Author Archives: prosperitysaskatchewan

Potash mentions in BHP’s Annual Report – November 2014 #potash

Potash mentions from BHP Billiton’s Annual Report 2014
Page 11 of 348
In August 2014, we announced a proposal to create an independent global metals and mining company based on a selection of BHP Billiton’s high-quality aluminium, coal, manganese, nickel
and silver assets. Separating these assets via a demerger has the potential to unlock shareholder value by significantly simplifying
the BHP Billiton Group and creating two portfolios of complementary assets. Once simplified, BHP Billiton would be almost exclusively focused on our large, long-life iron ore, copper, coal, petroleum
and potash basins. With fewer assets and a greater upstream
focus, BHP Billiton would be able to reduce costs and improve the productivity of our largest businesses more quickly. The proposed demerger remains subject to the receipt of satisfactory third party approvals, final Board approval and shareholder vote.
____________________________________
Page 15 of 348
We believe that our uniquely diversified portfolio is robust, both
across these scenarios, and also shorter-term shock events.
As an example, in a severely carbon constrained world, we believe
there is significant upside for our potash and uranium commodities,
and also for our high-quality hard coking coal (lower smelting
emissions) and iron ore lump product (direct blast furnace feed),
while copper is resilient. In aggregate these mitigate potential
negative impacts in other commodities, given the relatively short
pay-back periods for most present and future investments in fossil
fuel production. Conversely, our portfolio allows us to capture
upsides in an environment where developing countries experience
strong global growth.
_________________________________
Page 20 of 348
BHP Billiton’s continued diversification
If the demerger is approved, we would focus almost exclusively
on our large, long-life iron ore, copper, coal, petroleum and potash
basins. By concentrating on the development and operation
of these basins, BHP Billiton expects to reduce costs and improve
productivity more quickly.
Following the demerger, BHP Billiton would have a simpler portfolio
with fewer assets and a greater focus on upstream operations.
BHP Billiton would remain:
• the largest exporter of metallurgical coal;
• a global top three producer of iron ore;
• a global top four exporter of copper concentrate;
• the largest overseas investor in onshore US shale;
• the developer of the world’s best undeveloped potash resource
in Saskatchewan, Canada.
Consistent with our established strategy, our Core Portfolio (1)
provides broad exposure to steelmaking raw materials, copper,
energy and potentially agricultural markets and will remain
diversified by commodity, geography and market.
___________________________________
Page 38 of 348
Description of the Potash Business
Jansen Potash Project
Our Potash strategy is to build a material industry position over
the long term.
We hold exploration permits and mining leases, issued by the
Government of Saskatchewan, covering more than 14,000 square
kilometres of mineral rights in the province of Saskatchewan in
Canada. We have progressively explored our permit areas over
the past seven years and continue to evaluate their economic
development potential. We are converting our exploration permits
to long-term leases as these permits mature in order to enable
further evaluation. To date, we have secured 4,400 square kilometres
under long-term mining leases.
We believe our Jansen Potash Project, a greenfield potash project
in south-central Saskatchewan, is the world’s best undeveloped
potash resource and is likely to be a low-cost source of supply
once fully developed. Investment in Jansen could underpin
a potential fifth pillar of BHP Billiton, given the opportunity
to develop a multi-decade, multi-mine basin in Saskatchewan.
On 20 August 2013, we announced an additional US$2.6 billion
investment for Jansen, bringing total approved spending to
US$3.8 billion. This investment is funding the excavation and
lining of the Project’s production and service shafts, and the
installation of surface infrastructure and utilities. The level
of expenditure on the Jansen Potash Project in FY2014
was US$596 million.
With our investment premised on the attractive longer-term market
fundamentals for potash, we will continue to modulate the pace
of development as we seek to time our entrance to meet market
demand. The introduction of one or more minority partners,
consistent with our approach for certain of our other resource
operations, will be considered at the appropriate time.
On the basis of our current projections and assuming Board
approval, the Jansen mine is likely to ramp-up to its nameplate
capacity of approximately 10 Mtpa of agricultural grade potassium
chloride in the decade beyond 2020.
____________________________________
Page 39 of 348
Potash recorded an Underlying EBIT loss of US$583 million.
This included: a US$68 million impairment associated with
our decision to allow the exclusivity agreement for Terminal 5
at the Port of Vancouver (US) to lapse; and a US$300 million
charge related to the revision of mine site rehabilitation provisions for the Group’s North American closed mines, which are managed
by our Potash Business. In addition, exploration expense for Potash was US$47 million, a US$42 million reduction from FY2013.
The Jansen Potash Project was 30 per cent complete at the
end of the period with significant progress made on surface infrastructure and shaft excavation continuing.
___________________________________________
From page of 80 of 348
2.1.1 Petroleum and Potash Business continued
Potash
Our Potash strategy is to build a material industry position over
the long term.
We hold exploration permits and mining leases, issued by the
Government of Saskatchewan, covering more than 14,000 square
kilometres of mineral rights in the province of Saskatchewan
in Canada. We have progressively explored our permit areas over
the past seven years and continue to evaluate their economic
development potential. We are converting our exploration permits
to long-term lease as these permits mature in order to enable
further evaluation. To date, we have secured 4,400 square
kilometres under long-term mining leases.
We continue to progress our Jansen Potash Project, a greenfield
potash project, located approximately 140 kilometres east of
Saskatoon in south-central Saskatchewan. We believe Jansen
is the world’s best undeveloped potash resource and is likely to
be a low-cost source of supply once fully developed. Investment
in Jansen could underpin a potential fifth pillar of BHP Billiton,
given the opportunity to develop a multi-decade, multi-mine
basin in Saskatchewan.
On 20 August 2013, we announced an additional US$2.6 billion
investment for Jansen, bringing total approved spending to
US$3.8 billion. This investment is funding the excavation and lining
of the Project’s production and service shafts, and the installation
of essential surface infrastructure and utilities.
The level of expenditure on the Jansen Potash Project in FY2014
was US$596 million, which was lower than the annual instalment
of US$800 million previously announced for FY2014. We suspended
excavation of the production and service shafts in the December
2013 quarter to enable a thorough review of activities completed
and to ensure all learnings were captured and adopted in future
works. Shaft excavation resumed in the March 2014 quarter and
progressed in a staggered manner to mitigate risk and optimise
their development. As at 30 June 2014, the pre-development phase
was 30 per cent complete.
During FY2014, we allowed our exclusivity for Terminal 5 at the
Port of Vancouver to lapse. We are currently assessing a range
of options to meet our port requirements.
With our investment premised on the attractive longer-term market
fundamentals for potash, we will continue to modulate the pace
of development as we seek to time our entrance to meet market
demand. The introduction of one or more minority partners,
consistent with our approach for certain of our other resource
operations, will be considered at the appropriate time.
On the basis of our current projections and assuming Board approval,
the Jansen Potash Project is likely to ramp-up to its nameplate
capacity of approximately 10 Mtpa of agricultural grade potassium
chloride (KCl) in the decade beyond 2020. The Measured Resource
estimate for Jansen is 5.3 billion tonnes at 25.6 per cent potassium
oxide (K2O) (25.6 per cent K2O is equivalent to 40.5 per cent KCl
using the mineralogical conversion factor of 1.583) with an
anticipated life of more than 50 years. The Government of
Saskatchewan has issued a Potash Lease Special Agreement (KLSA)
for our Jansen Project, which provides long-term security of tenure
to allow the ongoing development and subsequent operation of
Jansen for the life of the operation.
We are continuing to evaluate other areas for which we have
exploration permits in the Saskatchewan potash basin, including
Young, Boulder and Melville, through analysis of the extensive
data collected from successive exploration programs.
In 2013, the management of the closed mine sites associated
with Base Metals North America was transitioned from the
Copper to the Potash Business. All locations are in care and
maintenance or in various stages of closure.
___________________________________________
Page 134 of 348
BHP Jansen mineral resources - Nov 2014 ar

