Tuesday 14th July 2020

Resource Clips


Posts tagged ‘ontario’

Jeff Kehoe of the Ontario Securities Commission comments on a $525,000 reward for spotting cryptic “irregularities”

June 15th, 2020

…Read more

CSA issues report card on resource estimate disclosure

June 5th, 2020

by Greg Klein | June 5, 2020

CSA issues report card on resource estimate methodology

Projects involving precious metals and B.C.-headquartered
companies predominated among the 86 deposits under scrutiny.
(Chart: Canadian Securities Administrators)

 

How well do early-stage explorers reveal the technical data and economic assumptions behind their 43-101 resource estimates? A review by the Canadian Securities Administrators found their technical reports generally satisfactory, although often lacking in data verification as well as discussions of economic prospects and cutoff grades.

Completed in late 2018 but not reported until June 4, the study examined 86 technical reports. As a result, 10 were sent back to the issuers to be amended and re-filed. Six of those were cited for inadequate disclosure and the other four required revisions to their resource estimates. Conducting the study were seven staffers from securities commissions in British Columbia, Ontario and Quebec.

CSA issues report card on resource estimate methodology

The review looked at 33 aspects of seven broad issues of disclosure: the QP’s experience; data verification; mineralogical controls and geological model; data analysis; resource estimation and classification; reasonable economic prospect of eventual mining; and reporting sensitivities, risks and uncertainties.

Among problematic areas was data verification, a vital issue concerning results from previous operators. The study found the process inadequate for recent data in over 20% of reports, and over 30% for historic data.

In several cases economic prospects were stymied by insufficient info regarding metallurgy, costs, prices and restraints. Reporting of overall sensitivity and risks was another issue of concern, especially where companies used boilerplate language instead of discussing risks specific to their projects.

Cutoff grades didn’t always have the base case emphasized, the study found, and not all cutoff grades came with a necessary discussion of reasonable economic prospects.

But the study found good work too. “Despite some deficiencies, many technical reports provided detailed and useful information on geological constraints applied to the estimate, and on statistical treatment of the data.”

“Robust technical reports are essential to disclosure at key project development stages,” noted Louis Morisset, CSA chairperson and president/CEO of l’Autorité des marchés financiers. “Our intention for publishing this guidance in the current environment is to support mining issuers in preparing their resource estimates, and to reinforce the importance of technical reports that are transparent and comply with disclosure requirements and industry best practices.”

As part of their ongoing disclosure review, securities commissions staff “will pay special attention to [mineral resource estimates] and the areas of inadequate disclosure identified,” the report added.

Download the CSA Review of Mineral Resource Estimates in Technical Reports.

International Montoro Resources furthers rare earths potential in B.C.

May 13th, 2020

by Greg Klein | May 13, 2020

Detailed analysis of field work shows the rare earths prospects of an early-stage project in east-central British Columbia. On March 13 International Montoro Resources TSXV:IMT announced a report culminating from last year’s grid-based survey of 535 soil samples on the 2,007-hectare Wicheeda North property.

International Montoro Resources furthers rare earths potential in BC

Previous work came under detailed analysis for International
Montoro Resources’ Wicheeda North REE prospect.
(Photo: International Montoro Resources)

“Thematic geochemical anomaly maps were generated for cerium and other values were received for light REEs including lanthanum, neodymium, praseodymium, samarium, europium and gadolinium,” the company stated.

The report was prepared by Bob Lane, who managed 2008 and 2009 drilling programs on the adjacent Wicheeda project, later acquired by First Legacy Mining, now Defense Metals TSXV:DEFN. Lane also took part in First Legacy’s 43-101 report on Wicheeda.

Commenting on International Montoro’s Wicheeda North, Lane said it “has the potential to host, and should continue to be explored for, REE mineralization because it occurs within a favourable geological belt known to contain carbonatite-hosted REE mineralization, such as the Main zone” of the Defense project neighbouring to the southeast.

Future recommendations include further prospecting and grid-based soil sampling. Additionally, airborne electromagnetics were suggested for the southern part of the property, which wasn’t surveyed in the EM, magnetic and radiometric geophysics conducted in 2010.

Given favourable results, Lane’s report recommends the company consider excavator trenching.

Last February the company announced exploration plans for its Camping Lake property in Ontario’s Red Lake region. Under an October 2019 agreement with Falcon Gold TSXV:FG, International Montoro may earn a 51% interest in the gold-base metals project.

Reporting on another Ontario project, International Montoro released geophysical analysis from Serpent River in December. The conclusions could indicate massive sulphide nickel-copper-PGE-gold mineralization on the Elliot Lake-region property, the company stated.

International Montoro’s portfolio also includes the Duhamel polymetallic project in Quebec’s Saguenay-Lac-Saint-Jean region.

Last month the company closed a private placement of $56,525.

