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ASSETS CAPITAL ASSETS Equity in United Engineering Society's Land and Buildings $486,792 79 Library 40,000 00 $526,792 79 INVESTMENTS Jas Douglas Fund-Schedule #2 $ 99,966 40 Life Membership Fund-Schedule #3 9,415 63 R W Hunt Medal Fund-Schedule #4 7,489 09 116,871 12 INVENTORIES Paper Account .305 10

Jan 1, 1923

[ASSETS CAPITAL ASSETS: Equity in United Engineering Society's Land and Buildings $486,792.79 Library 40,000.00 $526,792.79 INVESTMENTS: Jas. Douglas Fund-Schedule #2 $ 99,966.40 Life Membership Fund-Schedule #3 9,415.63 R. W. Hunt Medal Fund-Schedule #4 7,489.09 116,871.12 INVENTORIES: Paper Account 305.10] [ ]

Jan 1, 1925

By Peter J. Szabo

The mining executive works in a cyclical industry. His employment is subject to the vagaries of the marketplace. Boom and bust has always been the industry's story. "Big oil" failed in its mining effort. This left emotional and financial scars on many mining families. One must remember that mining executives always play a high-stakes game. Given the cyclical nature of the mining industry, mining executives need to take care of their own financial security. The mining executive that does not plan for his financial security in this cyclical business is playing Russian Roulette with his future. Take a look at those people who have reached their later years with the mining industry. One usually finds three categories of people. Those few in the first group have been fortunate enough to have worked for one company. They have survived the winnowing process of cyclicality, political problems, and takeovers. They have reached normal retirement age. For them, the retirement years are usually comfortable. People in the second group have worked for those same mining companies. But these people have been forced out by early retirement. Or they have been laid off for cyclical, takeover, or political reasons. The third group includes those who have held many positions in the mining industry. Probably not until their later years are they fully vested, if at all, in a pension program. The first small group, then, is the exception. The others, unless they have taken care of their financial security, are doomed to later years of financial problems, stress, and unhappiness. Too late in life, many realize the harsh realities of failure to plan and implement a personal financial program. Mining executives go to some of the world's leading mining schools, to learn how to make money. The curriculum is technically strong. Most mining graduates are familiar with the intricacies of discounted cash flow, present value, and the Hoskold formula. But few of these same mining schools require courses on personal financial planning. Such courses could give mining students a realistic foundation and the mechanisms with which to cope with their cyclical profession. An executive has only three sources of money. He can make money at work. He can put his money to work. Or he can get money from charities, such as government programs. Of these three sources of money, money at work has the best chance of providing financial security in later years. The mining executive must think of the day when he will be too old to work and contribute to the market place. At this point, the quantity and quality of his investments will determine whether his later years will be secure. Along with the Mining Engineering Handbook, two key books should be included in the mining executive's library. These are Venita Van Caspel's The Power of Money Dynamics and Benjamin J. Stein's Financial Passages. These books contain the basic concepts of personal financial planning so critical to an individual's financial survival. Venita points out the simple formula that is the key to financial independence: Time + Money + American Free Enterprise (Rate of Return) = Opportunity to Become Financially Independent Chart 1 shows that this is not a trite formula. The chart shows the dramatic effects of compounding over time. The chart also shows at various yields what a $2000 a year Individual Retirement Account (IRA) contribution will accumulate. Chart 1 (from Money magazine) is based on the future value of an ordinary annuity. It shows that the key to amassing a small fortune by the time a person reaches his 50s is starting to save methodically in his 20s. This, coupled with the highest yields consistent with safety of principal will ensure financial security. There are significant effects from compounding money over time. Every year the decision is put off to save for later years will cost a person dearly by the time he reaches his 50s. For example, consider the decision to put off for one year a $2000 IRA investment at a 12% return. Starting it at age 31 instead of 30 will cost the executive almost $100,000 by age 65. What if the executive waits until age 35 to get started with his $2000 a year investment? He will then lose nearly $400,000 by age 65. Stated another way, the executive costs himself this $400,000 simply because he did not invest $167 a month for five years. $167 a month - that's less than an inexpensive second car payment. This $400,000 pool of money could provide the executive a $40,000 a year income at age 65, assuming a 10% return on invest-

Jan 11, 1985

By José Claro

El texto revisa el proceso de financiamiento de las inversiones en el mineral de hierro. Para ello, se evalúan las condiciones económicas para la producción del hierro, a través de tres términos: la primera, refiere los préstamos otorgados por los gobiernos de países desarrolllados y sus agencias financieras a los países en desarrollo para nuevas producciones mineras. El segundo término señala los préstamos de futuros compradores y el tercer término, están los bancos comerciales, cuyos préstamos agilizan su utilización en una producción minera. Paralelamente a estas condiciones, se desarrolla la modalidad más común de financiamiento, donde la misma empresa minera o sus accionistas intervienen en la capitalización de la empresa. Esta modalidad permite recuperar la inversión a través del pago de préstamos e intereses, en lugar de recibir las utilidades en forma de dividendos sujetos a impuestos. Como consecuencia de ello, el flujo financiero puede utilizarse para recuperar la inversión, afectando la estructura del precio del cobre ya que hace necesario que la venta del producto genere recursos financieros suficientes para cumplir los compromisos.

