Business in Vancouver 2011-09-20 by GLACIER MEDIA DIGITAL LIMITED PARTNERSHIP dba BUSINESS IN VANCOUVER

Local. Business. Intelligence. September 20–26, 2011 • Issue 1143

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B.C. retools fiscal plan in wake of HST vote 4 Canadian innovation driving cross-border M&A action 8

Quarterly News Report

Resource industry news, analysis and insights - 17-24

Albertans drawn to B.C.’s affordable island cottages 10 E-books and education: no more pencils, no more books 11 How to tap student talent pools when school is back in session 13 Bike tire recycling rolling 14

Dominic Schaefer

Mining Report

Frack attack: Tria Donaldson and other environmentalists target shale gas industry 3

Karina Briño: the new face of mining in B.C. – 17

full disclosure

Credit card bill battle on

Ladner on the growing social fallout from income inequality 32

Merchants in B.C. might be successful in offloading the rising costs of accepting credit cards from consumers, but that shift would come with a heavy marketplace price

Demands undermining integrity of teachers’ union, says CFIB 33

By Richard Chu

Warren Roy and Global Relay are mining the rich vein of opportunities in North America’s data storage business 35

Biggest sales and management firms in B.C. 16 Biggest mines in B.C. 20

Business in Vancouver Issue 1143

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Card game: Plum owner Ed Des Roches brandishing monthly tallies of transaction and other fees his women’s fashion chain has to pay for accepting credit card payments from his clientele

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Business in Vancouver special report – 6, 7

Arrive Arrive Refreshed Refreshed For For Business Business Success Success www.airchina.ca

anada’s newest Competition Bureau commissioner hasn’t been afraid to kill sacred cows in big business over the past couple of years. Since she was appointed to head the bureau in 2009, Melanie Aitken has: •forced major changes in telecom marketing (in her case against Bell Canada); •helped preserve airline competition by preventing an Air Canada-United Airlines joint venture; and •provided Canadians with more options for selling homes by forcing the Canadian Real Estate Association to open up its Multiple Listing Service to homeowners. But Aitken’s Competition Tribunal case against Visa and MasterCard is already running into stiff opposition in B.C. from the two parties she’s aiming to protect. •

Air China is introducing fully-flat business class seat in Vancouver-Beijing flights. To experience a whole new level of comfort, please contact your travel agent or call Air China Reservations toll free 1-800-882-8122.

Daily business news at www.biv.com September 20–26, 2011

contents Columnists Cascadian Connections 8 Michael Orbach/Kushal Saha Real Estate Roundup 10 Peter Mitham BizPharmacy 13 Cyri Jones/Ivan Surjanovic Sustainability 14 Nina Winham Mining 21 Gordon Chambers At Large 32 Peter Ladner Podium 33 Laura Jones Golden Goals 34 Bob Mackin

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Now online Vancouver businessman to buy Dallas Stars PNE workers set to strike over wages Salmon farmers blamed for sea lion deaths Site C to have impact on private power sector B.C. releases new woodframe construction guide Government’s business plan for Site C flawed

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Burrard Street 11th priciest for offices in North America FortisBC to lower natural gas prices Nexterra inks contract for US Veterans Affairs heat system Business booming at Nat Bailey stadium Feds fund B.C. sturgeon industry

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Departments By the numbers 8 Insider trading 9 BIV lists 16, 20 Trouble 25–27 Lawsuit of the week 26 People on the move 28–29 Datebook 30–31 Letters 32

Sections Finance Real estate Technology Small business Business tool kit Mining quarterly Law Comment Profile

Business in Vancouver is published by BIV Media Limited Partnership at 102 East 4th Avenue, Vancouver, BC, V5T 1G2. Telephone‑604-688-2398; fax: 604-688-1963; New subscriptions are $79.95 for one year, $135.00 for two years, $189.00 for three years. Payment required with order. All prices are subject to 12% Harmonized Sales Tax. HST #831496872. Copyright 2010. Articles may not be reprinted without permission from the publisher. Reprint info: Veera Irani 604-608-5115. Publications Mail Agreement No: 40069240. Registration No: 8876. Return undeliverable Canadian addresses to Circulation Department: 102 East 4th Avenue, Vancouver, BC, V5T 1G2. E-mail: subscribe@biv.com US POSTMASTER: Business in Vancouver (USPS 009-409) is published weekly by BIV Media Limited Partnership. Our U.S. subscription rate is $95.95 Canadian per year. Payment required with order. C/O US Agent–Transborder Mail: 4708 Caldwell Rd E., Edgewood, WA 98372-9221. Periodicals postage paid at Puyallup, WA. and at additional mailing offices. US POSTMASTER: Send address changes to Business In Vancouver, c/o Transborder Mail, PO Box 6016, Federal Way, WA 98063-6016 Retail distribution by Globe Distribution Services.

