Wednesday 22nd November 2017

Resource Clips


Posts tagged ‘ontario’

B.C. Securities Commission under fire as half a billion in penalties remains unenforced

November 21st, 2017

by Greg Klein | November 21, 2017

Although some small cap companies seem to consider regulators the bane of their existence, big-time scammers might take a more benign view. A Postmedia investigation has revealed that the British Columbia Securities Commission—with 234 staffers and a $46.6-million budget—has collected less than 2% of $510 million in fines and payback orders issued over the last decade. The collection rate manages to fall even farther, to less than 0.1%, for 29 such orders of $1 million or more that total $458 million.

B.C. Securities Commission under fire as half a billion in penalties remains unenforced

Although the BCSC responds that the con artists may have hidden their assets or disappeared, journalist Gordon Hoekstra reports, “Postmedia tracked down $31 million in potential assets linked to the fraudsters,” including homes in affluent B.C. suburbs, Las Vegas and Hawaii.

Among available enforcement strategies, the BCSC “can file any of its decisions in B.C. Supreme Court, a simple administrative exercise, which automatically makes the penalties an order of the court,” Hoekstra points out. “If a property has been transferred to someone else, for example, a spouse, to escape a penalty, that may also be considered fraud.”

Regulators in other provinces do somewhat better, according to the study. Securities commissions in Ontario and Alberta achieved 18% collection rates over the last decade, while Quebec reached about 20% over the past four years. The U.S. Securities and Exchange Commission hit nearly 60% during the past five years.

The exposé seems to have taken both of B.C.’s main political parties by surprise. In a written statement NDP Finance Minister Carole James noted the commission operates at arms-length from the government. “We would encourage any proposals from the BCSC on any new mechanisms they may need to collect the fines,” she stated.

“No details were released by James, who ministry officials said was unavailable for an interview, on how the provincial government would follow up or monitor any proposals,” Hoekstra added.

As for the opposition party that had been government during most of the 10-year period, the BC Liberals “said in an e-mail that ‘unfortunately’ no MLAs were available for comment. The Liberals have 41 sitting MLAs, including two finance critics, Shirley Bond and Tracy Redies.”

Pistol Bay Mining wants to bring blockchain to resource companies

November 15th, 2017

Update: On November 20 Pistol Bay announced it had created a subsidiary called PB Blockchain Inc to create applications for mining and resource companies.

by Greg Klein | November 15, 2017

Although still focused on its Confederation Lake zinc-copper portfolio in northwestern Ontario, Pistol Bay Mining TSXV:PST sees untapped potential in technology’s current upheaval. The company reports ongoing discussions to form a wholly owned subsidiary that would create blockchain applications for the mining sector, as well as oil and gas and possibly other industries. Some products could include “Ethereum smart contracts, security, claim management, resource management and the tokenization of resources,” Pistol Bay stated.

Pistol Bay Mining wants to bring blockchain to resource companies

“We believe a unique opportunity exists to lead the mineral development industry by building a resource-focused blockchain company to facilitate modern mining-related transactions,” explained president/CEO Charles Desjardins. “This represents an exciting opportunity for the shareholders of Pistol Bay and, as a founder of the original Investment.com portal, I have always recognized the need to be early in adapting to new technologies.”

Back to mineral exploration, last month Pistol Bay announced confidentiality agreements with two companies interested in partnering on Pistol Bay’s 17,000-hectare Confederation Lake properties. One company was described as a mid-tier producer, the other a junior explorer. The news followed completion of the first regional and modern geophysical program carried out over the VMS-rich greenstone belt.

Having already received an exploration permit for Confederation Lake’s Dixie claims, Pistol Bay now has applications pending for the Garnet, Fredart, Moth and Fly claim groups. “With zinc prices at a record high, there’s lots of demand for zinc and copper exploration projects,” said Desjardins. “Not many companies can offer a belt-wide property base with proven VMS mineralization and a new airborne EM survey with multiple untested targets.”

Read more about Pistol Bay Mining here and here.

Castle Silver Resources drills 1.55% cobalt over 0.65 metres with nickel, gold and silver in Ontario

November 13th, 2017

by Greg Klein | November 13, 2017

Last summer’s drilling at Ontario’s former Castle mine “intersected mineralization in each and every hole,” Castle Silver Resources TSXV:CSR reported November 13. The one assay released so far hit 1.55% cobalt, 0.65% nickel, 0.61 g/t gold and 8.8 g/t silver over 0.65 metres starting near surface at 3.85 metres in downhole depth. The company estimates true width between 65% and 85%.

