Suppliers News (December 25, 2006)

Canadian, UK law firms unite

Fasken Martineau DuMoulin, likely Canada’s best known mining law firm, and London, U.K.-based firm Stringer Saul are joining to form what’s thought to be the first full-service Canadian-U.K. legal office.

The merger will expand the global partnership to almost 650 lawyers at offices in Vancouver, Calgary, Toronto, New York, Montreal, Quebec City, London and Johannesburg.

Fasken Martineau was interested in tapping Stringer Saul’s experience with clients listed on the London Stock Exchange’s Alternative Investment Market (AIM), home to a growing number of mining and exploration companies and similar to Canada’s TSX Venture Exchange. There are now 46 Canadian-based companies listed on AIM, which requires companies to have a sponsor in order to get a listing.

“An increasing number of our clients in Canada and around the world are looking to access the London capital markets through the AIM Market, not only in the mining area, where Fasken Martineau has been ranked as the world’s leading mining law firm for two consecutive years, but also in our strong life sciences, and financial services practice areas,” says David Corbett, managing partner of Fasken Martineau.

Through Fasken Martineau’s London office, the two firms have worked together since 2004. The combined office in London will be renamed Fasken Martineau Stringer Saul LLP.

Fasken Martineau DuMoulin specializes in mining litigation and ranks among the four largest law firms in Canada, with more than 600 lawyers.

Stringer Saul is a smaller, commercial law firm based in central London. It’s best known for taking a team-based approach to solving clients’ problems, rather than assigning one lawyer to each case.

Finning continues brisk business in South America

Finning International (FTT-T, FINGF-O) says its South American division has an order from copper miner Minera Escondida, 57.5% of which held by Australia’s BHP Billiton (BHP-N), to buy 45 of Caterpillar’s (CAT-N) 326-tonne 797 mining trucks.

Minera Escondida says the trucks will start arriving there in 2009. The purchase is covered under a previous agreement between BHP Billiton and Caterpillar.

Finning makes money selling Caterpillar equipment but it makes even more by servicing fleets.

“The growing fleet of Caterpillar equipment forms the basis for growing parts and service revenues for future years,” says Doug Whitehead, president and CEO of Finning.

Situated 170 km southeast of the city of Antofagasta in northern Chile, Escondida is the world’s largest copper mine. Escondida’s other owners include Rio Tinto (RIO-N) with 30%, Japan’s Mitsubishi owning 10%, and International Finance Corp., 2.5%.

In Argentina, Finning sold another $24 million in equipment to Silver Standard Resources (sso-t, ssri-q) for use at the company’s Pirquitas silver project.

The deal includes an O&K RH90 hydraulic shovel, as well as a fleet of seven 91-tonne Caterpillar 777 haul trucks and 10 pieces of support equipment.

The plum in the deal for Finning is a multi-year maintenance and repair contract that tops $70 million. The terms of that contract are still being worked out.

Pirquitas will be an open-pit operation producing an average of 9.6 million oz. silver per year over 8.8 years.

Delivery of the equipment is expected in mid-2007.

Finning is one of the world’s largest Caterpillar equipment dealers. The company sells, rents, finances and provides customer support services for Caterpillar equipment and engines in Western Canada, the U.K., and South America.

Alcan buys rest of cathode maker

Alcan (AL-T, AL-N) has bought the outstanding 70% stake in cathode maker Carbone Savoie, and certain related technology and equipment, from GrafTech International (GTI-N) for about US$135 million.

Alcan already owned 30% of the Carbone Savoie.

“Alcan has strengthened its commitment to aluminum smelting technology development in Europe and more particularly in France. We look forward now to begin fully integrating Carbone Savoie into the company,” says Michel Jacques, president and CEO, Alcan Primary Metal Group.

Alcan’s proprietary AP Series smelting technology uses Carbone Savoie’s advanced graphitized cathode blocks, which act as conductors in the electrolysis process.

Carbone Savoie had revenue of about US$114 million in 2005, and produces graphitized cathode blocks, sidewall blocks and ramming paste. The business employs about 500 people at two sites, both near Alcan’s research and development centre in Voreppe, France.