Maintaining essential service

April 14th, 2020

As Quebec mining resumes, Canadian companies make open-or-shut decisions

by Greg Klein | April 14, 2020

As Quebec mining resumes, Canadian companies make open-or-shut decisions

A COVID-19 outbreak put Impala’s Lac des Iles on lockdown.
(Photo: Impala Canada)

 

With additional health standards in place and encouraged by a surging gold price, Quebec miners have been given a back-to-work go-ahead. On lifting a three-week suspension, the province allowed ramp-up procedures to begin April 15. A ban on non-essential industrial activities, including mineral exploration, has been extended to May 4.

Mine restarts announced so far include Eldorado Gold’s (TSX:ELD) Lamaque mine, IAMGOLD’s (TSX:IMG) Westwood operation, Agnico Eagle Mines’ (TSX:AEM) LaRonde complex and Goldex mine, and the Agnico Eagle/Yamana Gold TSX:YRI Canadian Malartic JV.

Glencore stated it’s “analyzing options” to restart its Raglan nickel and Matagami zinc operations in Quebec.

As Quebec mining resumes, Canadian companies make open-or-shut decisions

Agnico Eagle and Yamana Gold were quick to announce
Canadian Malartic’s ramp-up. (Photo: Canadian Malartic JV)

New measures mandated by the government and its health and workplace standards agencies require physical distancing, additional protective equipment, health monitoring and enhanced sanitation. The new regimen also calls for additional training and in some cases longer stints in job site accommodations to reduce travel.

But market forces aggravated by the pandemic will keep Stornoway Diamond’s Renard mine on care and maintenance. Prior to the March 24 government-ordered suspensions, Renard operated only through the support of creditors.

“We will continue to monitor the market conditions for improvements which would allow for a restart of mining activities,” said Stornoway president/CEO Patrick Godin. The diamond industry has been hit by broken supply chains as well as plunging prices.

Also on April 14 McEwen Mining TSX:MUX announced restarts of its Black Fox mine in the Timmins camp, along with the San Jose operation in Argentina. Although the Ontario government exempted mining and exploration from its list of suspensions, the company paused Black Fox for two weeks while implementing new policies and procedures.

“Our miners and teams are overwhelmingly supportive of returning to work with the new safety measures,” the company stated.

In northwestern Ontario, Implats subsidiary Impala Canada suspended its Lac des Iles palladium mine on April 13 after learning that a worker tested positive for COVID-19. By April 14 the company announced seven confirmed cases connected with LDI. 

Impala told all employees to go into isolation until April 27, during which time they’d get a $100-a-day bonus on top of base pay for the entire month. The company also arranged free hotel rooms and meals during the isolation period.

As Quebec mining resumes, Canadian companies make open-or-shut decisions

McEwen Mining lifted the voluntary suspension
of its Black Fox operation. (Photo: McEwen Mining)

Industrial operations face numerous challenges in adapting to new health protocols. Last week the Globe and Mail reported concerns about conditions at Teck Resources’ (TSX:TECK.A/TSX:TECK.B) southeastern British Columbia coal operations.

A local resident “alleged that shortages of protective equipment, crowded commuter buses, packed site vehicles and ‘an absolute impossibility to self-distance because of the nature of the work,’ are fostering an environment where the virus could spread,” the paper stated.

The company had previously announced precautionary measures including “a temporary slowdown of operations and reduction of crews by up to 50%” at its B.C. mines.

According to the G&M, “Stephen Hunt, director of United Steelworkers union, which represents almost all of Teck’s B.C. workforce, said some members are satisfied the company’s mines are safe, while others are worried. He said Teck has made decent strides to reduce the risk for employees, including staggering shift start times to reduce congestion at the mine site as well as removing some of the seating on buses to ensure people are sitting at least six feet apart. Despite these precautions, he’s still on edge.”

On April 13 Cameco Corp TSX:CCO announced that the suspension of its 50%-held Cigar Lake uranium mine in Saskatchewan’s Athabasca Basin would continue indefinitely. Orano Canada also lengthened the suspension of its 70%-held McClean Lake mill, which processes Cigar Lake ore.

The global challenges posed by this pandemic are not abating—in fact, they are deepening.—Tim Gitzel,
Cameco president/CEO

“The precautions and restrictions put in place by the federal and provincial governments, the increasing significant concern among leaders in the remote isolated communities of northern Saskatchewan, and the challenges of maintaining the recommended physical distancing at fly-in/fly-out sites with a full workforce were critical factors Cameco considered in reaching this decision,” the company stated.

President/CEO Tim Gitzel added, “The global challenges posed by this pandemic are not abating—in fact, they are deepening.”

As Quebec allows mining to resume, Canadian companies make open-or-shut decisions

April 14th, 2020

This story has been expanded and moved here.

Troubled and uncharted

April 10th, 2020

Navigating the new normal to an uncertain destination

by Greg Klein | April 10, 2020

The new normal transitions into an uncertain future

 

What’s Chinese for “cui bono”?

