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Friday, January 15, 2010
Today's News Headlines
* Barrick sues New Gold over El Morro - Chile
* Miners restart protests to demand promised aid after restructuring - Venezuela
* Junior roundup: Everton, Linear Gold, Lithium One, Kootenay, Galway, Excellon - Regional
* National mining company launches operations - Ecuador
* Norsemont: Pampacancha drill results support resource expansion at Constancia - Peru
* Mining exports rise to US$1.7bn in November on better prices - Peru
* Xtierra reports favorable metallurgical tests linked to Bilbao feasibility - Mexico
* National mine output to hit 5.73Mt this year - Cochilco - Chile
* Antofagasta Minerals options up to 65% of copper project in US - Chile
* Arias reiterate decision, will not approve any new open pit mining concessions - Costa Rica
* IN BRIEF Mining minister issues equipment to small miners - Chile
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* Barrick sues New Gold over El Morro - Chile
Barrick Gold (NYSE: ABX) has filed a lawsuit against New Gold (TSX, NYSE: NGD) for exercising its right of first refusal on the El Morro gold project in Chile, according to a statement by New Gold.
In October Barrick made an agreement with Xstrata (LSE: XTA) to acquire the latter's 70% in the project for US$465mn, a deal that depended on New Gold not exercising its right of first refusal.
However, this month Goldcorp (NYSE: GG) made a deal with New Gold in which it agreed to pay US$463mn for the company to exercise the right and then transfer the 70% to Goldcorp, thus obstructing Barrick's plans to gain control of the stake.
"New Gold is unaware of any fact or circumstance that would support any of the allegations being made by Barrick and believes that the claim is completely without merit," read the company's statement issued Thursday. "New Gold intends to defend this action using all available legal avenues."
New Gold also owns the other 30% of the project.
Located in Chile's northern region III, El Morro has 8.3Moz of gold and 6.3Mlb (2.86Mt) of copper in measured and indicated resources.
By Business News Americas staff reporters
* Miners restart protests to demand promised aid after restructuring - Venezuela
Former informal miners that accepted a mining restructuring plan being promoted by the Venezuelan government have restarted protests to demand the government pay funding promised to aid displaced workers.
"This time the protest will go on until we get a response from the government," a miners' spokesperson told BNamericas.
The miners held a similar protest in December, but received no response from the government.
The restructuring measure is designed to cut down on informal mining in the zone and eliminate concessions on the Caroní river basin and the Sierra Imataca area in order to protect water resources.
The program stipulates that miners who stop informal mining will receive loans to start up agricultural activities.
By Harvey Beltrán
Business News Americas
* Junior roundup: Everton, Linear Gold, Lithium One, Kootenay, Galway, Excellon - Regional
Ottawa-based Everton Resources (TSX-V: EVR) reported that recent drilling with partner Linear Gold (TSX: LRR) at the Lechosa prospect of their Ampliación Pueblo Viejo property in the Dominican Republic returned 15m grading 1.27% copper, 14m of 1.23g/t gold and 22m of 83.7g/t silver in separate holes.
The phase 2 drilling was carried out in November-December and covered 761m in nine holes. Phase 3 drill work is to begin immediately, Everton said in a statement.
***
Vancouverite Lithium One (TSX-V: LI) reported initial results from ongoing sampling at the Sal de Vida lithium brine project in Argentina. Average values from 35 samples were 794mg/l (679ppm) lithium, 9,054mg/l (0.77%) potassium and 1,284mg/l magnesium, the company said in a statement.
Lithium One also reported the start of drilling that aims to test the depth and brine content of the project area, which covers 300km2 of the Hombre Muerto salt flat.
***
Step out drilling at Vancouver-based Kootenay Gold's (TSX-V: KTN) Promontorio project in Mexico yielded 3.0m grading 551g/t silver, 0.63g/t gold and 20% lead-zinc at the Ranch EM anomaly, the company said in a statement.
The current step out drill program has covered 4,274m in 13 holes on four prospect areas, Promontorio main pit zone, Ranch EM anomaly, Dorotea and Dorotea Northwest, Kootenay said.
A newly completed 43-101 technical report update recommends that future exploration focus on resource definition and assessing economics at the main pit zone, infill drilling at Dorotea and continued exploration drilling on extensions where mineralization has been shown.
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Torontonian Galway Resources (TSX-V: GWY) reported surface channel and chip sampling at its California gold properties in Colombia has returned 28m of 16.6g/t, 34m of 3.8g/t and 16m of 4.5g/t at the Pie de Gallo area.
Sampling at other parts of the property also showed gold mineralization, including 36m of 2.6g/t. An initial hole has been drilled at Pie de Gallo with results expected in two weeks.
***
Toronto-based Excellon Resources (TSX: EXN) has unveiled assays for 13 holes at its Platosa property in Mexico, 10 of which continued the delineation of the 623 Manto identified in July 2009 and indicated it may extend further southeast.
