reported AGM results with directors re-elected, auditors re-appointed and other business approved.

Declan options northeastern Alberta property

Southwest of the Basin’s Alberta extremity, Declan Resources TSXV:LAN has optioned the 50,000-hectare Firebag River property. Previous geophysical survey data “shows a complex pattern of magnetic lows and highs, truncated or offset in the northern part of the property by the Marguerite River Fault,” Declan stated on October 29. Exploration in 1977 “confirmed the presence of a southwest-oriented fault zone and a geochemical anomaly with 11 ppm cobalt in lake sediments atop this structure,” the company added.

The deal would have Declan paying $85,000, issuing five million shares over two years and spending $3 million over three years. The optioner retains a 2% NSR on metals and a 4% gross overriding royalty on non-metallic commodities.

In September Declan announced an option to acquire the Patterson Lake Northeast property. The company plans to engage Dahrouge Geological Consulting to explore its uranium properties.

Rockgate takeover offer: Denison softens conditions, extends deadline

Denison Mines TSX:DML advanced its attempted takeover of Rockgate Capital TSX:RGT by lowering the minimum tender condition from 90% to two-thirds of outstanding shares. In an October 30 statement Denison also extended the offer’s deadline again, this time to November 18, and dropped conditions related to staff retention and consulting agreements.

The same day Rockgate said insiders agreed not to exercise their options unless another company comes up with a better offer. Denison had requested a cease trade order on 11 million Rockgate options granted on September 30, which Denison termed “improper defensive tactics.” The British Columbia Securities Commission didn’t agree. But rather than risk Denison withdrawing its offer, Rockgate insiders “put the interests of the shareholders of Rockgate before their own personal interests and agreed to amend the terms of the options,” company president/CEO Karl Kottmeier said.

The tone of the companies’ statements has warmed considerably since Kottmeier labelled Denison’s offer an “unsolicited opportunistic hostile takeover bid.” Denison president/CEO Ron Hochstein thanked Kottmeier and the Rockgate board “for their contributions to allowing the offer to proceed towards a successful conclusion.”

Meanwhile Rockgate continues prefeasibility work on its flagship Falea uranium-silver-copper project in Mali.

Read how Denison’s offer defeated Rockgate’s proposed merger with Mega Uranium.

Read more about uranium merger-and-acquisition activity.

Lakeland Resources’ JV partner New Dimension to drill for gold

Lakeland Resources TSXV:LK announced on October 31 an imminent drill campaign of at least 1,800 metres by JV partner New Dimension Resources TSXV:NDR on the Midas gold property in north-central Ontario. Lakeland optioned the project to New Dimension in September in order to focus on Saskatchewan uranium exploration. But Lakeland will retain a 30% interest in Midas carried to an initial 43-101 resource estimate.

I’m excited that the project’s going to continue to be worked while we focus on uranium.—Jonathan Armes, president/CEO
of Lakeland Resources

“New Dimension is a great group to work with and the deal was easy to do,” Lakeland president/CEO Jonathan Armes tells ResourceClips.com. “I’m excited that the project’s going to continue to be worked while we focus on uranium. The onus is on them to explore that project and we share in any benefits that result.”

The previous week Lakeland closed a private placement for a total of $1,057,718 and announced the appointment of Basin veteran John Gingerich to the company’s advisory board. Field work continues on Lakeland’s Riou Lake uranium project.

Read more about Lakeland Resources.

Next Page 1 | 2

Gold stocks slaughtered, Barrick drops 10%

October 31st, 2013

by Frik Els | October 31, 2013 | Reprinted by permission of MINING.com

The gold price slid more than $24 or 2% an ounce on October 31 to a week low of $1,323 after the U.S. Federal Reserve signalled it may cut back its stimulus program sooner than thought and Chinese demand for the metal waned.

After a fightback from near three-year lows below $1,200 struck at the end of June, gold’s momentum now seems to have turned negative again with gold stocks sold off heavily on a relatively modest fall in the price of the metal.

By the October 31 close Barrick Gold TSX:ABX had lost 5.9%, after announcing results that were in line with expectations and the suspension of its troubled Pascua Lama project on the border between Chile and Argentina.

