Issuu on Google+

MARCH 2012

www.JARKS.ca

AMERICAN MANGANESE INC. The Right Place At The Right Time

ATHABASCA WATER TREATMENT PLANT UPGRADE Accommodating Growth

TE

O

I S N

AT

MNECA The Moncton Northeast Construction Association


JARKS ONSITE AT PDAC 2012 On Monday March 7, Managing Director John Michael and Editorin-Chief Sunjay Mathuria attended the 80th annual Prospectors and Developers Association of Canada (PDAC) International Convention, Trade Show, and Investors Exchange in Toronto. The PDAC’s services usually fall under three categories: advocacy, information, and networking. With a turnout of approximately 30 000 people, the PDAC convention is a chance for the world’s mining industry to congregate in one place for a few days and connect.

Continued on page 8....

2

jarks business canada H mar 2012


Prospectors & Developers Association of Canada

PDAC2012 Where the world’s mineral industry meets

International Convention, Trade Show & Investors Exchange Register today at www.pdac.ca! Early Registration Deadline February 3, 2012

March 4–7, 2012 Toronto, Canada Metro Toronto Convention Centre

www.pdac.ca mar 2012 H jarks business canada 3


Editor’s letter Welcome to the very first issue of JARKS Business Canada and thank you for reading! In accordance with our namesake, you will read about journeys, achievements, strategic relationships, and keys to success within the pages of this magazine. Our focus on the mining ex-

and President of American

the most of the high-grade

ploration

Manganese

uranium deposits found in the

and

development

Inc.

about

the

industry for this issue is very

growing demand for electro-

Athabasca Basin.

timely. In early March, the

lytic manganese metals and

PDAC held their annual min-

how his company has the re-

and development would diffi-

ing and investor’s convention

sources

them.

cult without the help of tech-

where thousands of investors,

Meanwhile,

Iron

nology – for instance, drilling

CEOs, and industry specialists

Mines have tapped into the

equipment. For this issue, we

gathered to showcase industry

iron market by developing key

have also highlighted a com-

highlights and discuss the fu-

partnerships in China. In our

pany that supports the mining

ture of mining.

article about Fission Energy,

industry. Energold takes an

For our first issue, we

CEO Ross McElroy explains

environmentally-friendly

spoke to Larry Reaugh, CEO

how his company is making

proach to drilling with their

4

to

provide Century

Of course, exploration

ap-

EDITOR Sunjay Mathuria editor@jarks.ca

GRAPHIC DESIGNER MANAGING DIRECTOR Jennifer Taylor John Michael jennifer@jarks.ca johnm@jarks.ca

RESEARCH DIRECTORS Jason Maha jasonm@jarks.ca

Kris Silva Clay Ramos kriss@jarks.ca accounts@jarks.ca

jarks business canada H mar 2012


unique drill design that leaves only a small ecological footprint. Innovation doesn’t stop at technology though. Our stories on the Athabasca Water Treatment Plant upgrades and the

MY PICK OF THE MONTH

Moncton Northeast Construction Association (MNECA) feature a large-scale project to accommodate a booming population and new ways to engage MNECA members with industry-specific training, respectively. I believe we have accomplished a great deal for our first issue with our rich and eclectic mix of stories. Maybe you have heard of some of the people or companies we have featured and if not, I am certain our stories will provide exceptional introductions to their achievements, and ground-breaking plans. I am also certain you will be hearing more about their successes in years to come. So whether you are at your computer, laptop, or on your iPad, sit back and enjoy these various journeys.

60

Check out Energold’s

innovative drill design and practices. Their drills can be found around the globe, where they collaborate with local communities and practice socially-

All the best!

responsible drilling. Energold is the definition

Sunjay Mathuria

of ground-breaking.

Business Canada

Jarks Business Canada. 5035 Hurontario St. C/O 30001 Mississauga ON L4Z 3X0 Canada Ph: 647.207.2667 Fax: 905.248.3329 Email: info@jarks.ca Web: www.JARKS.ca

mar 2012 H jarks business canada 5


contents

08

18

38 6

jarks business canada H mar 2012


Business Canada

Business Canada in grayscale

Business Canada in two colours

Business Canada in black & white

28 08

18

28

38

PDAC 2012

50 50

Energold Drilling Corporation

JARKS Onsite At

Going Where No Other Drilling

The PDAC 2012

Company Has Gone Before

Century Iron Mines

62

MNECA

Mining That

A Voice For The

Transcends Borders

Construction Community

Fission Energy Corp.

68

Athabasca Water Treatment

A Market For

Plant Upgrade

Uranium

Accommodating Growth

American Manganese Inc. The Right Place At The Right Time

mar 2012 H jarks business canada 7


9NSITE

AT THE PDAC 8

jarks business canada H mar 2012


Toronto’s largest annual mining convention came and went, bringing with it minerals and expertise from places as far off as Mongolia and Argentina. Thousands of exchange investors, CEOs, business executives, and mining industry specialists flooded the Metro Convention Centre in early March for the annual Prospectors and Developers Association of Canada (PDAC) International Convention, Trade Show, and Investors Exchange. The PDAC conference took place from March 4 to March 7 and hosted a multitude of mining companies and investors --- big, medium, and small. According to a PDAC news release, the

mar 2012 H jarks business canada 9


10

jarks business canada H mar 2012


goal of the convention is not

individual members of the

zation, the PDAC has grown

necessarily to increase the

PDAC, which include pros-

to become an international

number of participants ev-

pectors,

geo-

affair with, according to a

ery year. Rather, the goal is

scientists, and consultants

PDAC news release, “a suc-

to retain the quality of the

and 1 081 corporate mem-

cessful advocacy program

show and create a space of

bers, which includes senior,

and a highly-developed cor-

networking and education

mid-size, and junior mining

porate responsibility pro-

with technical sessions and

companies. Over the past

gram.�

short courses.

five years, the PDAC has fo-

developers,

cused much of its resourc-

The convention has been

The PDAC has represented

es on the association’s role

hailed as one of the most di-

the interests of the Cana-

in the international min-

verse mining shows in the

dian

mineral

ing community and this is

world,

and

development

indus-

evident in what the PDAC

and exhibitors that mine for

try since 1932, hosting the

convention has become to-

gold, uranium, manganese,

PDAC convention annually.

day.

