LBSR is certainly a company to keep on the radar. I own several million shares in a family trust that I hope will make us all some money. However, we should be looking at the long term of things. Not meant in a negative way unless the smart investor wants to see with far-sightedness, there could be a long-term result of which people are not looking. For one, every work that will be done will be done with borrowed money and dilution -- as do all mineral companies at this level. Every dime of work will go on the books as debt. Keep this in mind as time moves along. Secondly, the need for partners could be hard to find since the processes to open a mine in Arizona is very difficult and similar to Pebble when factoring in the red tape. The EPA has their finger on the red-tape button in Arizona as well. The hope is that drilling will map out a mining area to sell to a partner. It could happen. Here is a good article to read on the Rosemont mine and the processes they went through that will help us examine the crevices. As you will see, the political processes for Rosemont are no different than Pebble.
March 2013 Mining Engineering by William Gleason
Wth more than 20 major mines extracting copper, gold, coal, molybdenum and lime, Arizona is recognized as one of the better mining jurisdictions, not just in the United States, but in the world.
However, that is not to say the road to production is always paved with gold, or in many cases, copper.
Earning the license to mine in Arizona is a complex process with years of paperwork and permitting before the first tons of ore are ever processed. Now, get the federal government involved and the process becomes even more complex, and the path to production can become even longer.
The Rosemont copper project, 50 km (30 miles) south of Tucson in the Santa Rita Mountains, is in the historic mining district of Pima County. It is home to nearly 2.7 Mt (6 billion lbs) proven and probable reserves of copper, molybdenum and silver.
The project is partly on U.S. Forest Service (USFS) land, with tailings and waste piles that will be on that agency’s land, and therein lies the delays that have stretched for the better part of a decade.
Globally, the United States is tied with Papua New Guinea as the country that takes the longest time of 25 countries studied to permit a new mine — seven to 10 years, said a study prepared by Behre Dolbear Group, an international mining advisory group. The group said permitting delays are “the most significant risks to mining projects in the United States.”
The U.S. fared better, sixth from the best of the 25 countries, when the study’s researchers lumped permitting times with six other factors, including a country’s political and economic systems, degree of corruption and stability of currency. But the long permitting times remain.
Although Rosemont Copper, a subsidiary of Augusta Resources, says that it will set a new environmental standard and will employ water conservation and recycling techniques that will be a first-of-their kind in Arizona, opposition to the mine has been fierce and permits, especially those from the federal level, have been slow.
During SME’s annual Arizona Conference on Dec. 3 at the JW Marriott Star Pass Resort in Tucson, AZ, Kathy Arnold, Rosemont Copper’s vice president of regulatory and environmental affairs, spoke to an overflow crowd about the challenges the company has faced in getting the mine into production.
At the time of the conference, Rosemont Copper was in need of two final permits and one decision. The air permit was issued in February 2013 by the Arizona Department of Environmental Quality, so it was down to a 404 Permit to discharge dredged or fill materials issued by the Army Corps of Engineers. However, the Army Corps of Engineers was waiting for a decision that will be issued after the final environmental impact statement (EIS) is issued by the USFS.
It is the EIS that is the key to moving forward, Arnold said. Once the EIS is completed, the Forest Service can issue its Record of Decision and the Corps of Engineers can finalize its 404 Permit.
“It certainly has been challenging,” Arnold said in an interview. “The state has to meet a schedule and has done a good job of that, but that is not how it works at the federal level.”
Making things more difficult are the number of competing interests that the USFS must consider, including environmental groups, recreational enthusiasts and Native American tribes.
“Everyone’s opinions must be considered,” said Arnold.
And there is a lot to consider. The U.S. Forest service received more than 25,000 comments regarding the EIS.
To try to meet the challenges head-on, Arnold said the company has worked hard to be the most environmentally friendly project possible.
Among these efforts are the use of dry-stack tailings and state-of-the-art processing technologies. As a result, the mine will leave a much smaller footprint than similar-sized mines in Arizona. In fact, Rosemont’s plan will have the mine using 50 percent less water than traditional mining practices.
Rosment has already spent about $90 million on the best available mining equipment with the highest emission standards, and will work to control dust emissions with high efficiency dust collectors.
The company even has plans to protect Tucson’s skies with a carefully engineered facility lighting system that is designed to preserve the surrounding astronomical site and environment.
The company has also been transparent in its dealings with the public, offering tours of the site twice a week and hosting numerous meetings.
“You hear a lot about the people who don’t like us and don’t want to see the mine go into production,” said Arnold. “But we have more than 12,000 families who have signed on in support of the project and more than 8,400 friends on Facebook.”
Among its supporters is a Washington, D.C.- based mining advocacy group called Mined in America. It said Arizona workers are “paying a heavy price for this unreasonable postponement.”