Through grimly ironic coincidence, the country that unwittingly inflicted this on the world stands to benefit. “The Chinese Communist Party is seizing what its senior officials are calling the ‘opportunity’ of the pandemic to realize the party’s long-game objective of fully eclipsing North America and Europe in the global order,” writes Terry Glavin.

“While the Chinese government’s internal statistics are routinely questioned by outside analysts, China’s Ministry of Industry and Information Technology credibly reports that roughly 75% of small and medium-sized businesses across the country have already resumed production.”

On April 7 Bloomberg reported its own estimates “that most of China was 90% to 95% back to work at the end of last week, noting pick-ups in the steel market, construction activity and crude processing. Those oil refineries, as well as coal-fired power plants, are nearing last year’s operating rates, while metals stockpiles have shrunk from record or near-record levels. It’s a three-month cycle of collapse and recovery marked by perhaps the most heartening milestone for those nations still fending off the worst of the virus: China has now reported zero new COVID-19 deaths for the first time since January.”

But not so heartening, former U.K. foreign secretary William Hague noted in the Telegraph that “in Europe, North America and lower-income countries too, it seems likely that the virus will kill far more people, wreak much worse economic damage and bring more unwelcome changes to life than in China itself.”

The new normal transitions into an uncertain future

Glavin quotes from an analysis by Horizon Advisory, a consultancy that investigates Chinese policy: “Beijing intends to use the global dislocation and downturn to attract foreign investment, to seize strategic market share and resources—especially those that force dependence—and to proliferate global information systems.”

Hague warned that “China will gain from the new age of the surveillance state that will be summoned into existence around much of the world in the coming months…. Guess who will be well-placed to supply the systems, software and data, and to do so quickly and on a large scale?”

Glavin also stressed China’s designs on global information technology architecture, “mostly through Huawei Technologies, China’s ‘national champion’ telecom giant.”

He remains stark in his conclusion: “We may be stumbling headlong into an uncharted realm of social breakdown and mass graves. We could be destined for something else, somewhere dark and foreboding, where Xi Jinping calls all the shots. Or we might be traversing an excruciating social and economic terra incognita towards some eventual semblance of normalcy.”

Keep the news stream flowing

Seemingly steadfast, though, are miners and explorers. Many of their announcements concern responses to the crisis, especially whether companies are allowed to continue working, or whether they find it practical to do so.

The new normal transitions into an uncertain future

Photo: Talon Metals

But with many seasonal exploration programs completed before the industry entered pandemic mode, assays are starting to pour in. Some random and radically abbreviated examples from April 8 alone include 2.31 g/t gold over 101 metres from QMX Gold’s (TSXV:QMX) Bonnefond deposit in Val d’Or; 7.14 metres of mixed massive sulphides from Talon Metals’ (TSX:TLO) Tamarack nickel-copper-cobalt project in Minnesota; 25,466 ppm zirconium, 89.1 ppm dysprosium, 1281 ppm neodymium and 348 ppm praseodymium over 8.83 metres in a channel sample from Search Minerals’ (TSXV:SMY) Silver Fox zone in Labrador; 0.69% Nb2O5 over 185 metres at NioBay Metals’ (TSXV:NBY) James Bay niobium project in Ontario; 11.6 g/t gold and 2,960 g/t silver in surface chip samples taken by Cornerstone Capital Resources’ (TSXV:CGP) ASX-listed JV partner Sunstone Metals at their Bramaderos gold-copper project in Ecuador.

Other project updates included promises of assays to come from recent programs or new developments from analytical work. Determined, maybe even irrepressible, junior exploration soldiers on.

A humanitarian call for mineral exploration supplies and skills

As of April 9 the Association for Mineral Exploration received 29 responses to its call for assistance in providing testing, triage, housing and isolation areas for vulnerable people. “As mineral explorers, we have access to the supplies needed and are in a unique position to help,” AME pointed out. If you can, please consider the following donations:

  • Insulated structures (both hard and soft wall)

  • Camp gear such as furniture, lighting and kitchen appliances

  • Medical equipment

  • Camp support personnel such as caterers, housekeepers, janitors, etc.

  • Available medical staff including such qualifications as OFA3s, paramedics, RNs, etc.

  • Other supplies or skills

To make a contribution, fill out this form and AME will be in touch. 

For further information contact Savannah Nadeau.

AME’s program comprises part of a spontaneous international effort in which miners and explorers across Canada and around the world contribute supplies, facilities, skills and expertise to the cause.

We will get through this—won’t we?

From one perspective, nuclear energy poses dangers unimagined by its more conventional critics. Although statistically one of our safest sources of electricity, its complexity requires a sophisticated and orderly society to guarantee safety.

Would that be possible if the West succumbed to a future dominated by rampant terrorism, rioting and crime—and in Canada, incessant blockades as well as unrestrained flakery? These are nightmarish scenarios, of course, but the pandemic makes them seem almost quaint.