27% more jobs posted on SaskJobs than EI recipients in Saskatchewan in September 2014

November 20th, 2014
Statistics Canada
The number of EI recipients in Saskatchewan in September 2014 was up 6.6% from September 2013 (see chart below).
There were 10,800 EI recipients in Saskatchewan in September 2014, at the same time, there were 13,762 jobs posted on SaskJobs .ca alone. So, there were 27% more jobs on one website than EI recipients in Saskatchewan.
Today there are 11,721 jobs posted at SaskJobs.ca
SK ei recipients Nov 2014 top SK ei recipients Nov 2014

China’s nuclear generating capacity is set to triple over the next six years #uranium

China plans for nuclear growth

20 November 2014

http://www.world-nuclear-news.org/NP-China-plans-for-nuclear-growth-2011144.html

China’s nuclear generating capacity is set to triple over the next six years, according to an energy development plan published by the State Council.

The State Council published the Energy Development Strategy Action Plan, 2014-2020 on 19 November. The plan aims to cut China’s reliance on coal and promote the use of clean energy.

China currently has 19.1 GWe of installed nuclear generating capacity. According to the plan, this will reach 58 GWe of capacity by 2020, giving China the third largest nuclear generating capacity after the USA and France. In addition, by 2020, China should also have a further 30 GWe or more of new nuclear generating capacity under construction.

The plan calls for the “timely launch” of new nuclear power projects on China’s eastern coast and for feasibility studies for the construction of inland plants. It says that efforts should be focused on promoting the use of large pressurized water reactors (including the AP1000 and CAP1400 designs), high temperature gas-cooled reactors (HTRs) and fast reactors.

The plan also says that research should be conducted into fuel reprocessing technology. In addition, it calls for the active promotion of basic research into nuclear power and the research and development of nuclear safety technology. It also says that research should be conducted to “improve the nuclear fuel cycle system.”

Fast reactors – make maximum use of uranium resources by generating a certain amount more fuel than they consume – are seen as the main technology for China’s long-term use of nuclear energy. Under previously announced plans, deployment of PWRs is expected to level off at 200 GWe by around 2040, with the use of fast reactors progressively increasing from 2020 to at least 200 GWe by 2050 and 1400 GWe by 2100.

Cleaner energy

The plan sets a cap on annual energy consumption at 4.8 billion tonnes of the standard coal equivalent by 2020. This would limit the annual growth rate of primary energy consumption to less than 3.5% per year over the next six years.

Annual coal consumption will be held below 4.2 billion tonnes until 2020, the plan says. Its share of the energy mix will be reduced from the current 67% to 62% by 2020. The plan places responsibility on areas around Beijing, the Yangtze River Delta and the Pearl River Delta to cut their coal consumption in order to reduce air pollution. The share of natural gas, meanwhile, will be raised to over 10%.

Meanwhile, the share of non-fossil fuels in the total primary energy mix will increase from 9.8% in 2013 to 15%, according to the plan. Installed capacity of hydro, wind and solar power is expected to reach 350 GWe, 200 GWe and 100 GWe, respectively, by 2020.

Last week, China announced plans to achieve the peaking of CO2 emissions around 2030 and “to make best efforts to peak early.” It also intends to increase the share of non-fossil fuels in primary energy consumption to some 20% by 2030.

