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About 100 workers evacuated from Rio Tinto’s Bingham Canyon Mine

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About 100 workers evacuated from Rio Tinto’s Bingham Canyon Mine

An estimated 100 employees and contractors were evacuated from Rio Tinto’s (LON, ASX: RIO) Bingham Canyon copper mine in Utah, US, on Wednesday evening after the site was affected for a small landslide, the second this year in the same area.

Mine operator Kennecott Utah Copper said removing employees from the mine’s lower pit and halting operations for the night were only precautionary measures. The company added this time the slide wouldn’t affect production, reported the Salt Lake Tribune.

An excavator operator spotted the material shift —about 120 cm— and raised the alarm, while monitoring equipment registered the activity.

The copper mine was affected by a major land slide in April after a pit-wall collapse inside Bingham Canyon, considered by some experts to be North America's largest human-cause slide in history.

Rio Tinto's Kennecott Utah Copper unit, located in the Bingham Canyon operation, in southwest Salt Lake County, has been producing copper and other minerals since 1906.

At six-tenths of a mile deep and 2.5 miles wide, Bingham Canyon is one of the world’s largest existing open-pit mining operations. It produced about 163,000 metric tons of refined metal in 2012 plus 279,000 ounces of gold and 9,400 tons of molybdenum.

But due to the earlier landslide Kennecott estimates its 2013 production will drop by half.

Image tweeted by Rio Tinto showing the material shift.

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Alberta most attractive mining destination in Canada, third worldwide

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Alberta most attractive mining destination in Canada, third worldwide

Oil sands development in Northern Alberta, Canada.

For the second consecutive year, the Canadian province of Alberta —home to the booming and controversial oil sands industry— ranked first in the country and third worldwide as the most attractive jurisdiction for mining investors in the Fraser Institute’s annual global survey of mining executives.

The study, released Monday as the Prospectors and Developers Association of Canada (PDAC) convention held in Toronto kicks off, is based on input from 690 mineral exploration and development company executives.

Sweden and Finland scored the top places in this year’s survey, which spotlighted 112 jurisdictions worldwide. Kyrgyzstan and Venezuela were named the worst two countries to venture.

“Miners praise Alberta for its transparent and productive approach to mining policy. The province offers competitive taxation regimes, sound legal systems, and relatively low uncertainty around land claims. That’s what miners look for,” said Kenneth Green, Fraser Institute senior director of energy and natural resources.

Other two Canadian jurisdictions —New Brunswick (7), and Newfoundland and Labrador (9)—ranked in the top 10 worldwide, followed by Saskatchewan (12), Yukon (19), Quebec (21), Manitoba (26), Ontario (28), Nova Scotia (29), British Columbia (32), Nunavut (44), and The Northwest Territories (47).

Quebec, once the darling of mining investors, continued to fall down the rabbit hole. From 2007 to 2009, the French-speaking district topped the survey, then dropped to 5th in 2011, 11th in 2012 and finally 21st worldwide in 2013, due in part to amendments to Quebec’s Mining Act and recent tax policy changes.

“If Quebec wants to renew confidence in the global mining sector, it should reduce red tape, minimize the risk associated with policy changes and tax increases, and respect negotiated contracts,” Green said.

B.C. dropped to 32nd from 31st in 2012, though the survey recorded improved perceptions regarding the Western province’s political stability and availability of labour and skills.

The Canadian public policy think-tank also identified the 10 places mining enthusiasts should avoid. From the bottom, they are Kyrgyzstan, Venezuela, Philippines, Argentina (La Rioja and Mendoza), Angola, Zimbabwe, Ivory Coast, Indonesia and Madagascar.

Image by Christopher Kolaczan.

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America's first oil sands producer and other natural resources surprises: Peter Epstein

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The natural resources space has been difficult in recent years. Potash prices collapsed, uranium spot prices hit a nine-year low, the gas market was in glut. Only oil has stayed strong. But Peter Epstein of MockingJay Inc. has found some gems in the resource rubble, and foresees better times ahead. In this interview, Epstein tells The Energy Report who stands to capture the graphite market, how to catch the next wave in potash, and offers his thoughts on when investors might catch a break in the uranium market.

The Energy Report: Why are you excited about the oil and gas space right now?

Peter Epstein: Oil and gas is unique in that it hasn't budged when so many commodities have fallen precipitously in price. Coking coal prices, for example, are at multiyear lows. The iron ore price has fallen below $100/metric ton. The uranium spot price has fallen to a nine-year low. But oil prices have held in the $90–100/barrel ($90–100/bbl) range on West Texas Intermediate crude for three or four years, steady and strong. Natural gas prices collapsed in 2012 but have come back fairly strong, only recently giving back a bit of the gains. That's why I like oil and gas. It's a strong commodity. Even with all this talk about a slowdown in China, which causes lots of commodities to fall, oil and gas sticks in there.

TER: Oil, gas and mining industries are tarred with the same brush by environmental advocates, who describe them as dirty, polluting and environmentally destructive. Can these industries be made attractive to investors who put a premium on environmental considerations?

PE: Companies are learning the hard way that they have to have a social license to operate, as well as address the increasingly long list of permitting and environmental hurdles. Extractive industries that are dirty and polluting have to clean up their acts. But this is not a new problem; it's been going on for years—or even decades—depending on the jurisdiction.

Another negative impact for such companies is the longer time frame to production, created by a myriad of factors above and beyond environmental considerations. A longer time frame means more difficulty funding projects, and therefore a lower net present value. Project hurdle rates have to rise to account for the higher risks and longer time frames. This means that industry-wide cost curve increases and commodity prices have to rise in response. Margins will be squeezed somewhat, even if companies enjoy higher commodity prices in the long term.

TER: What do companies have to sacrifice to achieve environmental goals?

PE: Companies have to give up profits to meet these new realities. But companies that approach dirty and polluting industries in innovative ways, frequently with the use of technological advances, will be rewarded.