Since its inception as

silver, copper, and the list

There are currently 7 684

an Ontario-focused organi-

goes on. Last year, over 27

exploration

hosting

companies

mar 2012 H jarks business canada 11


12

jarks business canada H mar 2012


700 people attended, repre-

importantly, why investors

mining interests. Who are

senting 120 countries from

should

investing

they speaking to? Bank-

almost

continent.

in their company. Accord-

ing executives, brokers and

This year, at the 80th PDAC

ing to the PDAC website,

analysts, mining executives,

convention, it is reported

the Investors Exchange “at-

fund managers, and govern-

that 30 000 people attended.

tracts

ment

every

consider

companies

seeking

representatives,

to

opportunities for business

name a few. At the booths

Monday morning, the sec-

development, joint ventures,

and stalls, investor relations

ond day of the convention,

property acquisitions and

representatives busily chat-

was bustling with activity.

financing.� Exhibitors at the

ted with passers-by about

In the Investor’s Exchange

Investors Exchange includ-

what their company has to

room and the Trade Show,

ed: exploration companies,

offer to the mining indus-

companies set up booth to

mid-size producers, mining

try. From Abacus Mining

showcase

companies, and brokers and

&

financial institutions with

tion to Zincore Metals Inc.,

ments,

their

assets,

achieveand

most

Exploration

Corpora-

thousands of exhibitors and companies

have

travelled

to Toronto for the week to garner support and excitement for their mining and development expeditions. In particular, junior companies have

been

working

hard

trying to attract hesitant investors. Once you are finished perusing through the Investors Exchange, the PDAC also organizes a number of corporate presentations and presentations

about

min-

ing-related activities from around

the

world.

Mon-

mar 2012 H jarks business canada 13


day and Tuesday’s corporate presentations included: Tintina Resources Inc. on copper, Magma Metals Limited on nickel and PGM, Eldorado Gold Corporation on gold, New Millennium Iron Corporation on ferro metals, coal and potash, and Silvercorp Metals Inc. on silver. Investors also got a taste of the international mining scene

with

presentations

about responsible mining in 14

jarks business canada H mar 2012


Ecuador, new opportunities

hosted Mining Matters, a

on experience with vari-

in Nicaragua and Maurita-

charity that educates stu-

ous minerals. All the pro-

nia, and exploration high-

dents and teachers about

ceeds from the fifth annual

lights from Greenland. The

the industry and the impor-

PDAC-Caracle Cup Hockey

Aboriginal

and

tance of mineral resources.

Tournament, held on March

presentations have also been

Groups of school-aged chil-

3, went to the Mining Mat-

key facets of the convention,

dren donning “Mining Mat-

ters program. In particu-

exploring ways of building

ters� t-shirts got a chance to

lar, the tournament helped

relationships with commu-

experience the show them-

raise funds for an Aboriginal

nities and respecting agree-

selves, as they roamed the

outreach program that as-

ments and expectations.

PDAC convention grounds

sists in building awareness

alongside thousands of suit-

of employment opportuni-

too

ed-up executives and inves-

ties in the mining industry.

young to learn about geosci-

tors. Back in the classroom,

The program offers in-class

ences and the mining indus-

a room booked at the con-

workshops

try. The PDAC convention

vention, students got hands-

and educators, as well as

You

are

program

also

never

for

students

mar 2012 H jarks business canada 15


community-based

summer

alized communities to build

Every year, the PDAC con-

camps. The Mining Matters

interest and employment in

vention becomes a meeting

program is yet another way

the ever-growing industry

place for investor exchange

the PDAC has been engag-

of mining exploration and

exhibitors, CEOs, industry

ing with youth and margin-

development.

specialists, and executives to

16

jarks business canada H mar 2012


“Dealing with uncertainty.” With presenters from The Scotiabank Group, the Metals Economic Group, and the International Council of Mining and Metals, “Dealing with uncertainty” offered a critical, yet confident look into the future of mining. Opening the convention on Monday morning, the session helped unravel the future by addressing emerging market demands and predicting future discoveries. The last technical session on the final day of the convention also provided a glimmer of hope with presentations on new discoveries and developments from across the globe. As PDAC membership continues to grow and the industry continues to boom, it is almost certain next year’s convention will be an even bigger success. We look forward to more developments gather, network and share

to discuss what is to come

and even more exciting and

ideas. The four-day conven-

and what is in store for

timely mining projects. See

tion is not only about what

the future. The title of one

you all in 2013!

is happening in the industry

of Monday’s keynote ses-

right now, but it’s a chance

sions sums up the industry: mar 2012 H jarks business canada 17


MINING THAT TRANSCENDS BORDERS 18

jarks business canada H mar 2012


Century Iron Mines has their work cut out for them for the foreseeable future. Without a doubt, the demand for iron for steel and steel-related production is increasing, especially in developing countries. By forming strategic partnerships in China, a country with a booming economy, Century Iron Mines has scoped out and secured the iron ore market for the longrun. And they have lots of iron ore to go around too. With strongholds in northern Quebec and Labrador, Century Iron currently operates a number of projects: the Duncan Lake Iron Ore Property, the Sunny Lake Iron Ore Project, the Attikamagen Iron Project, and the Altius Project. These projects are “100 percent dedicated to iron ore,” says Sandy Chim, President and CEO and Director of Century Iron Mines. “This is the iron ore area of Canada,” he says.

mar 2012 H jarks business canada 19


“This is the iron ore area of Canada� Sandy Chim, CEO

20

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THE CHINESE PARTNERSHIPS

These partnerships ensure

tonnes and Chim predicts

that Century Iron Mines

that WISCO is growing to

Century Iron is all about

has the “vote of confidence”

the capacity for 60 million

strategic

from

China’s

tonnes a year, as the Chi-

nerships and joint ventures,

third largest steel producer

nese market demands more

which are the core of their

and supplier and the world’s

steel.

ongoing projects. Century

fourth largest, WISCO re-

Iron has pursued key strate-

quires a substantial amount

Chim explains how this ben-

gic partnerships with major

of iron ore that Century

efits Century Iron Mines:

Chinese state owned enter-

Iron aims to satisfy to a

“At that level, they will need

prises, such as Wuhan Iron

meaningful extent. Accord-

around 100 million tonnes

& Steel Co. Ltd. (WISCO)

ing to Chim, WISCO has

of iron ore.” In addition to

and MinMetals Exploration

“25 percent equity take and

the production share in the

and Development., both of

an off-take agreement for

joint venture with Century

which

Forbes

60% of production.” WIS-

of 40 percent of Century

Global 500 (#428 and #332,

CO’s annual steel produc-

Iron’s

respectively).

tion has reached 36 million

WISCO will also buy from

corporate

ranked

in

part-

China.

