Adolor Corp     4.67 +2.75 (+143.23%) Intraday 3 Month 6 Month 1 Year

Under the agreement, Cubist will commence a tender offer to purchase all of the outstanding shares of Adolor for the upfront cash payment and a CPR. The transaction, which has been unanimously approved by the Boards of Directors of both companies, is expected to close in the fourth quarter of 2011.

Adolor has commercialized ENTEREG® (alvimopan), the first and only FDA-approved therapy to accelerate the time to upper and lower gastrointestinal recovery following partial large or small bowel resection surgery with primary anastomosis. ENTEREG is an oral, peripherally-acting mu opioid receptor antagonist. Cubist, with its focus on addressing acute care and hospital needs, will leverage its existing commercial operations to promote ENTEREG. Launched in 2008, ENTEREG generated more than $25 million in U.S. sales in 2010 and $15.7 million through June 30, 2011. Cubist anticipates peak ENTEREG sales of over $100 million annually.

Adolor’s lead development program is ADL5945, an oral, peripherally-restricted mu opioid receptor antagonist. It is currently in development for the treatment of chronic opioid induced constipation (OIC), a growing, multi-billion dollar, currently underserved market. Adolor announced positive Phase 2 data for ADL5945 in August 2011 and Phase 3 trials are expected to be initiated in 2012. Cubist plans to retain certain U.S. and specialty rights while seeking a partner to assist with ex-U.S. and primary care commercialization.

“This transaction is an excellent strategic fit for Cubist and the latest milestone in what has been a transformational year for the company,” said Cubist President and Chief Executive Officer Michael Bonney. “ENTEREG is a first-in-class therapy with strong growth potential, and we believe our experienced sales force and strong commercial platform will realize the potential of this important hospital product. With the addition of ADL5945, Cubist will have a truly outstanding late-stage pipeline with three strong candidates addressing significant markets. We are excited about the acquisition of Adolor and believe it will deliver significant value to our shareholders, hospital customers, and patients.”

Michael Dougherty, Adolor’s President and Chief Executive Officer, stated, “This transaction delivers significant immediate value to Adolor stockholders, as well as potential future value through the CPRs. Cubist shares our commitment to patients and their health care providers, and we expect that ENTEREG and ADL5945 will benefit from Cubist’s proven track record and larger platform in development and commercialization.”

Terms of the CPR call for additional cash payments of up to $4.50 per CPR. The CPR will entitle each Adolor stockholder to receive up to $3.00 per share if ADL5945 receives regulatory approval in the U.S. and up to $1.50 per share if ADL5945 receives regulatory approval in the European Union, in both instances prior to July 1, 2019. In each case, the size of the payment would depend on the parameters of the approval. The CPR will not be publicly traded.


Cubist has scheduled a conference call and live audio webcast:
    
    WHEN: Monday, October 24, 2011 at 8:00 a.m. ET
    LIVE DOMESTIC & CANADA CALL-IN:             877-407-8289      
    LIVE INTERNATIONAL CALL-IN:             201-689-8341      
    
    24-HOUR REPLAY DOMESTIC & CANADA:             877-660-6853      
    24-HOUR REPLAY INTERNATIONAL:             201-612-7415      
    
    REPLAY PASSCODES (BOTH REQUIRED FOR PLAYBACK):
    ACCOUNT #: 351 CONFERENCE ID #: 381866
    
    Replay will be available for 90 days via the Internet at www.cubist.com

Junior, U.S-headquartered gold miner, Gold Resource Corporation (GRC) has entered into a position of holding some of its in-house treasury in physical gold and silver rather than cash in a move that will undoubtedly further increase its appeal to the gold-owning fraternity.

In reporting strong second quarter figures which have seen new production, revenue and dividend payout records, the company's board has announced that it has approved the company minting approximately US$1 million worth of its own one ounce gold and silver coins.

As production increases, the idea is to hold an increasing portion of its assets in physical gold and silver and possibly offer shareholders holding certain minimum positions the ability to someday receive their dividends in-kind.

Commenting on this move, the company's President, Jason Reid, said "Holding physical gold and silver in our treasury provides an excellent means of diversification in light of today's world economic conditions and not only provides that diversification to shareholders but underscores Gold Resource Corporation's commitment to precious metals.. Minting Gold Resource Corporation's Double Eagle precious metal coins, currently underway, not only marks the next Company milestone but takes a large step towards potentially offering our shareholders a future in-kind dividend.  With the unprecedented printing of fiat currencies around the world and the potential negative impact of governmental policies of various nations around the globe, Gold Resource Corporation provides investors excellent precious metal exposure from an increasing production profile, from dividends and now with physical exposure in the Company's treasury."

Gold Resource has always taken an innovative approach to its gold mining activities, and not one that has always met with outside approval as witness a highly critical article in Barrons in July, which the company has described as a "hatchet job".  Gold Resource is a maverick amongst gold miners having brought its El Aguila mine in Mexico into production without producing an SEC-compliant reserve report prior to moving forward.  This is in fact the way many gold, and other,  miners would have operated before what some might consider excessively protectionist legislation on SEC compliance, which heavily increases the cost of new mine development, started to be put in place to try and protect investors from possible fraud.