For example, American Sands Energy Corp. (AMSE:OTCBB) is trying to become one of the first U.S. companies to extract bitumen from oil sands. Located in Utah, the company proposes an entirely new approach—In fact, without this new approach, there's no chance that American Sands Energy could operate in the U.S. The company uses a proprietary solvent to separate the bitumen from the sand, but no water is used in the process. In arid eastern Utah, this is an extremely important factor. No water is required because the oil sands deposits in Utah are entirely different from those in Alberta, Canada. In Canada, the oil sands are a mixture of water, sand and bitumen. In Utah, the deposits only contain bitumen and sand—no water. American Sands Energy is a perfect example of a company that could be a winner by mitigating environmental factors.

"Companies that approach dirty and polluting industries in innovative ways, with the use of technological advances, will be rewarded."

Or take a company like Graphite One Resources Inc. (GPH:TSX.V), which has a project in Alaska. Everyone's heard about Tesla Motors Inc.'s (TSLA:NASDAQ) gigafactory, which will produce a large number of batteries for electric vehicles. Around the time of Tesla's big announcement in February, an outcry by certain groups contended that a large quantity of currently sourced graphite comes from dirty, polluting mines in China. This played a role in Tesla's announcing it would source the key materials for its batteries from North America. And Graphite One is one of only two U.S. graphite plays.

Graphite One has a massive graphite resource, of which a significantly sized portion can be mined at surface. The company plans to infill the mined areas to fully reclaim the disturbed areas. Graphite One is definitely worth watching. In fact, it is unique among graphite companies in that it has the opportunity to apply for a loan through a state of Alaska program. Alaska is mining-friendly, and will help ensure that prudent environmental standards are followed.

TER: Is there another graphite company that you like?

PE: Big North Graphite Corp. (NRT:TSX.V) is rehabilitating an existing, formerly operating facility in Mexico. I mention this as an example of something environmentalists like: a new company that comes in, starts up production, provides jobs and, more importantly, cleans up the whole mess when it's done. Right now, the mine is just an eyesore. It's damaged earth. Big North Graphite is going to reclaim the site in the end.

TER: What other companies are you excited about?

PE: Aroway Energy Inc. (ARW:TSX.V; ARWJF:OTCQX) has a heavy oil property in Saskatchewan, a light oil property in central Alberta and owns land in the Kerrobert area of west-central Saskatchewan. This story fascinates me because the company is 4–6 weeks away from drilling its Kerrobert area. Back in April, this stock was trading at CA$0.28, today it's at about CA$0.25. Yet the company is three months closer to potentially finding a blockbuster field. Located just 5–6 miles away, a private company called Caltex Resources Ltd. is producing a reported cumulative 4,000 barrels/day from dozens of wells. If Aroway hits in late August, the stock could double or triple in subsequent months.

TER: When uranium's price stalled around $35/pound ($35/lb), everyone bet it was about to rise again, because it couldn't go any lower. Then it stalled again, at about $28.50/lb. What will make uranium mining profitable and attractive again?

PE: For the first time since April, the spot price has a $3 handle on it, with Ux Consulting quoting it at $30/lb on Aug. 11. It appears that spot uranium may have bottomed at about $28/lb. If the spot price rebounds to even just $35/lb, that could be bullish for the sentiment of uranium juniors.

Let me point out that the spot price is not the same as the long-term price that most utilities contract at. Make no mistake, $28.50/lb was a nine-year low and a depressed price. Most uranium mines around the world can't do business at $28.50/lb—or at $35/lb. Many analysts believe the price at which new greenfield projects would get the green light is $60–75/lb. That might sound high, but in the months leading up to the terrible Fukushima disaster in March 2011, the long-term uranium price was steady at around $70/lb.

Globally, the cost per pound to produce uranium has not gone down over the past three years. All mining costs are generally increasing because of the factors we've discussed: permitting costs and time frames, environmental concerns, etc. The market needs a higher uranium price, and we will see a higher uranium price. It's a question of when, not if. Many pundits point to the restart of some Japanese reactors, all of which are currently offline. I agree that this will be a positive sentiment booster, but that alone will not be enough to move uranium prices by all that much, in my opinion.

"The market needs a higher uranium price, and we will see a higher uranium price. It's a question of when, not if."

Instead of focusing on Japan, the market should be watching China and India, both of which only generate 2–3% of their electricity from nuclear power. That has to change—and it will. Given their severe air pollution problems, the Chinese are going to build new reactors as fast as they can. They will also continue ramping up hydropower, wind, solar—you name it. But nuclear power generation in China is going to be a larger part of a growing pie. China is sitting on $2–3 trillion ($2–3T) in U.S. Treasuries, and it will happily buy hard assets in the form of uranium or uranium enrichment facilities. The Chinese are very active, up to a state-owned entity level, in terms of building nuclear power stations.

Some analysts point to in-situ recovery operations as potentially profitable. These have low costs and can be profitable at a uranium price of, say, $40–45/lb. But the size of these projects is typically too small to move the needle globally.

Finally, I would point out that utilities have not been contracting for long-term supplies of uranium since they feel no urgency to do so. That will have to change. Utilities can't wait until 2017 to contract 2018–2023 uranium supplies. As soon as next year, utilities will be back in the market and the long-term price of $45/lb will rise.

As a commodity that's hit a nine-year low, uranium is out of favor. A lot of the uranium stocks are oversold. But I think there are opportunities in small names.

TER: Some projections for nuclear power plant construction in China suggest that even with as much construction as it wants to do, the country still won't exceed 10% of its total power needs. Is that going to greatly increase uranium demand?

PE: China expects to start building something like six new reactors every year for the next five years, and that's going to keep ramping up. If your question is how long will it take to get 10% of its electricity from nuclear power, it could take 10–15 years. China thinks long term, and has a lot of U.S. dollars that it would like to transform into hard assets. And it's not just the Chinese who are actively going after uranium and nuclear power. It's Russia as well, and India.

By the way, both China and India are very active in building hydroelectric dams. But that kind of construction gets an unbelievable amount of scrutiny in terms of the environment, and the fact that tens or hundreds of thousands of people must be moved out of villages to build these dams. Hydroelectric development in China and India may come to a quicker end than people realize. Then, of course, you have coal. The World Bank, the International Monetary Fund, the U.S. and some other major international bodies are saying they're not going to fund Third World coal power plants anymore. Those factors all lead to more nuclear power development.