Researched and written by World Nuclear News

INDIAN COMPANIES TO BUY MORE SASKATCHEWAN POTASH #potash

INDIAN COMPANIES TO BUY MORE SASKATCHEWAN POTASH

Released on November 20, 2014

Premier Brad Wall on Hand as New Long-Term Sales Agreements Are Signed
Today Premier Brad Wall witnessed the signing of two new marketing agreements that will see millions of tonnes of Saskatchewan potash shipped to India over the next few years.
Canpotex, the off-shore marketing arm of Saskatchewan potash producers, signed separate sales agreements with Coromandel International Ltd. (CIL) and Tata Chemicals Limited (TCL).  The two companies, along with Indian Potash Limited (IPL), were also recognized by Canpotex for their long-time patronage.
In addition, Canpotex signed an Enhanced Market Development Agreement with each of the three companies to promote the use of potash in India.
Canpotex supplies about 25 per cent of the potash used in India, which is the company’s fourth largest offshore market.
Wall is in India on a week-long trade mission.
“With a growing economy and large population, India is an important market for our potash producers and we’re thankful for these purchase agreements,” Wall said.  “We have a strong commercial relationship that should only get stronger as Indian farmers begin to see the value of potash in a balanced fertilizer application.  Potash has helped Saskatchewan farmers become among the most productive farmers in the world and it can do the same for Indian farmers.”
“Canpotex is honoured to have served CIL, IPL and TCL for many years and grateful our relationship will continue into the future,” Canpotex President and CEO Steve Dechka said.  “We look forward to working with our partners to help Indian farmers improve their productivity and feed this dynamic, growing country.”
Wall, Dechka and Dr. Sanjeev Balyan, Minister of State for Agriculture and Food Processing Industries, were among those invited by IPL to the opening of a soil testing laboratory at Muzaffarnagar, located about 130 kilometres east of New Delhi.  The laboratory will provide free services to local farmers.
The delegation toured a sugarcane demonstration plot that serves as a showcase of scientific farming methods, including the use of potash as a fertilizer.

The Premier also delivered a keynote address to more than 600 farmers, in which he touted the benefits of potash.

At separate ceremonies attended by Wall, CIL and IPL were presented with awards for purchasing three million tonnes of Saskatchewan potash, while TCL was recognized for buying four million tonnes.
Also on Thursday, Canpotex hosted a dinner attended by the Saskatchewan delegation, Government of India representatives and industry officials.
“I’m grateful Canpotex provided an opportunity for our government to say thank you to our customers and discuss how we might work together to boost agricultural productivity in India,” Wall said.
The trade mission, which runs November 15-23, is intended to promote Saskatchewan’s strengths in energy, agriculture and innovation as well as to highlight investment opportunities.
On Friday, Wall was scheduled to meet with the Chief Minister of the State of Punjab and the Chief Minister of the State of Haryana in Chandigar.  On Saturday, the Premier will speak at the opening ceremonies of Agro Tech 2014 in Chandigar, and the opening of the Canadian Pavilion at the agricultural trade show.
Wall has also had meetings with government officials and potential investors in Mumbai, Ahmedabad, the largest city in the state of Gujarat, and New Delhi.  He delivered keynote speeches at a dinner in Mumbai and a luncheon in Ahmedabad.
Saskatchewan is the largest exporter to India among the provinces, shipping about $1.0 billion worth of goods in 2013.  The province’s exports to India have increased 67 per cent since 2007.  Saskatchewan imports from India have climbed by 244 per cent in the same period.
-30-
For more information, contact:
Kathy Young Executive Council Regina Phone: 306-787-0425 Email: kathy.young@gov.sk.ca Cell: 306-526-8927

TransCanada sees need for rail shipping #kxl

20 Nov 2014
Calgary Herald
LAUREN KRUGEL
THE CANADIAN PRESS
TransCanada sees need for rail shipping
Chances are good TransCanada will get into the rail business regardless of whether its long- delayed Keystone XL pipeline is built, CEO Russ Girling said Wednesday.
But how big a rail player TransCanada becomes will depend on the fate of its proposed pipeline expansion and others, he said.
For several months, Calgary- based TransCanada has floated the idea of a “rail bridge” while its $ 8- billion US cross- border pipeline remains in regulatory limbo.
The company is in “active negotiations” with shippers about moving their crude by train, but there’s no timeline for when the plan will be a go, Girling told reporters following TransCanada’s annual investor conference in Toronto.
“I would say there’s a better than 50- 50 chance that we will be in that business in some form or fashion in the future and it will take us some time here to actually nail down the agreements to underpin those investments,” he said.
Though TransCanada touts pipelines as the safest and most efficient mode of transport, it sees a longterm role for rail for the energy industry.
“I think the marketplace has learned that it is flexible, it can be put in place relatively quickly, it doesn’t have the same regulatory hurdles as building pipe does,” Girling said.
“I think it plays a larger role in the future than it has in the past, and therefore it’s likely a business that we’re in long term, irrespective of Keystone.”
Girling’s remarks came a day after efforts to speed along Keystone XL’s approval were narrowly defeated in the U. S. Senate.
The U. S. regulatory process for Keystone XL has been dragging on for more than six years, amid court challenges, political wrangling and sustained opposition by environmental and landowner groups.
Supplies of Canadian crude are still crucial to U. S. energy security and will provide a boost to the North American economy, as shown by the loyalty of its customers, Girling said Wednesday.
“The marketplace need for Keystone has probably grown,” he said, pointing to more than four million barrels a day of crude that’s still being imported into the Gulf Coast. “Our 20- year shipper contracts remain in place. Not one of those shippers has given up their capacity.”
As TransCanada awaits a U. S. decision on the project, it’s keeping a giant pile of 36- inch diameter pipe stacked in a rail yard in Little Rock, Ark., and storing pumps and other equipment in warehouses along the route. TransCanada this month raised it cost estimate for Keystone XL to $ 8 billion from $ 5.4 billion.
The existing Keystone network has been shipping 591,000 barrels per day crude to the Midwest since 2010 and in January of this year began deliveries to the U. S. Gulf Coast.
Keystone XL would add a new segment of pipe cutting across Montana, South Dakota and Nebraska with a capacity of 830,000 barrels per day.
Though most of Keystone XL’s volumes would come from the oilsands, TransCanada is planning an “on ramp” in Montana that would carry up to 100,000 barrels per day of crude from the Bakken formation.
Meanwhile, TransCanada is plotting new pipelines that would tap into burgeoning U. S. shale oil deposits, said Paul Miller, the executive in charge of oil pipelines.
North American crude production is expected to grow 40 per cent to 14 million barrels per day by 2020 — between the oilsands, the U. S. Bakken formation centred in North Dakota and shale in Texas and Colorado.
“In the United States, there’s numerous shale plays that do require transportation solutions,” said Miller, adding TransCanada is eyeing expansions in Alberta’s oilsands region, too.
“Some of those have the opportunity to connect to our existing Keystone system and some of those would be independent of our existing Keystone system.”
Earlier Wednesday, TransCanada said it’s aiming to accelerate the growth of its dividend over the coming few years.
Girling told the investor conference the dividend is expected to grow by an average of at least eight per cent a year through 2017.
The company’s dividend has been growing at an annual rate of around 4.5 per cent in recent years.
Girling said the dividend growth could reach 10 per cent, depending on whether major projects — Keystone XL and major natural gas pipelines to West Coast LNG projects, for example — go ahead.
Earlier this week, an activist investor urged TransCanada to make changes to boost its share price.
Sandell Asset Management Corp. wants TransCanada to transfer more assets to its master limited partnership, TC Pipelines LP, and to spin off its power business. TransCanada has called Sandell’s analysis “fl awed” and said it’s sticking to its current strategy.