Drilling finished in late August when an originally planned 1,500-metre program completed 22 holes totalling 2,405 metres.

Castle Silver Resources drills 1.55% cobalt over 0.65 metres with nickel, gold and silver in Ontario

Castle Silver expanded its summer campaign
from 1,500 metres to 2,405 metres.

“Once again we’ve demonstrated how historical operators overlooked the potential for cobalt, gold and base metals at the Castle mine as they focused exclusively on the extraction of high-grade silver,” said president/CEO Frank Basa.

“We will carry out trenching to follow up on an array of new near-surface targets generated by this drilling in the immediate vicinity of the Castle mine. But our priority now is to complete final preparations to carry out critical trenching and drilling of untested structures on the first level of the mine.”

With intermittent production between 1917 and 1989, the former mine has 11 levels totalling about 18 kilometres of underground workings. “This does not include an unknown extent of drilled vein structures which were never mined, typically due to silver grades below a certain high-grade threshold, for which CSR has records,” the company added.

Using XRF analysis, an independent firm has found potential for high-grade cobalt mineralization within unmined structures along first-level adit drifts and walls. In July Castle Silver released results from an 82-kilogram bulk sample of vein material that showed 1.48% cobalt as well as 5.7 g/t gold and 46.3 g/t silver. As a result, the company re-evaluated five previous chip samples for gold, with results averaging 3.7 g/t. The samples originally assayed 1.06% cobalt, 5.3% nickel and 17.5 g/t silver.

Earlier this month Castle Silver and Granada Gold Mine TSXV:GGM announced a provisional milling agreement for a plant that would be located on Castle Silver’s property in Gowganda, Ontario. About a 204-kilometre drive from Gowganda, Granada’s project reached pre-feas in 2014 and a resource update in June.

Castle Silver closed the final tranche of a private placement totalling $1.2 million in June.

Mining commentator Stan Sudol says undue emphasis on the gold rushes stifles Canadians’ understanding of a vital industry

November 10th, 2017

…Read more

Castle Silver Resources and Granada Gold Mine sign provisional milling agreement

November 1st, 2017

by Greg Klein | November 1, 2017

Two companies plan to co-operate on a proposed facility to process Quebec gold and Ontario cobalt-silver. Castle Silver Resources TSXV:CSR and Granada Gold Mine TSXV:GGM announced a provisional milling agreement to develop a flowsheet for a plant that would be located on Castle Silver’s property in Gowganda, Ontario. The Granada gold mine is located near Rouyn‐Noranda and about 204 kilometres by road from Gowganda.

Castle Silver Resources and Granada Gold Mine sign provisional milling agreement

As cobalt prices soar, Castle Silver Resources hopes to
revive a past-producer in Ontario’s historic Cobalt camp.

The companies have overlapping management and directors. Funding would come from US$20 million in loans, “which debt raise will be facilitated by a family office in the UK,” the companies stated.

The agreement foresees batch processing of at least 600,000 tonnes of Granada material grading four grams per tonne over three years. An option would allow treatment of another 1.4 million tonnes of pre‐concentrated waste rock. Initial metallurgical tests used a conventional coarse gravity process to achieve 70% gold recovery from Granada waste rock averaging 0.5 g/t, producing a 4.5 g/t gravity concentrate to be further processed at the mill.

The Granada project reached the pre-feasibility level in 2014 and a resource update last June. The Castle mine underwent intermittent silver-cobalt production between 1917 and 1989. Assays are pending from last summer’s 22-hole, 2,405-metre drill campaign.

In June Castle Silver closed the final tranche of a private placement totalling $1.2 million.

Charles Desjardins discusses Pistol Bay Mining’s portfolio covering most of Ontario’s Confederation Lake belt

October 27th, 2017

…Read more

Paved with mineralization

October 27th, 2017

Norman B. Keevil’s memoir retraces Teck’s—and his own—rocky road to success

by Greg Klein

Norman B. Keevil’s memoir retraces Teck’s—and his own—rocky road to success

Profitable right from the beginning, Teck’s Elkview mine “would become
the key chip in the consolidation of the Canadian steelmaking coal industry.”
(Photo: Teck Resources)

 

“We were all young and relatively inexperienced in such matters in those days.”