TER: Is there another company you'd like to mention?

PE: CBD Energy Ltd. (NASDAQ:CBDE) is interesting because, in addition to being a solar stock, the company also works with wind and energy management systems. It has over 17,000 (17K) installations, mostly in Australia, and is moving into the U.S. In Australia, 15% of homes have solar. In the U.S., it's estimated that 1% have solar. Even though it's extremely competitive in the U.S. for companies installing rooftop solar panels, the penetration of solar on rooftops of individual homes is still quite low.

CBD Energy is well funded. It has a strong management team and a long track record. In fact, it has licensed the "Westinghouse Solar" trademark to tell people who it is. It's a real brand name.

The exciting part of the story is that solar companies can trade at 10–30x revenues. But it's a very competitive, crowded space, and it's hard to tell if those kinds of multiples are fair, or if it's a bubble. In the case of CBD, however, you have a geographically diversified, fast-growing, small company that's trading at a 1x multiple of 2015 revenue.

TER: The potash space was shaken up in the last year by the collapse of the cartel in Russia. How is that affecting the potash space in North America today?

PE: Potash is a generic term that refers to a group of potassium-bearing minerals, naturally occurring potassium salts and the products produced from those salts. Potash is a plant's main source of potassium, and is used in fertilizers. For muriate of potash (MOP), prices collapsed after that event. It took a couple of months, but the potash price fell from more than $400/metric ton down to about $300/metric ton. Prices differ around the world, so I'm using a benchmark price that a lot of people refer to.

"The oil and gas space is unique in that it hasn't budged when so many commodities have fallen precipitously in price."

MOP is widely used in all types of farming, but it contains a chloride ion that can be detrimental to plant growth, especially fruits and vegetables. Sulfate of potash (SOP) is different. SOP improves yield, quality, taste and shelf life. These attributes are valuable to farmers, so SOP trades at a premium price to MOP.

SOP prices barely moved at all. It's almost like they're two different products. SOP is a specialty product with one-tenth the market of MOP. A third-party study commissioned by Potash Ridge Corp. (PRK:TSX; POTRF:OTCQX) suggests that demand for SOP would be 2–3 times greater if existing users could ensure security of supply, and if new users were introduced to SOP versus MOP. The premium of SOP over MOP has moved quite a bit because SOP prices were virtually unchanged during the Russian cartel turmoil, while MOP prices fell 25%.

You can make SOP, but you need MOP as a feedstock to start with. If you have to start with MOP and spend money to process it, the margin is not going to be that strong. Since it is an expensive process, not many companies do it. That's why the MOP market is 50M metric tons/year, and the SOP market is about 5 million tons.

Potash Ridge's Blawn Mountain project in Utah, on the other hand, will produce SOP by directly extracting it from mineral ores. By starting with SOP, which few companies in the pipeline have the ability to do, Potash Ridge has the competitive advantage of being able to offer a lower SOP price. The company has other advantages as well: It has a near-surface resource, and it's on state land, not on federal land, so there's no interaction with the U.S. Bureau of Land Management.

For MOP, in Saskatchewan alone, there's a huge amount of production. Plus, a number of juniors and both BHP Billiton Ltd. (BHP:NYSE; BHPLF:OTCPK) and Rio Tinto Plc (RIO:NYSE; RIO:ASX; RIO:LSE; RTPPF:OTCPK) have projects they could bring online.

TER: You have an extremely diverse portfolio of companies that you follow. Can you offer some advice for investors looking to build that kind of a portfolio for themselves?

PE: Investors in natural resources have not been happy campers for the last two or three years. I think it's important to stick with companies that have cash on their balance sheets. Stick to companies already in your portfolio, even if they're down 60–70%, with good management teams that are 100% committed to the company, not management teams involved with five different companies at once. And watch out for the cash burn of companies. You want the cash burn to be minimal, so that your companies can live to fight another day.

TER: Peter, I appreciate your time and your insights.

In 2011, CFA Peter Epstein left his senior analyst position at a $3B hedge fund and formed MockingJay Inc., a consultancy for companies in the natural resources space and an informal investment adviser to high-net-worth investors, family offices and funds. The company's mission is to increase awareness of select natural resource companies. Epstein's areas of expertise include uranium, coal, potash, gold and oil & gas. He has published hundreds of articles on investment sites such as Seeking Alpha, The Motley Fool and Au-Wire.com.

Want to read more Energy Report interviews like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see recent interviews with industry analysts and commentators, visit our Streetwise Interviews page.

DISCLOSURE:
1) Tom Armistead conducted this interview for Streetwise Reports LLC, publisher of The Gold Report, The Energy Report, The Life Sciences Report and The Mining Report, and provides services to Streetwise Reports as an independent contractor. He owns, or his family owns, shares of the following companies mentioned in this interview: None.
2) The following companies mentioned in the interview are sponsors of Streetwise Reports: Aroway Energy Inc., Uranerz Energy Corp. Streetwise Reports does not accept stock in exchange for its services.
3) Peter Epstein: I own, or my family owns, shares of the following companies mentioned in this interview: American Sands Energy Corp., Potash Ridge Corp., CBD Energy Ltd., Big North Graphite Corp., Aroway Energy Inc., Graphite One Resources Inc. I personally am, or my family is, paid by the following companies mentioned in this interview: None. My company has a financial relationship with the following companies mentioned in this interview: American Sands Energy Corp. I was not paid by Streetwise Reports for participating in this interview. Comments and opinions expressed are my own comments and opinions. I had the opportunity to review the interview for accuracy as of the date of the interview and am responsible for the content of the interview.
4) Interviews are edited for clarity. Streetwise Reports does not make editorial comments or change experts' statements without their consent.
5) The interview does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer.
6) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their families are prohibited from making purchases and/or sales of those securities in the open market or otherwise during the up-to-four-week interval from the time of the interview until after it publishes.

