The hidden cost of coal mining

Ten miners are confirmed dead in a coal mine flooding in Southwest China's Sichuan province, with two others still missing, local authorities said Saturday.

A Deloitte Access Economics analysis, commissioned by the Minerals Council of Australia and to be released today, estimates the industry's tax burden was about 50 per cent higher than Treasury estimates made during last year's bruising battle over the Rudd government's resource super-profits tax.

Canada led the world in the number of mining mergers and acquisitions (M&A) for the first half of the year, says Ernst & Young. And while the number of deals fell in comparison to the highly acquisitive first half of 2010, the value of the transactions that took place this year more than doubled compared to the same period last year. The country was the leading buyer in H1 with 196 deals, and also the leading target destination with 129 deals. Australia came second as a buyer and target destination, with 83 and 72 deals respectively.

Commodity markets were hit this week by shock news that the United States created no jobs in August, sparking speculation that the world's biggest economy could be heading for a double-dip recession. Analysts said the data bolstered expectations that the US Federal Reserve could soon decide to implement another round of quantitative easing -- dubbed QE3 by traders -- to help breathe new life into the struggling economy.

The Globe and Mail reports on Friday that MEG Energy, a small oil sands developer partly owned by China's CNOOC, has ponied up $100 million to join another Chinese state-owned firm Sinopec as financial backers of a planned pipeline from the oil sands to the northern British Columbia coast. Slowing demand in the US is adding pressure for a go-ahead on the Northern Gateway pipeline that will stretch for more than 1,100km at a cost of $5.5 billion affording Canada world prices for its oil, currently priced against heavily discounted US crude. Regulatory hearings are scheduled to start in January.

Actor and possible New York mayoralty candidate is no fan of nuclear power. In an interview with the Huffington Post on Friday, he said nuclear power is a dirty source of fuel. "Nuclear reators are filthy, contaminating processes. The biggest problem in the anti-nuclear movement is the big lie, the constant metronomic assertion of the nuclear industry that it is 'clean power'," says Baldwin in the interview. New York state, where Baldwin lives, has six nuclear power plants which provide 30% of the state's electricity needs.

Silvercorp Metals was forced on Friday to react to an anonymous letter also sent to the Ontario Securities Commission, presumably from a shorter of the company's stock that alleges a “potential $1.3 billion accounting fraud” at the company. The firm with projects in China and Canada closed down just shy of 10% after five times the usual number of shares changed hands. It had lost as much as 14% of its value earlier in the day after the company also said someone had built up a short position of some 23 million shares over the last two months. The Vancouver company has 175 million shares outstanding and is worth $1.3 billion. Silvercorp is the latest in a string of Canadian companies with Chinese backing and operations being accused of fraud.

Beating already rosy expectations new Australian Bureau of Statistics figures show mining companies intend to invest $82.1 billion this financial year on new and expansion projects, representing 55% of total capital expenditure in the country's economy. The spending spree by the resources sector – mostly in Western Australia and Queensland – represents a whopping 70% increase over last year. Mining firms spent 14.4% more last quarter, led by a 22% jump in plant and machinery purchases, and projections show further increases in the future. The positive capex news, accompanied by robust retail spending numbers saw the Australian dollar rise above 107 US cents.

Shares of Sunridge Gold rose a brisk 7% in Thursday morning trade after the junior explorer gave an update on drilling at its zinc-gold-copper deposit in the Horn of Africa only to end the day down 2.8%. Near triple the usual number of shares changed hands on the Toronto venture exchange. Investors in the the Vancouver-based company, which apart from its flagship Asmara project in Eritrea also has assets in another paragon of political instability, Madagascar, have enjoyed a wild ride over the more than ten years the company has been listed – an unlucky few snapped up shares in the company at $6.40 in 2003 and those who saw value in the company at $1.30 at the start of 2011 would have lost almost half that investment.