As

project

production,

mar 2012 H jarks business canada 21


Century another 20 per-

Duncan Lake. With WISCO

where scale is everything

cent at the market price,

and MinMetals as equity

and where scale is all about

securing a total sale of 60%

shareholders, Century Iron

capital,� explains Chim.

production from these joint

has developed a unique cor-

venture projects.

porate structure that dif-

“We have very strong sup-

ferentiates them from other

port from the Chinese mar-

mining corporations.

ket with these companies

Based in Beijing, MinMetals is a state-owned diversified

and they are placing a lot of

mining company that has

“We have built a very close-

confidence and hopes in us

5 percent equity stake and

knit relationship that will

meeting their expectations

an off-take agreement for

enhance us going forward

of delivering the iron and

10 percent of production of

as an iron ore company

carrying the projects into

22

jarks business canada H mar 2012


production,” he says.

expected to double its steel

driving force behind the de-

production from 683 million

mand for steel, Chim says:

A FAVOURABLE MARKET

metric tonnes per annum

“the world is going to need

(mtpa) to a predicted 1158

to make 813 million tonnes

Chim is also positive that

million mtpa. The crude steel

a year more of steel over

current and future market

production in the rest of the

the next 10 years, so you

trends will work in Century

world has grown steadily

will need 1.4 billion tonnes

Iron’s favour. He notes that

over the past 10 years and

a year more iron ore within

developing economies, such

Chim predicts that it will

this same period.” And Chim

as China and India will drive

continue to increase over

says Century Iron Mines is

steel growth over the next

the next decade. With the

positioning its resources to

10 years and China alone is

construction sector as the

feed into that demand.

mar 2012 H jarks business canada 23


MINERAL ROUNDUP: TACONITE

pared with other coarser

nature of the recently-dis-

grain iron ores, for making

covered taconite: “The de-

In early 2012, Century Iron

iron ore pellets which have

posit has a very unusual

Mines announced the dis-

been a growing segment of

characteristic of having two

covery of a large taconite

the global seaborne iron ore

to four times the thickness

iron discovery on its Rainy

market.”

of the regular iron ore formation

Lake property (part of the

in

the

Labrador

in

Last year, the company

Taco-

drilled around 50 to 60 000

nite provides an important

meters across three proj-

In another part of the ex-

source of iron ore supply for

ects when they discovered

ploration program which fo-

the steel market. A press

the taconite.

cused on finding high grade

Sunny

Lake

Project)

northern Quebec.

Trough.”

direct shipping ore (DSO), a

release published in January states: “The finer grain size

“This is a fairly major dis-

major hole that they “kind of

of taconite requires less en-

covery,” says Chim, proudly.

picked around at” towards

ergy cost of grinding, com-

Chim explains the unique

the end of the last min-

24

jarks business canada H mar 2012


mar 2012 H jarks business canada 25


26

jarks business canada H mar 2012


DUNCAN LAKE IRON ORE PROPERTY Location

Western Part of the La Grande Greenstone Belt

Mineral

Iron (Fe)

Property Size

5,848 hectares

Resource

5.7 MT Measured @ 23.29% Fe; 25.6 MT Indicated @ 23.48 and 821.5 MT Inferred @24.56% Fe

ing season. Due to weather conditions, they could only

A RECIPE FOR SUCCESS

do about 54 meters of drill-

partnered up with Augyva Mining Resources Inc. with the Duncan Lake Iron Ore

ing and out of that, they ac-

With more iron ore depos-

Project and Champion Min-

quired 40 or more meters of

its than any other company

erals Inc. with the Attika-

high-grade (over 62 percent)

in Canada, Century Iron

magen Iron Project. They

DSO.

hopes to meet the world’s in-

are currently in phase II of

creasing demand of steel by

their Duncan Lake Iron Ore

They are unable to confirm

aiming to produce 100-mil-

Project. Needless to say, es-

the discovery as a deposit

lion tonnes of iron ore per

tablishing strategic corpo-

due to the 43-101 rule.

year in the longer term fu-

rate partnerships and joint

ture by stages. So far, things

ventures whilst maintain-

However, with the previous

are on track this year. Joint

ing a strong presence in the

positive

work

ventures with other min-

iron ore regions of Quebec

done on the property, Chim

ing companies in the area

and Labrador seems to be

is optimistic and is convinced

have allowed Century Iron

Century Iron’s winning for-

that “it looks to be a good po-

to maximize manpower to

mula.

tential DSO deposit.” Drill-

explore and work in their

ing will resume in May 2012.

iron ore regions. They have

exploration

For more information www.centuryiron.com mar 2012 H jarks business canada 27


A MARKET FOR URANIUM

28

jarks business canada H mar 2012


We all know uranium is used

in 2011, made a high-grade

particular, Fission Energy

to fuel nuclear power plants

boulder field discovery at

acquired Strathmore’s as-

and

are

its Patterson Lake South

sets in the Athabasca Basin

crucial sources of energy.

property. Both are located

in Saskatchewan, a world

With energy consumption

in

Atha-

premiere district for ura-

increasing and new nucle-

basca Basin: home of the

nium where exceptionally

ar power plants being built

richest uranium deposits in

high-grade deposits can be

worldwide, the demand for

the world. Fission Energy

found.

uranium will only increase

has properties in Saskatch-

in years to come. Canada-

ewan, Quebec, and Peru.