Results included 1.15m grading 3,300g/t silver, 11.8% lead and 0.13% zinc, as well as 1.77m grading 1,470g/t silver, 4.9% lead and 7.3% zinc. The other three holes were drilled at the southwest corner of the NE-1 Manto and extended known mineralization there, including 1.45m of 602g/t silver, 5.27% lead and 14.1% zinc.
Drilling in 2010 will focus on the 623 Manto, areas near the Platosa mine and at the La Zorra area to the west.
By Business News Americas staff reporters
* National mining company launches operations - Ecuador
Ecuadorian president Rafael Correa has signed a presidential decree officially creating the national mining company or Empresa Nacional Minera (ENAMI EP), which will work towards two fundamental goals, the non-renewable natural resources ministry (MRNNR) said in a statement.
The first goal is to work on social environmental issues with small and artisan miners to help them develop sustainable businesses, deputy mining minister Carolina Bernal was cited as saying in the statement.
The second is to work with large-scale miners in developing major mining projects, both alone and alongside other mining companies.
ENAMI EP's general objective, however, is to manage non-renewable natural resources that are affected by mining in order to ensure they are used in a sustainable way and be present in all stages of mining activity to protect the environment and enforce respect for community rights.
The national mining company was created as public corporation with legal status, its own capital, and economic and admistrative autonomy.
By Business News Americas staff reporters
* Norsemont: Pampacancha drill results support resource expansion at Constancia - Peru
Drill results from the Pampacancha South prospect at Canadian Norsemont Mining's (TSX, Lima: NOM) Constancia project in Peru have shown 71.3m grading 1.61% copper equivalent, including 30m at 2.50%, the company reported.
Pampacancha South sits 3km southeast of the Constancia deposit. "These latest drill results take us a further step towards our vision to increase Constancia's global resource from its current 440Mt to more than 800Mt," said Norsemont president and COO Robert Baxter.
"Further drilling is planned to define and quantify a Cu-Au-Ag-Mo resource," Baxter added.
The results are the first from the current drill program at Pampacancha, which was discovered in September 2008. Additional holes yielded copper equivalent values of 1.10% over 49.3m, 0.93% over 28.4m and 0.92% over 20.5m.
Drilling is also underway at the Uchuicarco discovery 3.2km northwest of the Constancia deposit and will be followed by drilling at Yanaccacca 500m north of Constancia.
Norsemont also reported it has received authorization for drilling at the Chiloroya South discovery 5km south of Constancia from Peru's energy and mines ministry, and "significant" drilling is planned for the immediate future.
The Constancia feasibility study from September 2009 shows capital costs of US$846mn to build an open-pit mine and sulfide concentrator with nominal processing capacity of 50,000t/d. Output would be 149Mlb/y (67,675t) copper over 15 years, plus some gold, silver and molybdenum.
By Business News Americas staff reporters
* Mining exports rise to US$1.7bn in November on better prices - Peru
Peru's mining industry exported US$1.72bn worth of metals and minerals in November 2009, rising 48.7% from US$1.16bn year-on-year, according to the latest figures from the country's central bank.
Two of Peru's main products, copper and gold, saw the total value of exports rise despite lower volumes shipped, thanks to higher prices.
The red metal brought in US$707mn in November compared to US$459mn year-on-year, while physical sales abroad dipped to 112,700t from 126,500t as average prices soared to US$2.846/lb from US$1.647/lb. The entire metals complex saw values sink drastically in late 2008 as a result of the global economic crisis.
Gold exports brought in US$587mn in the eleventh month of 2009, rising from US$411mn as volumes slipped to 520,400oz from 539,400oz.
Meanwhile, Peruvian zinc exports totaled 148,700t worth US$178mn in November, up from 134,700t worth US$71.8mn. Lead pulled in US$144m from the sale of 68,000t, up from US$48.8mn and 33,700t, the central bank figures show.
Exports of fine silver from Peru plummeted to just 0.4Moz in November 2009 from 3.2Moz year-on-year, taking revenue down to US$6.4mn from US$32.0mn.
Iron ore export income fell to US$27.7mn from US$39.8mn, though shipments inched up to 0.7Mt from 0.6Mt. Peru also sent abroad US$12.9mn worth of non-metallic minerals, down from US$15.6mn.
Mining products account for more than 60% of Peru's export revenue.
By Business News Americas staff reporters
* Xtierra reports favorable metallurgical tests linked to Bilbao feasibility - Mexico
Toronto-based Xtierra (TSX-V: XAG) has completed oxide metallurgical test work related to a feasibility study on its Bilbao silver-lead-zinc-copper project in Mexico's Zacatecas state, the company said in a statement.
"The oxide test results are extremely positive and indicate that we have a practical and economic solution to the processing and recovery for the oxide resources which represent approximately 40% of the total resource potential at Bilbao," said CEO Terence McKillen.
He added: "More importantly, it allows us to focus on open pit mining methods for the initial development of Bilbao, including all of the oxide and transition resources with the potential of extracting a significant portion of the sulfide resources before underground development."