Flooding at Uralkali May Make PotashCorp Biggest Potash Producer #potash

Flooding at Uralkali May Make Potash Corp. Biggest Producer
By Yuliya Fedorinova
Nov 20, 2014 4:05 AM CT
Bloomberg
A flood at a Russian potash mine accounting for 3 percent of global supply threatens to force up fertilizer prices and make Potash Corp. (POT) of Saskatchewan Inc. the world’s largest producer again.
OAO Uralkali, Russia’s biggest potash miner, is monitoring the Solikamsk-2 mine about 1,000 miles (1,800 kilometers) east of Moscow after it halted operations and evacuated workers because of rising inflows of salty water into the site yesterday. Water can be deadly for potash mines because it dissolves the mineral deposits.
The situation may get worse after a sinkhole as wide as 40 meters (131 feet) was found 3.5 kilometers east of Solikamsk-2, suggesting a route for the water to find its way in, Uralkali said Nov. 18. The mine is separated by a concrete wall from another of the company’s operations, Solikamsk-1.
Uralkali became the largest potash producer in 2011, when it bought Russian competitor OAO Silvinit. Last year the producer broke a trading venture with Belarus, which has controlled 40 percent of global potash exports, leading to the drop in prices as the company started to run its mines near full capacity.
“Things don’t look good now,” Elena Sakhnova, an analyst at VTB Capital in Moscow, said by phone. “The sinkhole may signal that the mine will be flooded.”
Water inflows into Solikamsk-2 slowed to about 1,000 cubic meters per hour in the past day, one-sixth of the previous level, Kommersant reported today, citing chairman of Perm region government Gennady Tushnolobov.
Indicates Pessimism
If Uralkali loses both mines in Solikamsk, it may give up its spot as the largest potash maker to Potash Corp., which is expanding its mines in Canada, Sakhnova said.
The fact Uralkali also said that it may consider speeding up its new potash developments in the area indicates pessimism about Solikamsk’s future, ZAO Raiffeisenbank analyst Konstantin Yuminov said.
Should Solikamsk-1 be affected, Russia may face another problem. The mine is the main source of carnallite used in titanium production by OAO VSMPO-Avisma, a supplier to Boeing Co. VSMPO-Avisma plans to discuss alternative carnallite supplies, including from Israel, Vedomosti reported today, citing Chief Executive Officer Mikhail Voevodin.
Shares Slump
Uralkali’s shares plunged 21 percent in Moscow yesterday, the biggest drop in six years, cutting the company’s market value to about 379 billion rubles ($8.1 billion). The stock had rebounded by 5 percent to 135.50 rubles by 12:37 p.m.
Uralkali declined to comment for the story beyond the statements it’s already issued.
The two Solikamsk mines produce about 3 million metric tons a year, or about 5 percent of global output. Losing that would return the market to where it was before Uralkali broke its agreement with Belarus, analysts said.
North American potash producers, including Potash Corp., Agrium Inc. (AGU) and Mosaic Co. (MOS), will be main beneficiaries of any production loss by Uralkali and the crisis at Solikamsk may help in talks with China over the next year’s contract, Morgan Stanley said yesterday.
The price of the soil nutrient for China may rise to $340 per ton next year, up from $305 this year, Sakhnova said. The potash spot price in Brazil may climb to $400 per ton in the first quarter from $380 as the country buys the granular form of potash that Solikamsk-2 mostly produced, Yuminov said.
Rival Gains
Potash Corp. could gain about 1 million tons a year of sales while production from Solikamsk-2 mine is suspended, AltaCorp. analyst John Chu said yesterday.
The Canadian company plans to add 2.4 million tons of capacity next year, Morgan Stanley (MS) said yesterday. Its total capacity is 12.4 million tons a year, according to the company’s data.
Potash Corp.’s shares rose 1.5 percent yesterday after gaining 4.8 percent on Nov. 18 as Uralkali said it closed the mine.
Uralkali’s total capacity is about 13 million tons a year and the company plans to increase production to a range of 15 million to 19.5 million tons by 2020. The higher end was seen as achievable if the company decided to develop additional deposits in the Perm region, and expand a third mine at Solikamsk.
Uralkali lost a mine at Berezniki in Perm region eight years ago, after a sinkhole wider than 100 meters opened above the mine.
Should it happen again, the producer won’t be able to recover the output through new mines until 2018, VTB’s Sakhnova said.
All is not necessarily lost for Uralkali and there may be a chance the company can save the mines, Kirill Chuyko, BCS Financial Group’s head of equity research, said by phone.
Belaruskali managed to prevent its potash mine flooding in 2011, while Mosaic did the same in 2007.
To contact the reporter on this story: Yuliya Fedorinova in Moscow at yfedorinova@bloomberg.net
To contact the editors responsible for this story: Will Kennedy at wkennedy3@bloomberg.net Dylan Griffiths, Ana Monteiro