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PHOTOS: Bingham Canyon rebuilds after landslide

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MINING.com tours Rio Tinto Kennecott's Bingham Canyon mine 18 months after the largest non-volcanic landslide in history

PHOTOS: Bingham Canyon rebuilds after landslide

Source: Deseret News



Bingham Canyon, 30 miles south of Salt Lake City, Utah has been mined since 1906. The mine has produced more copper than any mine in history – more than 19 million tonnes. At peak production represents 25% of total US copper production. World number two miner Rio Tinto bought Kennecott in 1989 and has invested more than $2 billion in modernizing the mine and another $450 million to clean up historic workings and ground water. This picture from the Library of Congress dates back to November 1942.


Bingham Canyon: Moving a mountain - twice

Today what was a mountain 108 years ago is a pit more than than three-quarters of a mile deep (that's more than 200 stories high) and more than two and three-quarter miles wide across the top. The elevation of the mine drops from 8,040 feet to 4,390 feet above sea level. If you stretched out all the roads in the open-pit mine — some 500 miles of roadway — you’d have enough distance to reach from Salt Lake City to Denver.


On April 10, 2013 at 11:00 in the morning all employees are evacuated from the bottom of the pit after ground probes and radar monitoring equipment detect slope deformation increasing from 1mm a day to 5mm day. At 9:30 that same evening a slide along a geotechnical fault-line of the mine's northeastern wall occurs followed by another 90 minutes later. An astonishing 160 million tonnes of material is moved by the avalanche with the rock moving at estimated speeds of 70 – 100 miles per hour. It's the largest "man-made" landslide ever recorded.


The haul truck maintenance building (think more aircraft hanger than work shop) is sliced nearly in half by the slide, the pit access road disappears and 13-haul trucks are buried. The bottom of the pit is covered in debris nearly 200 feet deep. The two slides cause the equivalent of magnitude 5.1 and 4.9 'quakes' and results in 16 smaller 'aftershocks'.



Haul truck drivers ride about 18 feet above the ground thanks to 12.5 feet tires (that don't last more than nine months and cost upwards of $20,000). The trucks are about the same size as a two-story townhouse. This image of that same truck work shop in 2010 is by Rawhead Rex.



Crews were back on the site three days after the slide to remove waste rock. Six millions tonnes of dirt is hauled are to build a new access road so that mining can resume. The task was completed in October last year, seven months ahead of schedule and limited output losses to 50% of capacity.


Haul and water trucks always have right of way and you quickly understand why. The 320-tonne haul trucks are shipped to the mine in pieces and assembled on site. 10 of the buried haul trucks have been recovered and five, put together from parts of different trucks, are back in service.


When fully loaded, a haul truck weighs more than 1.1 million pounds. Kennecott also uses seven haul-sized water trucks with 50,000-gallon tanks. These trucks constantly spray water onto roads to reduce dust, Bingham Canyon's number one environmental impact.


Despite the disruption, in 2013 the mine produced 213,000 tonnes of copper, 192,300 ounces of gold, 2.2 million ounces of silver and 6,300 tonnes of molybdenum, using giant machines like this shovel and a fleet of more than 100 haul trucks.


From this in-pit crusher the ore is moved by conveyer belt, partly through a tunnel, to the processing plant. Rio Tinto is currently working on studies to extend Bingham Canyon's life to 2029, including expanding operations underground after the discovery of a high-grade copper-gold skarn deposit located approximately 300 metres below the open pit.


The Bingham Canyon Concentrator plant. Due to the landslide some 170 workers took early retirement and another 40 were laid off or transferred elsewhere in Rio Tinto including Kelly Sanders, Kennecott CEO and President.


This image of the copper smelter and tailings infrastructure is from the mine's new Virtual Visitors Center. I also got to try Kennecott's virtual reality experience (in beta at the moment) using an Oculus Rift head-mounted display. It places you right in the middle of the action and is almost more immersive than being there in the flesh! The Visitors Center and outlook point was closed and parts of the structure moved ahead of the slide. The facility generated $2.8 million for its charitable foundation and received more than 3 million visitors since 1992.



My tour guides from left to right: Trevor Heaton, environmental engineer, Nate Foster, mine manager and Kyle Bennett, Rio Tinto Kennecott spokesperson. Thanks guys!

Images by MINING.com and Kennecott Rio Tinto unless otherwise specified. Thanks to Deseret News for use of their image.

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IMAGE GALLERY: Potash ponds in the Utah desert

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To the non-expert eye they may seem a set of mirages, but these turquoise-purple-pink visions are what ground-level potash ponds look like near Arches National Park outside Moab, Utah.

These man-made pools are for collecting potash that is pumped up from underground. The sun then evaporates the fluids, leaving the fertilizer ingredient up for grabs.

IMAGE GALLERY: Potash ponds in the Utah’s desert

Courtesy of Fly Over America.

The spectacular blue is not, however, Nature’s gift. Workers add dye to the water so that it can absorb heat and evaporate more quickly, a process that normally would take about 300 days.

 

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U.S. coal miners owe over $62 million in health and safety violations fines

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U.S. coal miners owe over $62 million in health and safety violations fines

Digging coal by machinery at the Brown Mine in West Virginia, mid-1900s. (Image by Lewis Wickes Hine | Library of Congress)

U.S. coal producers owed the Mine Safety and Health Administration (MSHA) more than $62 million in fines for health and safety violations as of late April, a report by SNL Energy shows.

According to the monthly impact inspection list, published by MSHA, most of those sanctions were at least two years old. However recent attempts to curb this sort of offences have not attracted enough backers in Congress, says SNL report.

Two months ago, a couple of Democrat senators introduced a bill that would require mine-wide withdrawal orders for operations that are more than 180 days in arrears on paying fines or do not live up to payment plans.

The regulation also aims to reduce the list of over 6,000 contested violations by setting minimum penalty levels to lower the likelihood of operators trying to reduce fines through the appeals process, SNL notes.

