Newcrest Mining’s $8 billion-plus acquisition of Lihir Gold is creating a new top-tier of Australian gold producers, which are already being sized up for takeovers, Reuters reported.
The combined company would have 10 mines and four development projects in eight countries.
The Kinross Gold Corporation is taking a fourth-quarter charge of $216.1 million, mainly to write down the value of two gold mines in line with lower bullion prices and to reflect costs of its acquisition of Amax Gold Inc. The company, North America’s fifth-largest gold producer, is writing down the carrying values of the Refugio mine in northern Chile by $46.9 million and of the Fort Knox mine in Alaska by $40.5 million. Toronto-based Kinross is also taking charges of $104.6 million for excess costs incurred while incorporating Amax’s mines and $9 million for closing the DeLamar mine in southwestern Idaho.
The Kinross Gold Corporation is taking a fourth-quarter charge of $216.1 million, mainly to write down the value of two gold mines in line with lower bullion prices and to reflect costs of its acquisition of Amax Gold Inc. The company, North America’s fifth-largest gold producer, is writing down the carrying values of the Refugio mine in northern Chile by $46.9 million and of the Fort Knox mine in Alaska by $40.5 million. Toronto-based Kinross is also taking charges of $104.6 million for excess costs incurred while incorporating Amax’s mines and $9 million for closing the DeLamar mine in southwestern Idaho.
DENVER — The Navajo Nation filed a lawsuit on Tuesday against the and several corporations, saying that poisoned water that flowed from a punctured Colorado mine last year disrupted hundreds of lives near a critical watershed.
The disaster, the federal says, has heightened economic and spiritual pain in a region hamstrung by poverty and drought. The tribe is seeking to hold the agency and corporations accountable, be made whole for at least $2 million spent on testing and alternative water sources and be compensated for lost revenue and psychological damages.
“We cannot just sit back and let the E.P.A. do what they’ve been doing, just doling us pennies,” said the president of the Navajo Nation, Russell Begaye, in a telephone interview. “This river is the main river that gives life to the whole region, not just those who live around the river, but the entire nation. This is our lifeblood. It is sacred to us.”
A spokeswoman for the E.P.A., Nancy Grantham, said the agency could not comment on active legal issues. Representatives from the mining companies and the E.P.A. contractors declined to comment or did not return messages.
The lawsuit stems from an August 2015 episode in which contractors hired by the E.P.A. to assess a shuttered gold mine — the Gold King in southwest Colorado — accidentally broke the mine’s seal, causing about three million gallons of chemical-laced orange sludge to flow into the Animas River south of the mine and then into the San Juan.
People kayaking in the Animas River near Durango, Colo., last August, in water colored from a mine waste spill.
Jerry Mcbride / The Durango Herald, via Associated Press
An on the Animas River became a neon media sensation, drawing attention to a problem that continues to plague the West: The region has thousands of old, acid-filled mines, some leaching into waterways, others that could burst at any time. The mines have filled with poison from water and air entering earth cavities, mixing with sulfurous minerals.
Interactive Feature | Navajo Nation
The E.P.A. took responsibility for the accident and has spent to address cleanup and compensate communities, including the Navajo Nation. But people along the spill’s path have continued to feel its effects. The sludge coursed through Colorado, New Mexico and Utah. The E.P.A. is considering whether to declare the area around the Gold King a site.
The Navajo reservation, a vast region of red rocks that sits south of the mine, was hit particularly hard by the spill because leaders told people not to use water from the San Juan River for weeks after the E.P.A. said it was safe. Mr. Begaye, the Navajo president, said he was wary of the claim that the stream was healthy enough for agricultural and other use.
Irrigation lines were cut off. Corn, melons, hay and wheat never made it to market. The spill, the president said, delivered a psychological lashing in a drought-stricken place where , many live in poverty and the San Juan River holds financial and spiritual power.
The lawsuit names several defendants: the E.P.A.; two contractors called Environmental Restoration and Harrison Western; four mining companies called Gold King Mines Corporation, Sunnyside Gold Corporation, Kinross in Canada and Kinross USA; and 10 unnamed individuals.
It alleges that mismanagement of the mine, which had been closed for years but never cleaned up, caused it to swell with toxic water and eventually burst. The suit says that 880,000 pounds of metals spilled out when the Gold King burst, and that “roughly 80 to 90 percent” remains embedded in the river upstream, ready to flush into the Navajo Nation during rains and storms.