An outbreak during a nuclear refuelling program at Pennsylvania’s Limerick facility just hints at the vulnerability of key infrastructure if illness strikes enough people, or even just a few specialists with rare expertise. Populations would suffer not only compounding problems from the loss of essential services but also dangers ranging from an ailing reactor to a crumbling hydro dam.

Preparations to lock down essential staff show foresight, but might also presage a highly regimented society. Such an outcome might result anyway, as has often been the historic case following a period of chaos.

Weakening links in the supply chains

Anyone who’s seen the derelict state of greater Vancouver’s once bountiful agricultural districts might question the wisdom of importing so much food from so far away. Times like these afflict complicated trade, communications and transportation networks and, as the case of milk distribution shows, shorter supply lines too.

Unable to get their product to market, some Canadian dairy farmers have been dumping large amounts of raw milk. In British Columbia, the practice started on April 3, “a measure of last resort, and only considered in emergency situations,” according to the B.C. Dairy Association.

Among problems listed by Postmedia are “transportation shortages caused by an overwhelmed trucking industry, processing and packaging challenges, a sharp decline in bulk customers due to the mass closures of restaurants and bakeries, and inconsistent distribution to stores.”

Another hint of the possibilities to come was the suspension of Maple Leaf Foods’ (TSX:MFI) Brampton poultry plant after three workers became infected.

“This is a very fluid situation and our teams are working very closely within our network, as well as with our supply chain and logistics partners so that we can continue to deliver safe food at this critical time,” the company stated.

Meanwhile selling groceries can prove deadly, as shown by COVID-19 fatalities among U.S. retail workers. The virus recently struck down at least four American supermarket employees, the Washington Post reported on April 6. “Industry experts say the rise of worker infections and deaths will likely have a ripple effect on grocers’ ability to retain and add new workers at a time when they’re looking to rapidly hire thousands of temporary employees,” the paper stated.

In southwestern British Columbia, some newly hired staff appear to come from a vulnerable age group. Some of the security guards policing the socially distant queues outside retail outlets wouldn’t look out of place in a long-term care home.

Myriad other supply chain challenges include COVID-19-specific medical equipment.

The new normal transitions into an uncertain future

Can your immune system withstand The Stand?

Virus novel precaution: Take this immunity self-test

Tragically these are also times of rampant misinformation, whether it’s conspiracy theories of how the virus originated or phoney promises of miraculous cures. One especially preposterous claim has been perpetrated by the National Post: that Stephen King’s The Stand “is either the perfect distraction from COVID-19 or too eerily accurate to consider.”

Yes it’s a story, of sorts, about a virus killing off most of our species. But before any attempt to read it, potential victims should answer these questions:

  • I like fictional characters who resemble TV stereotypes

  • I don’t care how long an author takes to tell a story, as long as it’s long

  • My favourite pastimes include watching water boil, paint dry and grass grow

  • I like boring books because they make our suddenly shortened lives seem to pass so slowly

If you answered every question with a resounding yes, you have sufficient boredom immunity to survive this virus novel.

Calendar of the plague year

These days commemorate the plague that passed over and the Resurrection. We can hope…

OSC whistleblower program awards $525,000 to independent expert

April 6th, 2020

by Greg Klein | April 6, 2020

A program that encourages and protects in-house informers can also pay off handsomely to outsiders. The Ontario Securities Commission has awarded $525,000 to someone who used industry expertise, as opposed to inside intel, “to identify irregularities.”

OSC whistleblower program awards $525,000 to independent expert

The commission’s whistleblower program offers up to $5 million for tips on insider trading, fraud, misleading statements and other violations of Ontario securities law. The OSC keeps confidential the whistleblower’s identity, as well as that of the wrongdoer, the amount of “irregularities” and the penalty.

But the penalties or repayments must be high. The minimum amount to qualify for reward is $1 million. Payouts range from 5% to 15% of those amounts.

Sources come in two categories—knowledge derived from “experiences, communications and observations in employment, business or social interactions” or analysis “of publicly available information or data that reveals additional insight that is not generally known or available to the public,” the OSC states.

“Experts can be among the first to spot signs of potential misconduct in our markets,” said Jeff Kehoe, OSC director of enforcement. “These subtle clues are often buried deep in reams of data and technical information decipherable only by someone with in-depth market knowledge or industry-specific expertise.”

Launched in July 2016 as the first of its kind in Canada, the OSC’s program has so far given whistleblowers more than $8 million. As of February 2019, a total of $7.5 million went to just three informants.

Crisis response

April 3rd, 2020

A look at mining, exploration, infrastructure and supply chains under the pandemic

by Greg Klein | April 3, 2020

A look at mining, exploration, infrastructure and supply chains

 

Idled explorers: Can you help?

