Posts from — January 2008

Christopher Lind, a theologian at some Toronto University writes a try-to-feel-good attack on mining entitled Mining Companies Challenged by Demands of Ecojustice.  Because he attacks without substance, I feel it fair to counter with vigour.  The good Anglican starts by asking a perfectly reasonable question: 

Is social justice compatible with environmental justice? If social justice requires economic expansion and environmental justice requires industrial regulation, aren’t these two concerns moving in the opposite direction?  

Sadly he does not answer his question, or even begin to analyse the issues involved in this obvious conflict.  Instead he takes a few low pitches, routine mumblings really, at oil prices, cyanide, tailings in lakes, Canadian mines doing bad things in South America, and then in a crescendo of irrelevance concludes:

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Now it is Vale blustering through the banking landscape to take over Xstrata.  $150 billion here or there is peanuts in these stories.  That is the number in one new story.  Another story talks of $70 billion.  Another of $35 billion.  I suppose in these matters ten to a hundred billion is indeed peanuts.

The devil lies in the details of the billions, as this quote notes:

Analysts say Vale could fund about $35bn to $50bn of an offer price from bank loans without putting its investment grade in jeopardy. That would mean persuading Xstrata’s shareholders to accept a large amount of the purchase price in Vale’s so-called ”preferential” shares, which are more liquid but have fewer rights than its ordinary shares. Vale is said to be unwilling to offer ordinary shares as this would weaken its grip on control.

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Cambridge House International Inc. filled the halls at the 2008 Vancouver Resource Investment Conference today.  They advertise only 300 seats available, but I bet there were at least that many seated and that many more standing to hear the presentations and wondering around the halls of exploration companies. 

The demographics of those attending ranged from the grizzly, gray bearded prospector to the little old lady with white hair who asked tough questions of the pin-strip-suited geologists claiming to be able to make her money with their new mine.  I was intrigued by the sight of a young couple:  hand-in-hand and in-love, they wondered around picking up company brochures.   Now if only the mining industry could attract more young investors like that–imagine what could be done.

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From the Costa Rica Tico Times comes a long article on the human impact of the closure of the Glencairn Bellavista mine as a result of the downhill sliding of the heap leach pad. 

As told in the Tico Time we learn of the joys of a mine bringing money and employment to the locals, only to have the mine shut down a year or two later.  We learn of folk who foretold the fiasco the mine has become.  We learn that the Costa Rican government has four to ten million dollars of the mine’s equipment locked up as a sort of security to fix the situation.  It takes no great insight to predict that it will cost a lot more than that to restore the site to some sort of acceptable condition–it is clearly geomorphically unstable, and topographic change is inevitable. 

The story as told superbly by reporter,  Dave Sherwood,  presents a challenge to all professors of Sustainable Mining: in short, explain this one in theoretical terms.  The story presents a challenge to those who seek to hold Canadian mining companies operating in foreign countries to the same standards as mines in Canada; in short, to which Toronto court would you now drag the newly named company, Central Sun Mining (formerly Glencairn.) And it presents a challenge to investors: are you prepared to put more money behind Peter Tagliamonte as he seeks to open a new mine in Nicaragua. 

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Real estate investment advice on a mining-related blog? 

Indeed.  The best advice is at this link, from which I copy the picture above.  Seems you can get great second property bargains in the old mining towns of the West that are now being clean up.  Kellogg, Idaho is the latest opportunity.

I can attest to the financial wisdom on buying near contaminated sites being cleaned up.  Many years ago I bought a house in Huntington Beach, California in an area surrounded by old oil rigs and oil-contaminated soil.  My up-scale friends sniffed up their noses at my folly in buying in a grungy place.

The company I was about to go to work for assured me the area was slated for cleanup.  They were right.  For a few years there were piles of soil being aerated and bioremediated.  Now there are million dollar homes, Lincoln Navigators, and trophy wives dragging little blond kids to expensive toy stores.  A far cry from the old Buicks and gray-haired ladies with walking sticks we used to dodge as the drove erratically down the road.  Obviously my house value quadrupled; there is only so much land within half a mile of the beach.

So, if you seek good second home investment opportunities follow the trail of contaminated mines, Superfund sites, and EPA action.  Good luck and good investing. 

Sweeney Todd is modern grand opera.  It won Golden Globe Best Actor and Best Picture in the category musical comedy.  It is neither a musical nor a comedy.  It is grand opera.   The little old couple behind me who came expecting warbling tones and frilly dancing left in disgust.  I revelled in every note and nuance.  Forget the genius approbation on some blogs–this is the essence of opera: music, emotion, story, and spectacle. 

I know they dare not market the movie as modern opera, for that would be the kiss, or should we say cut, of death.  Who wants to see a move opera on a week night?  So they create the illusion of a dramatic musical comedy.   Afterall we all love musical comedies, don’t we?

This foray into the divide between movie/opera marketing and reality is prompted by reflections on the divide between marketing and reality that in mining is called variously a press release, a feasibility study, or an Annual Report. 

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Yesterday I mused on the White House decision to veto mine safety legislation. Today a news release from the Industrial Minerals Association - North America hit my desk.  They say they are disappointed at the passage of the S-Miner Act by the U.S. House of Representatives which passed today by a vote of 214 to 199.  I replicate below why they say they are disappointed:

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A friend sent me this.  I post it in respect.  For once I am speechless.  I do not know where it originates, whom it shows, or even if it is serious, or cynical, or comical.  Help!