“With so many Americans out of work and such a tremendous need for American natural resources so that we can revitalize manufacturing, it’s time for regulators to stop delaying and allow this project to move forward,” said Maurice Daniel, executive director of the group, in an interview with the Arizona Daily Star. “Let’s be clear: All of us want a responsible process. All of us view Rosemont as an opportunity to come together to create jobs and jump-start our economy. And yet unnecessary bureaucratic delays create a real lose-lose situation.”
During the mine’s first 20 years, 2,100 annual direct and indirect jobs would be created locally, 2,900 created at the state level and 4,200 national jobs.
The mine will have an annual economic impact of $701 million to Pima, Cochise and Santa Cruz counties, a $900-million impact to Arizona and $1.3-billion impact to the United States.
Coronado National Forest Supervisor Jim Upchurch said that the service must clear up unresolved issues about the proposed openpit copper mine near Tucson to make sure it meets all laws before approving it. These include issues involving Endangered Species Act rules, cultural and historical resources, and air quality, among others.
“The Rosemont project is a complex and controversial proposal that affects important and valuable natural, cultural and community resource values in southern Arizona,” Upchurch wrote in an email to the Arizona Daily Star. “These are not bureaucratic delays but, rather, important and required analyses and consultations that must be completed prior to a decision being made.”
When finally in production, the mine will account for about 10 percent of U.S. copper production. With proven and probable reserves of 2.67 Mt (5.9 billion lbs), the mine is expected to produce 110 kt/a (243 million lbs/year) of copper, 2.4 kt/a (5.4 million lbs/year) of molybdenum and 90.2 t/a (2.9 million ozpy) of silver.
“We are hoping that we will be able to begin construction in the third or fourth quarter of 2013,” said Arnold.
The construction process will take about 22 months, with production in 2015, if all goes well.
Technical program
Rusty McNew, director of global accounts for Caterpillar, delivered the welcoming address to the Arizona Conference. He spoke about the need to work together to create a stronger mining industry in the United States.
Gil Clausen, president and chief executive officer and director, Augusta Resources Corp., was the Distinguished Lecturer luncheon speaker. He also spoke of the challenges that are presented by regulatory policies in the United States.
The one-day conference included sessions on mining, environmental, mineral processing/smelting/metallurgy, mexico, geology and blasting.
The conference wrapped up with talks about three new projects, including KGHM’s Sierra Gorda copper project in Chile and Hudbay Minerals Constancia project in Peru and the restart of the Climax Mine in Colorado.
American Mining Hall of Fame
The conference was preceded by the 30th Annual American Mining Hall of Fame banquet in which Greg Boyce, chairman and chief executive officer of Peabody Energy, was inductee and guest of honor.
Under his leadership, Peabody has become one of the leading investment opportunities in the world with his vision to eradicate global energy poverty.
In his acceptance speech, Boyce said the greatest threat to mankind is that of global energy poverty, and it is a crisis that can be solved. Boyce introduced the Peabody Plan at the World Energy Congress in Montreal in 2010, as a five-step plan to alleviate energy poverty, create electricity access and deploy a technology path to achieve near-zero emissions from coal.
Boyce said more than 3.6 billion people lack adequate electricity and another two billion people will require power as the world population grows in the next 20 years.
“We lose 1.5 million people year because of energy poverty,” Boyce said. “Energy should not be a luxury. Peabody’s top priority, and the world’s top priority, should be the eradication of energy poverty.
“The world needs all forms of energy,” said Boyce. “Coal remains the only sustainable fuel with the ability to reach global markets.”
The Peabody Plan calls for:
• Working to eliminate energy poverty and propelling global economies by ensuring that at least half of new generation is fueled by coal.
• Replacing traditional coal plants with supercritical and ultrasupercritical plants, which are more efficient and carbon capture ready.
• Developing at least 100 major projects around the world that capture, store or use carbon dioxide from coal-based plants within 20 years. Deploying significant coal-to-gas, coal-to-chemicals and coal-to-liquids projects around the world over the next 10 years to reduce reliance on oil and natural gas.
• Commercializing and deploying next generation clean coal technologies to achieve continued environmental improvement and ultimately near-zero emissions.
Replacing the world’s older coal fleet with advanced supercritical plants would drive major global reindustrialization and enormous reductions in carbon dioxide without carbon capture and storage. Economies would realize $4.3 trillion in economic benefits and 21 million new construction jobs during a four-year construction cycle, according to a study by Management Information Services in Washington, D.C. Avoided carbon dioxide emissions would equate to removing more than the entire passenger car fleet in the United States.
Coal has been the world’s fastest-growing fuel this past decade. “Coal is the only sustainable fuel with the scale to meet the primary energy needs of the world’s rising populations and economies,” Boyce said.
The Peabody Plan would go far to eliminate energy poverty and energy inequality, and ensure full global access to electricity by 2050.
“Social and economic progress in the developing world is also the task of leaders in developed nations,” Boyce said. “Poverty and economic stagnation sting equally, regardless of the color of one’s flag.”
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