“Essential supplies and personnel are needed to create and operate temporary facilities for testing, triage, housing and isolation areas for vulnerable populations,” states the Association for Mineral Exploration. “As mineral explorers, we have access to the supplies needed and are in a unique position to help.”

AME calls on the industry to contribute excess capacity of the following:

  • Insulated structures (both hard and soft wall)

  • Camp gear such as furniture, lighting and kitchen appliances

  • Medical equipment

  • Camp support personnel such as caterers, housekeepers, janitors, etc.

  • Available medical staff including such qualifications as OFA3s, paramedics, RNs, etc.

  • Other supplies or skills

If you can help, please fill out this form and AME will be in touch. 

For further information contact Savannah Nadeau.

Preparing for a wider emergency

Given the danger of one crisis triggering others, essential infrastructure remains at risk. One plan to safeguard Ontario’s electricity service would require Toronto workers to bunk down in employer-supplied accommodation under lockdown conditions better known to isolated locations.

A look at mining, exploration, infrastructure and supply chains

Quarantines might require essential
services to provide job-site bed and board.
(Photo: Independent Electricity System Operator)

It hasn’t happened yet, but the province’s Independent Electricity System Operator stands ready for the possibility, according to a Canadian Press story published by the Globe and Mail. A not-for-profit agency established by the province, the IESO co-ordinates Ontario electricity supply to meet demand.

About 90% of its staff now work at home but another 48 employees must still come into work, CEO Peter Gregg said. Eight six-person teams now undergo 12-hour shifts in two Toronto-area control rooms.

“Should it become necessary, he said, bed, food and other on-site arrangements have been made to allow the operators to stay at their workplaces as a similar agency in New York has done,” CP reported.

Similar plans may well be underway not only for essential infrastructure but also for essential production, processing, manufacturing, communications, transportation and trade. One sign of the times to come could be locked-down camps in supermarket parking lots for our under-appreciated retail-sector heroes.

Meanwhile, retaining and protecting care-home staff already constitute a crisis within a crisis.

Australia guards against predatory foreign takeovers

With China prominently in mind, Australia has taken extra measures to protect companies and projects shattered by the COVID-19 economy. Canberra has temporarily granted its Foreign Investment Review Board extra powers to guard distressed companies and assets against acquisitions by opportunistic foreigners. Although previous foreign acquisitions came under review only when the price passed certain thresholds, now all such transactions get FIRB scrutiny.

The changes follow concerns raised by MPs on Australia’s intelligence and security committee. The Sydney Morning Herald quoted committee chairperson Andrew Hastie warning of “foreign state-owned enterprises working contrary to our national interest. More than ever, we need to protect ourselves from geo-strategic moves masquerading as legitimate business.”

Committee member Tim Wilson added, “We can’t allow foreign state-owned enterprises and their business fronts to use COVID-19’s economic carnage as a gateway to swoop distressed businesses and assets.”

Among protected assets are exploration and mining projects, utilities, infrastructure and an interest of 20% or more in a company or business.

Critical minerals become ever more critical

As Lynas Corp extended the suspension of its rare earths processing facility in line with Malaysian government pandemic orders, the company noted the importance of its products “in permanent magnets used in medical devices including ventilators, and in lanthanum products used in oil refineries for petroleum production.”

A look at mining, exploration, infrastructure and supply chains

The suspension of its Malaysian plant prompted
Lynas to emphasize REs’ criticality to virus treatment.
(Photo: Lynas Corp)

Originally set to expire on March 31, the government order currently stays in force until April 14. RE extraction continues at Lynas’ Mount Weld mine in Western Australia.

In late February Malaysia granted the company a three-year licence renewal for the processing facility, which had been threatened with closure due to controversy about its low-level radioactive tailings. Among conditions for the renewal are development of a permanent disposal facility for existing waste and putting a cracking and leaching plant in operation outside Malaysia by July 2023 to end the practice of transporting radioactive material to the country.

Committed to maintaining a non-Chinese supply chain, the company plans to locate the C&L plant in Kalgoorlie, Western Australia.

Sharing the disease, hoarding the treatment

A problem recognized in American defence procurement has hit health care—the need to build non-Chinese supply chains. Most of the world’s ventilators and about half the masks are manufactured in China, points out a recent column by Terry Glavin.

The West is learning, finally and the hard way, “that thriving liberal democracies cannot co-exist for long within a model of neo-liberal globalization that admits into its embrace such a tyrannical state-capitalist monstrosity as the People’s Republic of China.”

The U.S., for example, relies heavily on China for antibiotics, painkillers, surgical gowns, equipment that measures blood oxygen levels and magnetic resonance imaging scanners. China effectively banned medical equipment exports as soon as Wuhan went on lockdown, Glavin adds.

