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The Haitian Senate appears to be  buckling under unknown pressures on the Mining Issue!  After originally noting the environmental devastation caused by mining and calling for an immediate “stay of the exploitation permits already signed with SOMINE, SA, VCS Mining or any other entities”; review by a panel of “experts” of “contracts, which have already been signed” and most importantly “a national debate on the mineral resources of the country, [and] their potential …”  Le Nouvelliste reports that by last Thursday, February 28th, Senator Jean-William Jeanty was saying that they “are willing to bend (courber) themselves”, if they observe that the permits and contracts signed “respect international norms” and “if the interest of the country is well defended” (1)

WHY THE BACKPEDALLING?

This occurred about one week after their initial Resolution!  Why are they doing an about-face about the public debate (and panel of experts)?  Does it have to do with the visit of the Canadian Foreign Minister in the interim?  Were they told that if they cancel contracts that it would make companies unwilling to invest?  Or, were they threatened in some other way?  And, by whom? Perhaps their objective was never to defend the people or country but rather to make sure that Pierre-Yvon Beauboeuf and Jean-Marie Wolff were not cut out of the deal, as suggested by Senator Bien-Aime?

EXPLOITATION PERMITS ISSUED IN VIOLATION OF MINING CONVENTION AND OF COMMON SENSE

The fact that it was said that “Exploitation permits” were issued on December 21, 2012, suggests that, as other sites have argued, new Mining Conventions were not signed, but rather that they are trying to continue to operate under the old Mining Conventions from 1997, renewed and published in 2005.

However, it would seem clear that these Conventions are no longer valid, given that research permits were for a maximum of 4 years in total (2), and if they are legal the Conventions have not been followed regarding the issuing of Exploitation permits.

The required feasibility studies, as described within the Mining Convention,  have NOT been produced.  Feasibility studies should have been completed BEFORE exploitation permits were issued.  This is both common sense and is stated within the Conventions.  Feasibility studies should have been completed within the first four years of the Conventions, as well, which is why the Conventions would be invalid (This assumes that they ever were valid).

Even when approving the Mining Conventions in 2005, post-coup, interim President Boniface Alexandre mentioned that he was approving the Conventions by decret due to absence of a legislative body.  This seems to imply his recognition that the Conventions should be approved by the Parliament, as the Haitian Senate argued prior to backpedalling.

Those studies, which have been filed by Majescor on SEDAR, for the SOMINE property, are in English, rather than the French which is required under the mining Convention, despite the fact that the last study filed was done by a French company and that French is one of Canada’s official languages.  Documents in French would appear critical for Haiti, whose official languages are French and Creole. (3)

Neither Majescor-SOMINE, nor VCS Mining even claim to have done the environmental studies which are required as part of the feasibility study, which itself is required before issuance of an Exploitation Permit.  We note that, according to the Conventions, they are to allow little cyanide in the water (a better standard than Canada), but no mention is made of the toxic sulfur dioxide gas, which will be produced, nor of the sulfuric acid produced and used.  The environmental studies are but one part of a laundry list of requirements – most or all seemingly unmet.

Neither company, for instance, has proven existence of anything worthy of being mined, as even required by the standards of Canada (NI 43-101), which has a lower standard of proof for reporting than the US SEC.

IS THE SOMINE MINE FEASIBLE?

It is worth bearing in mind that Majescor is reporting a .3% copper grade, in a potential mine which is small by porphyry copper mine standards.  While they allege a cutoff grade of .1%, below which it cannot be mined, BME documents had stated a cut-off of .3%, which is generally considered the lowest cut-off for copper mining.  To make it more clear, this means that 99.7 % will be waste!  This makes the SOMINE project extremely low-grade..the lowest percentiles of the low-grades.

After receiving the Exploitation Permit, Majescor-SOMINE recently produced a new, inadequate, study about Douvray, but not on Faille or Blondin, for which they also received exploitation permits.  And, as clearly explained by Remi Bosc, the consultant hired by Majescor, the Douvray study is only an initial study or “Inferred Resource Estimate”.

On the first page of Majescor’s latest report, “effective March 1, 2013” and prepared by Remi Bosc-Arethuse of France, it clearly states “US investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into reserves.  ‘Inferred resources’ have a great amount of uncertainty as to their existence, and economic and legal feasibility.  It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category.  Under Canadian rules, estimations of Inferred Mineral Resources may not form the basis of feasiblity or pre-feasibility studies, or economic studies …. US investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable“.  (bold in original) He later discusses that Majescor’s heavy dependence on historical drill holes is only “acceptable for an inferred resource”.

