Week in Review: A Mining and Exploration Retrospect (Nov 17-23)

By ResourceClips


Quebec’s new royalty regimen “in a matter of months”

The new Parti Quebecois government unveiled its first budget this week without changing the royalty or tax code for miners. But, the Globe and Mail reported Wednesday, that could change early next year. The PQ wants to extract another $388 million from the industry. “We started working on a new framework and this regime will come into force in a matter of months,” the G&M quoted Finance Minister Nicolas Marceau.

During last summer’s election campaign, Marceau’s party talked of imposing a 5% royalty on all minerals extracted, regardless of a company’s profit. The PQ also proposed a 30% tax on all mining profits above 8%, to rake in the $388 million over five years.

Jean-Marc Lulin, president/CEO of Azimut Exploration [V.AZM] and outgoing president of the Quebec Mineral Exploration Association, told the G&M, “Our competitive advantage in the world lies in our legal, political and fiscal regime. You can’t toy with that without putting investments at risk.”

The government said it will consult with the industry prior to implementing changes.

The PQ also campaigned on revisions to the previous Liberal government’s Plan Nord infrastructure program. Last week’s news about how the government and Stornoway Diamond [T.SWY] will divide costs to built a road to the company’s Renard project, however, shows no real change to the plan so far.

Nuclear defence

“More people die from coal pollution each day than have been killed by 50 years of nuclear power operations—and that’s just from lung disease. If you include future deaths from global warming due to burning fossil fuels, closing down nuclear power stations is sheer madness.”

So concluded Gwynne Dyer’s column in Wednesday’s Georgia Straight, a left-wing Vancouver weekly. Nuclear energy, he said, “is a kind of witchcraft” that scares people “at least in the developed countries. [The Greens’ anti-nuclear campaign] cannot be logically reconciled with their concern for the environment, given that abandoning nuclear will lead to a big rise in fossil fuel use, but they have never managed to make a clear distinction between the nuclear weapons they feared and the peaceful use of nuclear power…. Fortunately, their superstitious fears are largely absent in more sophisticated parts of the world. Only four new nuclear reactors are under construction in the European Union, and only one in the United States, but there are 61 being built elsewhere. Over two-thirds of them are being built in the BRICs (Brazil, Russia, India and China), where economies are growing fast and governments are increasingly concerned about both pollution and climate change.”

Yet coal continues its breathtaking expansion

Nearly 1,200 new coal plants worldwide are in the planning stages, Marketwatch reported on Wednesday. China and India account for about 76%. The global top five coal burners are China, U.S., India, Germany and Japan.

MarketWatch cited a report from the World Resources Institute that listed Japan, China and South Korea as the world’s biggest importers. “In Japan, as pressure mounts to phase out nuclear power after the 2011 Fukushima Daiichi disaster, coal imports are likely to continue to grow.”

The inscrutable subtlety of longwall mining

After six weeks, controversy continues over the plan to import Chinese workers to staff a proposed British Columbia coal mine. On Thursday, a federal court granted two unions the right to seek a judicial review of the decision to grant work permits to the foreign miners. The following day the company involved launched an appeal, Canadian Press reported.

In a Friday dispatch picked up by Global News, CP also stated that the company, HD Mining International, signed a memorandum of understanding with Northern Lights College to train Canadians in longwall mining. A college spokesperson said the five-to-eight-month course could be underway by 2014. But HD Mining appears to be sticking to its plan to rely on Chinese “temporary” workers for its proposed Murray River mine until 2025.

"It's going to take some time, absolutely, because you're transferring a completely new skill set to Canadians in the form of longwall mining," HD Mining spokesperson Jody Shimkus told CP.

A proponent insisted efforts were made to recruit Canadians, according to another Canadian Press story published by the Vancouver Sun on Tuesday. An affidavit by Michael Xiao of Huiyong Holdings, which owns 55% of HD Mining, said three months of job ads drew no takers. It’s not clear, however, whether the three to five years’ experience required was restricted specifically to underground coal mining or even longwall mining. Nor is there any word how much experience the Chinese miners will have.

On Wednesday the United Steelworkers Union called on B.C.'s chief inspector of mines and minister of mines to order a suspension of work at Murray River, where surface preparations are underway prior to underground bulk sampling. The USW argued that “to understand and comply with the occupational [health] and safety rules and standards, all workers in mines must have appropriate facility in the English language.”

Seventeen Chinese workers have already arrived, with 60 more expected in mid-December. The federal government has so far issued 201 work permits.

New revelations have dogged the scheme ever since the USW brought it to light on October 9. Last week media reported that Shimkus was an assistant deputy minister in B.C.’s Ministry of Natural Resources less than a year ago, and therefore might be in a conflict of interest.

Meanwhile, training opportunities expand up north

While HD Mining condescends to sign an MOU with a local college, Northwest Territories underground mining courses are expanding to Nunavut. The Kitikmeot Inuit Association announced new training programs to start in Cambridge Bay and Kugluktuk early next year, the Nunatsiaq News reported on Tuesday.

The six-week introductory course will tackle subjects like geology, mining methods, underground mining, safety and the mining life cycle. The course is an approved program of Aurora College and will be taught by instructors hired by the Northwest Territories Mine Training Society, the newspaper reported.

Michele Buchan, manager of Inuit employment and training for the KIA, told the Nunatsiaq News, “It’s building a solid base for employability, and we know that the mines in the NWT do prefer to hire people who have had this training.”

Aurora College also offers a more advanced 14-week course at its Fort Smith and Yellowknife campuses in the NWT.