“It’s unlike anywhere else

based uranium exploration

Spun

Strathmore

on earth,” says Ross McEl-

and development company

Minerals, which had near-

roy, CEO and President of

Fission Energy Corp has

term production assets in

Fission Energy. “The depos-

discovered significant high-

the United States, a number

its in the Athabasca Basin

grade deposits at its Wa-

of Fission Energy’s proper-

are better quality resources

terbury Lake property and

ties were already staked. In

and are higher grade.”

reactors,

which

Saskatchewan’s

out

of

mar 2012 H jarks business canada 29


Core Samples from Discovery Bay

30

jarks business canada H mar 2012


Ross, Dev and Bob and North American coun-

With nine properties in the

STRATEGIC PARTNERSHIPS AND THE GROWTH OF NUCLEAR ENERGY

Athabasca Basin and over

There

quirements

200

staked

440 nuclear power plants

generators and the United

to date, Fission Energy is

in the world. This number,

States has 25 percent of

positioned as a potential

says

the world’s nuclear power

leading force in the ura-

crease dramatically in the

plants.

nium exploration industry.

coming decades. European

roy says the real growth in

Twenty

percent

of

the

world’s uranium and 100 percent of Canada’s supply derives from this region.

000

hectares

are

approximately

McElroy,

could

in-

tries have traditionally relied a great deal on nuclear power; France runs around 80 percent of its energy refrom

However,

nuclear

McEl-

mar 2012 H jarks business canada 31


the industry is coming out

“That’s a huge addition to

sides. Korea is currently

of Asia.

the overall grid,” he says.

bidding to build new nuclear

“China and Ko-

rea are emerging countries

plants in regions such as the

and their demands on the

As an exploration company,

Middle East and is winning

energy sector are huge be-

Fission Energy is constant-

many new contracts.

cause their populations are

ly searching for resources to

booming and their growing

feed into this future market,

“They need uranium for the

economies are vast. With

10 to 15 years down the line.

long term and this allows

the growing economy, you

The average project from

them to provide support

have higher energy require-

discovery to mining takes at

over a long period of time.

ments,” explains McElroy.

least 10 years.

It’s important for a junior company to have some se-

There are currently 13 nu-

This booming growth sector

curity out in the future so

clear power plants operat-

in Asia is one of the reasons

that their projects will be

ing in China and 26 under

Fission Energy has decided

supported,” says McElroy.

construction. McElroy says

to partner up with the Ko-

China also has plans to con-

rean Utility Company. The

THE PROJECTS

struct over 100 more plants

partnership is crucial and

Of all their projects, McEl-

in the near future.

effectively

roy says Waterbury Lake in

32

jarks business canada H mar 2012

benefits

both


the Athabasca Basin is the

in budget from what was

sin: Patterson Lake South.

number one priority.

originally planned. Fission

This past summer, the com-

Energy owns a 60 percent

pany discovered high-grade

“It’s right in the heart of the

share of Waterbury Lake,

uranium boulders. “We’re

uranium mining district,”

while the Korea Waterbury

continuing to follow up on

he says.

Uranium Limited Partner-

that and hopefully make a

ship owns 40 percent. The

discovery at the source of

The company made a high-

property also lies 30 me-

the boulders,” says McElroy.

grade discovery in the re-

ters away from properties

gion in 2010 and is continu-

Rio Tinto has purchased for

Over in eastern Canada,

ing to grow the deposit.

$654 million where a sig-

Fission Energy has secured

Fission Energy is quite con-

nificant discovery was made

deposits at Dieter Lake in

fident Waterbury will con-

four years ago. This merely

Quebec. Originally owned

tinue to churn out great

emphasizes

by a German utility compa-

results: the 40,256-hectare

nature of Fission’s project.

the

strategic

property is currently being

ny in the late 1970s, Fission Energy acquired the lands

drilled in an expanded 88

Another important project

in 2002. The property has a

hole 32,630m drill program

for Fission Energy is also lo-

sizable inferred resource of

with a 26 percent increase

cated in the Athabasca Ba-

24.4 million pounds.

mar 2012 H jarks business canada 33


Fission Energy works in the heart of the uranium mining district.

34

jarks business canada H mar 2012


mar 2012 H jarks business canada 35


McElroy explains how his company is differ-

Geophysics, Fission Energy has been able

ent from other uranium exploration com-

to acquire a solid understanding of the land

panies out there: “We’re successful with a

and how to maximize their use of it.

discovery. Most juniors are not.” “Most juniors have not had success explorWith the help of Bryson Drilling on the

ing in that area, but we’ve had two major

Waterbury project, Mineral Services Group

successes in the last two years,” says McEl-

for geological consulting, and various geo-

roy. Looking forward, McElroy wants the

physics groups such as Patterson Geophys-

company to continue growing deposits in

ics, Discovery Geophysics, and Living Sky

the next five years and sell assets as they

36

jarks business canada H mar 2012


become attractive to major mining com-

well-funded (a third of the market is strict-

panies. While McElroy attributes some of

ly in cash) and their geographically-varied

the success to “a certain level of good luck,�

properties allows for lot of room for expan-

he also says the company has a very tech-

sion. By focusing on the Athabasca Basin, a

nologically capable group to support their

region where McElroy himself has spent a

endeavors.

geotechnical

large part of his last 25 year working career,

and geochemical groups and a solid part-

Fission Energy has wisely positioned itself

nership with the Korea Utility Company,

in an area where their expertise gives them

Fission Energy is just as successful as any

a competitive advantage.

With

advanced

major company. Moreover, the company is mar 2012 H jarks business canada 37


38

jarks business canada H mar 2012


THE RIGHT PLACE AT THE RIGHT TIME

Things have been moving along pretty quickly at American Manganese Inc. over the past few years thanks to a favourable market and a plethora of manganese. American Manganese Inc., an exploration and development company for specialty minerals, certainly seems to be at the right place at the right time: Chinese production of manganese started declining a few years ago, the demand and market for manganese metals in North America is growing every year, and American Manganese Inc. has acquired property in Arizona that has billions of pounds of the mineral. As

mar 2012 H jarks business canada 39


40

jarks business canada H mar 2012


a junior development company, American Manganese Inc. has

researched the manganese market and has focused

its research on Electrolytic Manganese Metals (EMMs). Electrolytic Manganese Metals are primarily used to make stainless steel. American Manganese Inc. is a company listed with the TSX Venture Exchange with a focus on commodities for the steel industry, specifically manganese. “It is the fourth largest traded commodity on the market,� explains Larry Reaugh, CEO and President of American Manganese Inc. One thing that drew the company to manganese is that there is currently no American production of the mineral even though much of the demand for manganese comes from North America. After extensive research, the company determined that manganese is the most critical metal on the market right now. For example, in the stainless steel industry, there is no efficient substitute for manganese.