The April inspection, conducted at mines in Illinois, Kentucky, Nebraska, Oklahoma, Utah, Virginia and West Virginia, shows that the top ten coal miners alone had combined unpaid fines of $18.3 million

The monthly reviews, which began in force in April 2010, involve mines that merit increased agency attention and enforcement due to their poor compliance history or particular compliance concerns. Since April 2010, MSHA has conducted 934 impact inspections and issued 14,246 citations, 1,247 orders and 56 safeguards

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Canada-owned oil sands mine in Utah to begin producing in fall

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Canada-owned oil sands mine in Utah to begin producing in fall

It will be the first commercial oil sands operations in the United States.

Canada’s U.S. Oil Sands (TSX-V:USO) is fine tuning details to begin production at its mine in eastern Utah, one of the first commercial oil sands operations in the United States, after receiving final regulatory approvals from local officials late last week.

While the mine had already been approved for construction, the Calgary-based company recently submitted a proposal to expand it. The Utah Division of Oil, Gas, and Mining approved that plan, but ThinkProgress reported it did so on the condition that the company submits a comprehensive strategy to monitor air and water quality.

Environmentalists who have been fighting the project called the decision a victory, despite the fact that both the company and Utah authorities have argued there would be little risk to water contamination from the mine, since the operation doesn’t have any connection to a groundwater source.

But a recent public hearing, community groups presented evidence from a university professor showing that water in the Book Cliffs area would be, in fact, negatively impacted by the project, which is under construction about 300 kilometres southeast of Salt Lake City.

“Unfortunately, every decision that has been made to date is the (same) as looking out at the sky today and saying it is impossible that water can fall from the sky, and I find that infuriating,” University of Utah Geology Professor Bill Johnson said about the project last month. “The conclusions are based on data that was never intended to find a hydrological resource.”

Cheaper than in Canada

Canada-owned oil sands mine in Utah to begin producing in fall

US Oil Sands say their approach eliminates need for tailings ponds, requires 50% less energy input than traditional oil sands projects and recycles 95% of the water used.

U.S. Oil Sands has invested nearly $100 million over a decade to get permits, buy equipment and develop a new technology to extract crude.

The firm says its innovative approach eliminates need for tailings ponds, requires 50% less energy input than traditional oil sands projects, recycles 95% of the water used and has small above ground footprint.

The company's pioneering process uses a citrus extract called d-Limonene as a solvent to separate bitumen from sand. d-Limonene oil from orange rind is used industrial cleansers.

The Utah mine is being built at roughly a third of the capital cost of larger oil sands mines in northern Alberta, where new capacity is added for about $100,000 per barrel.

But U.S. Oil Sands is neither the only nor the first Canadian across the border. MCW Energy Group (CVE:MCW), small Toronto-based energy company, has built a processing plant in northeastern Utah which doesn't utilize water for extracting the crude. 

The firm, however, has not developed its own lease as it is utilizing a nearby resource owned by Temple Mountain Energy, which has total reserves of 89 million bbl on surface to 400 feet, a spokesman for MCW Energy Group told MINING.com.  He noted they have long term contract at a very convenient price, with a life expectancy of about 50 years.

A new report released this week by think-tank IHS predicts costs will negatively weigh on Northern Alberta oil sands production. The study estimates that output will grow by 800,000 barrels per day to about 2.9 million bpd by 2020. That’s down by 280,000 bpd from the 1.08 million bpd growth it estimated last year, when global oil prices were twice as high.

The forecast assumes projects now under construction will be built despite low oil prices.

Longer-term, however, IHS expects oil sands growth to continue. It said the oil sands are economically competitive with resources such as deep-water and North American tight oil but face pressures including project costs, timing of non-rail transportation to new markets and shifting fiscal terms in Alberta.

Canada-owned oil sands mine in Utah to begin producing in fall

Utah may seem an unlikely choice for a Canadian company to have an oil sands mine. However, the state accounts for the lion's share of U.S. oil sands deposits that the U.S. Geological Survey estimates hold 57 billion barrels of oil, only a fraction of which can ever be recovered.

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Canadian oil sands producer ready to begin digging pits in the US

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Canada-owned oil sands producer ready to begin digging pits in the US

The company's pioneering process uses a citrus extract called d-Limonene as a solvent to separate bitumen from sand.

Canada’s U.S. Oil Sands (TSX-V:USO) is fine tuning details to open its mine in eastern Utah, one of the first commercial oil sands operations in the United States.

Beginning this fall, the company will start digging the first in a series of pits, each the size of a football stadium, about 265km (165 miles) from Salt Lake City.

Although the development is being touted as 'the first oil sands mine in the US,'” truth is that another Canadian company, MCW Energy Group (CVE:MCW), already runs a processing plant in Asphalt Ridge in the Uinta Basin, one of Utah’s eight major oil sands deposits. The Toronto-based company is using an alternative technology to the one applied in Canada, as it doesn't utilize water for extracting crude.

U.S. Oil Sands is also developing a new technology and has already invested nearly $100 million over a decade to get permits, buy equipment and develop an unconventional extracting method.

Regardless of its “green” approach, the company has been the target of protests, AP reports:

Demonstrators who have been camping out all summer near the site gathered outside the front gate on a recent day to show their opposition. Some wore chipmunk masks. Other banged drums. Some held signs with messages such as "Dirty Energy Kills."

Opponents also worry the mine will attract more companies to the area, until now a common destination for hikers, campers and hunters.

U.S. Oil Sands claims says its approach eliminates need for tailings ponds, requires 50% less energy input than traditional oil sands projects, recycles 95% of the water used and has small above ground footprint.

The company's pioneering process uses a citrus extract called d-Limonene as a solvent to separate bitumen from sand. d-Limonene oil from orange rind is used industrial cleansers.

The Utah mine is being built at roughly a third of the capital cost of larger oil sands mines in northern Alberta, where new capacity is added for about $100,000 per barrel.

Bad timing?

A new report released this week by TD Securities shows it is not the best time to venture in the oil business. According to the research, more than 75% of Canada's daily output of 2.2 million barrels of crude from oil sands is being produced at a loss at current prices.