The world’s number one miner of the precious metal followed up after hours with more damaging news. The Toronto-based miner announced it is raising $3 billion by issuing 163.5 million common shares at $18.35 per share.

Barrick is now worth $19.4 billion, down 44% so far this year and nowhere near its $54-billion market value a mere two years ago.

Investors duly marked down the stock again with the counter shedding an additional 5.7% to $18.31 in after-hours trade in New York, wiping more than $2 billion off the value of the company on the day.

Barrick is now worth $19.4 billion, down 44% so far this year and nowhere near its $54-billion market value a mere two years ago.

Newmont Mining NYE:NEM, with a market value of $13.5 billion, escaped the worst of it, down 2.8% in regular trading and trading slightly to the upside after hours, after announcing profits up 11% despite a fall in revenue.

Attributable gold production rose 4% to 1.28 million ounces, while attributable copper output decreased 3% to 34 million pounds during the third quarter at the Denver-based company.

The world’s third-largest gold producer behind Newmont, AngloGold Ashanti NYE:AU was one of the worst performers of October 31. The Johannesburg-based company’s ADRs listed in New York slid 6.7% on October 31 and the value of the company has now halved this year.

Fellow South African miner Gold Fields NYE:GFI, the worst performer among the gold majors this year, gave up 4.4% in New York. The world’s fourth-largest gold producer has had its value slashed 63% in 2013, with investors punishing it for its contrarian purchase of high-cost mines amid the slump.

Goldcorp TSX:G, expected to produce around 2.5 million ounces of gold this year, declined 3.9%. The Vancouver-based company retained the top spot as the most valuable gold stock, with a Toronto big board market capitalization of $21.6 billion.

Toronto’s Kinross Gold TSX:K managed to hold above a $6-billion value despite losing 5.3% on the day. Investors in the company are nursing a $5-billion loss in market cap this year after Kinross, like all the majors, took multi-billion charges against the value of its operations.

Canada’s second-tier gold miners also suffered a loss of confidence from gold investors, giving up much of the gains of recent weeks.

Yamana Gold TSX:YRI skid 3.4%, Agnico Eagle Mines’ TSX:AEM losses were fairly modest at 2.5% while Eldorado Gold TSX:ELD declined 5.1% and IAMGOLD TSX:IMG dropped 5.3%.

Reprinted by permission of MINING.com

Investors pile back into gold stocks, Goldcorp up $2 billion in a week

October 22nd, 2013

by Frik Els | October 22, 2013 | Reprinted by permission of Mining.com

Investors pile back into gold stocks, Goldcorp up $2 billion in a week

Good day for the gold team. Photo: Perpetual Tourist

The gold price jumped more than $20 or 1.8% an ounce on October 22 to a three-week high above $1,340 after disappointing U.S. economic data.

The much weaker-than-expected employment numbers in the U.S. convinced gold buyers that any reduction in economic stimulus by the Federal Reserve will come later rather than sooner.

With positive sentiment returning to the gold market, investors took the chance to jump back into mining stocks which have been decimated by the 20% retreat in the price of the metal this year.

On October 22 Barrick Gold TSX:ABX shot up 4.8%, scaling the $20-billion market value for the first time in a month.

The Vancouver-based company has jumped more than $2 billion in market value over the past week and is now worth $21.3 billion.

The world’s number one miner of the precious metal has added more than $5 billion in market value since hitting 21-year lows early July.

Barrick is now worth $20.5 billion on the TSX, still down 41% so far this year amid an aggressive divestment and cost-cutting drive that is beginning to bear fruit.

Newmont Mining NYE:NEM, with a market value of $14.1 billion, added 3.5%. The company recently cut predictions for its copper output, but gold production targets remain unchanged at 4.8 million to 5.1 million ounces for the year.

The Denver-based company has not escaped the carnage in the gold sector and is down 38% this year.

The world’s third-largest gold producer behind Newmont, AngloGold Ashanti NYE:AU was one of the best performers on October 22. The Johannesburg-based company’s ADRs listed in New York gained 9% to a four-month high, but are still trading down 48% this year.

Fellow South African miner Gold Fields NYE:GFI, which is the worst performer among the gold majors this year, jumped 5% in New York. The world’s fourth-largest gold producer has had its value slashed 62% in 2013 with investors punishing it for its contrarian purchase of high-cost mines amid the slump.