Gold Resource describes itself as a gold producer targeting projects that feature very low operating costs and high returns on capital. The primary focus is on cash flow, with a priority to return a meaningful dividend back to its shareholders. So far, since its start of production just over a year ago it has already declared13 special cash dividends for shareholders. As to its track record to date, Gold Resource successfully declared commercial production in July last year from a shallow, high-grade open pit at its El Aguila project - one of several in Mexico. This has enabled it to reach production and cash flow in an extremely short amount of time. A second operation - on the Arista high grade polymetallic vein deposit -  is already producing.  In  its first 13 months of operation the company has already declared no less than 13 cash dividends for its shareholders - an aggressive dividend policy just not seen these days when juniors plough cash back into their projects and  any possibility of dividend payments seems to be deferred ad infinitum.

Because Gold Resource operates in this manner it does raise some suspicions amongst those who feel, in our view misguidedly, that such a totally different approach to mine development and shareholder rewards has to signify some kind of deep down malpractice and fraud.  Holding part of its treasury in gold and silver and the announced aim to ultimately pay in-kind dividends is unlikely to reduce such fears from the doubters, but in the meantime Gold Resource continues on its path and at current precious metals prices appears to be going from strength to strength.

Companies nowadays, and gold miners are no exception, often feel the need to take an innovative approach to attract shareholders and boost their stock prices as witness Newmont's pledge to increase its dividend on a fixed basis parallel with rises in the gold price and also Gran Columbia's floating of a silver backed debenture noted in a recent interview with Frank Holmes.  Gold Resource Corporation is perhaps the ultimate example of such a policy.

Link to article: http://www.mineweb.com/mineweb/view/mineweb/en/page66?oid=133623&sn=Detail&pid=110649

Hole 667 hit a tantalizing 38 metres @ 1.57 percent U₃O₈ as part of a drilling campaign that had already discovered the company's second zone of uranium mineralization, Roughrider East, beyond the envelope of its resource estimate last year.

Now 15 of 17 follow-up drillholes at the new discovery show there is a third, significant area of U₃O₈ mineralization at Hathor's Roughrider project, located in the province of Saskatchewan, Canada.  Hathor calls it the Far East zone.

Not surprisingly, as mineralization is still open to the east and south, Hathor reports that it will continue to concentrate drilling at Far East to see just how extensively it stretches.

The new drilling highlights are reminiscent of intersections from Hathor's main Roughrider West deposit, and the more recently defined East zone. One of the best drillholes cut 43 metres @ 3.26 percent U₃O₈ and included a 7-metre intersection @ 10.47 percent U₃O₈.

Overall Hathor describes mineralization in the new area as being 20 to 30 metres thick, with numerous intercepts over 30 metres in length, and running about 40 metres along strike. By way of comparison, Roughrider West occupies about 150 metres of strike length.

One key difference between the Far East zone and the Roughrider West zone, however, is depth. The western zone starts near surface while Far East mineralization is about 350 metres below surface.

In part because of its near surface nature, Roughrider West will remain the core deposit for Hathor as it works on a scoping study of the project. Nonetheless, Hathor notes Far East "represents significant upside to the overall resource potential of the Roughrider uranium deposit."

Meanwhile Hathor looks to have consolidated the Roughrider project, which is part of its larger Midwest Northeast property, through a recently signed definitive agreement with Terra Ventures. Terra owned, among other interests, a 10-percent stake in Roughrider.

According to UBS precious metals strategist, Edel Tully, the bank prefers gold to silver over the course of the rest of this year even though silver offers perhaps more opportunities for short term gain, albeit with a heightened risk profile.

Speaking on Mineweb.com's Gold Weekly podcast, Tully said, "Gold, purely from a precious metals and a safe haven angle, is our preferred method.... Obviously silver has come back quite impressively, it is up over $5 from the lows of last week so you could have made some big gains but, I would prefer to see silver try to stabilise somewhat, see it consolidate for a little while.

Tully adds that, while she does see a $50 an ounce silver price as quite possible, "the route back up to $50 is going to be alive with very volatile price action."

Gold, on the other hand, is likely to be a less volatile play, to which the movements of last week attest but, it also expected to continue on its upward trajectory.

"Our average gold price for the course of this year is $1,500, so it is just a tiny bit below where gold is trading right now, so I think a gold price above $1,600 this year is very, very possible," Tully says.

One of the main reasons for this is the slate of continued macroeconomic concerns facing countries around the globe.

Inflation concerns in China, which Tully acknowledges is a very important market for gold, have further boosted demand for the metal.

"Whenever I go to China, the actual view on inflation appears to be much higher on the ground than what the official statistics would reveal. So, I think the Chinese population will remain friendly toward gold so long, really as inflation is a problem."

Remaining in Asia, Tully adds that the current level of demand out of India is surprisingly strong and does not have the same level of seasonality as it has in previous years.

"While you are not going to have the wedding-type buying that happens in the beginning of the year, there certainly seems to be an appetite for gold in India that is not going to disappear over the summer," she says.

