3 On the 4th, the 83rd Canadian International Mining Conference concluded successfully in Toronto. As one of the world’s largest and most important comprehensive commercial mining exhibitions, the PDAC Annual Convention brought together a wealth of advanced technologies, mining industry insights, and investment opportunities. Overseas Mining Investment Network and the Hong Kong International Mining Association each sent representatives to the conference and have been continuously following and reporting on its developments, gaining valuable mining information and investment opportunities from the event. This article compiles selected Chinese-language information related to the conference for your reference.

[PDAC Report] Mineral development in the Pacific Ring of Fire receives a boost.

The Chromite region within the Pacific Ring of Fire was once touted as the next major oil-sand resource play in Canada; however, to date, development activities in the area have yet to make significant progress. Sunday marked the first day of the annual convention of the Prospectors & Developers Association of Canada (PDAC). On that day, the Chromite region received long-awaited positive news—but the boost was limited in scope.

Canada’s Minister of Natural Resources, Greg Rickford, announced that the federal and provincial governments will launch a joint study to build an all-weather highway connecting remote regions, with a value of $785,000. This announcement is a positive signal of the two levels of government’s concerted efforts to bring about change in the region; however, there is still a long way to go before a road can actually be built there.

The goal of this study is a “transport corridor.” This “transport corridor” connects the mineral deposit area with four remote Indigenous communities (Webequie, Eabametoong, Neskantaga, and Nibinamik) all the way to Pickle Lake in Ontario, located approximately 500 kilometers northwest of Thunder Bay.

Noront Resources (TSXV: NOT) One of its major shareholders is a large Chinese steel company—Baosteel. Noront welcomes this announcement. Two years ago, Cliff Natural Resources withdrew from the chromite mining region. Since then, Ontario Premier Kathleen Wynne has been pressing the federal government to deliver on its promise of a $1-billion funding allocation for mineral development. However, as of now, Rickford’s response has remained rather cautious. Even though Noront is actively strengthening its relationships with local Indigenous communities, the region’s ultimate and biggest challenge will still be infrastructure.

Source: NAI500

[PDAC Voice] Chinese mining companies need to adopt a rational approach to overseas investments.

Xinhua News Agency, Toronto, March 3 (Reporter Zeng Dejin) — The 83rd Canadian International Mining Conference was held in Toronto from March 1 to 4. In interviews with reporters, several industry insiders said that, amid the current overall downturn in the global mining sector, the industry is eagerly “craving” Chinese investment. However, the era of Chinese mining companies making “lavish” overseas investments akin to “tycoons” is coming to an end, and Chinese mining firms need to adopt a rational approach to overseas investment.

Xie Quan, Executive Vice President and Board Secretary of China Gold International Resources Co., Ltd., which is listed on the Toronto Stock Exchange, said that the company has been operating in Canada for several years. However, it remains extremely cautious when selecting mining investment projects and has not yet developed any projects locally in Canada.

Xie Quan said, “Our pace may seem relatively slow, but that’s because we’re being meticulous about risk management. Right now, everyone is saying that the overall economic situation is tough and the mining sector is in decline—this is supposedly a great time to ‘buy things.’ But that’s not necessarily true. The really high-quality assets that are truly valuable aren’t being sold by their owners; in fact, the best projects don’t actually lack funds. If they really did need to sell because they were short of cash, their prices wouldn’t be all that low either.”

Li Shilin, CEO of Selwyn Chihong Mining Ltd., a wholly-owned subsidiary of China Yunnan Chihong Zinc & Germanium Co., Ltd., told reporters that compared to the previous investment fervor, which was largely driven by “emotional” factors, Chinese companies are now much more “rational” when it comes to overseas mining ventures. He believes that in the next phase, the key challenge facing Chinese enterprises will be ensuring their operations align with international practices or the customs of the host country.

Regarding how Chinese companies can achieve success in mining projects, Yelle Bruijke, the company’s exploration manager, believes that while funding is important, the most critical factors are the team and market prices. “In mining projects, the single most important factor for success is people—within a team, everyone plays their part to the best of their ability. Of course, the price of major mining commodities also plays a decisive role.”

The reporter learned that in the mining sector, given the long-term nature of mineral resource extraction and the cyclical fluctuations in mineral prices, many Chinese companies have previously failed mainly because they lacked a spirit of “due diligence” and entered overseas mining projects prematurely without fully understanding their true value.

Xie Quan analyzed, “Seeking opportunities isn’t as simple as just spotting a mine and immediately rushing in to buy it. First, you need to have a network; only then can you truly seize real opportunities. That’s why we often maintain close communication with mainstream mining associations to obtain timely and accurate information, which enables us to gain a competitive edge when searching for mines.”

Source: Xinhua Net

[PDAC Perspective] The International Mining “Cold Winter” Meets China’s “New Normal” Economy

In this process of transformation, Wang Jiahua stated that global mining industries will become increasingly interconnected, mutually learning from and supporting each other—especially through closer cooperation with China’s mining sector. The time has come to establish a new order for the mining industry. The international cooperation advocated by China under the “Belt and Road” initiative will have a significant impact on the development of the global mining sector.

Mansion Placements John R. Ing, President and CEO of the Canadian company, stated that in the face of a sluggish mining market, many countries are tightening regulations on the mining sector. Canada boasts acceptable legal frameworks. He advised mineral companies to leverage Canada’s platform to expand their markets.

Zhang Fengjiu, President of the Canada-China Chamber of Commerce, noted that, at a time when the global mining market remains sluggish, exploring Chinese mining investments overseas under the new normal is highly significant for grasping the cyclical trends in the global mining market. According to him, currently, the three major Chinese oil companies—PetroChina, CNOOC, and Sinopec—are the largest investors in Canada’s energy sector. Canada has already become China’s second-largest investment destination.