The official Canadian “CIM” Mining standards explain uncertainty of Inferred Mineral Resources:
“….Due to the uncertainty that may be attached to Inferred Mineral Resources, it CANNOT BE ASSUMED that all or of any part of an INFERRED MINERAL RESOURCE WILL BE UPGRADED to an Indicated or Measured Mineral Resource as a result of continued exploration. CONFIDENCE IN THE ESTIMATE IS INSUFFICIENT TO ALLOW THE MEANINGFUL APPLICATION OF TECHNICAL AND ECONOMIC PARAMENTERS OR TO ENABLE AN EVALUATION OF ECONOMIC VIABILITY WORTHY OF PUBLIC DISCLOSURE.  INFERRED MINIERAL RESOURCES MUST BE EXCLUDED FROM ESTIMATES FORMING THE BASIS OF FEASIBILITY OR OTHER ECONOMIC STUDIES” (p. 4 CIM Definition Standards, All italics in Original, Bold emphasis our own)

The 1976 Mining Law calls for following International Mining Norms, whereas the Mining Conventions call for Canadian standards, which would generally below international norms, and certainly below the US ones. It is problematic that the specific standards to be used are not even stated.

After much screw-up (i.e. copper and silver bits from diamond drilling damaged sample) and otherwise waffling, Majescor only claims to have produced an Inferred Resource Estimate.  They were to have thrown out at least three of their samples, but we do not believe that they did since we found no mention of this screw-up in Remi Bosc’ report. Rather he discusses the fact that much higher grades of silver were intercepted in Majescor’s 2011 to 2012 drilling than in the 1997 St. Genevieve drilling.  Bosc calls this silver an “upside to the project” (pp. 59; 83).  It must be noted that Remi Bosc states that he was wholly dependent upon the information given to him by Majescor and that he had not gone on-site in Haiti either.  So, they seem to have left out the explanation by Kenzie MacNeil of their “bonanza-grade” silver anomalies and associated Tungsten and Copper anomalies.

MAJESCOR’S DRILLING SCREW-UP

We have to give Majescor credit for at least admitting to some screw-up and for having hired Kenzie MacNeil of “Overburden Drilling Management Ltd.” of Ottawa to evaluate the problem. Nonetheless, they did not admit to their mess-up in their new study.  Three anomalous samples were sent to Mr. MacNeil, but this does not mean these were the only screw-ups –who can know?  Mr. MacNeil says that “…each of the three samples is contaminated with diamond-impregnated silver solder fragments derived from the diamond drill bits”.

In other words during the drilling program they broke off parts of the drill bits and the metal from the bits was counted as metal content of the drill core, a pretty comic event, in this tragic mining story,  which places in our minds the Bre-X geologist putting gold shavings from his wedding ring in the samples to make the grade look higher.

Mr. MacNeil continues:  “As the solder is largely composed of copper and silver, the reported Cu [copper] and especially Ag [silver] analyses are compromised and unuseable.  The absence of mineralization in the +1.0 mm rock fragments of the crusher rejects confirms that the high Cu and very high Ag analyses are due to the silver solder contamination alone.”

In other words, there are no minerals in their core sample outside of the Copper (Cu) and Silver (Ag) and Tungsten (W) left by the drill bits!  This part surprises even us and is made clear in his microscopic descriptions.  Like a professor trying to help goof-ball students who have messed up royally, MacNeil continues:  “Going forward, any Ag-Cu-W anomalies where drill core is highly fragmented and broken or mixed with sludge should be treated with suspicion.  Ideally, only intact core should be analyzed or it should be analyzed separately from fragmented core or sludge to minimize the possibility of contamination.”  Nice to see serious professionals like Mr. MacNeil!
What a contrast to the Majescor team!

Meanwhile, the new Majescor NI 43-101 study seems to ignore this problem and its repercussions.  This major screw up would make us question their whole drilling program!  Considering that their stock is now slightly below five cents (.045), we seem to have company in our assessment.

DUVALIER AND THE MACOUTES MAY GET THE LAST LAUGH

Another interesting fact is that the BME reported a grade of .5% initially.  We do not know if the original numbers were exaggerated, especially considering that Pierre-Yvon Beauboeuf (of St. Genevieve-SOMINE) was Director of the BME at the time; if the original studies were done incorrectly or if this is indicative of the area having already been mined.  According to Remi Bosc, this area was first studied by the UNDP from 1973 to 1980 and by St.Genevieve and KWG from 1995 to 98.  Pierre R. Gauthier who was president of both St. Genevieve and KWG is considered by many to have questionable ethics.  Duvalier left in 1986 so it is entirely possible that, if there was anything worthwhile on the SOMINE property, that some or all of it may have been mined before he left, and there would have been ample time for reforestation.  The Macoutes would have been very able to organize forced work crews or corvee on any of these properties.  And, there have been many reforestation programs through the years.  To us it is a no-brainer that the Duvaliers would surely have mined anything of value early on!  Haiti should forget about this pie-in-the-sky mining and focus on getting money back from Jean-Claude Duvalier, without forgetting that he was not the only person of importance in his regime and perhaps not very important at all.  How many of these others who should be prosecuted are still alive, we do not know.  Perhaps this is why Duvalier fell ill?  There were those who did not want him to talk?

