Resource World Magazine

BORN in the USA Exploring US mineral projects It was the California Gold Rush in the mid 19th century that drove the westward expansion of men and machinery towards the Pacific. The railroad soon followed; mobilizing travelers seeking work, and lead to the establishment of cities such as San Francisco, Denver and Sacramento, which began as mining towns. By 1872, the General Mining Act was established to encourage the mining of federal lands. This act replaced the localized mining laws that had evolved in individual mining camps. The act���s purpose was to protect western miners, who, at the time, were regarded by many easterners as squatters robbing the public endowment. The mining act authorizes and governs prospecting and mining of all valuable deposits, as well as codifies the acquiring and protection of mining claims on public lands. It is this rule of law that has safeguarded individuals and companies working in the United States throughout the 20th century, and a fundamental reason as to why exploration and mining in the US has become so successful. The ability to have secure mineral tenures should never be underestimated. Globally, however, the geopolitical risk is greater than the geological risk. No matter how lucrative a resource may be, if you are unable to mine it due to politics ��� it is worthless. Take for example Pacific Rim Mining Corp., who, after investing millions of dollars in development and compliance attempts, imposed government restrictions have virtually denied Pacific Rim the opportunity to develop their El Dorado Project in El Salvador. El Salvador is the only country in the world considering a total ban on mining. Consider also the many exploration and mining companies who were forced to renounce their projects when nationalization occurred in Venezuela. It is a high risk endeavor to work on prospects in countries that do not have an established a national mining act to regulate and protect businesses investing in those countries. The US is a good mining jurisdiction to work in as they have well established infrastructure including electrical grids, roads, water supply, and telecommunications. With a high urban sprawl rate, these resources are often found relatively close to mineral targets, which can instantly lower the cost of development, and in consequence, increase the feasibility of advancing a project to production. In addition there is an abundance of skilled workers trained in geology, mining engineering, machine operations, trades, and administration, as well as myriad technical and service companies that possess machinery essential for the mining sector. With strong environmental regulations on ore processing, production, waste management, gas admissions and clearly outlined procedures for mine reclamation and closure, as well as enforcement initiatives, and repercussions for negligence, the 24 www.resourceworld.com by Kathrine Moore & Vanessa MacLean Bruce Clark, Mine Manager, examines the primary underground crusher at the Troy copper-silver mine in northwest Montana. Following a groundfall, commercial operations are expected to resume in early April. Photo courtesy Revett Minerals Inc. US government has a successful mandatory process to encourage development and growth in the resource industry. Having conscientious and regulated laws governing the mining and metals sector is a leading reason why 2012 was the third consecutive year in the US that the estimated value of mineral production increased, as published by the USGS in the mineral commodity summaries 2013. The estimated value of mineral raw material produced by mines in the US, in 2012, was $76.5 billion, (an increase from the 2011 value of $74.8 billion), and net exports of mineral raw material contributed an additional $21 billion to the US economy. Furthermore, domestic raw and recycled materials were used to process mineral materials worth $704 billion, and were consumed by downstream industries adding a further value of $2.4 trillion to the US market in 2012. The rebound in construction activity in 2012 boosted the nonmetallic mineral sector, and, in addition, the recovery of the US housing industry fueled demand for industrial minerals and products. However, in 2012, the supply for more than one-half of US apparent consumption of 41 mineral commodities came from imports. The US relies 100% on imports of 18 of these minerals, but for the first time since 2002, the US was not 100% reliant on REEs, as rare earth mining resumed in Mountain Pass, CA. The global demand for mineral resources is not decreasing. In fact, with future focus on the electronic and technological sectors as well as in innovative industries such as solar, wind and electric power, demand will only inflate. With many jurisdictions in the US keen on mining, and supportive laws emplaced to permit exploration, it is likely that business in the mining and metals industry will increase in the United States. n MARCH 2013

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