Nov 20, 1969

By José Claro

El presente texto señala algunos aspectos respecto al financiamiento de inversiones en la minería. Para ello, se revisa las condiciones adecuadas para la comercialización de su producto a través de tres premisas: La primera, refiere los préstamos otorgados por los gobiernos de países desarrollados y sus agencias financieras para nuevas producciones mineras; la segunda, considera los préstamos de futuros compradores como una fuente importante de financiamiento y la tercera, refiere a los bancos comerciales, cuyos préstamos permiten mayor agilidad en su utilización, aunque es cada vez más dificil encontrarlos a tipos de interés y plazos adecuados. Asimismo, otra modalidad frecuente en el caso de financiamiento, es que la misma empresa minera o sus accionistas intervengan en la capitalización de la nueva empresa minera a través de préstamos o cuasi capital, de forma que se recupere la inversión a través del pago de préstamos e intereses, en lugar de recibir las utilidades en forma de dividendos sujetos a impuestos.

Mar 1, 1971

By Bryan Morris

Quebrada Blanca (QB) is a copper project located in the semi-arid Andean highlands of northern Chile. The operation is situated 170 km ( 105 miles) southeast of the port of Iquique and 30 km (18 miles) west of the border with Bolivia, at an altitude of about 4300 m (14,000 ft) (Fig. 1). The QB ore body is a secondarily enriched porphyry copper deposit containing reserves of 85 Mt (93 million st) grading 1.3% copper. Underlying the enriched zone is a significant primary ore zone containing several hundred million tons grading about 0.5% copper. In the late 1970s and early 1980s Falconbridge and its affiliates spent $20- $30 million exploring the deposit and conducting feasibility studies. Falconbridge, however, decided not to develop the property. It was returned to its owners, Empresa National de Mineria (ENAMI), a Chilean state mining corporation. In 1988, ENAMI announced its intention to privatize the property through public bidding. Cominco Resources, then 61% owned by Cominco Ltd., examined the property and the extensive data base developed by Falconbridge. In conjunction with its parent company, Cominco Resources submitted a proposal to ENAMI to construct an open- pit mine, with heap leaching and solvent extraction/electrowinning (SX-EW) processing facilities. The plan would use patented heap leaching technology developed by Sociedad MineraPudahuel (SMP), a privately owned Chilean mining company. At that time, a $150-million project that would produce about 45 kt/a (50,000 stpy) of cathode copper was envisaged.

Jan 1, 1993

By D. A. Karvonen

Although the economy in the Province of Saskatchewan has historically been agriculturally oriented, a major new source of wealth has been realized through natural resources such as petroleum and natural gas, coal and uranium and since the 1960's - potash. Potash or potassium chloride, in the form in which it is presently produced in Saskatchewan is used primarily as fertilizer, a source of potassium, one of three essential elements required for healthy plant growth with about 5 percent of production sold to the chemical industry for use in such products as soap and liquid detergent, glass and ceramics, textiles and some pharmaceuticals. Saskatchewan is estimated to have approximately 40 percent of known world potash reserves and its ten active mines account for some 25% of annual world production. The development of this resource was recognized to be important to the development of Saskathcewan. In an effort to guarantee a fair and lasting economic benefit to the Province of Saskatchewan the Potash Corporation of Saskatchewan (PCS) was created on February 4, 1975 through an Order-in-Council under the Crown Corporation's Act and later on April 1, 1976, the Potash Corporation Act provided for its continuation. PCS was given the mandate to acquire ownership of a significant portion of the potash mining capacity in Saskatchewan and to establish an organization capable of operating the facilities, marketing the product and conducting all of the other activities necessary for a successful corporation competing in the world potash industry.