“It probably didn’t help that Ottawa sent 16,000 tonnes of gear to China back in February. That was a lot of gear—1,101 masks, 50,118 face shields, 36,425 medical coveralls, 200,000 pairs of gloves and so on—but a drop in Beijing’s bucket. A New York Times investigation last month found that China had imported 56 million respirators and masks, just in the first week of the Wuhan shutdown.

“It is not known how much of that cargo came from the massive bulk-buying campaign organized and carried out across Canada by affiliates of the United Front Work Department, the overseas propaganda and influence-peddling arm of the Chinese Communist Party.”

A look at mining, exploration, infrastructure and supply chains

Desperate need for health care supplies
pits country against country. (Photo: 3M)

Nor does the non-Chinese world display altruism. In response to the crisis, the EU and more than 50 countries have either banned or restricted exports of medical equipment, Glavin states.

By April 3 global health care products supplier 3M revealed that Washington asked the company to stop exporting U.S.-manufactured N95 respirators to Canada and Latin America. 3M noted “significant humanitarian implications” but also the possibility of trade retaliation. “If that were to occur, the net number of respirators being made available to the United States would actually decrease.”

The company did win China’s permission to import 10 million of its own Chinese-manufactured N95s into the U.S.

Meanwhile the Canadian government comes under increasing criticism for discouraging the public from wearing masks.

Chinese supply chains also jeopardized by Chinese disease

As the world’s main exporter of manufactured goods, China’s the main importer of raw materials, especially metals. But, as the world’s main exporter of disease, China managed to threaten its own supplies.

Reuters columnist Andy Home outlined lockdown-imposed cutbacks of copper, zinc and lead from Chile and Peru, and chrome from South Africa; reductions in cobalt from the Democratic Republic of Congo, in tin from already depleting Myanmar, and in nickel from the Philippines, the latter a hoped-for replacement after Indonesia banned unprocessed exports.

The longer the lockdowns, “the greater the potential for supply chain disruption,” Home comments. “As the biggest buyer of metallic raw materials, this is a ticking time-bomb for China’s metals producers.”

Miners’ providence unevenly distributed

Probably no other foreign shutdowns have affected as many Canadian miners and explorers as that of Mexico. Considered non-essential, their work will be suspended until April 30, with extensions more than likely. Mexico’s announcement must have sounded familiar to Pan American Silver TSX:PAAS, which had already pressed the pause button to comply with national quarantines in Peru, Argentina and Bolivia. That currently limits the company’s mining to Timmins, where production has been reduced by about 10% to 20% to allow physical distancing.

A look at mining, exploration, infrastructure and supply chains

Mauritania exempted Kinross Gold’s Tasiast mine
from domestic travel restrictions. (Photo: Kinross Gold)

One company more favourably located, so far, is Kinross Gold TSX:K. As of April 1, operations continued at its seven mines in Nevada, Alaska, Brazil, Mauritania, Russia and Ghana, while work went on at its four non-producing projects in Alaska, Mauritania, Russia and Chile.

Expanded shutdowns ordered by Ontario on April 3 include many construction and industrial projects but exempt mining. Earlier that day New Gold TSX:NGD announced Rainy River’s restart after a two-week suspension to allow self-isolation among employees. Many of the mine’s workers live locally and made short trips into Minnesota before the border closed.

Quebec border restrictions have hindered the Ontario operations of Kirkland Lake Gold TSX:KL, cutting off a source of employees and contractors. As a result the company reduced production at its Macassa mine and suspended work at its Holt complex, comprising three gold mines and a mill. Kirkland reduced operations at its Detour Lake mine effective March 23, after a worker showed COVID-19 symptoms and self-isolated on March 14. He tested positive on March 26. Production continues at the company’s Fosterville mine in Australia.

Some explorers have been idled by government restrictions, others by market conditions. Still, some companies have money and jurisdictions in which to spend it. Liberty Gold TSX:LGD, for example, resumed drilling its Black Pine gold project in Idaho on March 31.

Some jurisdictions, like B.C. and New Brunswick, have extended work requirement deadlines to help companies keep exploration claims active.

“China needs to be held responsible”

A few Canadian journalists are saying what we might never hear from our politicians. Here, for example, is Toronto Sun columnist Lorrie Goldstein:

“China needs to be held responsible. The problem is, because of its political power— and you see it in the World Health Organization announcements, in Canadian announcements—they’ve been praising what China did. There would have been a virus anyway. China made it worse. More people are dying, more people are being infected, and its dictators need to be held to account.”

COVID-19 wage subsidy will help keep mines open, but operations remain threatened by infection

March 30th, 2020

by Greg Klein | March 30, 2020

Ottawa’s extension of wage subsidies to all businesses brings hope to mining industry workers, says the Mining Association of Canada. But controversy remains about keeping projects in operation when there’s a risk of coronavirus transmission.