The upcoming end to QE2 in the US that is scheduled for June, is also likely to have some impact on the price of gold even, as Tully says, it is just from a psychological view. But, she adds, the end of the quantitative easing programme does not mean necessarily a tightening in US monetary policy.

"US monetary policy is going to remain loose for some time, hence the backdrop for a rising gold price, or at least a stable gold price remains the case.  Add into the mix then, a very uncertain US fiscal backdrop and it certainly is a number of interesting variables that will help to make sure that gold continues to be supported by investors."

The final major factor that is likely to play an increased role in underpinning gold prices over the course of the year is the continued presence of central bank buyers in the market.

In particular the news last week that Mexico has bought 93 tonnes of gold, while not a big mover of the price on the day of the announcement bodes well for the rest of the year.

"I think the biggest take-away we can grab from that is that another region of the world, another central bank region is buying gold. So, it is not just concentrated in Asia, that it is now in the Americas. So, the potential for another central bank in South America perhaps could be quite high going forward."

And, she says, "I think over the course of the year it is just another explanatory factor in why gold should move higher from here."

The company also downgraded total 2011 production guidance from the original forecast of 30 million to 33 million pounds to the revised forecast of 28 million to 32 million pounds.

"For the Thompson Creek Mine, the company expects that the first half of 2011 will have higher production and lower cash costs than the second half of 2011," said Thompson Creek Metals. "This is primarily the result of the Thompson Creek Mine pit sequencing and the tapering off of the higher grade production in the first half of 2011, with more stripping activities and significantly lower-grade production in the second half of 2011."

"This is expected to increase operating expenses and significantly reduce net income in the second half of 2011," the company said.

Thompson Creek Metals also announced it has approved the increased capital expenditure budget for the Mt. Milligan copper-gold project in British Columbia from C$915 million to C$1.26 billion. The C$350 million increase is for design improvements, increases in labor costs, the cost of steel, concrete and other materials, and forex rate changes.

"Mt. Milligan is an important building block for our company, both in terms of growth and diversification," said Loughrey. "We believe that, notwithstanding the capital increase, the economics for the project are still extremely attractive, and our liquidity and capital resources are sufficient to complete the construction of the Mt. Milligan mine."

"We expect to commence production in late 2013 and produce approximately 81 million pounds of copper and 194,000 ounces of gold annually," he added.

FINANCIALS

 "Thompson Creek achieved excellent financial performance in the first quarter of 2011, mainly as a result of increased production, sales volumes and molybdenum prices," Loughery noted.

Adjusted net income for the first-quarter 2011 was US$62.9 million or 38-cents per share, more than double the adjusted net come of US$25.6 million or 18-cents per share during the first-quarter 2010.

Net income for the first quarter of the year was US$128.9 million or 78-cents share, which included a non-cash unrealized gain on common stock purchases of $66 million or 40-cents per share. Net income for the first-quarter 2010 was US$1.1 million or 1-cents per share, which included a non-cash unrealized loss on common stock of $24.5 million or 17-cents per share.

Meanwhile, Thompson Creek Metals increased total 2011 capex from the previous guidance of US$591 million to the new guidance of US$680 million.

The company also increased 2011 exploration expenditures from the previous guidance of US$20 million to $23 million to the new guidance of US$20 million to $24 million.

A conference call to discuss 1Q results is scheduled for Monday at 8:30 a.m. eastern time.

Adjusted net earnings from continuing operations in the first quarter were US$48 million or 12-cents per share, which increased from $18 million or 5-cents per share.

The company reported quarterly gold production increased 39% from 77,215 ounces in the first-quarter 2010 to 107,622 ounces in the first-quarter 2011.

New Gold reiterated its 2011 production guidance of 380,000 to 400,000 ounces and lowered its guidance for total cash cost from $430 to $450 per ounce to $390 to $410 per ounce. "The forecast decrease in total cash cost is driven by the continued strength of the silver price and the significant impact it is having on total cash cost at Cerro San Pedro where need gold is expecting to produce between 1.9 and 2.1 million ounces of silver in 2011," New Gold said.

The company also reported 635,320 ounces of silver production and 3.5 million pounds of copper production during the first-quarter 2011, up from 206,700 silver ounces and 4 million pounds of copper production reported during the first-quarter 2010.

"We are very pleased as the momentum we established through our strong performance in 2010 continues to build in 2011," said New Gold Executive Chairman Randall Oliphant. "Our base of three operating assets has once again delivered increased gold production at lower cost."

"We feel fortunate that with the prevailing strength in commodity prices our margins and cash slows continue to grow significantly," he added. "We believe that this growth will be further enhanced through the development of our two fully-funded organic growth projects as well as by our proposed acquisition of Richfield."

On April 4, 2011, New Gold and Richfield Ventures announced a friendly transaction whereby New Gold will acquire all of the outstanding common shares of Richfield. Each Richfield shareholder will receive 0.9217 of a New Gold share for each Richfield share held. The offer valued Richfield at $10.38 per share or $550 million.

Net earnings for the first quarter of this year were reported to be $651 million or 82-cents per share, compared to $232 million or 32-cents per share reported in the first-quarter 2010.