Every thermal oil sands player is bleeding cash on every barrel produced with U.S. crude around $41 and the Canadian heavy benchmark, Western Canada Select (WCS), around $24 a barrel, according to a report released by the bank on Wednesday.

That means only around 450,000 barrels per day of oil sands production is in the black, a bleak picture for the region, which holds the world's third-largest oil reserves but is also saddled with high operating costs.

Canada-owned oil sands producer ready to begin digging pits in the US

Utah may seem an unlikely choice for a Canadian company to have an oil sands mine. However, the state accounts for the lion's share of U.S. oil sands deposits that the U.S. Geological Survey estimates hold 57 billion barrels of oil, only a fraction of which can ever be recovered.

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Rio Tinto’s Kennecott wins clean air lawsuit in the US

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A US court has ruled in favour of Rio Tinto’s (LON, ASX:RIO) Kennecott in a lawsuit over alleged pollution at its Bingham Canyon copper mine, located in Utah.

The charges were brought forward in Sep. 2013 by a coalition of environmental groups including the Sierra Club, Utah Physicians for a Healthy Environment, Utah Moms for Clean Air and WildEarth Guardians, which claimed the operation was exceeding the maximum amount of pollutants accepted by Salt Lake County under the Clean Air Act.

Bingham Canyon mine has produced more copper than any other operation in history – more than 19 million tonnes.

In particular, they said the state wasn’t authorized to approve a 2011 permit allowing Kennecott to expand operations because such plan violated the mentioned act.

But federal judge Robert Shelby said that the state granted Kennecott all the necessary permits each time it increased the amount of materials at the mine, without violating any laws.

“If Citizen Groups believe either federal or state actors should do more, or are failing to honor their responsibilities, then they may direct their arguments to those actors through the appropriate avenues,” Shelby wrote on his summary judgment.

Visible from outer space, the Bingham Canyon is the world’s deepest open-pit mine. First discovered by Mormon pioneers in the mid-1800s, it is over 1.2 km deep, 4 km wide and covers 7.7 km².

A massive slide at the mine three years ago slowed, but did not stop, Rio’s plans to extend the mine’s life by another decade, to 2029. The company says there’s still as much ore in the ground as miners have taken out of Bingham Canyon since it began production in 1906.

It is estimated that the mine has produced more copper than any mine in history – more than 19 million tonnes.

Rio Tinto’s Kennecott wins clean air lawsuit in the US

A massive slide at the mine three years ago slowed, but did not stopped, Rio’s plans to extend the mine’s life by another decade. (Image: Wikimedia Commons)

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Despite funding shortfall, US Oil Sands aiming for Q4 start-up

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Mining oil sands to extract bitumen used to create crude oil is generally a Canadian phenomenon. However, an Alberta company is hoping to change all that with a new project expected to start in the fourth quarter.

US Oil Sands (TSXV:USO) said on Thursday that the firm is holding steady to its Q4 deadline for completing its PR Spring Project in eastern Utah. The oil sands mine is one of the first commercial oil sands operations in the United States. According to the Calgary-based company, construction is 98% complete. The $62.5-million project is about 4% over budget, and that has presented a liquidity problem that US Oil Sands addressed in its Sept. 29 press release.

As a result of project costs having risen by about $2 million and due to "rectification of deficiencies," the firm does not have enough in the kitty to complete the project. It says it anticipates needing another $3-4 million in working capital before the end of the year, and is "actively pursuing funding alternatives in excess of US$6 million in order to meet this working capital deficiency and provide sufficient flexibility during the upcoming few months."

Just over a year ago US Oil Sands started digging a series of pits, each the size of a football stadium, about 265km (165 miles) from Salt Lake City.

Although the development is being touted as 'the first oil sands mine in the US,' the truth is that another Canadian company, MCW Energy Group (TSXV:MCW), already runs a processing plant in Asphalt Ridge in the Uinta Basin, one of Utah’s eight major oil sands deposits. The Toronto-based company is using an alternative technology to the one applied in Canada, as it doesn't utilize water for extracting crude.

US Oil Sands is also developing a new technology and has already invested nearly $100 million over a decade to get permits, buy equipment and develop an unconventional extraction method.

US Oil Sands claims says its approach eliminates need for tailings ponds, requires 50% less energy input than traditional oil sands projects, recycles 95% of the water used and has small above ground footprint.

The company's pioneering process uses a citrus extract called d-Limonene as a solvent to separate bitumen from sand. d-Limonene oil from orange rind is used in industrial cleansers.

The Utah mine is being built at roughly a third of the capital cost of larger oil sands mines in northern Alberta, where new capacity is added for about $100,000 per barrel.

US Oil Sands' stock was up 20 percent on Friday, trading at 3 cents a share on the Toronto Venture Exchange.

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Drone footage of Bingham Canyon copper mine

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Drone technology is advancing so quickly it's hard to keep up with it. From aerial shots of construction projects to surveillance of strategic locations and even heat maps of crops to make farming more efficient, unmanned aerial vehicles are a disruptive technology that appears to have unlimited staying power.

Rio Tinto's (LON, NYSE,ASX:RIO) Matt Key is chief drone pilot at Rio's Kennecott operations in Utah. Key leads a team of 20 certified drone pilots and is helping to improve safety and productivity at the Bingham Canyon copper mine, according to a spotlight on Key by Rio Tinto.

Key says two of the biggest advantages of flying drones at Kennecott are safety and maintenance.

"There are some jobs where it’s better for drones to do it rather than people – for instance high wall mapping or rock fall analysis. By using drones we’re removing people from harm’s way. We can also use drones to identify safety risks – such as cracks and signs of rock movement," he says. "We can see things we’ve never seen before. For instance, we’re using thermal diagnostic capability to identify equipment problems from the air. We can identify high friction rates on equipment in real time and notify the maintenance teams so the issues can be addressed."

Kennecott’s operations include the Bingham Canyon Mine, Copperton Concentrator, Garfield Smelter, refinery, power plant and associated facilities.

In production for over 110 years, Kennecott produces copper, molybdenum, gold, silver and sulphuric acid.