COVID-19 wage subsidy will help keep mines open, but operations remain threatened by infection

Companies still in operation hope extra precautions will
shield their mines from infection. (Photo: Agnico Eagle Mines)

In an effort to prevent layoffs, the feds now offer a temporary 75% wage subsidy up to $58,700 backdated to March 15, MAC reported. To qualify, large and small businesses, non-profits and charities would have suffered revenue decreases of at least 30% due to the pandemic. MAC “looks forward to further specifics of the program but welcomes the intent,” the association announced.

“As is the case with many sectors, mining has been heavily impacted by COVID-19, with multiple companies reducing or suspending operations at mines, smelters and refineries across Canada, resulting in tens of thousands of layoffs of direct and indirect employees,” said MAC president/CEO Pierre Gratton. “The wage subsidy will help prevent further layoffs, thus minimizing both the scale and extent of disruption to both businesses, employees and contractors, and better position the mining sector to resume operations and support the many thousands of individuals who depend on it for employment.”

Mine suspensions have been occurring inconsistently around the world and within Canada. Following an order from Quebec, IAMGOLD TSX:IMG suspended its Westwood mine in that province but continued work on its advanced-stage Coté project in Ontario, a province that considers mining and related projects to be essential services. The company continues operation at its Burkina Faso and Suriname mines, which have been transitioning to “self-confinement” since last week.

Agnico Eagle Mines TSX:AEM put its three Quebec operations on care and maintenance last week but continues reduced operations at its Meliadine and Meadowbank mines in Nunavut using Quebecois workers to replace native territorial employees whose communities are considered especially vulnerable to an outbreak.

Last week Baffinland Iron Mines took similar precautions with its Mary River employees, the Nunatsiaq News reported.

On March 29 the newspaper stated that Agnico Eagle had put Meliadine on “complete lockdown” with non-emergency travel to or from the site banned for 28 days. The company denied the decision came in response to a tweet from a catering contract employee ridiculing the site’s health precautions and the threat of infection, the paper added. The employee has been fired, according to the News.

The miner will also reduce transportation to Meadowbank from four flights a week to four a month.

Meanwhile an employee at Ontario’s Detour Lake mine has tested positive for COVID-19. “The worker arrived at the mine with no symptoms on March 12, began showing symptoms and self-isolated on March 14, and was taken from site on the morning of March 16,” said a March 29 statement from Kirkland Lake Gold TSX:KL. Workers who had been in close contact have been instructed to undergo medical examinations, while others have been told to monitor themselves for symptoms.

Work suspended

March 26th, 2020

Some Canadian mining and exploration dispatches during the pandemic

by Greg Klein | March 26, 2020

Shut Down Canada has largely been achieved, but not by the forces that advocated it nor—until someone finds a way of blaming this on climate change—by the doomsday belief they were pushing. Residents of our strangely quiet cities and towns watch the horror unfold elsewhere while wondering how long and hard the pandemic will hit Canada. Meanwhile, workers and business owners might consider themselves lucky if the economy fares no worse than a very serious recession.

Some Canadian mining and exploration dispatches during the pandemic

A reminder that one crisis can trigger another unwittingly came from FortisAlberta on March 23. The company that provides 60% of the province’s electricity “is taking the necessary actions and precautions to protect the health and well-being of its employees and to provide electricity service to its customers.”

The obvious but demoralizing question arises: What happens if too many key people get sick? That danger could apply to any number of essential services. Economic collapse, social disorder, a breakdown of supply chains add to the nightmarish possibilities.

All of which might not happen. In the meantime we can thank the front line workers who keep our society functioning to the extent that it does. Those one- or two-buck-an-hour temporary pay raises hardly acknowledge society’s debt to retail staff who interact constantly with a potentially plague-ridden public. Care workers for the elderly constitute another group of low-paid heroes, several of whom have already made the ultimate sacrifice.

In the meantime here are some reports on Canadian mining’s response to the crisis.

Inconsistent closures suggest an ambivalent industry

Some Canadian mining and exploration dispatches during the pandemic

IAMGOLD sidelined its Westwood operation in Quebec but
continues work on its Coté project in Ontario. (Photo: IAMGOLD)

Mining hasn’t actually been banned in Ontario and Quebec, although shutdowns of non-essential services continue to April 8 and April 13 respectively. Extensions, of course, look likely. Quebec has ordered the industry, along with aluminum smelting, to “minimize their activities.” Ontario specifically exempted mineral exploration, development, mining and their support services from mandatory closures.

Interpreting Quebec’s decree as a ban, IAMGOLD TSX:IMG suspended its Westwood gold mine in that province but continued work at its 64.75%-held, advanced-stage Coté gold project in Ontario as an “essential service.” Production continues at the company’s Burkina Faso and Suriname operations.

But regardless of government bans or directives, voluntary suspensions take place. Restrictions on travel and social distancing have made projects non-viable, while the threat of localized outbreaks looms large—not just at the job sites and accommodations, but in the isolated communities that supply much of the labour.

