PDAC 2015: Canada to Renew Mineral Exploration Tax Credit Program
Press Release: The PDAC 2015 Convention started with a flurry of announcements that support Canada’s mineral exploration and mining industry.
Federal Minister of Finance, the Honourable Joe Oliver, announced Sunday evening the government’s intention to renew the Mineral Exploration Tax Credit (METC), an invaluable financial instrument that helps Canadian junior mining companies raise capital for projects in Canada. Oliver also announced a proposed change to the government’s treatment of the Canadian Exploration Expense (CEE) program to include certain environmental and Aboriginal consultation expenses incurred prior to obtaining a license or permit as a Canadian Exploration Expense.
“The METC is a financial catalyst for investment in Canadian companies and helps them to remain competitive in the international marketplace,” says PDAC President Rod Thomas. “We welcome the government’s decision to renew this vitally important program. The Government of Canada is an important partner in creating conditions that allow Canada’s mineral industry to flourish and we look forward to continuing to work together to improve policies and programs that support the industry, including the METC.”
Earlier in the day the Honourable Greg Rickford, Federal Minister of Natural Resources and Minister for the Federal Economic Development Initiative for Northern Ontario, stood together with Ontario Minister of Northern Development and Mines, the Honourable Michael Gravelle, to announce a joint study of an all-weather transportation corridor in the region. “We know there is tremendous mineral potential in Northern Ontario and this is a very positive step,” says PDAC Executive Director Andrew Cheatle “that can help advance community access, mineral exploration and development in the Ring of Fire region.”
In addition, the Honourable Ed Fast, Minister of International Trade, announced the appointment of Jeffrey Davidson as Canada’s Corporate Social Responsibility (CSR) Counsellor for the extractive sector.
“We are very supportive of the government’s selection of Mr. Davidson,” says Rod Thomas, PDAC President. “Having worked in industry, non-profit and academic settings, Jeffrey Davidson is well-known as a capable and highly regarded individual. We look forward to working with him and the Office of the CSR Counsellor in its new, re-focused role.”
Barrick profit beats expectations as copper, gold prices up
Barrick Gold has reported a 78% jump in first-quarter profit, beating analyst expectations thanks to rising gold and copper prices, and said it was on track to meet annual forecasts.
Production in the second half is expected to be higher than the first, the gold miner said, thanks in part to the ramp-up of underground mining at the Bulyanhulu mine in Tanzania and higher expected grades at Lumwana in Zambia, reports Reuters
Barrick’s first-quarter gold production fell to 1.10 million from 1.25 million ounces due partly to lower grades at its Pueblo Viejo mine in Dominican Republic.
Adjusted profit surged 78% to $507mn in the quarter ended March 31, from $285mn a year earlier, and Barrick announced a 9 cent per share quarterly dividend.
Stronger prices helped boost Barrick’s revenue from its copper mines in Chile, Saudi Arabia and Zambia by 31% from the fourth quarter. Overall earnings per share were $0.29, ahead of analysts’ estimate of $0.27.
“We expect a positive stock reaction to the earnings beat and strong cash flow,” said Credit Suisse analysts.
Potential for South Africa merger
Barrick CEO Mark Bristow, who has championed mergers across the gold industry, said he backed the idea of South Africa-listed miners Goldfields and AngloGold Ashanti combining.
Speculation has been swirling around the two companies and Sibanye-Stillwater, whose CEO Neal Froneman floated the idea of a three-way merger.
“I’m a South African, and this country has such a great mining history and it would be great to see a real gold business come out of the many failed discussions that we’ve seen,” said Bristow.
Goldfields declined to comment. In a statement, AngloGold Ashanti said it was focused on delivering on its growth plan to unlock value from its portfolio of gold assets.
Bristow also said he had met with the Democratic Republic of Congo’s new mines minister and other officials and was continuing to work on getting $900mn belonging to its Kibali mine joint venture out of the country.
“We have a solution, it just needs to be sanctioned by the appropriate authorities which haven’t been around for a while,” he said, referring to a recent government overhaul by President Felix Tshisekedi.