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| August 07, 2014 --- Vol. 08, No. 32 | August 2014
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Alaska News Nuggets
CRITICAL MINERALS – Ucore Rare Metals Inc. Aug. 7 commended U.S. Sen, Lisa Murkowski, R-Alaska, and the National Mining Association for their efforts to advance Senate Bill 1600, the Critical Minerals Policy Act of 2013. SB1600 is designed to enhance the US domestic critical metals supply chain. Among other things, it would establish a list of up to 20 minerals to be deemed critical, streamline the federal permitting process, and focus priority on workforce development. Murkowski, who is the senior Republican member of the Senate Energy and Natural Resources Committee, introduced the legislation for Senate consideration in October of last year. The bill has yet to advance out of committee. "We have got to change the dynamic here, in this country, with how we view the importance of minerals to our nation," Murkowski said to the mining community in Alaska shortly after introducing this legislation. "We can't move forward until Washington (D.C.) gets out of our way." It is largely accepted that at least some of the 17 rare earth elements should be deemed critical due their importance to the high tech, defense and clean energy sectors. Dysprosium, terbium, europium, yttrium and neodymium are among the REEs that typically enter the critical minerals discussion. A study completed by the U.S. Department of Energy in 2010 listed all of these rare earths as critical to clean energy. "There is broad agreement that some of the heavy rare earth elements (HREE) are of increasing importance to the US in high tech, defense and clean energy sectors", said Deantha Crockett, Executive Director of the Alaska Miners Association. Another piece of critical minerals legislation, “National Strategic and Critical Minerals Production Act of 2013,” garnered wide support in the House before getting bogged down alongside S.B. 1600 in the Senate. Introduced by Rep. Mark Amodei, R-Nevada, H.R. 761 aims to “enhance government coordination for the permitting process by avoiding duplicative reviews, minimizing paperwork and engaging other agencies and stakeholders early in the process” for strategic and critical mineral projects. "Ucore is pleased to be developing a high-grade HREE project at our Bokan property in Southeast Alaska," said Ucore President and CEO Jim McKenzie. "The proposed legislation will ensure the US maximizes the economic and industrial benefits of the mining sector, bringing critical projects to term as quickly as possible. We commend Senator Murkowski for her continued leadership, as well as the ongoing efforts of the National Mining Association, to advance these important streamlining initiatives." For more information on the pending critical minerals bills, read “Stalled critical minerals bills get a push” at www.miningnewsnorth.com.
GOLD – Miranda Gold Corp. Aug. 6 said it has signed a letter of intent with Gold Torrent, Inc. to form a joint venture to develop the Willow Creek project, a high-grade gold property previously known as Lucky Shot, located some 75 miles (121 kilometers) north of Anchorage, Alaska. Late in 2013 Miranda signed a 20-year lease on the Willow Creek project, which it will assign, along with other data, reports and information on the Willow Creek project to the joint venture. To earn a 70 percent interest in the JV, Gold Torrent will sole fund the first US$10 million of expenditures on the JV. Gold Torrent will be entitled to 90 percent of the cash flow from production at the Willow Creek project until it recovers its US$10 million initial capital investment and thereafter it will be entitled to 70 percent, with Miranda receiving the balance of the cash flow. Gold Torrent intends to develop a small scale-underground mine and to bring the currently known mineralization into production, funded by the initial US$10 million contribution. After adequate access has been developed underground, expansion and exploration drilling will be conducted both during construction and during commercial production. This drilling is expected to expand the known mineralization well beyond the current levels. Recorded gold production from the Willow Creek District was 667,000 ounces at 1.2 ounces of gold per ton. Miranda and Gold Torrent believe that potential exists to define additional mineralization similar to historic discoveries with systematic mine and district exploration. Gold Torrent will be manager of the JV and the management committee shall comprise two Gold Torrent nominees and one Miranda nominee. Gold Torrent, established in 2013, is an OTC Bulletin Board listed company, is led by: Daniel Kunz, a senior mining executive with more than 35 years in mine development and operations including 17 years with Morrison Knudsen Mining and as President and COO Ivanhoe Mines; Ryan Hart, an experienced financial professional and former financial manager for Credit Suisse and UBS; and Alexander Kunz, a lawyer with management experience and a technical background in science. Gold Torrent is further supported by a technical and advisory team that includes: Pete Parsley, a senior geologist experienced in Alaska and in high-grade gold deposits; and Bruce Thorndycraft, a senior metallurgist with extensive experience in mill design, construction and operation. Under the terms of the LOI Gold Torrent has 60 days to complete its due diligence period, at which point it has further 15 days to enter into a joint venture for the development of the Willow Creek project.
QUARTERLY REPORT – Coeur Mining Inc. Aug. 6 reported second quarter 2014 revenue of US$164.6 million, adjusted net loss of US$31.6 million, and cash flow from operating activities of US$30.5 million, the highest level in a year. The company realized average metal prices of US$19.60 per silver ounce and US$1,277 per gold ounce during the quarter, which is 3 percent lower and roughly flat, respectively, compared to the first quarter of 2014. Coeur is narrowing its 2014 production guidance to 17.0 - 18.0 million silver ounces and 225,000 - 240,000 gold ounces and is maintaining its full-year guidance for exploration (US$23-US$28 million including capitalized drilling), general and administrative expenses (US$43-US$48 million), amortization (US$190 million), and capital expenditures (US$65-US$80 million). "Our second quarter results demonstrate improved or consistent performance across our portfolio. Our costs are tracking below initial expectations as we make further progress increasing the efficiency of our operations," said Mitchell J. Krebs, Coeur's President and Chief Executive Officer. The Kensington Mine in Southeast Alaska produced 28,089 ounces of gold during the second quarter, roughly a 10 percent increase over the 25,428 ounces produced during the first quarter. Increased ore grades and milling rates attributed to the higher gold production. Gold grades are expected to be slightly above the second quarter for the remainder of the year due to the mining of high-grade stopes from the main section of the mine and from the high-grade Raven deposit. Costs applicable to gold-ounce sold at Kensington were US$1,008 during the second quarter, nearly unchanged from the first quarter. Coeur expects these costs to decline in the second half of 2014 due to higher grades being mined. Kensington produced a negative cash flow of US$600,000 during the second quarter, compared to a positive cash flow of US$13.9 million during the first three months of the year. Coeur attributes the lower cash flow to the timing of concentrate shipments. The company had four drills operating at Kensington during the second quarter.
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