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"DRILL, DRILL, DRILL� by Irene Crowo Nielsen

how far are we willing to go?


Geophysical measurments are the foundation for finding mineral resources. The data are public and free. Helicopter (mag, rad, EM) 3.900 km2 Plane (mag, rad) 24.600 km2 Regional seismic surveys 2012

By the end of 2010 only 15 % of norwegian ground had coverage of high-resolution magnetic data. While Sweden had covered 90 % and Finland are now selling their gear because they have covered 100 %. Why are we so far behind? It looks like the government is asking the same question and gave 25 million NOK in 2011 with the promise of the equivalent for another 3 years.

(source: status i mineralkartleggingen MINN programmet, NGU, Sintef)

How do they scan the ground?


When you know where the minerals are, then what?

Mining Rights a quick introduction Register a proprietorship Read the rules for exploration at www.dirmin.no or see drawing

(source: www.dirmin.no/rettigheter)

Pay the fee and you are ready to go!

Happy Prospecting!


The explotion of mining rights in norway NGU starts detailed geophysical measurments

THE SUDDEN BOOM

Only 15% of norwegian ground has coverage of high resolution magnetic data

WHO ARE THEY?

sweden

w u ag Au th

UK USA

Au, base metals

Australia

WHAT ARE THEY LOOKING FOR?

Cu

Norway

finland denmark chile

REE nb, + mo ti

canada

Cu, Au ni, cu,pge

FE Cu, Pb,ZN

fe, ti ,v

Finnmarksvidda: a booming example Applications for mineral rights 2006

2007

Alta

karasjok

kautokeino

2008

Alta

karasjok

kautokeino

2010

Alta

karasjok

kautokeino

2011

Alta

2012 Alta

karasjok

kautokeino

No change in 2009

Alta

karasjok

kautokeino

(sources: http://www.sintef.no/project/GeoNor-konferansen2011, dirmin.no)

EU publish the Raw The Act of Minerals Materials Initiative (01.01.10) - RMI

karasjok

kautokeino

...and it is only the end of march


(sources: the different companies websites via www.google.com, http://www.ngu.no/kart/)

k

Looking north: how willing to share information are they?


(source: http://www.ngu.no/kart/bergrettigheter/)

how are they organized?


Here is an example: 2Bernt Stilluf Karlsen (61) a business man with several positions in the norwegian business world suddenly became the name on everybodys lips when he pretty much overnight via his mailbox company Klosters Rederi secured big areas of exploration rights in Norway (november and december 2011). According to the Directorate of Mining, the company paid approximately 1 million kroner in an establishment fee and secured a total of 1164 exploration areas in the north. Some called it a raid because it all happened so quickly.

Stilluf Karlsen says to the newspaper Budstikka that he has actually been working on this in silence for a couple of years. Stilluf Karlsen was even in contact with the canadian company Dalradian Resources in june 2011 before he secured the mineral exploration rights. He then struck when the timing was right. He functioned as a mediator and sold the exploration rights to the canadian company as recent as in january 2012. To the norwegian online newspaper geo365 he says that there were three reasons why he conducted his “little” initiative. To be short he mentioned the two year old Mineral Act, that the country is hardly explored and that the government has contributed money to upgrade the geological and geophysical database. He ends it with saying that this was an unique opportunity and a “cheap” option.

Dalradian paid 20 million kroner, and up to 80 millions for the stocks in the company. Stilluf Karlsen then stated to the newspaper Nationen, that Dalradian was the best option and that they are among the best in the world of exploration. -”They are ahead on the technology front, they have the knowledge and education, they have acess to people and drilling facilities as needed”. Patrick Anderson the CEO for Dalradian Resources stated that “as an exploration company, we could simply not let this opportunity slip away from us”.

Reactions: - “Im happy that foreign companies invest in the norwegian mineral industry. It will have positive influence on us, both as a country and as individuals.” - Per Roar Bredevold, Frp. “It is positive that canadians show interest, it suggests that there are many who have faith in norwegian mineral industry” - Svein Flåtten, Høyre. “We want to facilitate for private actors, but not in a way that the values are taken out of the country without national benefits as well as regional ones” - Irene Lange Nordahl, Sp. Irene Lange Nordahl (Sp), Alf Holmelid (SV) and Rigmor Andersen (KrF) are worried that such large areas of land now is in foreign hands before Norway has made a national mineral strategy. Manager Morten Often in the exploration company Store Norske Gull says: “the mineral industry in Norway has never experienced similar large acquisitions of rights, and the acquisition has consequences for other actors”.

CEO Patrick Anderson and CFO Keith McKay, Dalradian Resources Foto: Ketil Blom Haugstulen/Nationen

Managing Director in Nussir AS, Øystein Rushfeldt makes it clear that he believes the way Dalradian does it as “special”. ”It is impossible to look efficiently in such a large area and within a reasonable time limit, much of the area will probably just be there without any activity.”

(source: http://www.nationen.no, diverse artikler om mineralindustrien og om dalradian resources, www.geo365.no)

Speculation is a part of the picture when the limits are fewand the prize is high...

What are Dalraidians next steps in Norway?


The canadian "gameplan" for the north Data acqusition/compilation

drill drill drill...

target selection

data analysis

...SEE FOR YOURSELF

ground truthing

“ It is a rare opportunity today to be able to assemble a dominant land position in a stable first world country, covering geological belts known to host major precious and base metal deposits.” Patrick Anderson, CEO Dalradian Resources

“Let The Treasure Hunt Begin...” These five words starts the norwegian part of Dalradians investor presentation (march 2012) including the “famous” picture of Trond Giske holding up the norwegian mineral map. The canadian company must feel like they won the lottery, being able to have the mining rights for as much as 5% (approx. 11 000 km2 in north of Norway) of the norwegian land. They sure presents it as an adventure, with gold being one of the main minerals they are looking for.