He was referring to copper futures, a peril then unfamiliar to him. But the remark’s a bit rich for someone who was, at the time he’s writing about, 43 years old and president/CEO of a company that opened four mines in the previous six years. Still, the comment helps relate how Norman B. Keevil enjoyed the opportune experience of maturing professionally along with a company that grew into Canada’s largest diversified miner. Now chairperson of Teck Resources, he’s penned a memoir/corporate history/fly-on-the-wall account that’s a valuable contribution to Canadian business history, not to mention the country’s rich mining lore.

Norman B. Keevil’s memoir retraces Teck’s—and his own—road to success

Norman B. Keevil
(Photo: Teck Resources)

Never Rest on Your Ores: Building a Mining Company, One Stone at a Time follows the progress of a group of people determined to avoid getting mined out or taken out. In addition to geoscientific, engineering and financial expertise, luck accompanies them (much of the time, anyway), as does acumen (again, much of the time anyway).

Teck gains its first foothold as a predecessor company headed by Keevil’s father, Norman Bell Keevil, drills Temagami, a project that came up barren for Anaconda. The new guys hit 28% copper over 17.7 metres. Further drilling leads to the three-sentence feasibility study:

Dr. Keevil: What shall we do about Temagami?

Joe Frantz: Let’s put it into production.

Bill Bergey: Sounds good to me.

They schedule production for two and a half months later.

A few other stories relate a crucial 10 seconds in the Teck-Hughes acquisition, the accidental foray into Saskatchewan oil, the Toronto establishment snubbing Afton because of its VSE listing, an underhanded ultimatum from the British Columbia government, getting out of the oyster business and winning an unheard-of 130% financing for Hemlo.

Readers learn how Murray Pezim out-hustled Robert Friedland. But when it came to Voisey’s, Friedland would play Inco and Falconbridge “as though he were using a Stradivarius.” Keevil describes one guy welching on a deal with the (apparently for him) unarguable excuse that it was only a “gentleman’s agreement.”

Norman B. Keevil’s memoir retraces Teck’s—and his own—rocky road to success

Through it all, Teck gets projects by discovery or acquisition and puts them into production. Crucial to this success was the Teck team, with several people getting honourable mention. The author’s closest accomplice was the late Robert Hallbauer, the former Craigmont pit supervisor whose team “would go on to build more new mines in a shorter time than anyone else had in Canadian history.” Deal-making virtuoso David Thompson also gets frequent mention, with one performance attributed to his “arsenal of patience, knowledge of the opponents, more knowledge of the business than some of them had, and a tad of divide and conquer…”

Partnerships span the spectrum between blessing and curse. International Telephone and Telegraph backs Teck’s first foray into Chile but frustrates its ability to do traditional mining deals. The Elk Valley Coal Partnership puts Teck, a company that reinvests revenue into growth, at odds with the dividend-hungry Ontario Teachers’ Pension Plan. Working with a Cominco subsidiary, Keevil finds the small-cap explorer compromised by the “ephemeral response of the junior stock market.” And smelters rip off miners. But that doesn’t mean a smelter can’t become a valued partner.

Keevil argues the case for an almost cartel-like level of co-operation among miners. Co-ordinated decisions could avoid surplus production, he maintains. Teck’s consolidation of Canada’s major coal mines helped the industry stand up to Japanese steelmakers, who had united to take advantage of disorganized Canadian suppliers. “Anti-trust laws may be antediluvian,” he states.

Keevil admits some regrets, like missing Golden Giant and a Kazakhstan gold project now valued at $2 billion. The 2008 crash forced Teck to give up Cobre Panama, now “expected to be a US$6 billion copper mine.” Teck settled a coal partnership impasse by buying out the Ontario Teachers’ share for $12 billion. Two months later the 2008 crisis struck. Over two years Teck plunged from $3.6 billion in net cash to $12 billion in net debt.

But he wonders if his own biggest mistake was paying far too much for the remaining 50% of Cominco when an outright purchase might not have been necessary. Keevil attributes the initial 50%, on the other hand, to a miracle of deal-making.

For the most part Keevil ends his account in 2005, when he relinquishes the top job to Don Lindsay. By that time the company had 11 operating mines and a smelting/refining facility at Trail. A short chapter on the following 10 years, among the most volatile since the early ’70s, credits Teck with “a classic recovery story which deserves a full chapter in the next edition of Never Rest on Your Ores.” Such a sequel might come in another 10 years, he suggests.

Let’s hope he writes it, although it’ll be a different kind of book. As chairperson he won’t be as closely involved in the person-to-person, deal-to-deal, mine-to-mine developments that comprise the greatest strength of this book—that and the fact that the author grew with the company as it became Canada’s largest diversified miner.