Jan 1, 1983

By Douglas A. Karvonen

INTRODUCTION Although the economy in the Province of Saskatchewan has historically been agriculturally oriented, a major source of wealth has been realized through natural resources such as petroleum and natural gas, coal and uranium and since the 1960's - potash. Potash or potassium chloride, in the form in which it is presently produced in Saskatchewan, is used primarily as fertilizer, a source of potassium, one of three essential elements required for healthy plant growth, with about 5% of production sold to the chemical industry for use in such products as soap and liquid detergent, glass and ceramics, textiles and some pharmaceuticals. Saskatchewan is estimated to have approximately 40% of known world potash reserves and its ten active mines account for some 25% of annual world production. POTASH CORPORATION OF SASKATCHEWAN In an effort to guarantee a fair and lasting economic benefit to the Province of Saskatchewan, the Potash Corporation of Saskatchewan (PCS) was created on February 4, 1975 through an Order-in-Council under the Crown Corporation's Act and later on April 1, 1976, the Potash Corporation Act provided for its continuation. PCS was given the mandate to acquire ownership of a significant portion of the potash mining capacity in Saskatchewan and to establish an organization capable of operating the facilities, marketing the product, and conducting all of the other activities necessary for a successful corporation competing in the world potash industry. The corporation is the largest potash producing and selling organization in the Western World - or third largest in the world. (See also Figure 1). PCS through its wholly-owned subsidiary, PCS Mining, has acquired a whole or partial interest in five geographically distinct producing properties or divisions, representing today more than 40% of Saskatchewan's potash producing capacity. The acquisition of each division was followed by a program designed to exploit and maximize the particular opportunities at each minesite for increased production. To that end, PCS Mining has taken an active lead in expanding to meet future demand and has implemented expansion programs at all properties except for its Esterhazy Division where it has a long-term processing agreement with International Minerals & Chemical Corporation (Canada) Limited. Through its wholly-owned subsidiaries, PCS Mining, PCS Sales and PCS Transport, this provincial crown corporation has the ability to operate as a producer and marketer of Saskatchewan's potash. In certain instances PCS, the parent company, assists in the financing of various projects undertaken by the subsidiaries and in other cases the subsidiary involved arranges its own financing. POTASH RESERVES As a background to the specific issue of financing, it is helpful to describe briefly the nature of the deposit which supports the industry - our collateral, if you like. The potash beds underlying Saskatchewan are sedimentary rock deposits formed by the gradual evaporation of an inland sea during the Middle Devonian period roughly 400 million years ago. Now known as the Prairie Evaporite, this formation stretches from North Dakota and Northeast Montana through Southern Saskatchewan into North-Central Alberta. These beds lie at mining depths ranging from 950 - 1000m (3,000 ft) below the surface, where conventional mining methods can be used, and to 1,650m (5,000 ft), where solution mining must be

Jan 1, 1985

By James H. Boettcher

In the second quarter of 1979, ASL Inc. inquired whether Crocker National Bank ("CNB") would provide $4 million in term loan financing to help ASL acquire the outstanding shares of the S&S Coal Company in West Virginia. ASL had, prior to approaching CNB, sought financing with the assistance of a financial advisor from a number of commercial banks without success. A summary of the initial terms requested by ASL is shown in Table I compared with the actual terms the transaction closed with. It is not difficult to note that the two sets of terms differ significantly. This is often the case when financing requests based on the expectations and vision of a mine developer are juxtaposed with more pragmatic requirements of a commercial bank. The "art" and fun of structuring financing plans for mining ventures (highly leveraged acquisitions or grass roots) comes in working with mine developers to arrive at a final financial structure that meets their objectives and constraints as well as those of the bank or other financial institution providing much of the financing. This article briefly describes the process we went through with ASL beginning with the terms they requested initially and ending with the ones on which the transaction was finally closed.

Jan 1, 1981

By Robert Halupka

The industrial minerals sector represents a broad range of products involving a variety of technologies serving a diversity of markets and end uses. Unit values of products vary widely, reflecting the peculiarities of each product/market sector. Generalizations are therefore understandably difficult to make and borrowers may need to take extra time to "educate" lenders on the key aspects of their business and industry sub-sector. This paper will examine the factors and the thinking that lenders apply when considering financing proposals to companies in the industrial minerals sector. If you understand the lender's perspective and their concerns, then you can make better use of your own time and resources when arranging financing for your company or project.