WHAT IS MANGANESE? Steelmaking accounts for about 90 percent of manganese demand. EMMs are primarily used for the alloying of steel, stainless steel, and aluminum. Currently, China controls around 98 percent of EMM production and export, but

mar 2012 H jarks business canada 41


Reaugh says this number is going to decrease rapidly, leaving American Manganese Inc. with the opportunity to pick up where China leaves off – and at a cheaper price. “China is currently consolidating its business, which means there will be fewer producers there. They pretty much depleted their ore bodies and their prices are going up,” says Reaugh. He predicts in five years that China will no longer be exporting EMM. According to Ken Reser, manganese also replaces the use of nickel alloy in 200 series stainless steel, which is more costly.

PRE-FEASIBILITY STUDIES With only one other EMM

42

jarks business canada H mar 2012


producer

in

the

world,

which is located in South Africa,

Reaugh

says

we

will need to start sourcing our own supply. We consume about 250,000 tonnes of

electrolytic

manganese

per year. The South African manganese metal company only produces 30,000 tonnes per year; Reaugh believes his company can produce 50,000 tonnes to meet demand levels. American Manganese Inc. is in the middle of pre-feasibility studies at Artillery Peak

Manganese

Proper-

ties, land that they acquired in Arizona a few years ago. The property has been recognized as having the largest known manganese deposits in Southwest USA. From 1928 to 1955, the property

mar 2012 H jarks business canada 43


functioned as an underground mine that produced manganese for steel mills and the U.S. government strategic materials stockpiles. In 2007, American Manganese Inc. purchased the property and began drilling and a Preliminary Economic Assessment (PEA). Over the past few years, American Manganese Inc. commissioned Kemetco Research Inc., a research and development company specializing in metallurgy extraction, to conduct proofs of sulfuric

Potentially The Lowest Cost Producer of Elctrolytic Manganese. acid extraction in 2009 and to test for Lithium Manganese Oxide (LMO) in 2011. LMO is currently in demand in the battery industry due to its low cost and high power output. Wardrop, a Tetra Tech company, is working with Kemetco to put together the pre-feasibility evaluation report. The study will be completed by the end of the first quarter. It has already indicated the presence of 13.5 billion pounds of manganese and an inferred amount of 3.5 billion pounds.

44

jarks business canada H mar 2012


mar 2012 H jarks business canada 45


“We’ve got more manganese

“We’ll still have manganese.

from 1.5 million tonnes to-

than you can shake a stick

It’s wide open and we cer-

day to 2.8 million tonnes

at,” says Reaugh.

tainly haven’t found it all,”

in 2021. EMM is primarily

says Reaugh.

used for upgrading specialty

The company will produce

steel (47%), manufacturing

around 110 million pounds

ELECTROLYTIC

aluminum alloys (32%), and

of manganese a year, leav-

MANGANESE METALS

electronics (14%). The EMM

ing an abundance of man-

(EMM) AND EMD

market currently consumes

ganese to be mined over the

According to a market fore-

1.2 to 1.3 million tonnes per

next several decades – even

cast, the worldwide demand

year, which is around 3 bil-

when production doubles,

for Electrolytic Manganese

lion pounds of manganese. A

triples, or quadruples.

Metals (EMMs) will grow

refined form of manganese,

46

jarks business canada H mar 2012


Electrolytic Manganese Di-

which provides a more pow-

spinel for electric vehicles.

oxide (EMD) is made by the

erful charge than any other

Ford predicts that electric

same process as EMM and

alternative metal. EMD is

vehicles will account for up

is predicted to be one of the

the largest component of

to 25% of its vehicle line-up

fastest-growing

segments

lithium ion batteries and

by 2020, further increasing

in the manganese industry

have been used in a variety

the demand for manganese-

due to battery consumption.

of products such as laptops

based lithium ion batteries.

American Manganese Inc.

and cell phones. In the auto-

will be testing EMD this

mobile industry, Chevy Volt

Reaugh says he hopes to

year and looking at produc-

and the Nissan LEAF are

also start looking at sodium

ing a lithiated manganese

using lithium ion batter-

manganese batteries, which

powder derived from EMD,

ies with lithium manganese

he sees as a rapidly-growing

mar 2012 H jarks business canada 47


48

jarks business canada H mar 2012


market for manganese battery consump-

Manganese Inc. will be at PDAC Interna-

tion. Overall, the manganese market grew

tional Convention, Trade Show, & Investors

at 8% per year to 30 billion pounds in 2008.

Exchange, a mining investment show annu-

The EMM market grew 26% between 2003

ally held in Toronto. This year, Reaugh says

and 2008.

they will speak about the critical metal aspect of manganese.

THE FUTURE Larry Reaugh has reason to believe in man-

“It’s an opportunity in this business,” he

ganese; so far, everything is right on track.

says. “We’re more on the specialty side of it; we’re more in the rare earth category than

“If everything goes according to plan, we

the metal category.”

should be permitting and constructing by 2013. We hope to be a producer of EMM

“Manganese is a non-known metal out there

in the US by mid-2014. Those are our goals;

in investment circles.”

that’s our timeline,” he says. But Reaugh knows that is set to change this In March, representatives from American

year.