"We remain comfortable with 2011 gold production guidance of between 2.65 million and 2.75 million ounces of gold, but if the improving trend in cash costs continues we may revisit our guidance of between $280 to $320 per ounce cash costs as the year progresses," said Goldcorp CEO Chuck Jeannes.

Goldcorp reported 637,600 ounces of production during the first quarter, up from 600,100 ounces during the same period of 2010.

The Vancouver-based gold miner also reported silver production of 6,143,000 ounces during the first quarter, compared to 3,332,500 ounces reported during the first-quarter 2010.

During the first quarter copper production was reported at 21.38 million pounds, down substantially from 35.28 million pounds of copper reported a year earlier.

Lead production more than tripled from 11.79 million pounds in first-quarter 2010 to 36.53 million pounds in first-quarter 2011. Zinc production soared from 17.46 million pounds in the first quarter of last year to 55.56 million pounds in the first quarter of this year.

Meanwhile, the company's big Peñasquito operation achieved its designed full milling capacity of 130,000 tpd. Second quarter activities will be directed towards stabilizing plant performance at 130,000 tpd.

Los Filos achieved record quarter gold production of 94,000 ounces during the first quarter. Construction of a fourth stage of the heap leach pad at the operation is expected to be completed during the second quarter.

During the first quarter Goldcorp also presented detailed development plans for Cerro Negro, Éléonore and Cochenour, "three important new growth projects that will anchor our 60% growth in gold production to 4 million ounces in 2015," said Jeannes.

An updated feasibility study and new development plant at the Cerro Negro project in Argentina had doubled plant throughput to 4,000 tpd, contributing to an average of 550,000 ounces of gold production annually during the first five full years.

A new mine plan for the Éléonore project in Quebec provides for doubling plant throughput to 7,000 tpd, beginning in 2017 with gold production averaging 600,000 ounces annually over 15 years.

Meanwhile, Goldcorp has published a second update on the implementation of the Human Rights Assessment for the Marlin mine in Guatemala. Operations at the controversial mine continue pending conclusion of the Guatemalan government's administration process, which was promoted by the Inter-American Commission on Human Rights.

Following completion of a scoping study at Cochenour, full-scale development of the project is underway near Goldcorp's flagship Red Lake operation. Estimated life-of-mine gold production is expected to average between 250,000 to 275,000 ounces annually over a 20-year mine life.

Excluding the Pueblo Viejo joint venture with Barrick in the Dominican Republic, Goldcorp budgeted 2011 capex of $1.5 billion. Exploration expenditures are expected to total $170 million this year.

However, analysts were expecting earnings of 36-cents per share on revenue of $185.6 million.

Stillwater's Montana PGM mines produced a total of 131,200 ounces of palladium and platinum during the first quarter of this year, a 1.7% increase over the 129,000-ounce PGM production reported during the same period of last year.

"Our total mined PGM production of 131,200 ounces was very strong and higher than expected for the quarter," said Stillwater CEO Frank McAllister. "The higher production levels were the result of more tons mined than anticipated, improved ore grades in the lower off shaft area of the Stillwater Mine and resumption of production from the east side of the mine..."

"While I am pleased with this improvement, it is not yet clear to what extent the first quarter production rates will be sustainable in the second and third quarters," he cautioned. "Consequently, at least for now, we are maintaining our 2011 guidance estimate of 500,000 PGM ounces."

McAllister also noted that Stillwater saw "significant increases in recycling revenues" during the first quarter of this year. "As planned, during the first quarter of 2011, we commissioned our new state-of-the-art assay laboratory which utilizes an automated x-ray facility that provides very accurate results with much faster turnaround times than conventional fire assay methods."

During the first quarter of this year, Stillwater processed 115,600 total ounces of PGMs from recycled catalytic materials, compared to 119,300 ounces of recycled material processed during the first quarter of 2010.

"Overall, I am pleased with our performance during the first quarter," McAllister said. "Palladium prices did trend down during the first quarter, likely as a result of the uncertainty surrounding the effect of rising oil prices and the impact of the Japanese earthquake and tsunami damage on the outlook for automobile production."

"However, I believe these factors will have a relatively short term impact on PGM demand and we will continue to experience the benefits of robust PGM, and specifically palladium, market dynamics over the intermediate to longer term," McAllister stressed.

Meanwhile, Stillwater reported nearly triple the net income recorded during the first quarter of 2010. Net income for the 2011 first quarter was $36.2 million or 34-cents per share, compared to 2010 first-quarter net income of $13.4 million or 14-cents per share.

The first-quarter 2011 net income included $45.9 million net income from mining operations, net income of $2.9 million from recycling activities less $300,000 of cost associated with the Marathon properties, a $4.1 million income tax provision, about $1.2 million of unallocated net interest expenses and corporate costs of $7 million.

The company reported 267,368 gold equivalent ounces including gold production of 221,489 ounces as well as silver production of 2.3 million ounces.

This compares to 239,838 GEO reported during the first-quarter 2010, including 190,663 ounces of gold and 2.6 million ounces of silver.

Copper production during the first quarter of this year was reported at 38.5 million pounds, up 30% from 29.7 million pounds during the same period last year.

El Peñon experienced record quarterly production of 115,798 GEO during the first quarter of the year including 73,568 ounces of gold and 2.1 million silver ounces, a 7% increase over the 108,437 GEO reported during the same period of 2010.