Near the Gold King in Colorado, toxic water continues to flow out of the mine at a rate of 570 gallons a minute. A nearby water treatment plant put in place by the E.P.A. removes 95 percent of contaminants.
The agency says that the water below the mine and the treatment facility has generally returned to prespill conditions, and local governments have instructed residents to resume recreational and agricultural activities on the Animas and San Juan Rivers.
The suit is the latest to come out of the mine blowout. Earlier this year, New Mexico sued the E.P.A. and the State of Colorado over the accident. And the E.P.A.’s Office of the Inspector General has opened a criminal investigation into the spill.
of Canada said Monday that it would of that it does not already own, in an all-stock deal valued at $7.1 billion.
The deal would unite Kinross with Red Back, a fellow Canadian company and a major gold producer with a focus on African assets. The combined company would have 10 mines and four development projects in eight countries.
Under the terms of the deal, Red Back shareholders will receive 1.778 Kinross shares and 0.110 common share purchase warrants for each of their shares. At Monday’s closing share price, the deal amounts to 30.50 Canadian dollars per Red Back share, or $29.81.
That is a 17 percent premium to Monday’s closing price and a 21 percent premium to Red Back’s 20-day volume-weighted average price.
“By combining Kinross’ world-class mines, growth projects and proven ability in mine development with the potential of Red Back’s assets, we are creating a gold growth powerhouse,” Tye Burt, Kinross’s chief executive, said in a statement.
Lukas Lundin, Red Back’s chairman, and Richard Clark, the company’s chief executive, are expected to join Kinross’s board after the deal closes.
Based in Vancouver, Red Back focuses primarily on its Western Africa assets, notably in Mauritania and Ghana.
Newcrest Mining‘s $8 billion-plus acquisition of Lihir Gold is creating a new top tier of Australian gold producers, which are already being sized up for takeovers, Reuters .
These include Thailand-focused Kingsgate Consolidated, Perseus Mining, with ground in West Africa, and Andean Resources, exploring in South America.
Takeovers have denuded the top end of the Australian gold sector, leaving only a few vehicles with which institutions can ride the gold bull market outside of Newcrest, according to Warwick Grigor, who heads BGF Capital Group.
Sino Gold fell into the hands of , is offering about $7 billion for Red Back Mining and Lihir, now Newcrest, bought Africa-focused Equigold.
The Kinross Gold Corporation posted a second-quarter profit that topped forecasts as high gold prices more than offset lower production. The company, based in Toronto, said it earned $65.6 million, or 19 cents a share, in the period, compared with a loss of $16.4 million, or 5 cents a share, a year earlier. Sales increased to $252.3 million from $174.6 million.
The Cyprus Amax Minerals Company signed a deal yesterday with underwriters to sell its stake in the Kinross Gold Corporation of Toronto to the public for $4 (Canadian) a share. In United States dollars, the shares will be sold for about $2.71 each, for proceeds of about $242 million. Cyprus said it and its affiliates have agreed to sell their total holding of 89 million Kinross shares. Cyprus Amax, based in Englewood, Colo., said it would realize net proceeds of $232 million.
Amax Gold Inc. of Englewood, Colo., agreed yesterday to be acquired by the Kinross Gold Corporation of Toronto in a stock deal under which each Amax share will be exchanged for 0.8 Kinross share. Shares of Amax closed yesterday at $3.3125, up 12.5 cents, on the New York Stock Exchange. Kinross closed at $5.25 (Canadian), the equivalent of $3.66 (United States), on the Toronto Stock Exchange. With more than 114.8 million shares outstanding, Amax’s stock would be worth more than $420 million (United States). The merger will make Kinross the fifth-largest gold producer in North America, Amax said.
DURANGO, Colo. — The Animas River is the cultural soul of this patch of southwestern Colorado, a sort of moving Main Street that hosts multiple floating parades a year and is typically bustling with rafters and kayakers. Schoolchildren study the river. Sweethearts marry on its banks. Its former name, given by Spaniards, is el Río de las Ánimas, the River of Souls.
But since Wednesday, the Animas has been grievously polluted with toxic water spilled from one of the many abandoned mines that pockmark the region — a spill for which the has claimed responsibility, saying it accidentally breached a store of chemical-laced water.