For more information www.AmericanManganeseInc.com

mar 2012 H jarks business canada 49


GOING WHERE NO OTHER DRILLING COMPANY HAS GONE BEFORE

50

jarks business canada H mar 2012


Energold

Corpo-

one of the most environmen-

TSX Top 50 and Business in

ration has definitely gone

tally and socially conscious

Vancouver’s Top 100 (2007-

where

drilling

drilling companies world-

2011 inclusive).

company has gone before.

wide. In the past five years,

Unsatisfied with the way

their focus has remained on

With the help of a talented

mining companies were ap-

leaving the smallest possible

team of engineers, Energold

proaching

in

ecological footprint as a re-

developed a unique rig de-

third-world countries, En-

sult of their drilling endeav-

sign that would be less dam-

ergold

concerned

ours and creating a sense of

aging to local environments.

with the lack of sensitivity

sustainable community in

to local environments and

the places they work. This

“We developed, in conjunc-

communities. Thus began

outlook and strategy has led

tion with others, a rig that

pursuit to design a more

to Energold winning a num-

could be broken down into

environmentally-friendly

ber of awards in its young

different pieces and moved

rig. Since its inception as an

life, including PROFIT 100

in manually, by canoe, air-

exploration company, Ener-

– Canada’s Fastest Growing

plane, pick-up truck, how-

gold has grown to become

Companies (2009-2011) the

ever you want to do it,”

no

Drilling other

exploration

became

mar 2012 H jarks business canada 51


Energold gives back to local economies by training locals to operate the drilling equipment.

52

jarks business canada H mar 2012


explains CEO of Energold Drilling, Fred Davidson. He explains the rigs themselves are very simple to operate and they are specially designed to be installed and set up on site very quickly. There’s no real secret behind The

Energold’s unique,

success.

component-

driven, and portable nature of their drilling rig allows them to explore parts of the world that were previously inaccessible.

Starting

out

with one rig eight years ago, Energold now boasts a fleet of about 240 rigs over 95 of which are its modular rigs .

A UNIQUE RIG DESIGN When they first started out, Energold observed the impacts of the rigs and drilling practices of other companies on the environment and local communities. “We’re working in a lot of places where it’s impossible to get a rig into the sites mar 2012 H jarks business canada 53


without having to build a road. The road can be a kilometer or two long and in many cases, it goes through farmers’ fields causing severe damage, not to mention the wait time it takes companies to get road building permits” says Davidson. While some financial compensation may be provided for the physical damage created, Davidson says the companies never really compensated locals for the “emotional damage created by the roads and subsequent drilling.” “At the same time, you’ll see the locals standing there watching the gringos driving a bulldozer and pulling a ten ton rig across their field. Nobody from the community is able to participate,” Davidson says. This is where Energold is different, their rigs and drilling expeditions overseas operate primarily with local labour forces. Davidson says they not only hire locals, but they get them to bring in the rigs onto their traditional trails so the 54

jarks business canada H mar 2012


fields and pastures are not

about 3.5 meters by 3.5 me-

Energold also works with

disturbed. “It’s a good way

ters as opposed to the 15

Atlas Copco, and Core Boss

of dealing with social alien-

meters by 15 meters of oth-

who

ation of the community that

er, bulkier traditional rigs

“very proactive in terms of

results from mining and ex-

with their ancillary equip-

designing and redesigning

ploration,” he says.

ment.

recently

equipment that meets our

Drilling

specifications.”

Energold

acquired Furthermore,

Dando

Davidson

says

are

Energold’s

Drilling International in the

rigs take up less space. The

UK, a highly-regarded engi-

Davidson says Energold

rig only occupies a space of

neering groupthat helps the

also consults and debriefs

company continuously im-

the drilling crews when

prove and upgrade rig de-

the come out of the

sign and productivity.

fields, taking their ideas to engineers

“We’re always looking at making

them

safer

and

more convenient,” says Da-

in order to make the rigs more effective.

vidson.

mar 2012 H jarks business canada 55


Engaging local communities

“Every country has its own

gions. “Mining companies

and creating industry

stories and adventures,” he

are realizing the low hang-

says.

ing fruits are gone and have

Currently servicing mining

to head to the frontiers to

and energy sectors in the

According to Davidson, the

Americas, Africa, and Asia,

exploration

Energold operates 240 rigs

underspent in the past 20

What further differentiates

in 23 countries, Davidson

years and as result, Ener-

Energold is their commit-

describes the whole indus-

gold is venturing into re-

ment to community build-

try as “exciting.”

mote and often volatile re-

ing and local engagement.

56

jarks business canada H mar 2012

industry

replenish their reserves.”

has


“Every country has its own

ing and local engagement.

stories and adventures,” he says.

“What’s

exciting

is

that

we’re able to give people According to Davidson, the

who have no hope a job and

exploration

a career and going forward,

industry

has

underspent in the past 20

we’re

creating

industry

years and as result, Ener-

where there never was and

Engaging local communities

gold is venturing into re-

that’s very satisfying,” says

and creating industry

mote and often volatile re-

Davidson.

gions. “Mining companies Currently servicing mining

are realizing the low hang-

When employing locals, En-

and energy sectors in the

ing fruits are gone and have

ergold’s policy is to “push

Americas, Africa, and Asia,

to head to the frontiers to

down” the skill set and

Energold operates 240 rigs

replenish their reserves.”

train them to work with the

in 23 countries, Davidson

equipment.

Whereas

describes the whole indus-

What further differentiates

the employee would not ex-

try as “exciting.”

Energold is their commit-

perience culture shock or

ment to community build-

a language barrier working

mar 2012 H jarks business canada 57


While Energold does much of its work in remote places, they ensure they do as little damage as possible to local environments.

58

jarks business canada H mar 2012


in their own backyard, Energold also receives the benefit of this local knowledge and access. “It works for us because they know how to work in that culture and it works for them because we can give them a high-skilled, good paying job,” says Davidson.

MOVING FORWARD As the company moves forward, there are a number of opportunities in frontier mining, oil sands drilling,geothermal and even water well drilling. The oil shortage has left companies searching for new ways to excavate deposits in various places and Energold thinks they have just what it takes to tap into the oil industry. “Our fleet is designed to exploit existing deposits. Most people are unaware that most oil sand deposits are going to be done from underground and not from open pits. More and more, the rigs that we’re putting into the field are capable of drilling to those depths and those target ranges for the oil sands,” explains Davidson. And of course, Energold hopes to do this by leaving as small a footprint as possible. Energold has also made its way into the water well sector with the help of Dando,one of the leading water well equipment providers in the world. Dando in particular, is one of the UN

mar 2012 H jarks business canada 59


and World Bank approved

Energold into the oil sands

$16 billion a year,

water well comtractors in

coring and seismic oil/gas

oil giants like Shell or Im-

Africa. Energold operates in

drilling industry in Alberta,

perial Oil can easily spend

many third-world countries

Canada. The niche sector

that a year between them.

where clean water is an on-

attracted Energold because

going critical issue.

of its higher margins, syn-

Energold has a five-year

ergies on equipment and

plan.