Yamana aims to produce 1.04 million to 1.14 million GEO in 2011 including a range of 860,000 to 965,000 ounces of gold, and 8.5 million to 9.5 million ounces of silver.

The company also expects to spend US$85 million on exploration this year and will continue focusing on increasing mineral reserves and resources with its near-mine and regional exploration programs, as well as continuing to explore greenfields targets.

Net earnings for the quarter were US$148.2 million, compared with net earnings of $131.5 million for the first quarter of 2010, which included $7.4 million in earnings from discontinued operations.

Earnings per share were 20-cents for the first-quarter 2011, up from 18-cent per share for the first-quarter 2010.

In a statement Yamana CEO Peter Marrone said, "We continue to advance our new projects, the first of which, Mercedes, is expected to start production by the middle of 2012. C1 Santa Luz and Ernesto Pau-a-Pique will begin contributing b7 the end of 2012 and Pilar is expected to be in production in early 2013."

"All of the projects can be fully funded directly from our cash flow," he said. "These projects will contribute to our 60% production growth expected in the next three years."

Meanwhile, Kinross has increased 2011 full year-production guidance to 2.67 million - 2.7 million gold equivalent ounces as a result of increasing the company's Kupol interest to 100%.

The revised GEO production forecast is based on planned gold production of 2.4 million - 2.5 million ounces and silver production of 11.8 million - 12.2 million ounces this year.

Production in the first quarter of this year was 642,857 GEO, an 18% increase over the 544,134 GEO produced during the first-quarter 2010. The increase was mainly attributed to the addition of production from West Africa operations.

Kinross now expects to produce 535,000 to 555,000 GEO at its Russian region this year, compared with its prior forecast of 435,000 to 455,000 GEO.

On April 27, 2011, Kinross' 75%-owned subsidiary, Chukota Mining and Geological Company (CMGC) completed the purchase of the 25% of Kupol mine that Kinross did not already own for US$350 million, giving Kinross 100% ownership of the Kupol mine and the Kupol East-West exploration licenses.

Meanwhile Kinross completed the sale of its approximately 8.5% equity interest in Harry Winston Diamond for net proceeds of US$100.6 million.

The company said it growth projects remain on schedule. "At Fruta del Norte, construction of the portal high wall for the underground exploration decline has commenced, and negotiations with the Ecuadorian government on an exploitation agreement are proceeding," Kinross said.

At Paracatu the third ball mill is 98% complete with commissioning continuing through the second quarter, the company said.

"We continue our aggressive campaign to define and advance mineral reserves and resources at Tasiast, with 26 drills turning around the clock," Burt said. "Results at the main deposit continue to fulfill our expectations, while encouraging results at other targets along the trend reinforce our belief that Tasiast has the potential to develop into a major gold producing district."

Adjusted net earnings for the first-quarter 2011 were $180.3 million, an 81% increase over the $97 million reported in the first-quarter 2010. Adjusted net earnings per share were 16-cents in Q1, compared to 14-cents per share for first-quarter 2010.

Reported net earnings were $255.5 million or 23-cents per share for the first quarter of 2011, compared with $181.3 million or 26-cents per share for first-quarter 2010.

"Gold could also fall back sharply," CPM advises.

 "Silver could fall $12 or more, to around $37 or lower, very quickly," CPM warned. "No asset in history has risen so sharply so rapidly and retained most of its price appreciation. Silver has no immunity to the laws of the markets."

Much of the recent buying last month "has been by shorter term investors who reasonably may be expected to sell once prices stop rising and start falling. Many of these investors have been momentum based traders, technically based traders, and short-term investors," said CPM.

Noting that buying in silver ETFs "has not been spectacularly great over the past month," CPM also observed that there also have not been reports of "exorbitantly large silver purchases in the physical markets."  Meanwhile, there is no price pressure from heavy silver bullion coin buying.

"The price implication of this is that prices have been pushed sharply higher during April on thin buying volumes by shorter term oriented market participants and by congestion in May Comex futures contract," CPM advised. "This suggests silver prices are vulnerable to a sharp downward correction when, not if, these short-term buyers decide to stop buying, or perhaps decide to sell."

CPM also noted that silver ETFs have seen only modest buying. The main silver ETF, the iShares Silver Trust, rose from 35.8 million ounces on April 1 to 366.2 million ounces on April 25. As silver prices rose further last week, the SLV holdings dropped back to 354.3 million ounces of as April 29.

Official Bolivian news agency ABI reported Sunday President Evo Morales issued a decree that would bury 20 years of neoliberalism in the nation's mining industry.

Essentially Morales is ending market rule and privatization of mines contained in Supreme Decree 21060, which was enacted in 1985 by former Bolivian President Victor Paz Estensoro.

Morales also annulled laws pertaining to banking and investment in order to increase state control of those sectors.

"The best legacy of the Bolivian people is to be anti-imperialist, anti-capitalist and anti-neoliberal," he declared.

At a special Workers Day ceremony Sunday miners burned a black box symbolizing the end of the old mining legislation.