Goldcorp TSX:G, expected to produce around 2.5 million ounces of gold this year, jumped 4.9%, helping retain its top spot as the most valuable gold stock.

The Vancouver-based company has jumped more than $2 billion in market value over the past week and is now worth $21.3 billion.

Toronto’s Kinross Gold TSX:K scaled the $6-billion mark, gaining 3.3% but investors in the company are still nursing a $5-billion loss in market cap this year after Kinross, like all the majors, took multi-billion-dollar charges against the value of its operations.

Australia’s Newcrest Mining declined 0.5% on the Sydney bourse, missing out on the gold price rally in New York. The Melbourne-based company earlier this month ousted its CEO and chairman after its August results showed an AU$5.6-billion loss.

Canada’s second-tier gold miners also enjoyed a rerating with Yamana Gold TSX:YRI adding 4.6%, Agnico Eagle Mines TSX:AEM jumping more than 4.7%, Eldorado Gold TSX:ELD advancing 3.8% and IAMGOLD TSX:IMG upping its value 4.5%.

Reprinted by permission of Mining.com

Investors pour into gold stocks: Barrick gains $7bn in 7 weeks

August 23rd, 2013

by Frik Els | August 23, 2013 | Reprinted by permission of Mining.com

The gold price made a serious attempt to scale the psychologically important $1,400 level on Friday, sending investors scurrying for gold mining stocks.

Bullion bulls are celebrating an 18% jump in the price of gold since the metal hit multi-year lows below $1,200 at the end of June.

Barrick Gold TSX:ABX gained 3% to $21.20 on Friday, up an astounding 49% in just seven weeks.

The Toronto-based global No. 1 gold miner continues to recover from 21-year lows of $14.22 struck on July 5, following a string of setbacks at the company.

Barrick is now worth $21 billion on the TSX, gaining $7 billion in market value in as many weeks. The company, which has written down the value of its assets by some $13 billion this year, peaked at a market capitalization in January 2011 of more than $54 billion.

Gains for Newmont Mining NYE:NEM have been more modest, but the $16.4-billion Denver-based company, which hopes to mine around five million ounces this year, is still up nearly 20% since gold’s June 28 low.

Goldcorp is the best performer of the gold majors, keeping its 2013 market value losses to 10% despite the 16% drop in the gold price this year.

The world’s third-largest gold producer in terms of ounces mined, AngloGold Ashanti NYE:AU gained 3.3% on Friday, but the Johannesburg-based company has made few strides on the back of the resurgent gold price.

Shares of the company are still down 45% year-to-date as it struggles with unrest in its home country’s mining sector and falling gold output. In dollar terms AngloGold’s JSE-listed shares have performed even worse, down 10% as the rand continues to slide against the U.S. and Canadian dollar.

Fellow South African miner Gold Fields NYE:GFI was the lone counter in the red on Friday as the company suffered a second day of losses in reaction to its purchase of three Barrick gold mines.

Gold Fields’ acquisitions in Australia will add more than 400,000 to its annual output, putting it within range of the mined ounces of Canada’s Goldcorp TSX:G, which expects to produce between 2.5 million and 2.8 million ounces in 2013.

Vancouver-based Goldcorp, the world’s most valuable listed gold company, added 2.4% on Friday, pushing its market value to $26.6 billion.

Goldcorp is the best performer of the gold majors, keeping its 2013 market value losses to 10% despite the 16% drop in the gold price this year.

Canadian peer Kinross Gold TSX:K—which this year expects to produce between 2.4 million to 2.6 million ounces—traded up more than 3%.

Australia’s Newcrest Mining TSX:NM jumped more than 5% on the Sydney bourse.

The 2-million to 2.3-million-ounce producer is still 43% cheaper than at the start of the year after suffering $6 billion in writedowns, a dividend cut and an investigation by Australian market regulators prompted by suspicious price movements.

See also: Friday rally sets up gold price breakout.

Reprinted by permission of Mining.com

Top gold producers in SA downgraded by HSBC to “sell”

August 12th, 2013

by Cecilia Jamasmie | August 12, 2013 | Reprinted by permission of Mining.com

South African top gold producers AngloGold Ashanti NYE:AU, Harmony Gold NYE:HMY and Sibanye Gold NYE:SBGL were downgraded to sell by HSBC, which said the lower price of the metal is cutting margins at the companies currently dealing with labour disputes.