Part of the recent string of

human capital, and a signif-

to become a global drill-

acquisitions included Ber-

icantly larger overall mar-

ing company that is not

tram

ket.

worldwide

strictly bounded to drill-

poration, which added sig-

expenditure in mineral ex-

ing for minerals, energy, or

nificant

ploration only now exceeds

water. Energold wants to

60

International capabilities

Corfor

Whereas

jarks business canada H mar 2012

Their

The big

objective

is


help drill it all, and gener-

lieves he has just the recipe

and clients need to go off the

ate a good profit at it for

to ensure Energold’s suc-

beaten path for the next big

their shareholders. As the

cess: “You have to develop

discovery.. The Energold in-

world demands more com-

the right attitude, the right

vestment logic is simple, in

modities, there is a pressure

training, and the right skill

a gold rush, one can do very

to provide drills quickly. In

sets. We continue to seed

well selling plenty of shovel

the next five years, Ener-

new markets as natural re-

and picks.

gold hopes to triple in size,

sources become more scarce

which will further assert their international presence and expertise in the evergrowing field. Davidson be-

For more info www.energold.com mar 2012 H jarks business canada 61


Bill Dixon 62

jarks business canada H mar 2012


A VOICE FOR THE CONSTRUCTION COMMUNITY

The Moncton Northeast Construction Association (MNECA) covers a lot of land – from Restigouche county in the north to Albert county in the south. Established in 1942, MNECA represents almost 400 businesses. Initially starting out as a construction association for businesses in the Moncton area, the association expanded its jurisdiction to the rest of the eastern New Brunswick. They provide a variety of benefits for their members. As their website states, the major benefits of joining MNECA can be divided into six major categories: advocacy/voice of the industry community, project information, networking, directory, benefits/discounts, and labour relations. Not only do members enjoy access to tendering documents and bidder’s lists, they are also able to network with contracting members, who provide industry-specific services.

mar 2012 H jarks business canada 63


“That’s sort of the raison d’etre,” explains Bill Dixon, Executive Director of Moncton Northeast Construction Association. “We’re a traditional builder’s exchange and an accredited employer’s organization under the New Brunswick Industrialization Act.” The association is a member of the Construction Association of New Brunswick and the Canadian Construction Association. Dixon says members also benefit from hotel discounts and goods from Mark’s Work Wearhouse. “We are also the voice of the industry and for that we maintain relationships with local municipal governments when we’re dealing with local building codes 64

jarks business canada H mar 2012


and permits,” says Dixon. From an advocacy perspective, the association provides the government and the public with the views of their members in the construction industry.

KEEPING UP WITH THE TRENDS The days of hard copy and paper are waning, as continuous advances in technology provide paper-free

exist for members to ac-

ciation is that they own and

and electronic alternatives.

cess soft copies of the docu-

have full control over the

Around 10 years ago, the

ments, but Dixon says most

software that stores their

Moncton

members are opting to do

database.

Northeast

Con-

struction Association took

their work electronically. “We are not beholden to

note of this trend and began MNECA has an electronic

somebody else and we make

database called the Con-

sure we keep up with tech-

“Probably around 2002, we

struction Information Net-

nology and software devel-

moved into the electronic

work that it shares with

opment,” says Dixon.

age and we now 99 per cent

three

of our services are provided

associations.

digitizing their documents.

other

construction Members may not be visiting the offices to view docu-

electronically,” Dixon says. Three satellite offices still

A unique facet of the asso-

ments, but they are flocking

mar 2012 H jarks business canada 65


to MNECA’s training class-

try doesn’t work that way,”

orders and plan and spec

es.

Dixon explains. “Things are

reading, all of which have

quite dynamic on a con-

been overwhelmingly suc-

struction site.”

cessful.

To better serve their mem-

“When we put those classes

bers’

the

out there, they get gobbled

Northeastern

up. We’re oversubscribed,”

“Our members are looking to us for industry-specific training,” says Dixon.

unique

needs,

A lot of the training that

Moncton

currently exists for compa-

Construction

nies is designed for more

is now looking at develop-

Luckily, the association has

static operations, such as

ing their own construction

the space to provide the

the appliance and manufac-

superintendent course. In

training. The buildings that

turing industries.

the past, they have offered

once stored all the paper

project management cours-

documents are now used as

es and courses in change

training rooms.

“The 66

construction

indus-

jarks business canada H mar 2012

Association

says Dixon.


“We’re still supplying the

However, this could prove to

As of January 1st of this

tendering documents, but

be beneficial for the Greater

year, the association has

we can do that with a cou-

Moncton Area, which en-

rebranded itself the CANB

ple of computers and serv-

joys a diverse economy as a

Moncton Northeast, to ap-

ers sitting in Montreal, so

retail and distribution hub.

pear as a more unified body

we don’t need a 500 or 600

An increasing number of

with its sister associations

square foot room for that,”

younger people are migrat-

across the province.

he says.

ing to Moncton from other parts of the province, revi-

Despite the regional and

CHALLENGES AND FUTURE PLANS

talizing the local job force.

economic challenges, MNE-

With the current condition

As for future plans, the as-

grow every year and they

of the economy, there is not

sociation wants to become

maintain the lowest mem-

a lot of money to go around

even more accessible to its

bership fees in the province.

in

members. They are cur-

By the end of 2011 to date,

though the association had

rently

the

the association had raised

a good run coming out of the

Construction

Association

$30 000 that was donated

2007-2008 recession, they

of New Brunswick, which

to eight schools in the re-

have come to a point where

is the federation of geo-

gion. With ongoing revital-

the government funding has

graphic and trade associa-

ization strategies and proj-

dried up and the projects

tions in the province. Dix-

ects, MNECA will be able

are almost completed.

on explains the move: “We

to serve its members even

felt a restructuring of the

better this year. Whether

“Government has not been

Construction Association of

they are providing a voice

spending a lot on job devel-

New Brunswick was neces-

for local businesses in gov-

opment lately,” says Dixon.

sary because even our own

ernment and industry talks

members didn’t recognize

or

And this definitely has ram-

who we were. And those we

training programs for their

ifications in the construc-

were trying to influence on

members, MNECA is a place

tion industry, especially in

the government and indus-

of growth for construction

the northern reaches of the

try side didn’t know who we

businesses and they invite

province where the econo-

were.”

you to join.