They present their further steps almost as a strategic gameplan. They use words as “Boots on ground”, “Target selection” and “Drill Drill Drill”. They describe Norway as a mining friendly country with large population centers, paved highways and thin or absent forest cover and excellent infrastructure. They have only scratched the surface layer of what is there, what will happen now? Have this in mind: while Norway (Statoil) is looking for black gold in Canada (oilsands), Canada (Dalradian) is looking for real gold in Norway...

(source: www.dalradian.com/investor presentation march 2012)

Boots on ground


think about this... What is the knowledge, what are our learnings now that we are starting to see the whole picture? First of all it is easy to see that exploration rights pretty much are up for grabs for the first one to come. All data are public, free and easy to find. NGU and the Directorate of Mining work together gathering detailed data resulting in a yearly “Mineral Statistics of Norway”. According to their website they do this to mark the importance of the industry to the Ministry of Trade and Industry and other ministries and authorities as well as the public. They also want to contribute to counties, municipalities and industries so they will be able to put the mineral resources into good landuse planning including both existing mineral deposits and possible future ones. The government is also very public about the millions they want to invest in high resolution data in the north. Are we being too public with our data? Maybe we should hold back a little to protect our own national interests? We should keep in mind that these northern areas also are Europes last large continuous natural areas and that they are in fact both a national and a world interest. One can discuss the potential risks and consequenses of having such an open profile. When speculation is a part of the picture it does also attract actors with other intentions than just the mining business in itself. The hunt for money is strong. Lot of undefined norwegian actors shows up in the map of actors in the north. The businesses looks like proprietorships with only one owner. Who are these mining jokers? Why do they have exploration rights? Are they only there to speculate?

We have already seen tendencies towards this happening in the case with Bernt Stilluf Karlsen and his mailbox company being a mediator and selling the rights for millions to the canadian company Dalradian Resources.

Will the big actors in the end manage to sqeeze out the small norwegian ones? What will happen then? No norwegian controll over exploration rights? Why is this happening so fast?

Does anyone else find this a little frightening but me? What will an experienced canadian company benefit from owning 5 % of exploration rights in a country who is just establishing itself in the field? One can also ask the question: when foreign companies buys exploration rights for such big amounts of money, will they then have the good-will and money left to actually care about what is best for the local communities?

One can start to wonder if this will be history repeating itself in terms of another Klondike Gold Rush. If we take a quick look back....

Another interesting thing on the map of exploration rights in the north is the way recent actors is suddenly surrounding already established businesses in the area. Take for example the norwegian company Store Norske Gull, it has been in the Lakselv-Karasjok area for years (permit in 2006) and is now pretty much overnight surrounded by the canadian company Dalradian Resources. Morten Often, the company manager of Store Norske Gull stated to the newspaper, Nationen, that: - “There is a definite problem for us and others operating in the same areas when they now have covered the field of rights” He also fears that the acquisition will lead to slow exploration activities several places because it is almost impossible for only one actor to look efficiently for minerals in such a large area. -”It requires enormous resources to seek actively in such a large area”. Store Norske Gull is only one of many companies who finds themself caught in the middle with stamplike areas compared to the big actors.

The sudden news of gold in the Klondike (1897), led approximately 100 000 people to travel to the Klondike of the Yukon in north-western Canada in hope of successfully prospecting for gold. It created a nation-wide hysteria and led many people leaving their jobs to set of to make fortunes as miners. The prospectors came from many nations, and most of them had no experience in the mining industry. Some miners was there only to speculate, buying and selling claims building up huge investments. As an effect of this, “Boom towns” sprang up along the gold routes to accomodate the flow of prospectors. Dawson City (in the heart of the gold creeks) grew from a population of 500 to around 30 000 people in only 2 years. The difference between rich and poor became very visible. The native Hän people who had been living along the Klondike long before the gold suffered extensively being moved into a reserve to make way for the prospectors, many of them died as a result. The grass is always greener on the other side and it all came to an end when announces of gold discoveries in Nome, Alaska was found. Prospectors left behind ghostlike towns and the Hän people found only few ways to benefit economically from the gold rush, their fishing and hunting ground was almost completely destroyed and by 1904 they needed aid from the NEWMP to prevent famine.


I am not saying this will happen in north of Norway, it will most likely not because of todays society and democracy. Tore Tanum from the Ministry of Foreign Affairs stated in a lecture that no one is served by a new gold rush, and that the Ministry of Foreign Affairs sees it as a task to argue that history will not repeat itself. He says that “the bad guys does not always win”. But it is interesting to compare the situation happening right in front of our eyes with the Klondike Gold Rush. It is a story we need to know in order to detect similar conditions taking place in our era in perhaps only different, more modern ways.

think about this...

As a final comment, should not the law be tightened slightly to protect national interets on all levels? From national interests in mineral resources to the indigenous rights and traditional landuse? It could be a governmental institution that have to approve exploration rights according to the companys degree of seriousness. The companies should for example be able to show previous references, relevant education and hand in a written statement with their intentions for the area. It could also be a requirement for foreign companies to hire a norwegian communications manager to make the communication between locals, the understanding of societies, laws and rules more easy and efficent. One thing is for sure: something needs to be done!

Sources: Direktoratet for Mineralforvaltning (www.dirmin. no), “Norske gruveselskaper fryktar kanadiske Dalradian Resources sitt oppkjøp av mineralrettar” (www.nationen. no/2012/02/16/naring/store_norske_gull/store_norske/ nussir/dalradian/7257852/), Klondike Gold Rush (http:// en.wikipedia.org/wiki/Klondike_Gold_Rush)

Drill Drill Drill  

How far are we willing to go?

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