Source: Phoenix News

[PDAC Business Opportunity] China-Canada Mining Cooperation Holds Great Potential

The “China-Canada Mining Investment Forum,” co-hosted by the Canadian Chinese Chamber of Commerce and the China Mining Association, was held in Toronto on March 2, 2015. Approximately 200 representatives from governments, institutions, and enterprises of both China and Canada attended the conference, including more than 50 delegates from Chinese geological exploration, energy, mining, and financial institutions.

The theme of this forum is to focus on the comparative advantages of global mining investments and investment opportunities in Canadian mineral products where Canada holds a competitive edge. It will also explore various approaches to investment and financing in the resource sector. The forum brings together companies from China that have made investments, Canadian firms, China’s International Mining Rights Exchange, the Toronto Stock Exchange, as well as seasoned mining experts from prominent Canadian law firms and accounting firms. Together, they shared insights into international investment experiences and discussed the opportunities and risks encountered by Chinese companies as they venture abroad.

Participants noted that holding the China Mining Investment Forum at a time when the global mining market remains sluggish is highly meaningful for us to gain insight into global mining market trends, explore Chinese mining companies’ overseas investment strategies under the new normal, and seize investment opportunities while navigating the cyclical nature of the global mining market. It also provides a valuable opportunity for everyone to share investment wisdom and experience.

Currently, China’s three major oil companies—CNPC, CNOOC, and Sinopec—as well as related enterprises, are the largest investors in Canada’s energy sector. In the mining sector, major investors include CITIC Group, Jinchuan Nickel & Cobalt, Jinduicheng, Wuhan Iron and Steel, Yankuang, and China Minmetals Resources. In addition, dozens of Chinese companies are involved in investments at the exploration stage and equity investments, ranging from large and medium-sized state-owned enterprises to small and medium-sized private enterprises. As of the end of 2014, the total value of agreements signed by Chinese companies exceeded US$72.6 billion, with actual investments surpassing US$55 billion. Canada has become China’s second-largest investment destination.

The 83rd Canadian International Mining Conference recently took place in Toronto, amid a backdrop of continued sluggishness in the global mining market. At the China Mining Investment Forum held on March 2, local time, during the International Mining Conference, China’s economy—once the primary driver of global rigid demand in the mining sector—has shifted to a “new normal,” striking a sensitive nerve in the international mining industry.

“Under the influence of the global economic situation, the global mining industry is experiencing significant fluctuations. The future development of the mining sector still faces numerous uncertainties,” said Bai Xingbi, Deputy Director-General of the Department of Science and Technology and International Cooperation of China’s Ministry of Natural Resources, who attended the forum. “In the face of these uncertainties, we should remain confident and steadfast. While taking into account the challenges and uncertainties, we must also recognize the opportunities for development and make preparations well in advance.”

Bai Xingbi stated that after more than 30 years of sustained rapid economic growth, China’s economy has entered a new normal of medium-to-high-speed growth. The economic structure will be optimized and upgraded, and economic development will increasingly rely on innovation-driven growth.

But what are the prospects for mining investment in China under the new normal? Has the global mining industry entered a “winter period,” and if so, how long will this “winter period” last?

Wang Jiahua, Executive Vice Chairman of the China Mining Association, stated that the Chinese economy has entered a “gear-changing phase,” yet China remains the largest economy providing support to the global mining industry. “China’s economic demand for resources is still in both a ‘rapid growth phase’ and a ‘high-level stabilization phase,’” Wang Jiahua said. Under these circumstances, it would be inaccurate to prematurely declare that the global mining industry has entered a “winter period.”

However, Wang Jiahua pointed out that the days when global mining companies could “lie back and reap profits” simply by riding on rising prices are indeed over. They must continuously innovate and boost labor productivity. He predicts that the global mining industry is facing a new round of reshuffling, in which technological innovation and enhanced labor productivity will become the central focus for mining companies worldwide.

Source: China Daily

[PDAC Business Opportunity] Canada International Mining Conference “Craves” Chinese Investment

Industry insiders say that the global mining sector is currently in a downturn, with both mineral prices and mining financing remaining sluggish. The industry is eagerly looking forward to Chinese investment. Chinese enterprises have already overcome early challenges related to legal and property rights in overseas mining investments; the next step should be to strive for greater diversification of their investment portfolios.

This year’s mining conference, lasting four days, will attract more than 25,000 delegates from over 100 countries and regions. At the conference, several veteran industry insiders told reporters that, due to sluggish commodity prices, the global mining sector—including gold mines—is currently in a downturn. Compared to last year, mining companies are facing even more acute cash-flow and operational challenges.

Due to the sluggish global commodity prices, the overall outlook for mining development remains grim. Take gold as an example: recently, the spot price of gold in London fell below the $1,200 per ounce mark, reaching a low of $1,191.05 per ounce—the lowest level in seven weeks.

Moreover, the “winter” in the global iron ore market is likely to persist for some time. Relevant data show that after the boom period for the global mining industry from 2004 to 2011, in 2012, the net profits of the top 40 publicly listed mining companies began to decline, reaching their lowest level since 2003 by mid-2014.

Industry insiders believe that in 2015, the international mining industry was even more eager for project financing and industrial mergers and acquisitions, particularly welcoming investment from China.

Troy Nazawich, Investment Relations Manager at Canada’s Fucheng Mining Company, told reporters that Fucheng Mining has several investment projects involving major Chinese companies. Currently, the company is collaborating with another Canadian firm controlled by a Chinese company, aiming to secure an investment of 600 million Canadian dollars (approximately 480 million U.S. dollars).