Meanwhile, maybe Lindsay’s been keeping a diary.

The author’s proceeds go to two organizations that promote mining awareness, MineralsEd and Mining Matters.

OSC tele-townhall encourages scam awareness

October 16th, 2017

by Greg Klein | October 16, 2017

OSC tele-townhall encourages scam awareness

Courts and regulatory agencies notwithstanding, there’s probably no greater frustration for con artists than con-resistant investors. With that in mind, the Ontario Securities Commission has a public outreach program underway including a tele-townhall.

Taking place October 24 at 6:30 p.m., the one-hour event will work “much like a call-in radio show,” the commission explains. Staff will provide information about frauds and scams commonly perpetrated in Ontario. Callers may ask questions and take part in live polls. Participants can register here up to noon of that day.

As part of an outreach program called From Bay Street to Main Street, the OSC also has several investor awareness meetings scheduled over the next few months. Many of the events will take place with groups representing Canadian newcomers or seniors, two particular scam targets.

The OSC also promotes investor knowledge through its Get Smarter About Money website.

Among other strategies across the country, the British Columbia Securities Commission has promoted investor awareness through entertaining videos, a few of which can be seen here and here.

Canadians need to get past the Klondike to understand mining’s contributions: Stan Sudol

October 13th, 2017

by Greg Klein | October 13, 2017

Rights offerings to be streamlined, says CSA

Like the nugget in this prospector’s hand, the
Klondike’s place in history looms unrealistically large.

The Fraser, Cariboo and Klondike gold rushes undoubtedly played an important nation-building role, with the latter becoming especially famous “thanks to terrific public relations from writers like Jack London, Pierre Berton and Robert Service,” says Stan Sudol. But how important were those events when the Yukon coughed up about 12 million gold ounces, “small change compared to the Timmins camp which is currently at 73 million ounces and counting!”

In a speech to the Canadian Business History Association Conference the Sudbury native and communications consultant/mining strategist/speech writer/mining blogger related how Ontario’s gold and base metals discoveries far surpassed the western gold rushes for their importance to the Canadian economy. “Notwithstanding the historical hype of the Klondike the two most important mining events in our history are the discoveries of the Sudbury nickel mines in 1883 and the Cobalt silver boom of 1903.”

And, he notes, while London, Berton and Service missed out on these developments, Sudbury did attract the attention of Stompin’ Tom Connors.

Sudol outlines the history of the Ontario and Quebec camps, looking at their social and environmental impacts as well as economic contributions. His compelling account takes readers up to the present, as mining in the Northwest Territories and Nunavut helps create an indigenous middle class.

Read it here on the Republic of Mining.

At a regulatory crossroads

October 4th, 2017

It’s time to fix federally induced problems, says the Mining Association of Canada

by Greg Klein

The fundamentals behind the last supercycle remain in place, insists Pierre Gratton. Yet the Mining Association of Canada president/CEO warns that the country has lost ground as a global industry leader. While the current upswing continues, the transition to a cleaner, lower-carbon future will call for even more mineable commodities. Whether Canada participates to its fullest potential, however, depends largely on policies directed by Ottawa.

Addressing a 230-strong Greater Vancouver Board of Trade audience on September 27, Gratton noted that by 2015 Canada lost its first-place spot for exploration investment. The usurper was Australia, which proved itself “much more strategic and successful over the past decade.” Meanwhile this country’s list of active projects has fallen to nearly half its 2011 peak of 2,700. Only two new projects came up for federal environmental assessment in 2016, an historic low. “We’ve got world class deposits sitting idle,” he added, citing Ontario’s Ring of Fire, Nunavut’s Izok Corridor and British Columbia’s New Prosperity.

It’s time to fix federally induced problems, says the Mining Association of Canada

Pierre Gratton: “Hopefully we’ll get it right this time, we’ll lock
it in, we’ll know what the rules are and get down to business.”
(Photo: Matt Borck, courtesy Greater Vancouver Board of Trade.)

Yet opportunities have been improving, he maintained, and not just because of stronger commodity prices. In addition to continued growth among emerging economies, carbon-reducing measures call for new technologies that require more mining products. That’s the case for electrified transportation, wind and solar generation, and energy storage.

“The transition to a low-carbon future is not years away from now—it has already started and it’s accelerating at a rapid pace.” Unless Canada turns that to its competitive advantage, “we will lose this opportunity to other countries… It’s going to be us, Australia or someone else.”