On Sunday, anger over the spill boiled over after the agency announced that the amount of toxic water released was three times what was previously stated — more than three million gallons rather than one million — and that officials were still unsure if there was a health threat to humans or animals.
The day of that announcement, State Senator Ellen Roberts, a Republican who lives near the river, cried softly as she considered the pollution, adding that she had dropped her father’s ashes in the depths of the river, which pollutants had turned into an unnatural-looking yellow-orange ribbon.
“It is not just a scenic destination,” Ms. Roberts said. “It is where people literally raise their children. It is where the farmers and ranchers feed their livestock, which in turn feeds the people. We’re isolated from Denver through the mountains, and we are pretty resourceful people. But if you take away our water supply, we’re left with virtually no way to move forward.”
On Monday, Gov. John W. Hickenlooper released $500,000 in funds for assistance. The City of Durango and La Plata County have declared states of emergency.
Soon after the spill was detected, city officials stopped pumping water from the Animas into the reservoir that provides drinking water for Durango’s 17,000 residents — taking action swiftly enough that the contamination did not reach the drinking supply. The reservoir still receives water from the Florida River, a tributary of the Animas, but the city has asked local residents to conserve so that the reservoir does not get too low.
Most people living outside the city use wells, and officials say about 1,000 residential water wells could be contaminated.
The river is closed indefinitely, and the county sheriff has hastily recast his campaign signs into posters warning river visitors to stay out of the water. The yellow plume has traveled down to New Mexico — where officials in several municipalities have stopped pumping river water into drinking water systems, fearing contamination — and to the Navajo Nation.
Testing by the E.P.A. — an agency typically in the position of responding to toxic disasters, not causing them — found that the wastewater spill caused levels of arsenic, lead and other metals to spike in the Animas River.
On the day of the accident, a team from the agency had been investigating an abandoned mine about 50 miles north of here. Called the Gold King, it is roughly 1.5 miles long and about 700 feet tall at its highest point. The mine had been abandoned for nearly a century, but between roughly 1890 and 1920 it produced 350,000 ounces of high-grade gold, according to its owner.
For years, the Gold King has leaked toxic water at a rate of 50 to 250 gallons a minute. The agency had planned to find the source of the leak in the hope of one day stanching it. Instead, as workers used a backhoe to hack at loose material, a surprise deluge of orange water ripped through, spilling into Cement Creek and flowing into the Animas. The burst did not injure workers.
In his first interview since the spill, the owner of the mine, , said the spill was probably the fault of another mine company — the Sunnyside Gold Corporation — that had built retention walls inside an abandoned mine near the Gold King, part of an old cleanup agreement with the federal government. Once the Sunnyside mine filled with wastewater, the water probably spilled into the Gold King, and then into the Animas, Mr. Hennis said.
He urged Sunnyside’s parent company, the , to clean up the mess. “They’ve got to step forward and be responsible,” he said of Kinross. A spokesman for Sunnyside, Larry Perino, said the company had no role in Gold King spill.
Since the 1870s, metal mining has both enriched and poisoned this region, turning the earth under portions of southwest Colorado into a maze of tunnels and leaving behind shuttered sites oozing with chemicals. There are about 200 abandoned mines in the Animas watershed. Sunnyside was the last to close, in 1991.
On Sunday night, residents packed a school auditorium in Durango for a meeting with the E.P.A.’s regional director, Shaun McGrath. During a public comment session that lasted more than two hours, residents flouted a sign on the wall that instructed the auditorium’s typical patrons — middle schoolers — to refrain from calling out, jumping up or insulting others during assemblies.
Shouts rang out. A few people cried. One resident questioned whether the agency had refashioned itself into the “Environmental Pollution Agency.” Others demanded to know what would happen to wildlife, livestock, water wells, sediment and river-based jobs.
“When — when can we be open again?” asked David Moler, 35, the owner of a river-rafting company who had approached a microphone. “All I hear is a handful of ‘gonna-dos,’ ” he added. “What should I tell my employees?”
Mr. McGrath and his colleagues urged patience and assured residents that they would provide information about health risks once they had it. The agency, he said, is awaiting test results to determine whether the water poses a risk.
“We’re going to continue to work until this is cleaned up,” Mr. McGrath said, “and hold ourselves to the same standards that we would anyone that would have created this situation.”