Alcan has 65,000 employees in 61 countries and regions, and posted revenue of US$20.3 billion in 2005.

BioteQ takes Chemsulphide technology to China

Vancouver-based BioteQ Environmental Technologies (BQE-V, BTQNF-O) has signed a contract to form a joint venture with China’s largest copper producer, Jiangxi Copper.

The joint venture will build and operate a water treatment facility to collect copper-heavy water runoff at the Dexing copper mine in Jiangxi province, China. The company, to be owned equally by both companies, will be called JCC-BioteQ Environmental Technologies.

Under the agreement, BioteQ will provide — without the usual royalties — its patented chemsulphide recovery technology to the joint venture for use at Dexing, which produces 120,000 tonnes of copper concentrate per year from flotation concentrate. It also produces copper cathode via heap leaching low-grade stockpiles followed by solvent extraction-electrowinning.

Initially, the $3.5-million treatment plant will be designed to collect 1.1 million lbs. copper per year, but over time and with some modifications, the maximum capacity should reach 4.5 million lbs. annually. At a copper price of US$2 per lb., revenue should be roughly US$9 million yearly at full capacity.

Annual operating costs at maximum capacity are estimated at US$2.4 million or US53 per lb. copper. Any copper recovered would be refined at commercial rates at the Jiangxi Copper refinery.

BioteQ will provide an operations and technical manager for the joint venture, whereas Jiangxi will provide a general manager and administrative support. Jiangxi says it will get any necessary permits. Both companies will share equally in costs and profits.

The BioteQ plant is expected to be up and running by mid-2007.

Jiangxi Copper is listed on the Hong Kong, London and Shanghai stock exchanges and is based in Guixi City. Production from all operations in 2004 reached 420,000 tonnes copper, 12 tonnes gold and 330 tonnes silver.

Vancouver-based BioteQ treats acid contaminated water through the use of its patented BioSulphide and ChemSulphide processes.

Tagish Lake sends PJ Whelan underground

Tagish Lake Gold (TLG-V) has hired P.J. Whelan Mining Contractors to conduct two stages of underground development work at Tagish’s Skukum Creek gold-silver project in the Yukon.

The first stage of the underground work will include some 300 metres of drift and 200 metres of raise on the Rainbow Two and newly discovered Bergvinson zones, 1,300 metres below surface.

Tagish Lake hopes the new underground workings will demonstrate the continuity of earlier results indicated by diamond drilling.

P.J. Whelan will also drive three crosscuts, for a total length of 200 metres, north from the Ridge access drift. This will provide a platform to test the upward and downward extensions of the Rainbow Two and Bergvinson zones.

In the second stage, a 1,100-metre adit will be carved out to access the downward extensions of known zones 200 metres below the existing 1,300-metre adit at Skukum Creek.

The measured and indicated resource at Skukum Creek measures 1.12 million tonnes running 8 grams gold and 153.1 grams silver per tonne, using a 5 grams gold per tonne cutoff grade. The inferred resource stands at 370,000 tonnes grading 8.56 grams gold and 54 grams
silver.

Tagish Lake has several gold-silver deposits in the Yukon’s 178-sq.-km Skukum mineral district, 80 km south of Whitehorse.

Lamp lets underground miners send text messages

NL Technologies (NLT), a communications equipment maker, recently received Australia’s safety certification for a cap lamp that allows miners to communicate underground via text messages, in much the same way people communicate everyday on cellular phones.

Most of the work done on the approval process for the Northern Light Digital Messenger cap lamp was conducted by NLT’s Australian subsidiary, NLT Australia.

The lamp employs a keyboard-like device that lets miners send text messages, even under emergency conditions. The lamp does this by using the same 802.11 wireless technology found in many laptop computers.

The wireless technology in each lamp connects to a larger underground wireless network underground. Every lamp has its own identification code and management can track a miner’s whereabouts by using the supplied software.

“The ability for workers to send messages back to the surface has huge implications for safety — not only during rescue operations, but during daily operations as well,” says Tim Haight, managing director of NLT Australia.

NL Technologies says it will focus on selling the lamps to coal mining companies based in Australia.

For more than 20 years, NL Technologies (NLT) has built communications products for underground miners.