Moreover, Canada can produce these commodities “as a leader in sustainability.” This country “already operates some of the lowest-emitting, highest-tech and most socially responsible mines in the world.” Gratton credited companies that implemented MAC’s Towards Sustainable Mining program with reducing greenhouse gas emissions. And altruism can be rewarding: “Our Canadian-made mining standard has caught the attention of Apple and other global companies that see it as a program robust enough to demonstrate responsible sourcing.”

But if environmental progress bodes well for Canadian mining, the policy environment remains uncertain. The 2012 regulatory reforms of the previous Conservative government lost both public and investor confidence, Gratton argued.

Ottawa now needs to put “the principle of one project/one review squarely into action. We need a federal process that no longer places an unfair and unequal burden on Canada’s mining sector alone, which has sadly been the case since 2012.”

For a couple of these pieces, like the Fisheries Act and the Navigation Protection Act, I think the mining industry is probably going to come out fine. The Environmental Assessment Act, I don’t know.

The Liberals, he said, are “committed to review and replace all of the federal reforms of the previous Harper government…. For a couple of these pieces, like the Fisheries Act and the Navigation Protection Act, I think the mining industry is probably going to come out fine. The Environmental Assessment Act, I don’t know. At this point it is still so much in flux it is hard to know exactly where this will land.”

Six years of regulatory uncertainty with the prospect of more to come contributes to “this question mark in Canada. And hopefully we’ll get it right this time, we’ll lock it in, we’ll know what the rules are and get down to business.”

Returning to climate change, Gratton noted some industry initiatives, including wind energy reducing diesel dependency at Diavik and Raglan, and the transformation of B.C.’s former Sullivan mine into a community-owned solar plant that sells electricity to the grid. Goldcorp’s (TSX:G) Borden project, anticipated for 2019 production, would be Canada’s first all-electric underground mine.

Not only would the battery-powered fleet cut emissions, it “will significantly reduce ventilation costs,” Gratton stated.

“But we need to do more to spur innovation.” MAC proposes government support for innovation superclusters, a possible “catalyst to achieve transformative outcomes for our industry and help re-establish Canada as a global leader for mining innovation.”

Northern infrastructure, bringing both roads and electricity to isolated areas, again complements both the industry and the environment. Gratton pointed to the Northwest Territories’ planned $150-million all-season road to the Tlicho community, and the federal/Yukon $360-million road that would access the Coffee and Casino projects, two potential mines that would “contribute billions in new investment … and thousands of direct and indirect jobs.”

With federal funding available for green infrastructure, here’s an opportunity to take more communities off diesel, fully open up B.C.’s Golden Triangle and deliver to Yukon and the projects up there reliable, clean energy.

Referring to the 344-kilometre extension of B.C.’s Northwest Transmission Line in 2014, Gratton said: “I’ve a pitch for you today. Why not finish the job and take that line all the way to the Yukon? With federal funding available for green infrastructure, here’s an opportunity to take more communities off diesel, fully open up B.C.’s Golden Triangle and deliver to Yukon and the projects up there reliable, clean energy.”

Undiscouraged by the rugged 800-kilometre gap between the provincial and territorial grids, he added, “I was meeting recently with Yukon officials and they’re very interested in this. I remember also that Premier Horgan, when he was Energy and Mines critic, was a big champion of this project too. So here’s a nation-building project that maybe he can get behind.”

“I could talk about many other things as well, but the key takeaway is that we need to reposition Canada and enhance our competiveness going forward. And it’s critical because other countries are doing the same.”

But in response to an audience question about native consent, was he optimistic or euphemistic? “We’re not in a world of veto,” Gratton insisted. “We’re in a world of deep and meaningful engagement.”

Speaking with ResourceClips.com, he said MAC’s supercluster proposal could create regional centres for excellence focusing on mining and exploration in Sudbury and Vancouver, processing in Quebec City and oil sands in Edmonton.

There are some issues where we’ve made real progress with this new government that we hadn’t been able to make under the previous government.

Although it’s too early to evaluate the Liberals’ performance, the former Chretien-era government communications guy did say, “There are some issues where we’ve made real progress with this new government that we hadn’t been able to make under the previous government.”

Environmental permitting delays, he pointed out, “have been horrendous. At times it takes five years after an environmental assessment before you get your permit. The previous government announced a policy that would shorten that to eight months but didn’t do anything to implement it. This government has actually put in place the tools to make it happen. So we are seeing those timelines shrink.”

Additionally Ottawa now consults with MAC much more than did the previous government. The Conservatives’ lack of dialogue, he stated, “could be why they got things wrong.”