British Columbia to spend C$25bn improving Asian trading opportunities - POLITICAL ECONOMY - Mineweb.com | The world's premier mining and mining investment website Mineweb

British Columbia to spend C$25bn improving Asian trading opportunities

BC's Premier announced Monday the launch of the Pacific Gateway Transportation Strategy which aims to expand the Canadian mining exports to Asia

Author: Dorothy Kosich
Posted:  Tuesday , 03 Apr 2012
RENO (MINEWEB) - 

British Columbia Premier Christy Clark Monday launched the new Pacific Gateway Transportation Strategy 2012-2020 to expand international trade in coal, potash, minerals, forest products, grain, container traffic and growth in air travel.

The strategy targets Cdn$25 billion in new public and private sector investment needed to meet demand, in addition to $22 billion already committed since 2005.

"We have a once-in-a-generation opportunity to take advantage of the fastest growing economy in history," Clark said. "Asia is right at our doorstep-our ports are closer than anywhere else in North America. Our government is making sure we can get our goods to market as efficiently and quickly as possible and this strategy is a huge part of that plan."

For instance, Teck has invested more than $1 billion and hired an additional 1.000 people in British Columbia to expand its steelmaking coal, copper and zinc operations. "We're investing to meet growing demand, particularly in Asia, for the products we produce," said Teck CEO Don Lindsay. "Working with the B.C. government and the other Pacific Gateway partners, we're creating opportunities for equipment operators, trades people and professionals across the province."

Neptune Terminals' strategic investments have resulted in record terminal exports of potash and steelmaking coal, a 20% job increase at terminals, "and additions to come as we complete our expansions," said Neptune Bulk Terminals (Canada) President, James Belsheim.

The strategy will increase major road and rail capacity, rural resource transportation capacity, bulk and container terminal capacity at B.C. ports and air passenger and cargo capacity to meet projected growth through 2020.

So far, about $12 billion worth of projects have been completed. $10 billion in projects are now underway including expansion of the Trans-Canada Highway to four lanes from Kamloops to the Alberta border and Kicking Horse Pass. The highway is a main route for movement of east-west goods to B.C. ports.

Going forward, $25 billion in additional investment is planned. CN and Canadian Pacific plan to invest $2.8 billion to increase capacity on rail mainlines.

Private sector investment of between $300 million and $1.1 billion will expand coal terminal capacity in Vancouver and Prince Rupert, while up to $60 million has been committed to expand metal and mineral terminal capacity in Northwest B.C. and Vancouver.

Private sector investments of up to $700 million will be used to develop additional potash terminal capacity.

"We are building on our world-class transportation network to support the growth of exports that create new jobs and opportunities in B.C.," said Transportation and Infrastructure Minister Blair Lekstrom. "Our vision is to make B.C. the preferred choice for Asian-Pacific Trade and secure a great economic future for British Columbians."


See the article online here: British Columbia to spend C$25bn improving Asian trading opportunities - POLITICAL ECONOMY - Mineweb.com | The world's premier mining and mining investment website Mineweb

The MasterMetals Blog

Chalco Agrees to Buy SouthGobi Stake to Gain Coal Mines (1)

(BN) Chalco Agrees to Buy SouthGobi Stake to Gain Coal Mines (1)

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Chalco Agrees to Buy SouthGobi Stake to Gain Coal Mines (1)
2012-04-02 11:05:28.628 GMT

(Updates with comment from SouthGobi CEO in eighth
paragraph.)

By Michelle Yun
April 2 (Bloomberg) -- Aluminum Corp. of China Ltd., the nation's biggest producer of the metal, agreed to buy Ivanhoe Mines Ltd.'s stake in SouthGobi Resources Ltd. to gain control of Mongolian coal production as it expands into other commodities and diversifies revenue.
Ivanhoe will tender its 57.6 percent stake in SouthGobi into Chalco's C$925 million ($928 million) offer to buy as much as 60 percent of the company at C$8.48 a share, 28 percent more than its close in Toronto on March 30, according to a statement today from Chalco, as the Chinese company is known. Should shareholders tender more than 60 percent of the stock, the amount sold by Ivanhoe may be reduced, according to a statement from Ivanhoe.
Control of SouthGobi will give Chalco coal sales from the Ovoot Tolgoi mine to bolster revenue as aluminum prices decline.
Ivanhoe, founded by billionaire Robert Friedland, said in February it was encouraged by progress of talks as it sought to sell some assets to finance the Oyu Tolgoi copper and gold project.
"It marks the most significant step by a long way for Chalco in terms of executing this diversification strategy it's been talking about for a number of years," said Andrew Driscoll, Hong Kong-based head of resources research at CLSA Asia-Pacific Markets.
The aluminum producer has also agreed to purchase as much as 100 percent of SouthGobi's production for as many as two years, Chalco said. Its shares fell 1.9 percent to HK$3.67 at the close in Hong Kong. SouthGobi surged 18.2 percent to close at HK$60.50.

Offer Premium

Chalco's offer is priced at 36 percent more than SouthGobi's weighted average price over the past 20 days, compared with a 21 percent premium for similar-sized completed basic materials deals over the past five years, according to data compiled by Bloomberg.
Chalco will use its own cash, bank loans or a combination of both for the purchase, it said. It will retain nine of SouthGobi's senior staff, including Chief Executive Officer Alexander Molyneux for 12 months from their employment termination under consultant agreements to facilitate transition, Chalco said.
"It's almost certainly going to happen as long as the regulatory approvals happen and go forward," Molyneux said on Bloomberg Television's "On the Move Asia" program today after the announcement. "You might say there's a lot more synergy having a Chinese state-owned enterprise as a major shareholder as opposed to having a very well-known exploration resource development company."
The acquisition is Chalco's biggest since it agreed to pay
$1.35 billion for a stake in Rio Tinto Group's Simandou iron ore project in Guine in July 2010. The offer is expected to open on or before July 5 and shareholders will have not less than 35 days to accept the offer, according to Chalco's statement.
SouthGobi was among the assets that Ivanhoe's advisers had contacted potential investors about last year after receiving unsolicited expressions of interest, Ivanhoe said in September.
"Depending upon the uptake of the offer by other SouthGobi shareholders, Ivanhoe could receive up to approximately C$889 million from the sale of all of its shares in SouthGobi,"
Ivanhoe said in its statement today. "A sale of 60 percent of its current holding would realize proceeds of approximately
C$533 million."

For Related News and Information:
Top metal stories: METT <GO>

--Editors: Andrew Hobbs, Peter Langan

To contact the reporters on this story:
Michelle Yun at +852-2977-4643 or
Myun11@bloomberg.net

Natural #Gas Prices

Natural Gas Prices

I cannot tell you how long, but this price arbitrage cannot and will not last forever!

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