In Canada, that often means native communities. “They have a bad history with disproportionate impacts from epidemics,” a Vale Canada spokesperson told the Financial Post. The company put its Voisey’s Bay mine in Labrador on care and maintenance, and planned reductions at its associated Long Harbour nickel-copper-cobalt processing plant in Newfoundland.

So far alone of the Northwest Territories’ three operations, Dominion Diamond Mines announced an indefinite suspension for Ekati on March 19. The Union of Northern Workers stated its intention to grieve the manner in which its members were laid off.

Some Canadian mining and exploration dispatches during the pandemic

Having laid off its native staff, Agnico Eagle continues its Nunavut
operations largely with workers from Quebec. (Photo: Agnico Eagle)

Agnico Eagle Mines TSX:AEM made the ramp-down decision a day after Quebec’s March 23 order, after discussions with government “to get additional clarity.” The suspensions applied to three Quebec mines but the company planned “reduced operations” at Meliadine and Meadowbank in Nunavut, largely under Quebecois workers.

Five days earlier Agnico Eagle began sending home Nunavummiut staff from its Nunavut mines and exploration projects to prevent virus transmission “from a southern worker to a Nunavut worker, with the risk of it moving into the communities,” explained CEO Sean Boyd. Production was expected to continue under the remaining staff.

The following day residents blocked a road from Rankin Inlet airport to Meliadine to protest the use of replacement workers from Mirabel and Val d’Or, Quebec. Although the territory has banned travel from other jurisdictions, critical workers may apply for an exemption. They’re also required to undergo two weeks of isolation in their own region prior to travel.

From boots on the ground to fingers on the keyboard

Exploration suspensions haven’t come at a bad time for some projects, which had completed or nearly completed winter programs. Where labs remain open, assays might provide some badly needed good news.

Much of the crucial work of analyzing results and planning future exploration can be done by desktop. One example of a company with a multinational work-at-home team is Turmalina Metals TSXV:TBX, which completed a seasonal field program at its San Francisco de Los Andes gold project shortly before Argentina imposed a nation-wide quarantine. “While Turmalina maintains a corporate office in Canada our technical and managerial team operate remotely from individual home offices located in Peru, Brazil, Argentina, Canada and Asia,” states a March 23 announcement. “The current compilation, analysis and modeling of recently collected data is being done on a physically decentralized basis from these individual home offices as the company prepares for drilling.”

Follow the money

No one’s saying so out loud, but travel restrictions just might divert money from conferences, trade shows and expense accounts to actual work. Then again, money can still be squandered on low-IQ promotional campaigns produced at the kitchen table.

Every metal and mineral has a silver lining

This isn’t a sector that overlooks opportunity. Two days after Vanstar Mining Resources TSXV:VSR reported that drilling “continues without stopping” at its 25%-held Nelligan project in Quebec, the company acknowledged that majority partner IAMGOLD had suspended work. But “it should be noted that current events can also bring certain opportunities for acquiring gold projects at a lower cost,” Vanstar pointed out. The junior was merely echoing comments made by others, including BHP Group NYSE:BHP earlier this month.

With the economic outlook as confused as a professional stock-picker’s thought processes, mining’s future remains profoundly uncertain. But diminished supply can certainly help chances of rebounding demand.

And suspensions might encourage advantageous awareness, as noted by Uranium Energy Corp NYSE:UEC president/CEO Amir Adnani. “The recent global events and supply disruptions further underscore the importance of domestic supply chains for vital resources,” stated the U.S. purveyor of U3O8.

How could we live without them?

Endeavours deemed essential by Ontario and Quebec include capital markets services and agencies like the TMX Group and securities commissions. The provinces also consider alcohol and cannabis retailers essential. As if the world wasn’t already facing worse consequences, Toronto medical officer Eileen de Villa said banning booze “would lead to pretty significant health consequences.”

She didn’t specifically mention geoscientists.

The experts speak

Some fatuous remarks at PDAC provided retrospectively grim humour, as well as an exhibition of prognosticator pomposity. Here’s Mickey Fulp’s take on COVID-19, as quoted by IKN:

  • “I think it’s overblown.”

  • “All these shows are flu incubators, anyway.”

  • “I think it (i.e. infections) are going to be less this year, because people are doing things like washing their hands.”

  • “This is a blip on the radar screen. Especially in the U.S. where I’m from, because our economy is absolutely roaring and virus fears are not going to do major damage to the U.S. market.”

  • “I think it absolutely is an overreaction and the quicker it’s realized, the better.”

  • “This is a variety of flu.”

Of course to sheltered North Americans, the first week of March might seem a long time ago. So here’s Doug Casey’s insight, as published by Kitco on March 24:

“The virus itself isn’t nearly as serious, I don’t know how serious it’s going to be, but not terribly in my opinion. What I’m really shocked at, Daniela, is the degree of hysteria on the part of the powers that be. They’ve actually just gone insane.”

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