BHP Billiton upbeat on Olympic Dam plan and potash #potash #uranium

BHP Billiton upbeat on Olympic Dam plan
by: SARAH-JANE TASKER
From: Business Spectator
November 20, 2014 2:33PM
BHP Billiton’s plan to expand its massive Olympic Dam mine by using a heap-leach process is showing “promise”, according to chief Andrew Mackenzie, giving hope to South Australia more than two years after the world’s largest miner abandoned a $30 billion expansion at the mine.
Mr Mackenzie, speaking to shareholders at BHP’s (BHP) Australian annual meeting in Adelaide this morning, said that if the heap leaching trials under way at Olympic Dam proved successful, adding they were showing “promise”, then the miner would use the technology and phased expansions of the underground mine to further increase Olympic Dam’s output.
South Australia had been banking on the original $30bn expansion plan to underpin an economic surge and any hint of success with the new low-cost option would be closely watched.
Mr Mackenzie said that throughout the process the state and federal governments had been supportive and created an environment that was “highly conducive” to business investment.
The company also used the meeting to again outline its view on climate change, which comes just after the issue was widely discussed on the sidelines of the G20 after US President Barack Obama gave a speech on climate change during his visit to Australia for the economic forum.
Australia had resisted putting climate change on the G20 agenda, arguing it was an economic forum and there were other forums to discuss climate change.
BHP chairman Jac Nasser said today that climate change was a global challenge posing a significant risk to the environment and therefore social and “economic” development.
Mr Nasser said the miner’s business strategy depended on sustainable global growth, adding that it
was clear this would require substantial reductions in greenhouse gas emissions.
He said that would, in turn, change the structure of energy markets around the world.
He also again outlined that the world’s largest miner supported a price on carbon.
“But a carbon price alone will not be sufficient to drive the pace and scale of the global response required,” he said.
The chairman of the world’s largest miner also outlined the benefits of its planned $17 billion demerger of its non-core assets.
He said the company had
good progress in recent weeks and that the de-merger was on track.
“We have received a number of the more significant regulatory approvals, including from Australia’s foreign investment review board and the Australian Taxation Office and we are progressing well on those that remain outstanding,” he said.
On the demerger, Mr Nasser said that the company could reduce costs and improve the productivity of its remaining assets more quickly.
“This means we should generate stronger growth in free cash flow and a superior return on investment,” he said.
BHP expects to release all shareholder documentation with full details of the de-merger in March, with a shareholder vote scheduled for May.
Mr Nasser also talked up BHP’s potential fifth major commodity, potash, as driving food production through its use as a fertiliser.
Despite the end of the mining boom and urgent calls from the government and the Reserve Bank for other sectors to step up, Mr Nasser highlighted how important the resources industry remained to the Australian economy.
“The industry’s export earnings increased by 12 per cent to $US195 billion, representing more than half of Australia’s export earnings,” he said.
“There are very few industries in Australia that have world scale and are globally competitive. The resources industry is one of them; an industry that is ready to lead Australia’s prosperity for decades to come.”
BHP’s shares were 56c lower at $32.11 at 11:19am (AEDT) in trading on the Australian Securities Exchange.
The stock has fallen about 18 per cent since August.
With AAP

To deny Keystone XL is to deny free trade #kxl

To deny Keystone XL is to deny free trade

BARRIE McKENNA

OTTAWA — The Globe and Mail

Published Wednesday, Nov. 19 2014, 4:10 PM EST

Last updated Thursday, Nov. 20 2014, 5:17 AM EST

As the Keystone XL pipeline saga lurches toward a final showdown – a U.S. presidential veto or Congressional approval – it’s worth recalling what the original Canada-U.S. free-trade deal says about energy.

The essential bargain at the heart of the agreement is that oil should flow freely, except in times of scarcity and national emergency.

Very soon, probably early next year, we’ll find out if freedom has its limits.

The FTA’s energy chapter, later grafted on to the North American free-trade agreement, was among the most contentious parts of the whole deal. It was reached after intense bargaining and considerable nationalist angst, particularly in Canada.

Many Canadians worried the agreement would see trade in energy pivot north-south forever, with Alberta crude sold cheaply to Americans, leaving the rest of the country at the mercy of unpredictable global price gyrations.

Liberal leader John Turner fought (and lost) the 1988 federal election, warning that free trade in energy and other resources would “sell out the birthright of this nation” and turn Canada into a colony of the United States.

Canada instead took a leap of faith. Among other benefits, the country would be able to sell unlimited amounts of oil, to Americans or anyone else.

Derek Burney remembers well the essential energy bargain. As then-prime minister Brian Mulroney’s chief of staff, the long-time Canadian diplomat worked on the deal as the final trade-offs were made in 1987.

“The basic deal in the original FTA was that the U.S. wanted unfettered access to supply from Canada on a non-discriminatory basis, and Canada agreed,” recalled Mr. Burney, a director of TransCanada Pipelines Ltd., which is seeking to build the Keystone XL pipeline.

But it wasn’t a one-way street. Both countries harboured suspicions that the other side might try to meddle in the market, particularly when it came to oil.

The Americans didn’t want a repeat of Pierre Trudeau’s national energy program and other policies that might discriminate against U.S. interests in times of scarcity. So they negotiated strict limits on Ottawa’s ability to interfere in the market and limit exports, making another NEP impossible.

Canadians, in turn, worried the U.S. might block crude imports on national security grounds to protect domestic energy production and refining capacity – as it had done in the 1950s and 1960s. Ottawa secured strict limits on when national security could be used as a pretext to block energy trade. The list of exemptions includes armed conflicts, filling defence contracts and responding to nuclear threats.

“The whole point of open trade on the border for energy was, ‘you can’t restrict our imports and we can’t discriminate against your exports,’” added Mr. Burney, now an adviser at law firm Norton Rose. “That’s the equation. You can’t put a tax at the border, you can’t have a separate price for domestic consumers – all that stuff that would be contrary to an open border.”

There is no war in the homeland. And, clearly, scarcity isn’t a problem.

North America is producing oil and gas in abundance – from Canada’s oil sands and from vast shale deposits. The U.S. is on a course to energy independence, but it isn’t there yet, and experts say it will continue to need foreign oil for some time yet, from Canada or somewhere else.

The rationale is wearing thin for U.S. President Barack Obama to continue blocking Keystone, which is designed to transport Canadian and U.S. crude to refineries on the Gulf Coast. He can’t easily make the case that it’s about climate change. The U.S. State department has already determined that the project would not significantly increase greenhouse gas emissions.

A Nebraska court is expected to issue a verdict shortly on the route of the pipeline through that state, removing one of the last pretexts for further delays.

