March Newsletter – 12.03.19
Behre Dolbear hosted a PDAC breakfast event on Monday, March 4th at the InterContinental Toronto Centre Hotel. Our delicious buffet was attended by over 70 invited clients, friends of the firm and subcontractors. Behre Dolbear has been hosting similar events at PDAC since 2008. It was an excellent opportunity for all to meet and fuel up, and for the firm to thank clients and colleagues.
This year”s PDAC Convention Centre that was attended by more than 25,000 mining and minerals professionals from more than 120 nations. Our group of friends all enjoyed time together before setting out to the convention and two more full days of meetings and PDAC related activities.
Thank you all for joining us and best to all we did not see. We hope to see you next year! Best wishes to all in 2019 from the Behre Dolbear Group.
Billionaires Are On the Hunt for New Underground Cobalt
- Breakthrough Energy, Andreessen Horowitz back Kobold Metals
- Startup is using big data to explore for the key battery meta
A coalition of billionaires led by Bill Gates has thrown its financial weight behind a startup hoping to build a “Google Maps for the earth’s crust” to hunt for new sources of cobalt.
The startup, Kobold Metals, is using data-crunching algorithms to scour the globe for cobalt, in a bet that there may still be significant undiscovered sources of the metal that has become one of the world’s hot commodities thanks to its use in electric vehicle batteries.
The company has raised money from Silicon Valley venture capital firm Andreessen Horowitz and Breakthrough Energy Ventures, a fund backed by Gates and a dozen other tycoons including Jeff Bezos, Ray Dalio and Michael Bloomberg, owner of Bloomberg LP, the parent company of Bloomberg News.
Kobold Metals is betting it will be able to find new sources of the metal using what it calls “machine prospecting.” The company is building a database of geological data that it then feeds into an algorithm, hunting for signals that indicate the likelihood of increased concentration of cobalt.
“What we’re building is basically Google Maps for the earth’s crust and below,” said Connie Chan, partner at Andreessen Horowitz.
Megamerger Push Has Gold Miners Eyeing New Dance Partners
- Moves by biggest miners to get bigger could have domino effect
- PE firms raising ‘billions’ to help producers diversify assets
A push by the world’s biggest gold miners to get even bigger will likely have a knock-on effect among their competitors, adding new vigor to an industry that failed to inspire investor support in 2018.
The megamerger mania now under way for Newmont Mining Corp., Barrick Gold Corp. and Goldcorp Inc. is likely to result in some of their assets being sold, helping to diversify portfolios for other miners and boosting the interest of investors. More importantly, it could force mid-tier companies to team up in order to successfully compete.
“This is a competitive marketplace in terms of attracting capital, and you have to make a decision at some point,” Michael Siperco, an analyst at Macquarie Capital Markets, said in a telephone interview. “Yamana, Kinross, Iamgold — what’s the strategy here in terms of not getting absolutely left behind?”
KCGM celebrates International Woman’s Day with a blast!
For those who couldn’t make it to the Super Pit for today’s pink blast in honour of International Women’s Day, here’s how it looked from above! #IDW2019 #BalanceforBetter #WomenInMining #WomensDay
For those who couldn't make it to the Super Pit for today's pink blast in honour of International Women's Day, here's how it looked from above! #IDW2019 #BalanceforBetter #WomenInMining #WomensDay pic.twitter.com/hbwhP9BJKP
— KCGM (@KCGMSuperpit) March 8, 2019
LEGAL AND REGULATORY
Canada, NWT governments invest in Slave Geological Province access
The Government of Canada, this week, announced it would invest C$5.1 million ($3.8 million) in two projects to support resource development in the Slave Geological Province (SGP) of the Northwest Territories (NWT).
Paul Lefebvre, Parliamentary Secretary to the Minister of Natural Resources, on behalf of Navdeep Bains, Minister of Innovation, Science and Economic Development and Minister responsible for CanNor, was joined by Wally Schumann, GNWT Minister of Infrastructure and Industry, Tourism and Investment, to make the announcement this week during the Prospectors and Developers Association of Canada annual convention, in Toronto.
Funding will go towards the planning of an all-season access corridor into the SGP as well as aerial geophysical surveys of the region, the government said. “The surveys will lead to the development of mapping products used by mineral exploration companies to target their activity,” it added.
