An investment letter I subscribe to has had some interesting articles on metals.
Important metals, like copper, tin, zinc, lead, gold etc. are rising in price. Copper has tripled in price, over the last 10 years.
The authors of the article suggests that the high prices might be enough to bring old, abandoned mines back into operation.
Take the UK-it has tin and lead deposits that had been worked up to the last century. Or the eastern USA: Vermont had a big copper mine, Massachsetts has several old iron and zinc mines.
If big mining companies decide to re-open these old operations, how wold you find out? Do they have to file plans with the state governments?
Mines are closed when they become uneconomic, and reopened when the numbers turn.
Standard operating procedure.
And if you think you can reopen a mine on the QT you aren’t thinking very clearly.
Purchase of the lease, securing equipment to refurbish and begin work, survey work to establish the , employ a workforce etc. If nothing else it would appear on any decent investment sheet via a company announcement at every stage.
In addition, mines can become economical to rework due to advances in new technology - this article, for example, describes how some mines are reopening due to both increases in commodity prices and new extraction technology.
Not only that, but even mine tailings that were once considered waste products can become worth sifting through for residual minerals.
In a sense, you can consider oil and gas extraction as a sort of mining, and you definitely see older wells being reactivated now that crude oil prices have gone back up.
Look at it this way- when oil was $20 a barrel about 13 years ago, there were plenty of wells that wouldn’t have made money at that price. Now that it’s pushing $100 a barrel, those same wells are plenty profitable now.
I know in Pennsylvania they are mining much thinner coal seams than when I was a kid.
It depends on why the commodity prices are rising. If it’s because the cost of extracting these commodities is increasing then the peripheral deposits are worth even less than they already were and there will be operating mines being abandoned as their productivity falls below the profitability margin.
Three little words:
Environmental Impact Report.
Any exploratory drilling–you gotta find out what is down there, after all–requires permits, sometimes at the County level, other times at the State level. There has to be a proposal, timeline, and projected costs before an investor will open his or her wallet. The Environmental Impact Report will factor heavily into those projections.
If the new mining will produce pollution of any kind: air, water, soil, expect the residents in nearby communities to have a huge voice in the plans. An investor with a fattened bank account is of no comfort to the people who must drink the water and breathe the air.
~VOW
In northern Minnesota and northern Wisconsin there are new mines proposed, and old mines to be reopened. Lots of public input. Unless there are no newspapers, no radio, no television, no internet, no word of mouth, and all your public servants are immensely corrupt, the miners can’t sneak up on you. Don’t worry about that.
The hardest thing is making the judgments about ecology, science, abatement, jobs, economic viability, boosters, dreamers, nay-sayers, etc. Hard to make the right choice.
Stripper wells. Lot of these things in Western PA, where the oil industry started:
Of course, as the price of oil goes up, it’s probably reflected in general energy costs, and thus the cost to run your “nodding donkey” out there to get a few barrels a day. Note also the remarks in that article concerning “premature abandonment”. The well owner has a judgement call as to when they wish to salvage what they can of the infrastructure, and close out the lease.