More recently, Mr. Obama tossed a new objection into the debate, suggesting that Canada is merely using the U.S. as a conduit to pump its oil “through our land” to foreign markets, with scant benefits for Americans. It’s a claim that is misleading, if not flat out wrong.

If Mr. Obama rejects Keystone, Ottawa should dust off NAFTA, file a formal trade challenge and demand the free trade in energy that the deal was supposed to deliver.

Follow BARRIE McKENNA on Twitter: @barriemckenna

FORTUNE MINERALS PROVIDES CORPORATE UPDATE AND ANNOUNCES THIRD QUARTER FINANCIAL RESULTS

November 18, 2014
NEWS RELEASE
FORTUNE MINERALS PROVIDES CORPORATE UPDATE AND ANNOUNCES THIRD QUARTER FINANCIAL RESULTS
Building a diversified producer in a challenging resource market
LONDON, ONTARIO, Fortune Minerals Limited (TSX: FT) (OTCQX: FTMDF) (“Fortune” or the “Company”) (www.fortuneminerals.com) is pleased to provide an update of its Revenue Silver Mine operations and progress towards building a diversified producer with the development of its organic growth assets. The Company also reports that its consolidated financial statements and Management Discussion and Analysis for the period ended September 30, 2014 have been filed and are available on the SEDAR (www.sedar.com) and Company’s websites.
“Mining is a cyclical business,” commented Robin Goad, Fortune’s President and CEO, “Despite very challenging capital markets for the resource sector, we have demonstrated our ability to grow both internally and through acquisitions. We successfully transformed Fortune Minerals into a producer with the purchase of the Revenue Silver Mine, financing this acquisition through an innovative US$ 35 million production prepay facility with Lascaux Resource Capital. We have also been able to advance our Arctos and NICO projects through joint venture and corporate investments of approximately CDN$ 41 million with strategic partnerships. We are well positioned for growth from our diversified assets when confidence returns to the capital markets for our sector.”
Building the next diversified producer
Fortune has established a platform for growth through development and acquisitions in mining friendly jurisdictions in North America. The Company’s work force has been expanded to approximately 180 employees with experience in acquiring, financing, developing and operating mines.
Fortune owns a portfolio of diversified mining assets that includes a 100% interest in the high-grade underground Revenue Silver Mine (“Revenue”) in southwest Colorado, U.S.A. that is ramping up to a planned 400 short ton per day production rate. Fortune also has two advanced development stage organic growth assets to contribute to the development of a diversified North American mining company. The NICO Gold-Cobalt-Bismuth-Copper Project has received its environmental assessment approval and key permits to construct a mine and concentrator in Canada’s Northwest Territories (“NT”) and its environmental assessment approval for the proposed refinery in Saskatchewan where it will process NICO concentrate to high value products. The Arctos Anthracite Metallurgical Coal Project in British Columbia, a joint venture with South Korean steel producer POSCO, is in the permitting process to construct a mine and railway extension to supply premium anthracite coal to the global steel and metals processing industries. With more than CDN$ 250 million dollars invested in developing its principal assets, Fortune is positioned to become a reliable North American producer of commodities critical to a growing world economy.
Revenue Silver Mine
Continuing with the ramp up to 400 short tons per day
Fortune completed the acquisition of a 100% interest in the Revenue Silver Mine in southwest Colorado on October 1, 2014 after acquiring an initial interest in May at which time it also became the Operator. Revenue is a historical producer of approximately 15 million ounces of silver in the prolific Sneffels Silver Mining District. The mine was reopened in 2013 and is the largest employer in Ouray County.
The Revenue mine produces silver (approximately 80% of revenues) and by-product gold, lead and zinc from high-grade, narrow epithermal veins that are mined using underground shrinkage methods. Mine production is then trammed in electric train sets to an underground mill and flotation concentrator that produces silver- and gold-bearing lead and zinc concentrates that are sold to smelters, and a gravity gold concentrate that will be sold to a refinery.
Since taking operational control of Revenue in May, Fortune has made significant investments to improve mine safety and approximately US$ 5 million is being spent to establish operations. The mine and safety leadership has been changed and structures put in place to improve safety awareness. The main haulage tunnels and access raises have also been systematically scaled, screened and re-bolted to improve ground conditions. In addition, track and ties have been upgraded and improvements made to the mine ventilation system. A new ventilation shaft is also being installed from the main haulage level to surface to improve air volume and quality while providing a secondary exit at the back of the mine. This shaft, expected to be completed by the end of November, will also serve as an ore pass to provide access to high-grade mineralized material located in surface stockpiles located outside of the historical entrance to the mine at higher elevations. Fortune is also driving a decline ramp from the Revenue Tunnel level to access lower levels of the Virginius Vein where there are stopes containing high-grade mineralized material that was not removed for processing during test mining in the 1980’s. The ramp will also provide access to high-grade stopes in Fortune’s new mine plans. Bottlenecks identified in the mill during commissioning are being corrected with equipment modifications and automation, including installation of higher capacity pumps, screens, replacing spargers in the column flotation cells, and improving ore handling on conveyors and ore bins. A thickener is also being installed to improve tailings filtering capacity and efficiency. Surface facilities include a new mine air heater and structures to improve tailings management.
Fortune is pleased with the progress being made at the Revenue Silver Mine. The focus on Safety and Improvements has positioned the operation to achieve the planned production rates. Four concentrate shipments have already been delivered to a smelter for processing. Fortune’s goal is to have the Revenue Mine operating at 300 short tons per day by the end of November and is targeting 400 short tons per day by year-end. In order to reflect the reality of lower commodity prices, the mine plan is also being adjusted to focus production from the higher grade Virginius Vein.
NICO Gold-Cobalt-Bismuth-Copper Project
Shovel ready mine positioned to supply the rapidly expanding rechargeable battery market
The NICO project is a vertically integrated project consisting of a proposed mine and concentrator in the NT and refinery in Saskatchewan to produce gold, cobalt sulphate, bismuth metals and chemicals, and copper cement. NICO was discovered by Fortune in 1996 and has had more than CDN$ 110 million of expenditures to date to delineate the deposit, conduct test mining, and complete pilot plant processing, engineering and feasibility studies to verify project economics. Environmental assessment approvals and the principal permits have been received to construct the mine and mill, and the refinery in Saskatchewan has also received its environmental assessment approval. Negotiations are ongoing with the Tlicho Government for an impact benefit agreement that will create employment and business opportunities for the life of the NICO Project.