Bains said: “Knowing where mineral deposits exist and being able to access them is the first step in attracting investment and growing the resource development sector. We know that similar projects in NWT in the past have led to significant economic development activity. These projects are building on that success.
“The Government of Canada is committed to the creation of more good jobs, more economic growth and long-term sustainable development in the North.”
CanNor is investing C$2.7 million in a two-year SGP access corridor project, with a further C$678,000 investment from the Government of the Northwest Territories Department of Infrastructure. Total funding for this project is almost C$3.4 million.
Oil’s big reset: Energy majors learn to thrive after price crash
When OPEC started an oil-price war in late 2014, most people believed U.S. shale was doomed. In reality, the giant oil majors suffered most — burdened by expensive mega-projects, Chevron Corp., BP Plc and the rest struggled to adapt to the fall in energy prices.
Slowly, those companies figured out how to survive in the lower-for-longer price era. They cut costs and, more importantly, learned how to stop them from rising again. In an industry that favored tailored solutions for every project, companies started to talk about standardization. At closed-door sessions in Davos, Switzerland, Big Oil bosses didn’t waste time on self-important talk, but instead discussed how to share the design of anything from underwater valves to pumps.
Nearly five years after the crash, the cultural change is starting to work. The world’s major energy companies have managed to press the reset button, allowing them to make profits today similar to what they did in a world of $100-plus a barrel oil prices.
“Big Oil has been able to re-emerge from this downturn stronger and lower on the cost curve,” said Michele Della Vigna, the top oil industry analyst at Goldman Sachs Group Inc., who had been a critic of the majors.
The level of spending at the world’s eight largest integrated oil and gas companies fell last year to $118 billion, down 45 percent from a pre-crisis peak of $215 billion in 2013, according to data compiled by Bloomberg News.
INNOVATION AND TECHNOLOGY
SGS pairs portable instrumentation and machine learning with FAST
SGS has announced a new service for the metals and mining industry, Field Analytical Services and Testing (FAST), in North America and Australia.
FAST provides real-time data acquisition in the field by pairing portable instrumentation and machine learning, according to the company, which used the backdrop of the annual Prospectors and Developers Association of Canada show, in Toronto, Canada, to make the announcement. “It will bring instrumentation into the field, provide data within 24 to 48 hours and, with the use of machine-learning, enable real-time decision-making capabilities for clients,” the company said.
Part of the solution includes Minalyze AB’s Minalyzer ED-XRF core scanning technology, according to the company.
Russ Calow, Vice President Global Analytical Services, Minerals at SGS in Canada, said: “This service offering will allow our clients to optimise their exploration programmes and production procedures, while making rapid decisions that support quicker speed-to-market.
“SGS is committed to providing analytical procedures that yield meaningful, reliable data – while integrating our in-house, industry leading machine-learning capabilities to give innovative, field based solutions to our clients.”
Rio Tinto’s new bauxite mine completed early, under budget
PERTH (miningweekly.com) – Diversified major Rio Tinto has completed the commissioning of its A$2.6-billion Amrun bauxite mine, in the Cape York Peninsula.
“Amrun was completed early and under budget, demonstrating Rio Tinto’s productivity and innovation capabilities. By applying fresh thinking we also delivered safety, environmental, cost and timing benefits,” said Rio CEO Jean-Sebastian Jacques.
The mine and associated processing and port facilities will replace production from Rio’s depleting East Weipa mine and increase bauxite export capacity by around ten-million tonnes a year, at a time when higher-grade bauxite is becoming scarcer globally.
Amrun’s first shipment was made in December 2018, six weeks ahead of schedule, and at full production, the mine will have capacity of 22.8-million tonnes a year, with options to expand.
Nemaska Lithium : reviewing strategic alternatives
Nemaska Lithiums (TSX: NMX) board of directors has appointed a special committee to review all strategic alternatives, after the company disclosed this month that it has been forced to revise the budget for the Whabouchi lithium mine and Shawinigan electrochemical plant up by C$375 million.
Nemaska, which has received funding from the Quebec provincial and Canadian federal governments, is building the Whabouchi hard rock lithium mine in the James Bay region and Shawinigan processing plant north of Montreal, aiming to put Canada on the global lithium production map.
The special committee is comprised of independent members of the corporations board of directors, the company said in a statement.