Jan 1, 2001

"Investment in diamond exploration has been declining over the past decade, in spite of positive long-term industry fundamentals and a growing interest in diamonds as an investment category. The lack of new significant discoveries in recent years has eroded investor confidence, yet no new discoveries are possible without investment in exploration. Junior ‘mine finders’ have been the hardest hit. Their agility, tenacity, and appetite for risk are not sufficient to attract the funding required, even at the greenfield stage. Developing new discoveries into mineral resources can be crippling without solid financial support. Junior incubators could play a crucial role, especially at the project evaluation stage – but where are they? Alternatives to traditional funding mechanisms have become available, many still untested in the junior diamond exploration space. Valuable lessons can be drawn from the past and used to inform emerging new strategies. IntroductionDiamonds are the ultimate expression of love. Their ancient and timeless allure continues to influence consumer emotions and behaviours across continents, cultures and age groups. Analysts are predicting a sustained supplydemand shortfall in the years ahead which will trend diamond prices generally upwards. With positive long-term industry fundamentals, one cannot help but wonder why funding for diamond exploration and development projects is so scarce.Investment in exploration across commodities – including diamonds – has been declining for a number of years, reaching a historic eleven-year low early in 2017. The lack of major diamond discoveries in recent years has done little to strengthen the case for investing in diamond projects, yet no new discoveries can be made without investment in exploration.Global estimates of known carats in the ground stand currently at 2.5 billion carats, which equates to around 18 years of production at current levels of 140 million carats (mct) per annum. Sustainable replenishment of depleting diamond resources is possible only through the development of new discoveries. This is what junior explorers are best at – but they need investors to fund their evaluation activities from early in the project development continuum."

Feb 1, 2019

By C. C. Bailey

Part I Problems of Mine Financing Directed primarily at the methods and problems of financing domestic mining ventures-projects involving one or more of the stages: exploration, development, commercial operation.

Jan 6, 1953

By C. C. Bailey

THE vendor seeking outside capital for his project has the following potential sources which may be approached; 1--private sources, 2-institutional funds, 3--government agencies, 4--established mining concerns, and 5-public financing.

Jan 7, 1953

By Robert B. Wickham

"American Barrick has always balanced its aggressive operating approach with a conservative financial strategy. In fact, what enables their mining team to pursue such aggressive plans with confidence is the conservative financial strategy adhered to by the company. These policies are built on a prudent mix of gold linked financings, equity and gold price hedging.This paper outlines these policies and focusses in particular on American Barrick's gold price hedging program.IntroductionThe company's balance sheet at the end of 1990 clearly shows the wisdom of its conservative policies. Total assets have grown to over US$1 billion; cash has grown to US$312 million and shareholders' equity to US$645 million. All amounts included in this paper are quoted in U.S. dollars. Increased gold production and an effective gold price hedging program also combined to produce record income from operations, earnings and cash flow in 1990.The first half of 1991 is also indicative of the benefits of the company's conservative financial policies. Increasing production, together with its comprehensive gold hedging program, has generated increased earnings, even in a period of falling gold prices.All year-over-year numbers for the first six months are up. Gold production was 36% higher; earnings of $40.2 million $ 0.30 per share - were 46% higher than 1990.Barricks revenue continued to increase despite gold prices remaining unchanged during 1990. Barrick's hedging policy protects the company from falling gold prices on the basis that the upside looks after itself. Their hedging program - including various goldlinked fmancings - enabled Barrick to realize an average price of $437 per ounce of gold sold in 1990, compared with the Comex average gold price for the year of $384 per ounce."

Jan 1, 1991

By Eric Low

Raising capital by issuing debt or equity is necessary in almost every corporation. In the field of corporate finance, the raising of capital is a heavily-studied topic. However, some of what is studied on this topic in corporate finance is not applicable in the mining industry. There are also many financing options that were created for the mining industry such as flow-through shares, prepaid forwards, and royalty sales. The cyclical nature of the industry makes the risk-return profile of financings more difficult to estimate than in other industries. Additionally, the methods used to assess firm value are different than other industries, as the values of orebodies are not included on balance sheets. For precious metals companies, which are a hedge against most other securities, there are additional complications with determining investor expectations and cost of equity. This thesis puts forth a decision-making framework to explain mine financing choices from the perspective of mining companies. The approach is threefold. First, all of the major equity and debt financing instruments available to mining companies are presented and analyzed. Each financing method is assessed on a wide range of criteria. Next, these concepts are applied in case studies of four companies: BHP Billiton, Barrick Gold, Teck Resources, and Noront Resources. For each company, the overall choice of financing methods is shown and analyzed. The effect of financing choices on the weighted average cost of capital (WACC) is calculated. The final section deals with case studies of individual mine finance decisions during the past two years.