The feasibility study for NICO by Micon International Limited shows an attractive rate of return from the development with average annual production of approximately 41,360 ounces of gold, 1,615 metric tonnes of cobalt contained in sulphate, 1,750 metric tonnes of bismuth contained in ingots, needles and oxide and 265 metric tonnes of copper in cement (see Technical Report filed on SEDAR and Fortune news release, dated April 2, 2014). NICO is uniquely positioned to be a reliable Canadian-based supplier of cobalt and bismuth products with cost advantages under the North American Free Trade Agreement (NAFTA) as well as trading relationships with the European Union. With 61% of primary cobalt mine supply coming from the politically unstable Democratic Republic of the Congo and 42% of refinery production sourced from China, NICO will be strategically positioned to be a reliable vertically integrated North American supplier of cobalt chemicals to service the rapidly expanding rechargeable battery industry. With 12% of global bismuth reserves, NICO will also be an important new supplier of bismuth ingots, needles and oxide to diversify a market where 80% of supply is currently sourced in China. Bismuth has unique applications in the automotive, pharmaceutical, aerospace, electronics and plumbing industries and is experiencing significant demand growth as a non-toxic and environmentally safe replacement for lead in products now being impacted by legislation and policies banning or restricting the use of lead.
In 2013, Procon Resources Inc. made a strategic CDN$ 11.7 million investment in Fortune to help advance NICO towards development and proposed arrangement of project financing. As Fortune continues discussions with potential partners and its banks it is also actively pursuing alternative solutions and off-take agreements to help finance the project. The Company is also waiting for the Government of the Northwest Territories (“GNWT”) to provide a schedule for the all-weather road planned to the community of Whati, which Fortune would use to construct a spur to the mine. The GNWT has applied for an increase to its borrowing limits from the federal government in order to allow it to make investments in infrastructure that will support both the community and future resource development, including roads and power.
Arctos Anthracite Coal Project
World Class anthracite metallurgical coal project in the Environmental Assessment process
Arctos is one of the world’s premier metallurgical coal projects with very large resources and reserves of high rank anthracite coal located in northwest British Columbia. The project is an international collaboration between Fortune (80%) and POSCAN (20%), the Canadian subsidiary of South Korea’s POSCO, a leading global steel producer. Substantial work totaling more than CDN$ 110 million has already been invested in the project by Fortune, POSCAN and the previous owner of the project to delineate the resources and conduct engineering, feasibility and environmental studies. Additionally, a large bulk sample was collected for pilot plant processing to produce 100,000 metric tonnes of finished coal products for trial cargoes to potential customers in North America, Asia and Europe. Arctos is currently in the British Columbia environmental assessment process. The feasibility study for the Arctos project by Marston & Marston Inc., a division of Golder Associates Limited, indicates an attractive rate of return for the development (see Technical Report filed on SEDAR and Fortune news release, dated October 15, 2013).
The Company’s environmental field programs at the Arctos Project were disrupted by protestors and special interest groups in 2013 and the Company agreed to a request from the British Columbia Government to withdraw from the area to allow it to negotiate the Klappan Strategic Initiative with the Tahltan First Nation. The Company had intended to return to the field in 2014 to complete the work required for the environmental assessment and applied to the government for the requisite permits. Regrettably, the British Columbia Government unilaterally imposed a hold on issuing new permits until after December 1, 2014 after it had assured the Company that such permits would be issued after the Tahltan elections in July. The Arctos joint venture has therefore refocused work on optimization studies to improve project economics, while also conducting stakeholder engagement and low impact environmental monitoring required for the environmental assessment process. Fortune has also continued work to identify opportunities to attract additional strategic partners for Arctos with the aim of achieving a fully financed and permitted project for development.
Summary
With more than CDN$ 250 million invested in advancing its principal assets to date Fortune is building the next diversified mining company with a production profile of precious, base and specialty metals and premium coal. With concerns about the concentration of supply for some of these commodities, Fortune is well positioned to grow as a reliable North American producer with significant resources and reserves required by a growing world economy.
The disclosure of scientific and technical information contained in this press release has been approved by Robin Goad, M.Sc., P.Geo., President and Chief Executive Officer of Fortune Minerals Limited, who is a “Qualified Person” under National Instrument 43-101.
About Fortune Minerals:
Fortune is a diversified North American mining and development company that owns and operates the Revenue Silver Mine in Colorado. The Company is developing the vertically integrated NICO gold-cobalt-bismuth-copper project that is comprised of a proposed mine and mill in Canada’s Northwest Territories (“NT”) that will produce a bulk concentrate for shipment to a refinery in Saskatchewan for processing to high value metal and chemical products. Fortune is also developing the Arctos anthracite metallurgical coal project in British Columbia and owns the Sue-Dianne copper-silver-gold deposit and other exploration projects in the NT. Fortune is focused on outstanding performance and growth of shareholder value through assembly and development of high quality mineral resource projects.
Fortune Minerals Limited
Robin Goad, President, or
Troy Nazarewicz, Investor Relations Manager
Tel.: (519) 858-8188
Renmark Financial Communications
Barbara Komorowski: bkomorowski@renmarkfinancial.com , or
Montreal Tel: (514) 939-3989, Toronto Tel. (416) 644-2020
This press release contains forward-looking information and forward-looking statements within the meaning of applicable securities legislation. This forward-looking information includes statements with respect to, among other things, the planned ramp-up of Revenue to achieve a 400 short ton per day production rate; the anticipated completion of mine improvements at Revenue; the proposed development of the NICO project, including construction of a mine and concentrator thereat and estimated production therefrom and the development of the Arctos project including construction of a mine thereat and a railway extension thereto. Forward-looking information is based on the opinions and estimates of management as well as certain assumptions at the date the information is given (including, in respect of the forward-looking information contained in this press release, assumptions regarding the Company’s ability to complete improvements at Revenue in a timely manner, and to complete the development of the NICO and Arctos projects as anticipated and in a timely manner). However, such forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. These factors include the inherent risks involved in the exploration and development of mineral properties, unexpected technical delays and associated timing delays in the ramp-up of
Revenue and associated production of silver and other metals; the risk that the Company may not be able to arrange the necessary financing to complete the NICO and Arctos projects; the risk that operating and/or capital costs may be materially higher than anticipated; the risk of decreases in the prices of relevant commodities; potential loss of key personnel; potential discrepancies between actual and estimated production; potential labour shortages; the risk of mining accidents; the risk of changes in applicable laws or regulations; uncertainties with respect to the timing and receipt of all necessary permits; and other factors. In addition, the risk factors described or referred to in Fortune’s Annual Information Form for the year ended December 31, 2013, which is available on the SEDAR website, should be reviewed in conjunction with the information contained in this news release. Readers are cautioned to not place undue reliance on forward-looking information because it is possible that predictions, forecasts, projections and other forms of forward-looking information will not be achieved by the Company. The forward-looking information contained herein is made as of the date hereof and the Company assumes no responsibility to update or revise it to reflect new events or circumstances, except as required by law.