Although we have yet to finish posting the rest of our core information in the form of Highland Clearances parts II and III, we will probably need to start updating daily for awhile,if we can, starting with critical evaluation of the two known Mining Conventions. So, if you are really interested in this case, please come back soon.

HAITIAN SENATORS:  PLEASE, YOU MUST NOT BEND!  THE PEOPLE AND COUNTRY ARE IN DANGER!
AUX SENATEURS HAITIENS:  SVP IL NE FAUT PAS VOUS PLIER!
LE PEUPLE ET LE PAYS EST EN DANGER!

(1) « Les dirigeants de Somine ont partagé avec nous certaines informations sur les permis et contrats déjà signés avec l’Etat haïtien, a déclaré le sénateur Jean-William Jeanty, président de la commission des TPTC du Sénat. Nous allons analyser les documents. Si nous constatons qu’ils respectent les normes internationales en la matière et si l’intérêt du pays est bien défendu, nous sommes prêts à nous courber… »  Senator Jean-William Jeanty President of the Public Works, Transportation and Communications Commission (TPTC) of the Senate as quoted in “Les Senateurs Poursuivent leur queste” by Yvince Hilaire and published by Le Nouvelliste 1 mars 2012 (unfortunately there appears a time lag and this only reached the internet edition on late Sunday or early Monday).
(2) The Mining Conventions allow research for two years with the possibility of renewal for another two years.  This means that feasibility studies should have been completed and exploitation permits filed for by May 2009 at the latests.  The only extensions are for Force Majeures and work must be taken back up as quickly as possible.  We cannot find a Force Majeure which would have impacted that part of Haiti, except perhaps some flooding.  But, this would not add up to the difference between May 2009 and Dec. 2012.  SM Delta, VCS’ Haiti subsidiary did not even exist until 2010.  VCS Mining is a complicated case anyway.  It may well be that VCS Mining renewed a pre-existing exploitation permit, considering that there is exploitation on the property.
(3) p. 31 Special No. 2, Mardi 3 mai 2005, “Le Moniteur”, Article 42.1
of the St. Genevieve Mining Convention states “La presente Convention est redigee en langue francais.  Tous rapports ou autres documents etablis ou a etablir, en execution de la presente Convention, doivent etre reiges en langue francaise.”

REFERENCES AND FURTHER READING

March 1 article on the Senate and Mining in Le Nouvelliste
http://www.lenouvelliste.com/article4.php?newsid=114004

Study re Broken Drill Bits
http://www. majescor.com/uploads/cause%20of%20anomalies%20-%20september%2027,%202012.pdf

Canadian Foreign Minister Visit
http://www.lenouvelliste.com/article4.php?newsid=113828

NI 43 101 Rules and Procedures
http://www.ccpg.ca/profprac/en/Documents/ni_20110624_43-101_mineral-projects.pdf

CIM terms
http://web.cim.org/UserFiles/File/CIM_DEFINITON_STANDARDS_Nov_2010.pdf

Douvray Porphyry Copper Deposit Mineral Resource Estimate,
SOMINE Project, NI 43 101 Technical Report prepared by Remi Bosc of Arethuse Geology Sarl and CT Barrie-Majescor, 20 Jan. 2013,
published on the SEDAR web site as of March 1, 2013

lowest copper grades
http://www.polinares.eu/docs/d2-1/polinares_wp2_annex2_factsheet6_v1_10.pdf

Draft EPA document discussing copper porphyry copper deposits and
global tonnage statistics
http://ofmpub.epa.gov/eims/eimscomm.getfile?p_download_id=506365

http://en.wikipedia.org/wiki/Waffle_(speech)

Copper facts
http://www.bgs.ac.uk/downloads/directDownload.cfm?id=1410&noexcl=true&t=Copper%20

Environmental Impacts of Copper Production
http://www.princeton.edu/~ota/disk2/1988/8808/880810.PDF

see p. 2 editorial re Canada (in French)
http://www.haiti-liberte.com/archives/volume6-33/Haiti_Liberte_Feb_27_2013_web.pdf

http://haitianalysis.blogspot.ch/2013/02/morne-bossa-neighbors-nervous.html
http://www.ayitikaleje.org/haiti-grassroots-watch-engli/2013/2/20/nervousness-and-lack-of-transparency-surround-three-new-mini.html

Workplace Safety and Sulfuric Acid
http://nj.gov/health/eoh/rtkweb/documents/fs/1761.pdf
Material Data Sheet Sulfuric Acid
http://www3.imperial.ac.uk/pls/portallive/docs/1/7276136.PDF
For those who did not take chemistry lab and do not recall that
Sulfuric Acid is the one you don’t want to accidently open and sniff
(you can see the smoke coming off of it anyway) here is a real
case similar to the clean-up man in La Femme Nikita:  John George Haigh and the “Acid Bath Murders”
http://en.wikipedia.org/wiki/John_George_Haigh

Canada’s poor environmental record
http://www.environmentalindicators.com/htdocs/conclusions.htm