THE LEADER VOLUME 12 • NUMBER 4
Founder and Publisher John Chadwick B. Sc. Min Eng Email: john @ im-mining. com
Editor Paul Moore B. Sc( Hons), M. Sc. Email: paul @ im-mining. com
Editorial Board Professor Malcolm Scoble Robert E. Hallbauer Chair in Mining Engineering., University of BC, Vancouver
Peter Knights Professor and Head of Division of Mining
Stephen Stone West One Management Perth, Western Australia
Dr. Andrew M. Robertson President, Robertson GeoConsultants Vancouver, Canada.
Ed McCord Project Consultant Caterpillar Global Mining, USA
Jason Nitz Fleet Management & Dispatch Superintendent Newmont Mining Corporation, USA
Dr Terry Mudder Managing Director, TIMES Ltd, USA
Simon Tarbutt Consultant, Santiago, Chile
Dr. Mike Daniel Comminution Process Consultant CMD Consulting Pty Ltd
Editorial Enquiries: Tel: + 44( 0) 1442 870 829 Fax + 44( 0) 1442 870 617
Advertising Sales: Phil Playle Email: phil @ im-mining. com + 44 1442 87 77 77
Advertising Production Lynne Lane Email: lynne @ im-mining. com
Design & Production Trevor Sheldon Email: sheldonmann @ gmail. com
Circulation Enquiries circulation @ im-mining. com
Website: www. im-mining. com
Annual Subscription Enquiries: Emma Smith Email: emma @ im-mining. com
Annual Subscription UK and Europe £ 160, € 230 Rest of the world US $ 270
International Mining( ISSN No: 1747-146X) is published monthly by Team Publishing Ltd, GBR and is distributed in the USA by Asendia USA, 17B South Middlesex Avenue, Monroe NJ 08831 and additional mailing offices. Periodicals postage paid at New Brunswick NJ. POSTMASTER: send address changes to International Mining, 17B South Middlesex Avenue, Monroe NJ 08831
Printed by The Manson Group, St Albans © Team Publishing Ltd 2017
ISSN 1747-146X
IM uses, as preference, SI units throughout, so, for example, all tonnes are metric unless otherwise stated. All dollars are US unless otherwise stated
SME Annual Conference leads the up turn in North America
Following close on the heels of the Mining Indaba, reported on last month, this year’ s SME Annual Conference confirmed the air of optimism in the industry. Most now seem convinced the industry is climbing out of its long depression. And, as reported by SNL Metals, financing for mineral exploration almost doubled in 2016, compared to the level of 2015, from $ 4.5 billion to $ 8 billion – another good sign.
In his excellent keynote address to the conference, Doug Silver of Orion Mine Finance noted how the major mining companies had had to reset following their massive losses. They had to protect their balance sheets. When credit ratings drop, certain large investors are required to sell their shares and if share prices decline, computerised trading kicks in and take them lower. As share prices collapse, other institutions sell off to cut their losses and all this leads to a negative downward cycle.
As a result they have had to sell assets to raise cash and reduce staff, cut capital spending and cut discretionary spending, i. e. exploration.
Silver explained that institutional Investors do not return until the majors demonstrate that they know how to run a business. And revival of the junior sector lags the return of the majors.
Considering what is driving the next cycle, he considers that developing new mines will continue to become more difficult with declining ore grades reducing productivity. Also a majority of new assets are located in challenging geopolitical jurisdictions. Exacerbating the difficulties, staff retiring will lead to a skills gap in building new mines and exploration.
Underinvestment in mine projects today will extend the next up-cycle. New mineral discoveries are going to be critical to maintaining supply. Mining costs will continue to rise faster than inflation. However, he noted“ what a great time [ it is ] to build mines!” n US $ is up. Cushioning the revenue line in foreign mines n Oil prices, labour costs and steel costs down n Long-lead items readily available n Based on historical trends we are closer to market bottom than top n Share prices typically go up when mines are commissioned or expanded, or new mineral discoveries are made n Investors are beginning to rotate back into mining equities.“ Every day we wait, we get closer to the markets improving.”
It was interesting during the conference to consider the industry’ s public image at this stage in the cycle. Congratulations to SME for organising the Move Mining competition during which five finalist teams presented their ideas for getting the message of the importance of mining across to the public. I was honoured to be one of the five judges.
Although they did not win, the Wasatch Wonders( University of Utah and Utah Valley University) opened the presentations and set the scene very well with a video of students being asked to name things that are mined – those students struggled and pretty much failed! The excellent Wasatch Wonders ideas – We dig it, you live it! – begin with social media,“ we want to reach out to millennials and then long term, invest in an educational outreach plan to facilitate a continuing influence in how society views mining.”
The equally excellent winners of the $ 5,000 investment in their idea, was Team Attwood. The concept includes“ developing a refined version of the Minecraft game that includes a bit more of the realities of mining such as exploration, more realistic geology, milling and refining, energy sourcing and environmental stewardship.
“ Elementary and middle school aged children should be taught about the realities and benefits of mining in a fun and engaging way.”
Leveraging Minecraft they aim“ to increase young students understanding of the necessity and benefits of mining. This same approach could be used to engage older students as well.”
The statistics of Minecraft, which has won various awards and accolades, are staggering. As of June 2016, reported Team Attwood,“ over 106 million copies had been sold across all platforms, with more than 40 million unique players each month, making it the best‐selling PC game to date and the second best‐selling video game of all time. At any given moment nearly 1 million people around the world are playing Minecraft.” In 2014, Microsoft bought the Minecraft intellectual property for $ 2.5 billion.
The Minecraft convention Minecon regularly breaks attendance records for attendees at a computer game meeting. According to Wikipedia Minecon 2016 was held in Anaheim, California, at the Anaheim Convention Centre in September 2016.“ Tickets to the event were $ 160 per person, and toddlers aged three and under were admitted free. The Minecraft team received another award, as they sold 12,000 tickets, which sold out within seconds of going on sale.”
All power to Team Attwood for trying to tap into this. It’ s certainly worth the industry getting behind it.
The other finalists were all so good and have been reported in more detail elsewhere http:// immining. com / 2017 / 03 / 03 / move-mining-mined /.
John Chadwick Founder john @ im-mining. com
APRIL 2017 | International Mining 3