Canada’s Extractive Sector Strategy well received, expected to fuel prosperity of sector

Canada’s Extractive Sector Strategy well received, expected to fuel prosperity of sector
19th November 2014
By: Tracy Hancock
JOHANNESBURG (miningweekly.com) – The Canadian government has an important role to play in supporting both the global competitiveness of the Canadian mineral industry and its ability to contribute to the sustainable development of the societies in which it operates, said Prospectors & Developers Association of Canada (PDAC) president Rod Thomas on Tuesday.
The organisation has welcomed Canada’s commitment to assist the mineral exploration and mining industry to succeed abroad, noting that measures to support the sector were included in the updated Corporate Social Responsibility (CSR) Strategy for the Canadian International Extractive Sector that was released on November 7, as well as the Extractive Sector Strategy on Tuesday in Ottawa by Minister of International Trade Ed Fast and Minister of Natural Resources Greg Rickford.
The Ministers made the announcement at the Mining Association of Canada’s annual Mining Day on the Hill luncheon.
The Extractive Sector Strategy builds on Canada’s plan for responsible resource Development, ensuring that mining and energy continued to represent an engine of economic growth and prosperity for Canadians.
“Our government recognises the importance of the mining industry to Canadian jobs and long-term economic prosperity. We’re working aggressively to attract investment and open new markets. Once again, we are demonstrating our commitment to creating the conditions that enhance Canada’s competitive position as a global mining leader, ” said Rickford.
Fast added that the Canadian government was proud of its leadership and excellence on responsible resource development and the Extractive Sector Strategy ensured the country’s “world-class extractive sector will continue to thrive”.
The Extractive Sector Strategy consists of four pillars, namely, to secure access to markets for Canadian extractive-sector companies, promote Canadian companies abroad, support CSR and enhance the awareness of the importance of the extractive sector to Canadians.
Key elements of the Extractive Sector Strategy include leveraging trade and investment agreements to provide the certainty and the predictability necessary for Canadian businesses to invest and operate abroad; transforming business opportunities into business successes through economic diplomacy and on-the-ground support; advocating for improved governance and regulatory frameworks abroad and sharing best practices; and increasing training in missions abroad to support the extractive sector, complemented by embedded resources in Canada in extractive sector associations and expanding stakeholder linkages to ensure the government is responsive to the needs of the extractive sector, including developing yearly market access plans for priority markets.
In addition to Tuesday’s announcement, the Canadian government was laying the groundwork to ensure the long-term success of Canada’s mining and oil and gas sectors by keeping taxes low, eliminating red tape and modernising the regulatory regime for major projects. The government was also investing in public geoscience programmes such as the Geo-Mapping for Energy and Minerals and the Targeted Geoscience Initiative to secure the long-term prosperity of mining communities and industry by ensuring informed land-use and resource investment decisions.
“PDAC supports the steps taken to promote responsible mineral development, along with the efforts that provide additional stability for our members operating abroad, such as the development of Foreign Investment Promotion and Protection Agreements with foreign countries,” said Thomas.
“Canada is home to a world-class mineral exploration and mining industry,” noted Thomas. “It is important for Canadians to understand the enormous contribution the industry makes in their daily lives, from employing geologists, lawyers and accountants to providing the raw materials used in our smartphones.”
Canada’s CSR Strategy for the Extractive Sector was launched in 2009 and underwent a five-year review in 2013. The PDAC supported efforts to enhance the capacity of the Trade Commissioner Service to support responsible exploration and mining abroad, and highlighted that trade commissioners were valuable sources of intelligence that could help companies establish positive relationships with all project-affected stakeholders. The PDAC also strongly supported Canada’s work to build up the capacity of developing countries to manage their resources responsibly.
“Many Canadian mineral exploration and mining companies are recognised as world leaders in CSR practices,” Thomas pointed out, adding that the PDAC was pleased to see the Canadian government recognise the guidance the industry had developed, including PDAC’s e3Plus.
He said the PDAC looked forward to continuing to work with the government of Canada to promote a responsible and competitive Canadian extractive sector.
The Mining Association of Canada (MAC) also commended the federal government on the announcement of the new Extractive Sector Strategy, which it said complemented the CSR Strategy.
“Taken together, these two strategies send a welcome signal that Canada supports and promotes a strong and vibrant Canadian mining sector both at home and abroad. The government of Canada is also setting a high bar for corporate responsibility performance, which our members embrace,” noted MAC president and CEO Pierre Gratton.
He added that Prime Minister Stephen Harper’s government had negotiated and concluded free trade and foreign investment protection agreements at an unprecedented rate over the past eight years, positioning Canada’s globally-leading mining sector for success.  “The new strategy will add distinction to Canada’s mining brand and should send a clear signal to other mining countries to take note.”
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