New

Brunswick.

Al-

my is mostly dependent on forestry and mining.

CA’s membership numbers

restructuring

offering

leading-edge

For more information www.mneca.ca mar 2012 H jarks business canada 67


68

jarks business canada H mar 2012


ATHABASCA WATER

TREATMENT PLANT

ACCOMMODATING GROWTH Over the past 10 years, Alberta has experienced tremendous growth. In 2011, Alberta’s population grew by 1.6 percent while the province’s economy expanded by 3.3 percent, with the employment increasing by more than 77 000. In the Regional Municipality of Wood Buffalo, northeast of Edmonton, the average annual growth rate was 7.4 percent between 2000 and 2010. As expected, the booming growth rate ultimately put a strain on local resources and services, especially water. Designed in the 1980s, the existing water treatment plant located in Fort McMurray was built to service approximately 50 000 people with 32 million litres of water per day (MLD). By 2003, however, it was recognized that the plant would require an upgrade address more stringent regulatory requirements, a growing service area, and of course, rapid population growth.

mar 2012 H jarks business canada 69


70

jarks business canada H mar 2012


The Athabasca Water Treatment Plant Upgrades help accommodate a booming population in Alberta.

mar 2012 H jarks business canada 71


72

jarks business canada H mar 2012


“We started off by optimizing the plant as

quire a major upgrade to the water treat-

much as we can using the existing plant and

ment plant to take us to the 133 000 popula-

putting in the mechanical components to

tion threshold,” says Holodniuk.

optimize the treatment of water,” explains Wes Holodniuk, Director of Engineering

FACILITY UPGRADES

and Transportation with the Regional Mu-

The facility improvements, which will be

nicipality of Wood Buffalo.

completed by 2013, include (among many others): a filtration capacity upgrade, filtra-

As a result, the Regional Municipality of

tion piping modifications, plant waste dis-

Wood Buffalo decided to expand the plant

charge system upgrade, and plant site road-

output to 50 MLD for a population of ap-

way access modifications.

proximately 70 000. As with any construction project, the Atha“However, when we looked at the long-range

basca Water Treatment Plant Upgrades

projection of growth, we saw we would re-

provides employment to local residents in mar 2012 H jarks business canada 73


the surrounding communi-

Planning,

Information

ties.

Technology, and Parks. The

sustainable practices

project also benefits from

With new regulatory re-

The project itself is a result

consulting expertise of As-

quirements

of collaborations of vari-

sociated

and

project utilizes a number

ous departments within the

contractor, Bird Construc-

of technological advances.

regional municipality: En-

tion Company.

The building itself was de-

gineering,

Environmental

Services, Accommodations, 74

Engineering

to

meet,

the

signed using LEED prinTechnological advances and

jarks business canada H mar 2012

ciples and UV disinfection


mentally-friendly and sustainable practices in the construction

and

in

the

plant itself. “We are definitely looking at our energy consumption, where our booster pumps are, and how far we push the water,” explains Holodniuk. The building’s LEED principles will be constructed using high efficiency windows to decrease the need for

air

conditioning

and

heating and the roof of the administration’s new building will feature a solar and green roof. Constrained by the Athabasca River on two sides, the escarpment on one side, was installed. Further up-

treatment facility, but they

and bridge construction to

grading the 1980s system, a

also ensure the plant is well

the north, the project hasn’t

New Control System will be

prepared to meet the needs

been without its share of

installed and a Plant Waste

and demands of the future.

challenges.

help reduce the amount of

The

Holodniuk

water waste. These features

Treatment Plant Upgrades

the plant everyday while

not only create a more effi-

project is also a green ini-

treating water and doing

cient and functional water

tiative,

construction at the same

Management

System

will Athabasca

utilizing

Water

environ-

says

operating

mar 2012 H jarks business canada 75


time has also been particu-

concerns,” he says. Since

parameters are in place for

larly challenging.

construction and day-to-day

evacuation

operations are occurring on

because

“We’ve had to move our lab

site simultaneously, Holod-

different operations on the

and our whole control pan-

niuk also says safety is a top

same site,” he explains.

el, relocate staff and opera-

priority for the project.

tions. Site security, safety,

or

we’re

emergency doing

two

Building for the future

and making sure everything

“We want to make sure ev-

Although the project has not

operates

eryone knows what safety

received any official awards

76

are

our

biggest

jarks business canada H mar 2012


ly smoothly,” he says. The

Regional

Municipal-

ity has a number of other plans to help service the region’s growing and dispersing

population.

Comprehensive

The

Regional

Infrastructure Sustainability Plan (CRISP), which was planned by the Government of Alberta, will be implemented in the region. The CRISP will establish a longterm blueprint for future infrastructure development that will match economic development in the area. With a current population of 104 338, the Regional Municipality of Wood Buffalo will continue to grow substantially in the coming years and with the Athabasto date, they are certainly

ly under budget, they are

ca Water Treatment Plant

on the right path to recog-

on schedule and things are

Upgrades project underway,

nition for their innovation,

running smoothly.

future residents can be sure they will continue to have

resourcefulness, and problem solving. Holodniuk

is

“And I guess I am going to

access to safe, high quality

knock on wood. We’ve been

drinking water.

particularly

able to operate and con-

proud of the fact that al-

struct at the same time and

though the project is slight-

things are running relativemar 2012 H jarks business canada 77


78

jarks business canada H mar 2012


JARKS March 2012