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January 2021 - AgnicoEagle pays $286 million for TMAC, which operates a gold mine in Hope Bay (Canada) for a 26 per cent premium to the $1.75 per share that Shandong Gold was to pay
https://financialpost.com/commodities/mining/agnico-eagle-to-buy-tmac-resources-after-canada-rejects-chinese-suitor
- The acquisition price is “reasonable given the stable jurisdiction, and is within typical valuation ranges,” said Fahad Tariq, an analyst with Credit Suisse
Feb 2022 - AgnicoEagle decides to shut it down
"And after all the consideration, we thought that it was making more sense to stop operating and just focusing and putting all our energy into exploration."
- When it was fully operational the Hope Bay mine had 689 employees
https://www-cbc-ca.cdn.ampproject.org/c/s/www.cbc.ca/amp/1.6363802
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My Thoughts:
Perhaps if boards/management at various mining companies were more forthcoming with the actual state of affairs with shareholders, the market and thus potential suitors - such boob-ups would be less frequent.
Also, it seems to me last week's sudden (forced?) departure of former Kirkland Lake CEO turned AgnicoEagle CEO Tony Makuch may also signal things weren't all they were talked up to be at various Kirkland properties prior to Agnico's $13.5 billion purchase of said company.
In particular the Detour Lake gold mining complex which recently got a stunning 10 million ounce upgrade to its mineral resources from its new-but-very-short-term owner Kirkland Lake
https://www.mining.com/kirkland-lake-gold-adds-10m-oz-gold-to-detour-lake-resources/
Awaiting announcement of a resource 'recount' soon - but will there be repercussions or just a shrug of the shoulders ? It seems to be acceptable to blame the geologists, blame the resource estimate contractors or blame the actual geology but never blame senior management.
https://financialpost.com/commodities/mining/agnico-eagle-announces-surprise-exit-of-ceo-tony-makuch-amid-earnings-miss
The mining idustry is not good at talking about its boob-ups, even within a company. Net results are
1. it never learns and
2. shareholders tend to suffer.
An insightful study on the success or more commonly faiings of Feasibility studies can be found at below link. I bet you cant find too many reports/presentations like this?
https://vdocuments.mx/why-feasibility-studies-fail-melbourne201302presentation.html
good luck
the gnome
Goldgnome - thanks for sharing that eye-opening study
As a side note - that Hope Bay mine that Agnico Eagle just shut down - guess who did the original feasibility study and went on to build and commission it as CEO of TMAC Resources in 2013 to 2017?
Dr Catherine Farrow
https://www.linkedin.com/in/catharine-farrow-78535617/details/experience/
Perhaps the TMAC/Hope Bay mine's extensive history of poor performance and failure was a valuable learning experience for this Dr Farrow?
Actually, it must have been a superlative lesson because some genius saw fit to reward Dr Farrow's failures by hiring her as one of Centamin's non-executive directors in late 2019 - where she still sits... (Rebess - your last post was so on the money!)
One can review Dr Farrow's mine building catastrophes as CEO of TMAC/Hope Bay here:
https://www.juniorminingnetwork.com/junior-miner-news/press-releases/1727-tsx/tmr/32370-tmac-resources-reports-operating-and-financial-results-for-q1-2017.html
In my experience Geologist have neither the training, depth of experience or financial knowhow to manage feasibility studies or mining development programs, or in fact mines. What qualification did the previous Centamin CEO have? A PhD in geology is defintely not a requirement for doing feasibility studies, in fact it seems to act it he opposite direction.
The litany of mistakes in mining companies is gigantic.
Some of my "quiet" experiences
the CEO who had no idea what the cost of mining was? He had asked sevearl times.
the mine development which followed the wrong quartz vein (it was barren), and then they checked for gold ...geologist got in front of the cart? too smart???
the mine manager who put the tailings dam on the ore extension
the major company which shorted on the metalurgical studies and only sampled the oxide ore, and so designed the processing plant. It was later found that >80% of the ore was refractory.
the major company which made a new discovery, did some preliminary scoping drilling and work, decided it was too small at 150k ounces, and sold it for a song. It was later found to have dearer 5 m ounces of gold, a slight miscalculation?
the major company which discovered a massive porphyry deposit in the philipines, and then found out the levels of corruption, not to mention local terrorism , were outside the boards stringent guidelines (tail wagging the dog???), prohibited the company from doing any development of what they found...
and so on, and so forth
say no more...
the gnome