Global opportunities, challenges abound

Delegates to the recent Northwest Mining Association convention were given a whirlwind “tour of the world” in three days without having to leave their comforts here.

Following the theme “New World of Minerals,” convention planners arranged for speakers and dignitaries from nearly every continent to discuss opportunities and challenges on an international level.

Despite the industry downturn, about 3,500 registrants poured into Spokane to hear about new developments and operating facts from around the world, as well as to rub elbows with industry members who explore and operate outside North America.

Sir Arvi Parbo, head of Australia-based Western Mining, told delegates that developed countries are placing increased limitations on production, not because of a lack of mineral occurrences, but because increasing areas of land are being excluded from exploration and mining.

“Approval procedures for new mineral projects in developed countries have also become complicated, expensive and time-consuming,” Parbo said. “The procedures gradually introduced in recent years have made it possible for determined small groups to hold up approvals for a long time, if not forever; governments have in effect forfeited their decision-making powers.” Parbo urged delegates to master the skill of public communication and explain mining, its environmental progress, and the industry’s many contributions to the community.

The state of the domestic industry in the U.S. was also discussed by a number of speakers, several of whom voiced concerns over new regulations such as a US$100-per-year “rental fee” for each existing mining claim on federal lands and a new lead tax. Delegates were also urged to become more politically active and fight regulatory abuse.

“We have accepted a regulatory environment but we oppose being strangled to death by unreasonable regulations,” said Brian Kennedy of FMC Gold (NYSE), who went on to tell of an arduous 3-year battle to bring on stream a heap-leach mine in Idaho.

Because of a tougher regulatory climate at home, Kirk Kinart of Battle Mountain Exploration said Lessor Explored Countries (LECs) are rapidly becoming major consumers of investment capital and North American exploration and mining skills.

“The factors driving this trend are varied, but suffice to say that Battle Mountain no longer debates the merits of spreading its net and venturing forth from its U.S. home,” Kinart said, pointing out the company is active in Chile, Bolivia, Australia and seven other countries outside the U.S. Kinart said Battle Mountain geologists or its partners have had the “pleasure” of walking on to several significant outcropping gold systems never before sampled. These include the El Higo property in the Dominican Republic where discovery outcrop sampling returned initial results of up to 13 grams gold per tonne in 5-metre channel samples for distances of up to 50 metres, and the Golden Cliffs project in Indonesia, where discovery outcrop channel sampling returned 40 metres of 4.1 grams gold.

Kinart pointed out that discoveries like these not only reflect the increased discovery potential of many LECs, but also good planning and a lot of hard work. A number of speakers also discussed investment opportunities in the former Soviet Union. Most companies active there, however, appear to be in the information-gathering stage because of political uncertainty and various other practical impediments to investment.

Delegates were told that progress is being made to address the absence of mining law, as well as the issues of land tenure, sanctity of contract, availability of data, and expatriation of profits and the sale and export of products. Various republics, including Russia, are also now reported to be moving toward a competitive bid and tender system as a means to attract foreign investment to both existing and undeveloped projects.