At a mass rally Sunday in the Coliseum in Huanuni, Bolivian Vice President Alvaro Garcia Linera urged Huanuni miners to "take control" of the leadership of the Miners' Federation to promote state mining and economic activity in Bolivia. He also called on miners to "preserve and protect" the struggles of indigenous peoples, workers and peasants which "form the backbone of our country."

Last month Bolivian mining unions asked the state to "recover" the silver, zinc, lead and tin mines currently operated by private companies.

 However, Deputy Mining Minister Hector Cordova told Bloomberg that a new mining bill to be sent to the Bolivian Congress won't substantially change contract conditions for Coeur d'Alene Mines, which operates the nation's largest pure silver mine, San Bartolome; Pan America Silver's San Vincente silver mine; and Orvana Minerals.

Nevertheless, he said the government will seek to renegotiate contracts with Glencore International, whose Sinchi Wayra subsidiary controls five small and medium-size mines in Bolivia, including Porco, and will sign a contract with Sumitomo Metal Mining, which operates the San Cristobal silver-lead-zinc mine.

Cordova told Bloomberg that the new legislation is aimed at giving state miner Comibol a controlling interest in joint ventures and forces companies to return mining concessions which aren't being developed.

Meanwhile, the new mining law will require mining companies "to pay a little more in royalties because metals prices have risen," he added.

In the Scotiabank Commodity Price Index report for April, Mohr advised China's copper demands will likely strengthen seasonally again in the second quarter of this year as reconstruction in Japan will eventually lift copper demand.

"However, we acknowledge that commodity prices are now at mid-cycle, with further gains likely to be more limited," she cautioned.

In her analysis, Mohr suggested, "Copper could still retest the previous US$4.60 record of February 14."

"Chinese copper fabricators destocked copper and produced 2.1% fewer copper semis in January and February due to credit restrictions and high prices," she said. "However a big seasonal pick-up in consumption in the second quarter will lift prices."

"End-use demand in air conditioners, electronic goods, high-speed railway equipment and autos remains strong," Mohr noted.

Meanwhile, Mohr's research has found spot potash prices continue to advance, rising to US$409 per pound in March. "Prices are expected to increase another US$50 by May, with BPC already concluding sales to Brazil at higher prices, given strong demand in that market."

The Fukushima-Daiichi nuclear power plant crisis in Japan caused spot uranium prices to drop $11 to US$55.50 per pound in late April, according to Scotiabank. "Spot transactions have slowed as buyers and sellers reassess the market outlook."

"While uranium prices will likely remain soft until the Fukushima-Daiichi plant is fully stabilized, prices should start to pick up again by late 2011," Mohr forecast. "The biggest impact of this crisis will likely be the faster adoption of new reactor technology (such as passive self-regulating reactors, not requiring cooling)."

"The four major growth markets for nuclear power-China, India, Russia and South Korea-are expected to go ahead with previously planned nuclear energy expansion (totaling 106.2 GWe [Gigawatt-Electric] or 28% of current world capability of 377.8 GWe)," Mohr noted. "While there could be some delay, an official in China has indicated there may be an announcement in the late summer."

Nevertheless, she warned, "Germany's recently announced decision to phase out nuclear power (now 23% of electricity supplies) will likely prove costly and undermine industrial competitiveness, as the country shifts to much higher-cost, less reliable base-load electricity sources and becomes more dependent upon imported energy (pipeline natural gas from Russia and nuclear from France)."

"We maintain our spot price forecast of US$70-75 by 2013," Mohr advised.

On Monday Canada Lithium said "it will vigorously defend" the action against the company, its directors, and a geologist regarding the mineral resource estimate for the Quebec Lithium Project.

The Ontario Superior Court of Justice has a year to decide whether to hear the lawsuit.

Geologist Michelle Stone, who prepared the mineral resource estimate at issue in the litigation, is named as a defendant.

Canada Lithium said Siskinds has "requested a variety of orders and declarations" in its notice of action as well as Cdn$50 million in general and special damages.

In a news release, Canada Lithium said, "The Notice of Action alleges that the company its directors, certain officers, and Ms. Stone made misrepresentations in violation of Canadian securities regulatory requirements that was announced by the company on October 28, 2010 and incorporated into various disclosure documents" including the NI 43-101 technical report filed on Nov. 22, 2010 and a prospectus issued by the company on Jan. 24, 2011.

The mineral resource prepared by Stone, a geologist with Canada Lithium, estimated total measured and indicated mineral resources of 46.7 million tonnes, grading at 1.19% Li20. Proven and probable mineral reserves were calculated at 15.4 million tonnes grading 1.17% Li20.

By March 16, 2011, Canada Lithium announced it had appointed AMC Mining Consultants to independently conduct a resource estimate of the Quebec Lithium Project and to "expeditiously prepare" a new NI 43-101 report. The appointment was the result of a preliminary independent review by Roscoe Postle and Associates confirmed there were "significant issues with the geological modeling that produced the mineral resources estimate for the project (announced by the company on October 28, 2010."

In March, the company warned investors "there will be a material reduction in the measured, indicated and inferred minerals resources" contained in the NI 43-101 report. At the time, the company said "it is not possible to accurately quantify the magnitude of the reduction of the mineral resource at this time..."