Newcrest Mining‘s $8 billion-plus acquisition of Lihir Gold is creating a new top tier of Australian gold producers, which are already being sized up for takeovers, Reuters .
These include Thailand-focused Kingsgate Consolidated, Perseus Mining, with ground in West Africa, and Andean Resources, exploring in South America.
Takeovers have denuded the top end of the Australian gold sector, leaving only a few vehicles with which institutions can ride the gold bull market outside of Newcrest, according to Warwick Grigor, who heads BGF Capital Group.
Sino Gold fell into the hands of , is offering about $7 billion for Red Back Mining and Lihir, now Newcrest, bought Africa-focused Equigold.
on Wednesday sold its indirect interest in Canada’s largest diamond mine in a previously announced deal worth $220 million in cash, stock and a note, The Associated Press reported.
The Toronto-based gold mining company said it completed the sale of its portion of a joint venture that holds a 40 percent interest in Diavik Diamond Mine, in Canada’s Northwest Territories.
The joint venture was with , also based in Toronto, The Associated Press .
Harry Winston bought out Kinross’s portion for $50 million cash, about 7.1 million of its own shares worth about $100 million, and a $70 million note that matures in 12 months. The note bears 5 percent annual interest and can be repaid in cash or additional Harry Winston shares.
In Canada, a Merger for Miners of Gold
By THE ASSOCIATED PRESS
August 2, 2010
TORONTO (AP) — The announced on Monday that it would acquire the 91 percent of shares of Red Back Mining that it does not already own in an all-stock deal valued at $7.1 billion.
Kinross, which is based in Toronto, said the merger with Red Back Mining, a gold producer focused on Africa, would create a pure gold sector producer with an exceptional growth profile.
Shareholders of Red Back Mining, based in Vancouver, will receive 1.778 Kinross common shares and 0.110 of a Kinross common share purchase warrant for each Red Back common share held. The current Kinross shareholders will then hold about 63 percent of the combined company, while current shareholders of Red Back will hold about 37 percent.
The value of the offer is $29.80 per Red Back common share, representing a premium of 15 percent from Friday’s close of Red Back shares on the Toronto Stock Exchange. Canada’s stock exchange was closed on Monday because of a holiday.
Red Back’s two main projects are the Chirano Gold Mine in Ghana and the Tasiast Gold Mine in Mauritania. Kinross has mines and projects in Canada, the United States, Brazil, China and Russia.
Analysts estimate that the combined company’s gold production would be about 3.9 million ounces in 2015.
“By combining Kinross’s world-class mines, growth projects and proven ability in mine development with the potential of Red Back’s assets, we are creating a gold growth powerhouse,” Tye W. Burt, Kinross’s president and chief executive, said in a statement.
“The significant upside in reserves that we believe exists at Red Back, and Kinross’s ability to accelerate that potential, makes this an outstanding prospect for shareholders of both companies.”
of Canada said Monday that it would of that it does not already own, in an all-stock deal valued at $7.1 billion.
The deal would unite Kinross with Red Back, a fellow Canadian company and a major gold producer with a focus on African assets. The combined company would have 10 mines and four development projects in eight countries.
Under the terms of the deal, Red Back shareholders will receive 1.778 Kinross shares and 0.110 common share purchase warrants for each of their shares. At Monday’s closing share price, the deal amounts to 30.50 Canadian dollars per Red Back share, or $29.81.
That is a 17 percent premium to Monday’s closing price and a 21 percent premium to Red Back’s 20-day volume-weighted average price.
“By combining Kinross’ world-class mines, growth projects and proven ability in mine development with the potential of Red Back’s assets, we are creating a gold growth powerhouse,” Tye Burt, Kinross’s chief executive, said in a statement.
Lukas Lundin, Red Back’s chairman, and Richard Clark, the company’s chief executive, are expected to join Kinross’s board after the deal closes.
Based in Vancouver, Red Back focuses primarily on its Western Africa assets, notably in Mauritania and Ghana.
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Continuing the consolidation of the global gold mining industry, three midsize North American producers, the Kinross Gold Corporation, Echo Bay Mines Ltd. and TVX Gold Inc., said today that they planned to merge through an exchange of stock. The combined company, which would be the world’s seventh-biggest gold producer, will have a market value of about $2 billion and an annual output of two million ounces. The company, to be based in Toronto, will be 40.3 percent owned by existing Kinross shareholders. Bernard Simon (NYT)