Check out the aerial footage of a drone flying through Bingham Canyon, presenting a bird's eye view of the operation.

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Rio Tinto declares force majeure at Kennecott following fatal accident

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Rio Tinto (ASX, LON:RIO), the second largest mining company, declared force majeure last Friday on shipments of refined copper from its Kennecott unit in the U.S. following the death of a worker earlier in the week.

Albert Lozano died on October 11 as a result of sulfur dioxide exposure at the company’s smelter as he was performing regular work duties to remove debris from a boiler, the company said in a statement.

While the firm has not provided any information regarding to when the measure will be lifted, the Utah-based division said production of refined copper at the smelter has been halted since Oct.8, the day of the incident, Reuters reported.

Rio Tinto declares force majeure at Kennecott following fatal accident

Link for those willing to help Lozano's family: https://www.youcaring.com/thelozanofamily-979821

Rio Tinto Kennecott accounts for nearly 20% of the U.S. total copper production, and its iconic Bingham Canyon mine is one of the world’s top producing operations.

Visible from outer space, the Bingham Canyon is the also world’s deepest open-pit mine. First discovered by Mormon pioneers in the mid-1800s, it is over 1.2 km deep, 4 km wide and covers 7.7 km².

massive slide at the mine three years ago slowed, but did not stop, Rio’s plans to extend the mine’s life by another decade, to 2029. The company believes there’s still as much ore in the ground as miners have taken out of Bingham Canyon since it began production in 1906.

It is estimated that the mine has produced more copper than any mine in history – more than 19 million tonnes. Last year, the mine was responsible for 63% of Rio Tinto’s copper output, generating 156,500 tonnes of refined copper.

The Anglo-Australian giant lowered Monday its outlook for mined copper and said production of the base metal slid in the third quarter, mostly due to lower head grades at Kennecott mine and the Oyu Tolgoi copper-gold operation in Mongolia.

Rio Tinto declares force majeure at Kennecott following fatal accident

A massive slide at the mine three years ago slowed, but did not stopped, Rio’s plans to extend the mine’s life by another decade. (Image courtesy of Kennecott Rio Tinto.)

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Trump to shrink Utah national monuments in bid to boost drilling, mining

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NEW YORK (Reuters) – U.S. President Donald Trump will shrink the size of two national monuments in Utah, Senator Orrin Hatch of Utah said on Friday, a change that will open parts of them to drilling and mining but which Democrats, environmental groups and Native Americans are vowing to fight.

The decision would mark the Trump administration’s most symbolic land designation to date, reflecting its broader effort to boost development on federal land while rolling back Obama-era environmental and conservation efforts.

The two Utah sites, Bears Ears National Monument and Grand Staircase-Escalante National Monument, are among several that U.S. Interior Secretary Ryan Zinke has recommended reducing in size in order to make way for more industrial activity.

Zinke was charged by a Trump executive order in April to review some 27 such monuments that were created by past presidents under the Antiquities Act – a century-old law that protects cultural artifacts and other historical objects but which Trump has said has been misused as a way to put huge tracts of land off limits to development.

Former President Barack Obama designated the 1.35-million-acre Bears Ears site – named for its iconic twin buttes – as a national monument during his final days in office.

“I was incredibly grateful the President called this morning to let us know that he is approving Secretary Zinke’s recommendation on Bears Ears,” Hatch said in a statement emailed to Reuters. The statement did not provide details on the exact changes to the boundaries or the legal mechanism the administration might use to make the changes.

White House spokeswoman Sarah Sanders, when asked about the monument decision, said she did not want to get ahead of the president’s announcement. “I can tell you he (Trump) will be going to Utah in the first part of early December,” she said.

Trump met with Zinke in the Oval Office on Friday.

Sanders said both Trump and Zinke spoke to Hatch and Utah’s other U.S. senator, Mike Lee, during the course of the meeting. Lee has also supported shrinking the sites.

While national parks are created by Congress largely to protect outstanding scenic features or natural phenomena, national monuments are created by presidents, in recognition of a site’s cultural, historical or scientific importance.

OPPOSITION

Industry groups like the oil lobbying organization the American Petroleum Institute have said in the past that both Bears Ears and Grand Staircase-Escalante were unfairly designated as monuments and needed to be reviewed.

Green groups and scientists have supported the designations and condemned any move to reduce their size.

“Any efforts to take away protections for America’s lands and waters will be met by deep opposition and with the law on our side,” said Jamie Williams, president of The Wilderness Society, in a statement on Friday.

The Navajo, who consider Bears Ears sacred ground, on Friday followed up their comment in September that they would sue the Trump administration for violating the Antiquities Act if it tried to reduce the monument’s size.

“The Navajo Nation stands ready to defend the Bears Ears National Monument. We have a complaint ready to file upon official action by the President.” Ethel Branch, the Navajo Nation’s attorney general, said in an email to Reuters on Friday.

Grand Staircase, which was designated a national monument by President Bill Clinton in 1996, has drawn concern because an archeological site lies beneath it where two dozen new species of dinosaurs have been discovered. A coal deposit also lies beneath Grand Staircase. Paleontologists are worried the site could be destroyed if the monument’s size is reduced, the Los Angeles Times reported on Thursday.

A spokesman for Representative Rob Bishop, a Republican from Utah who is chairman of the House of Representatives Natural Resources Committee, said on Friday that Bishop was working on legislation “that will protect the antiquities in the Bears Ears region, ensure that local voices are heard and bring some finality to this issue once and for all.”

Reporting by Emily Flitter; Additional reporting by Valerie Volcovici and Roberta Rampton in Washington; Editing by Andrew Hay and Leslie Adler

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Rio Tinto lifts force majeure at Kennecott copper mine

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World’s second largest mining company Rio Tinto (ASX, LON:RIO) has lifted force majeure on shipments of refined copper from its Kennecott unit in the US, 79 days after adopting the measure.

The company, Reuters reports, halted production of refined copper at its smelter at the Utah-based mine on Oct. 8 after a worker was exposed to sulphur dioxide gases at the plant while removing debris from a boiler. The employee died two days later.