Located in the Lacorne Township north of Val d'Or, Quebec, the Quebec Lithium Mine originally operated as an underground mine and processing plant that produced spodumene, lithium carbonate and lithium hydroxide monohydrate. A 1974 feasibility report calculated a historical reserve of 15,736,939 tonnes grading 1.14% Li20.

Canada Lithium acquired the property from IAMGOLD in May 2008.

"We belive this case is without merit and that it will ultimately be dismissed," said Canada Lithium CEO Peter Secker. "The company took immediate action when we learned that there was a potential issue with the previously announced mineral resource estimate and we are working to resolve this matter as quickly as possible and anticipate receiving an independent resource estimate on or before May 13, 2011."

DOE's Ames Laboratory at Iowa State University-which calls itself the "rare-earth center of the nation-- is among a small group of U.S. facilities working to improve industrial methods for the processing of rare earths.

Rare Earth magnets are the most advanced commercialized permanent magnet materials today. They can be found in computer hard drives, loudspeakers and headphones, and in electric motors for cordless power tools or power steering. These magnets are also used in the drive motors for hybrid and electric vehicles.

Ames Lab scientists already devised a way to make neodymium-iron-boron magnets less expensively, and without generating the hazardous waste by-products resulting from standard manufacturing methods.   Ames said its scientists "will investigate several compositions of rare earth materials and processing techniques with the goal of making permanent rare earth magnets with properties comparable to currently available neodymium-iron-boron magnets."

The material combinations to be studied by Ames "will correspond with the relative concentrations of rare earth elements in Molycorp's Mountain Pass mine, using techniques that are more cost effective and leave a smaller environmental footprint than current metals."

Molycorp is concentrating on   "mine-to-magnets" strategy. Upon completion of its modernization and expansion efforts at its Mountain Pass, Calif. processing facility in 2012, it expects to produce at a rate of 19,050 metric tons of REO equivalent per year. The company plans to offer a range of rare earth products, including high-purity oxides, metals, alloys, and permanent magnets.

In Wednesday's news release, Dr. John L. Burba, executive vice president and chief technology officer of Molycorp said, "It is my hope that this cooperative agreement will lead to breakthroughs in rare earth material manufacture that can advance the state of the art in rare earth magnet design and manufacture as well as strengthen our nation's productive capacity of these and other critical rare earth materials."

 "We are looking forward to a highly successful partnership between Molycorp and the Ames Laboratory that will incorporate new techniques, processes, and materials into U.S. supply chains," said Debra Covey, Ames Laboratory associate laboratory director for Sponsored Research Administration.

As of Mineweb's deadline late Wednesday, neither the Ames Laboratory nor Molycorp could provide more detailed documents to Mineweb as to the expected outcome or products resulting from their official partnership.

Hybrid cars, car batteries, cell phones, and white LED-based lights are among the manufactured products depending on rare earth elements. Rare earth element magnets can be found in hard drives or anything that uses a small electric motor. Neodymium magnets are responsible for the miniaturization of electronic devices.

Medical and defense applications also rely on the use of rare earth magnets. They are also utilized in wind-generated power and oil drilling, among other uses.

Anson Marston Distinguished Professor Karl A. Gscheiner, an Ames Lab scientist, believes the U.S. must educate its own scientists and engineers in rare earth science, engineering and technology in order to compete with China's monopoly on rare-earth chemistry research.

"The Ames-Molycorp partnership will serve to re-energize applied rare earth research in the U.S., and will begin to ameliorate the current void in in intellectual infrastructure in rare earths by training undergraduates, graduate, and post-doctoral students and providing them with research opportunities," he stressed.

Overall copper equivalent mine reserves grew to 39.2 pounds per share, compared to 11.3 pounds per share in 2010.

The company's overall copper equivalent and gold equivalent are based on proven and probable reserves at the Constancia Copper Project in Peru; HudBay's flagship mine the 777,  the Lalor Lake Project, the Chisel North Mine, and Trout Lake Mine, all located within the Flin Flon District near the provincial border of Manitoba and Saskatchewan.

The reserve and resource estimate does not include nickel reserves at the Fenix nickel project in Guatemala. HudBay is seeking a joint venture partner for Fenix.

In a statement, HudBay CEO David Garofalo said, "As promised, we have systematically executed on our objective of growing our mineral exposure on a per share basis through accretive acquisitions and exploration, which we believe will lead to a substantial value re-rating of HudBay over the course of this year. "

"Much of this growth was driven by the value-accretive acquisition of the Constancia copper project in Peru, where we plan to initiate procurement and engineering activities, update the resource model and conduct a pit optimization study over the course of the year to enable use to make a formal construction decision in early 2012," he noted.

HudBay has budgeted $70 million for what Garofalo called "one of the largest exploration budgets in our history" in 2011.

Meanwhile, HudBay also announced a 2011 pre-construction program of US$116 million for the Constancia copper project.  The program contemplates early equipment procurement for long lead items, a resource model update, metallurgy review and pit optimization study, geotechnical and condemnation drilling and a US$9 million exploration program.

HudBay expects construction to begin at Constancia in early 2012 with the goal of the first full year of production by 2016.