The mining industry in Africa’s No. 1 economy failed to contain costs during a decade-long bull market in gold and it is now badly placed to manage the pressures that come from lower prices, HSBC analysts led by Johannesburg-based Derryn Maade wrote in a note released last week, reports Commodity Fundamentals.

Gold producers represented by the Chamber of Mines of South Africa (CMSA), are in dispute with South Africa’s four biggest labour unions after workers rejected a 5% raise offer.

South Africa’s two main mining sectors, platinum and gold, are under pressure from spiralling costs and weaker commodity prices. Their representatives have warned that any significant increase in wages will risk more job losses and trigger closures.

Wage negotiations are expected to run until the end of the year.

Reprinted by permission of Mining.com

Week in review

December 14th, 2012

A mining and exploration retrospect for December 8 to 14, 2012

by Greg Klein

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U.S. politicians ponder windfall royalties

The United States has joined the list of countries considering additional ways to mine miners, according to a Wednesday Reuters story. Some American politicians are talking about royalties as high as 12.5%, the same benchmark applied to certain other resources, including oil and gas.

Reuters said the proposal would get about $700 million during the lifespan of Freeport-McMoRan’s copper-molybdenum operations in Colorado, Arizona and New Mexico. Last year alone, the royalty could have taken $150 million from Barrick’s TSX:ABX Goldstrike mine in Nevada, according to Reuters’ figures. Barrick told the news agency the company’s taxes have already jumped four-fold over five years.

Democrat Representative Raul Grijalva, a proponent of the 12.5% levy, sees it differently. “As we face these fiscal challenges, these are the pennies that we should pinch,” Reuters quoted him. Along with some other U.S. federal politicians, Grijalva also wants to review miners’ tax breaks.

Previous attempts to raise miners’ taxes have failed, Reuters stated, “as the industry has strong political allies.” The story added that “state and local governments often catch a windfall from mining revenue.”

Ivory Coast hikes taxes but overestimates profits, miner says

A mining and exploration retrospect

A new tax on Ivory Coast gold extraction underestimates cash costs by nearly 50%, according to at least one source. New legislation that applies to 2012 production assumes cash costs of $615 an ounce, Reuters stated on Friday. The tax on “profits” above that amount will fluctuate with the yellow metal’s price. At $1,600, that comes to 17%. The rate will be lower for companies that pay the country a corporate tax, the news agency added. Randgold Resources CEO Mark Bristow called the new levy, expected to raise $79.8 million, a “punitive tax,” Reuters said.

In a December 7 Bloomberg report, Endeavour Mining TSX:EDV spokesperson Nouho Kone said Ivory Coast gold production can actually cost between $1,000 and $1,200 an ounce. “The worst-case scenario would be to see companies shut down their mines in the short term,” he told Bloomberg. Reuters stated that Perseus Mining TSX:PRU put its $160-million Sissingue project on hold last September “pending clarification of the fiscal regime applicable to the project.”

Maybe Ghana too

Ghanaian President John Dramani Mahama’s re-election brings to mind his previous effort to impose a 10% tax on windfall profits, Monday’s Financial Post reported.

The government had already raised miners’ corporate taxes from 25% to 35% and imposed “a uniform regime for capital allowance of 20% for five years of mining,” the FP stated. But the government’s intended windfall tax had been shelved due to industry pressure, according to a Wednesday Reuters dispatch.

Reuters added that government discussions with gold miners are underway “to loosen up so-called ‘stability agreements’ held by some firms that lock in royalty and tax rates.” This year Ghana raised gold royalties from 3% to 5%, but the stability agreement exempted companies like AngloGold Ashanti and Newmont Mining TSX:NMC, the news agency stated.

Unions lose bid to block foreign workers from staffing B.C. mine

HD Mining International called it a “massive victory,” the Globe and Mail reported Friday. A federal court judge has allowed the company to import Chinese workers for its proposed Murray River coal mine in British Columbia. Two unions had applied for an injunction blocking the work permits after learning that HD Mining planned to staff its underground operation exclusively with Chinese workers—which would total over 400 at full production.

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