Rio Tinto Kennecott accounts for nearly 20% of the US total copper production.

Rio Tinto Kennecott accounts for nearly 20% of the US total copper production, and its iconic Bingham Canyon mine is one of the world’s top producing operations.

Visible from outer space, the Bingham Canyon is the also world’s deepest open-pit mine. First discovered by Mormon pioneers in the mid-1800s, it is over 1.2 km deep, 4 km wide and covers 7.7 km².

massive slide at the mine almost five years ago slowed, but did not stop, Rio’s plans to extend the mine’s life by another decade, to 2029. The company believes there’s still as much ore in the ground as miners have taken out of Bingham Canyon since it began production in 1906.

It is estimated that the mine has produced more copper than any mine in history – more than 19 million tonnes. Last year, the Kennecott generated 125,800 tonnes of refined copper, about 20% less than in 2016.

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The Vancouver junior shaking up the lithium mining industry

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The Vancouver junior shaking up the lithium mining industry

MGX Minerals President and CEO Jared Lazerson

Demand from electric vehicles is blowing up lithium mining.

In 2015, 174,000 tonnes of lithium worth $1.2 billion were mined.

While the lithium-ion battery was invented 25 years earlier, the mineral hardly made headlines and output was controlled by four large primary producers (as it is today) operating largely out of sight in the high Andes and West Australia.

This year primary lithium mining is set to grow to a $4.5 billion industry. Impressive growth but still a minnow.

Now the trillion-dollar automotive industry has descended on the sector. (For context, Toyota does $4.5B every week and according to one report vehicle manufacturers are spending $255 billion to bring more than 200 new electric models to market by 2022.)

Pick any EV demand graph from any investment bank report, consultant white paper or research house forecast from the last year and they are all alike.

They start in the bottom left corner and end in the top right.

Graphs of future lithium supply look much the same.

And the Big 4 – Albemarle, Ganfeng, SQM and Tianqi – will be responsible for the vast bulk of the output expansion. And thanks to joint ventures,  cross-shareholding and downstream connections these companies are likely to only tighten their grip on primary production.

The additional output will also be from largely the same places – brines in Chile and Argentina and hard rock in Australia.

Both of which come with their own set of unique problems. On the salars in South America or basins in Nevada, an 18-month wait for solar evaporation. For Australian spodumene miners a long, costly and often bottlenecked chain from ore to battery grade lithium.

MGX is also playing the green energy boom through a wholly-owned subsidiary called ZincNyx Energy Solutions acquired in December. ZincNyx this week announced the start of manufacturing of zinc-air batteries for modular storage of electricity from renewable sources.

That makes the burgeoning industry ripe for disruption.

MGX Minerals Inc, a mining junior based in Vancouver BC, is doing just that. And it’s already deploying its technology.

MGX, founded in 2012, and its Calgary-based water treatment subsidiary PurLucid, can cut extraction time of lithium from brine to a single day.

A number of Chilean lithium juniors and brine producers are testing the technology to speed up time to market and at the same time slash their environmental footprint (and to stop praying for it not to rain).

But cutting construction and production time for traditional lithium from brine producers is not even MGX's biggest selling point.

MGX produces lithium by cleaning up the oil industry’s wastewater.

The company has integrated PurLucid’s nanoflotation technology with its own rapid lithium recovery process. MGX bought 51% of PurLucid in September 2016 with an option to buy the firm outright.
North America's oil & gas sector pumps an astonishing 80–100m barrels of brine each day
While competitors have emerged, MGX is now in deployment phase with North American oil and gas companies as first customers. The company this week closed on a $15.5m private placement and revenues from its roll-out will flow before the end of the year.

CEO Jared Lazerson tells MINING.com that the company started out as an industrial minerals minor, but early on saw the opportunity in advanced materials:

“We liked the lack of volatility in industrial minerals but quickly segued into battery materials were the outlook is for strong growth for at least the next fifty years.”

MGX Driftwood Creek Magnesium

MGX is advancing its Driftwood Creek Magnesium project in BC, hoping to become only the second producer of magnesium oxide in North America. A preliminary economic assessment for the project outlines a 19-year mine life, a three-and-a-half year payback and $400m net present value.

The North American wastewater treatment industry is worth $29 billion a year and the oil & gas sector pumps an astonishing 80–100m barrels of brine each day.

Recognizing the massive expertise built up in the Alberta oil patch to manage wastewater, MGX started to develop the idea of what it dubs “petrolithium”.

Lazerson says petrolithium enables “a beautiful transition” using robust industrial process to clean up the environment and reduce costs at the same time.

For Alberta, struggling to bring bitumen to new markets outside the US, petrolithium represents energy diversification.

For the Canadian province’s oil giants it provides not only environmental credentials but an on-ramp to the electric vehicle boom (not to mention a new revenue stream from water purification).
Lithium is on the list of 35 minerals deemed as "critical" by the US dept of the interior to promote domestic production
MGX have permits covering 1.7m acres in Alberta where it’s partnering with oil and gas majors and in the US, MGX has acquired leases over 110,000 acres in Utah’s Paradox basin. The company announced a seismic survey program in Utah this week. The MGX process can also be applied to wastewater from other industrial sources where lithium, an abundant resource, may be present.

Lithium is on the list of 35 minerals deemed as "critical" and of strategic importance by the US dept of the interior in an effort to promote domestic production.

Lazerson says the company was careful not to fall into a capex and growth trap, designing its technology to be modular:

“We can put the equipment in a container and ship it off and if you want more, we ship you another. There is a point where you would decide to build a $1 billion centralized plant, but as a company we did not want to be in a position where we spend all this money developing a technology and then have to go to shareholders and the market to raise money for a massive capital expenditure program.”

MGX (CSE: XMG; OTCQB: MGXMF; Frankfurt: 1MG), listed in October 2014 and is worth C$112m on the Canadian Securities Exchange. The spot price of battery grade lithium carbonate in China has declined this year and was assesses at $21,000 per tonne at the end of May according to MetalBulletin data. That compares to $7,700 a tonne in June 2015.

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