The tests recovered 61.2% zinc, 41.0% lead, 66.7% silver, 71.0% copper and 55.0% gold, the company said.
Xtierra started the feasibility study in April 2009.
Bilbao has an NI 43-101 compliant 3.6Mt indicated resource with average grades of 3.53% zinc, 2.75% lead, 0.29% copper and 88.23g/t silver and 2.38Mt of inferred resources averaging 2.52% zinc, 2.79% lead, 0.28% copper and 83.08g/t silver, according to the company.
By Business News Americas staff reporters
* National mine output to hit 5.73Mt this year - Cochilco - Chile
Chile's copper mine production is expected to rise to 5.73Mt this year from 5.34Mt in 2009 and in 2011 will reach 5.89Mt, according to the quarterly market research report by the country's state copper commission Cochilco.
Global mine output is expected to increase to 16.8Mt this year from 15.8Mt in 2009 and will reach 17.6Mt in 2011.
Peru, the world's second largest copper producer behind Chile, will fall from 1.23Mt last year to 1.21Mt in 2010 but rise to 1.22Mt next year, according to Cochilco.
The US, the third largest producer, will drop from 1.21Mt in 2009 to 1.17Mt this year but rise to 1.21Mt again in 2011.
China, the fourth largest, put out 1.06Mt in 2009 and will produce 1.13Mt this year and 1.22Mt in 2011, the report says.
By Business News Americas staff reporters
* Antofagasta Minerals options up to 65% of copper project in US - Chile
Chilean copper producer Antofagasta Minerals has signed an agreement to earn up to 65% in Duluth Metals' (TSX: DM) Nakomis copper-nickel project in the US state of Minnesota, the former reported in a statement.
Antofagasta agreed to invest US$130mn in the project over three years to earn 40%. If the company completes an economically viable feasibility study it can earn 25% more.
"This transaction is in line with our strategy to seek and acquire high quality mineral resources in order to improve our growth outlook in the long term," Antofagasta CEO Marcelo Awad said.
Nakomis has 274Mt grading 0.6% in inferred copper resources and also has nickel, platinum, palladium and gold.
Antofagasta Minerals is owned by London-based Antofagasta plc (LSE: ANTO), which in turn is controlled by Chile's Luksic group.
By Business News Americas staff reporters
* Arias reiterate decision, will not approve any new open pit mining concessions - Costa Rica
Costa Rican President Oscar Arias has reiterated that no new open-pit mining concessions have been approved during his presidency and none will be.
"I have not and I will not award any new open-pit mining permits," Arias told local press in a public statement.
The president said that he would not be granting new permits "since this is an issue that personally concerns me and, as I have said many times, Costa Rica's future must be green, or there will be no future at all."
CRUCITAS
Arias explained that the renewal of the concession for the Crucitas gold project, which is owned by Canadian company Infinito Gold (http://) (TSX-V: IG), does not mean that he or his government support open-pit mining as a way of doing sustainable business in Costa Rica.
"I want to make very clear that neither I or my government approved the Crucitas concession. The concession is a right that an international company acquired many years ago which we inherited upon coming into power," Arias said.
Activity has been at a standstill at Crucitas since October 21, 2008 due to a challenge from individuals in Costa Rica, which is allowed under the country's constitution despite the February 2008 approval of the project EIS. The company had begun tree clearing work just five days prior to the suspension.
Crucitas has an indicated resource of 1.2Mt grading 1.32g/t gold and in 2008 a bankable feasibility study outlined US$66mn capex for output of 85,000oz/y.
By Business News Americas staff reporters
* IN BRIEF Mining minister issues equipment to small miners - Chile
Chile's mining minister Santiago González has issued equipment to small-scale miners in the country's northern region III as aid, according to a statement by the ministry.
The ministry said it spent roughly US$20,000 on the equipment.
By Business News Americas staff reporters
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In-deph interview
* "We'll have a number of projects on the go in Latin America in 2010"
Robert Quartermain (part I)
CEO
Silver Standard
Argentina, Chile, Mexico, Peru
http://www.bnamericas.com/interviews/mining/Robert_Quartermain_,part_I,_,Silver_Standard,/170073064
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Main companies covered in today's news
* Hochschild Mining PLC
http://www.bnamericas.com/company-profile/en/Hochschild_Mining_PLC-Hochschild/170073064
* Antares Minerals Inc.
http://www.bnamericas.com/company-profile/en/Antares_Minerals_Inc,-Antares/170073064
* Ventana Gold Corp.
http://www.bnamericas.com/company-profile/en/Ventana_Gold_Corp,-Ventana_Gold/170073064
* Quaterra Resources Inc.
http://www.bnamericas.com/company-profile/en/Quaterra_Resources_Inc,-Quaterra/170073064
* Xstrata PLC
http://www.bnamericas.com/company-profile/en/Xstrata_PLC-Xstrata/170073064
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