The company has scheduled a conference call with analysts Friday at 12:30 p.m. ET.

President Obama's Fiscal Year 2012 proposed budget calls for charging a 5% royalty on the gross proceeds of hardrock minerals mined on public lands including silver, gold and copper.

The President is proposing a number of new royalties and fees on both hardrock and coal mining, along with reductions on oil and gas subsidies,  which he says will save the country $3 billion over the next 10 years.

The Office of Management and Budget (OMB) said the President's budget "provides a better return to taxpayers from mineral development."

"A number of recent studies by the Government Accountability Office and DOI's Inspector General have found that taxpayers could earn a better return through more rigorous oversight and policy changes, such as charging appropriate fees and reforming how royalties are set," the OMB said.

The President's budget would also establish a new Abandoned Mine Land fee on hardrock mining, "so that the hardrock mining industry is held responsible in the same manner as the coal mining industry."

The agency also suggested the budget "mitigates the environmental impacts of mining by dedicating and prioritizing funds to clean up abandoned mines and by strengthening the regulation of active coal mining." The fee would be based on the volume of material that a mining company displaces.

Senate Majority Leader Harry Reid of Nevada, a longtime advocate of Nevada's gold mining industry, said, "I'm willing to consider any proposal for mining reform that protects the mining industry, doesn't kill jobs and shares revenue with the state."

"I will carefully study the president's proposal to determine whether it meets these criteria and ensures that one of the pillars of the state's economy can continue to create jobs and strengthen the economy," he added.

While Reid's efforts have been successful in the past in stopping the Congress' effort to levy new fees and taxes on the hardrock mining industry, this time Republicans control the House, which may also help U.S. mining.

Meanwhile the President's proposed budget for the Environmental Protection Agency stresses coordinating federal water policy with state and local government, Native American tribes, industry and agricultural sector to achieve goals.

Among those goals are coordinating the actions of the EPA, the Department of the Interior, and the Army Corps of Engineers "to better address impacts of surface coal mining on aquatic resources."

However, House Republicans have proposed cutting the EPA budget by 16% below what President Obama has requested.

Coxe's bullish case for copper over the longer term remains what he has been saying for the past decade, "The growth in demand as Asia industrializes will continue to support the industrial metals."

"These economies are compressing-into forty years-the economic growth we achieved over two centuries," he said in a Basic Points--The Metals Take Center Stage analysis published this week. Plus, Coxe observed, "China is a far better credit risk than the US, and the metal miners shouldn't be losing sleep that their biggest customer is going to disappear into a debt hole."

In his analysis, Coxe also noted the transformation of Asian economies "means that global steel demand will continue to pressure available supplies of iron ore. Successes such as Canada's Consolidated Thompson...and the recent proposed takeover of Baffinland Iron Mines by ArcelorMittal and Nunavut Iron Ore show that an iron ore deposit no longer has to have proximity to China or the Suez Canal to attract serious attention."

"Incidentally, Vale could be the biggest single beneficiary of the current major widening of the Suez Canal," Coxe suggested.

PRECIOUS METALS

In his analysis, Coxe also discussed the uprising in Egypt and its impact on gold prices.

"Why should gold go up if [Egyptian President] Mubarak goes down?" Coxe asked. "Because gold goes down when there is blissful peace and improving prosperity."

"A revolution in the most important Arab state that could conceivably end with the Muslim Brotherhood in effective charge should surely be bullish for gold," Coxe suggested.

RARE EARTHS

However, Coxe was far more skeptical regarding the plethora of rare earth exploration companies. "There may be a shortage of rare earth deposits outside of China, but there is assuredly no shortage of companies aiming to be rare earth producers."

"The sheer number of suddenly-expensive small companies with big dreams of rare earth production suggests that investors should take more than ordinary caution," Coxe advised. "We have not made a detailed study of this new mining boom, but we know the history of the uranium boom, and how few of those projects turned out to be great investments.

"We wonder how much of the research many of the penny stock buyers have conducted is based on the idea that they are buying unobtainium," Coxe quipped.

"Nevertheless, we wish the speculators and the companies well. Not all booms end in busts for most of the well-managed players. There will doubtless be some huge winners, and we hope to know enough about this new mining industry to be able to make some recommendations in the near future," he added.

INVESTMENT RECOMMENDATIONS

1.     Despite their recent run-ups, Coxe said long-reserve-holding base metals stocks remain very attractive.

2.     If Egypt's crisis is resolved peacefully, reduce precious metals stock exposure in commodity stock portfolios but retain these stocks in general equity portfolios as risk-reducers.

3.     Do not sell the Australian iron ore and coal producers' shares because of the weather events there. "Besides, investors should have longer time horizons than what is needed to clean up after a flood," he advised. "Forinvestors who missed the big run-ups in those stocks now is an excellent entry point."

4.     Maintain a strong position within the agricultural sector.

5.     The Euro's recent strength is probably unsustainable.

6.     Bond portfolios' durations should be near benchmark levels. "The time for extending durations because of an increased chance of a double-dip recession in Europe and/or the US, would also be a time for loading up on gold."

Written by Dorothy Kosich, republished courtesy of Mineweb.com