May 1, 2011

Regional problems, such as political risk and debt reschedulings, in Pacific Rim nations coupled with the price volatility of gold mean that multi-faceted financing packages are needed to offset the many risks inherent in a new gold mine development. The cross-border risks of getting money back out of a producing mine may require the involvement of export credit agencies, multilateral government banks, or political risk insurance. Variations on forward gold sales, gold loans, or offset structures can also enhance the flexibility and safety for the providers of both the debt and equity. The region will become as large a gold producer as South Africa by 1990. The large dollar amounts for both investment and revenues realised are of great significance to the economies of many of the Pacific Rim countries especially as a means to increase foreign exchange earnings.

Jan 1, 1987

By James Mackie

The Vancouver Stock Exchange (VSE) has been providing venture capital for start-up companies since 1907. Ninety years' experience in the junior mining industry has enabled the VSE to develop policies and procedures tailored to the unique needs of start-up companies. Policies and procedures applicable to listed companies are documented in the Corporate Finance Services Department "Policy and Procedures Manual." Approximately 50% of the companies listed on the VSE are in the mineral exploration and development business. The largest number are exploring base metal, precious metal or diamond properties. A recent count shows that about 20 companies are exploring industrial mineral or non-metallic deposits. The minerals sought by these companies include limestone, decorative stone, building stone, lava rock, wollastonite, zeolite, garnet and graphite. There are two basic routes to obtaining VSE financing for an industrial mineral property. The owner can either sell an interest in the property to a listed company or form a company and have it listed on the VSE. In each instance, the listed company is responsible for raising funds to develop the property. A typical financing consists of the sale of company securities byway ofeitherprivate placement or prospectus offering.

Jan 1, 2001

By Wallace W. Wilson

It scarcely is possible to read a new issue of any of the principal mining trade journals without noting some mention of a major new overseas mining venture with which one or more domestic companies are involved. These projects follow a fairly consistent pattern; most are large open pit mines with relatively low grade orebodies but huge reserves; the total price tag is in nine significant figures and half or more of the total cost is for infrastructure. West' notes that nearly $7 billion is being invested annually for new mining projects and the expansion of existing mining ventures in the free world. He anticipates that by 1975 such investments will reach the $10-11 billion annual figure and that in the period 1972-76 total capital requirements can be expected to aggregate around $45 billion. West estimates that 75% of the total capital will come from internally generated funds. Conceivably, a substantially higher percentage could be attributable to external financing, especially if the trend of recent mineral development in Canada and Australia is any criterion, and including local sales of equity as a part of the package.

Jan 7, 1973

By Wallace W. Wilson

It scarcely 1s possible to read a new issue of any of the principal mining trade journals without noting some mention of a major new overseas mining venture with which one or more domestic companies are involved. These projects seem to follow a fairly consistant pattern; most are large open pit mines, with relatively low grade ore bodies but huge reserves; the total price tag will be in nine significant figures and around half or more of the total cost will be for infrastructure. West1 noted that nearly $7 billion is being invested annually for new mining projects and the expansion of existing mining ventures, in the free world. He anticipates that by the year 1975 such investments would reach the $10-11 billion annual figure, and that in the five year period 1972-76 total capital requirements can be expected to aggregate around $45 billion. The proportion of this total investment which will be financed in some manner is difficult to estimate because of the variety of available financing arrangements. West estimated that around 75% of the total capital would come from internally generated funds, with the balance from external sources. Conceivably a substantially higher percentage could be attributable to external financing, especially it the trend of recent mineral development in Canada and Australia is any criterion, and of course, including local sales of equity as a part of the package.

Jan 1, 1973

By A. W. White

Introduction To discuss all the technical details of incorporation laws, security laws, underwriting procedures, codes, and ethics-as laid down by varous associations -would be impossible in the time which has been allotted to me. My remarks, therefore, will be made in a very general way and will naturally be coloured with experiences which my firm and I have had. There is a common expression that "money makes the mare go". I hardly have to mention here that the best prospect in the country is of very little value unless its prospects can be developed-and this requires large capital expenditures. The art and problems surrounding the raising of this money is a long and interesting story. Since by its very nature mining is risky, the appraising of its risks in the many phases of its development programme is continuous. Very few men-if any-and very few corporations -if any -can afford to take all the risk of mining. Because of taxation policies-and the very scheme of present-day living -the truth of this statement can be seen throughout the whole industry by a close examination of the records. Since this is so, it is essential that the mechanics of distributing risk on a sound, and equitable basis be known to those engaged in the business and to the investor or spectator who proposes to risk his funds in the industry. Perhaps the greatest stimulant to modern business activities has been the creation of corporate bodies. It is evident, from the number of charters being granted by various jurisdictions, that this method of doing business is becoming more and more important. A limited company -or corporation-can be defined as a fictitious person existing solely in contemplation of the law.

Jan 1, 1951