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news Lobbying for action: It’s been nearly a year and a half since new legislation created fines of up to $25,000 for B.C. lobbyists who don’t publicly register their activities. But thus far no penalties have been handed out, and only 1.5 employees are on the job investigating the sector for non-compliance

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News

September 20–26, 2011 Business in Vancouver

Province unveils new shale gas rules By Joel McKay

nvironmentalists haven’t wasted any time attacking the provincial government’s efforts to increase transparency around natural gas fracking in northeast B.C. Earlier this month, Premier Christy Clark announced a new online registry that would allow the public to find hydraulic fracturing (fracking) well sites with the click of a mouse, and trace the chemicals that are used to extract the natural gas from B.C.’s tight rock formations. “Now all British Columbians will have access to the information they need to make informed decisions about the industry’s operations,” Clark said in a statement. But the Wilderness Committee, a citizen-funded environmental protection organization, said the new website doesn’t ensure gas companies aren’t contaminating groundwater. Wilderness Committee campaigner Tria Donaldson called on the government to ban all hydraulic fracturing activities until there’s a

better understanding of how they could affect the environment and human health. She pointed to jurisdictions such as Quebec, New York and New Jersey, which have all instituted some type of ban or moratorium on hydraulic fracturing activities. “There’s very, very rigid regulations coming in all around the world and in B.C. we’re talking about putting up a website,” Donaldson said. “We’re just barely skimming the surface.” Hydraulic fracturing relies on a combination of water, sand and chemicals that are pumped into deep, tight and shale rock formations. The combination fractures the rock, releasing the gas contained therein, allowing it to be drawn back to the surface. Environmentalists have blamed the process for contaminating groundwater, claiming in some areas that tap water has become so chemically laced it can be set on fire. In April, U.S. Democratic Congressmen released a comprehensive

inventory of the chemicals used by hydraulic fracturing companies, the first report of its kind. It detailed that companies were “injecting millions of gallons of products that contain potentially hazardous chemicals, including known carcinogens.” Although Donaldson conceded that the industry in B.C. has yet to report an incident of harm to groundwater, she believes it’s only a matter of time. “Fracking in B.C. is relatively new as an industry, so I think we’re really in the early stages of what the impact will be,” she said. The B.C. Ministry of Energy and Mines said in a statement to Business in Vancouver that there is “a considerable amount of inaccurate information being circulated about hydraulic fracturing, particularly in relation to B.C., and this website will provide clear and accurate information.” Although all current fracking activities will be published on the website, the ministry said the industry would not be required to disclose the location of future well sites.

Wilderness Committee

Environmentalists blast government’s attempt to improve transparency around controversial “fracking” drilling techniques

Wilderness Committee campaigner Tria Donaldson: the government’s new fracking disclosure rules don’t go far enough to protect groundwater

When asked if the website would also disclose the location of historic well sites, the ministry said it was a “possibility” but not the intended purpose of the registry. For the industry, the new disclosure rules are just business as usual. Encana (TSX:ECA) spokesman Alan Boras said his company has been disclosing well-site activities and chemical ingredients used at

sites in the U.S. for a long time. That information, he said, is available at www.Fracfocus.org. “We are in favour of disclosure, and we have been encouraging our suppliers to continue to develop environmentally friendly fluids.” Boras added that Encana is not concerned that the provincial government could be moving toward a moratorium on drilling similar to other jurisdictions. Although the natural gas industry is relatively new to B.C., in recent years it has exploded into a $6 billion per year sector, generating jobs, new businesses and tax dollars for various levels of government. Still, the province has said it’s keeping a close eye on the industry. In June, Energy Minister Rich Coleman told Business in Vancouver the government was planning to conduct a health review focusing on the industry’s impact on northeast B.C. residents. A Ministry of Health spokesman said that review has yet to begin. The hydraulic fracturing registry will be online in January. • jmckay@biv.com

B.C. uranium junior calls hostile bid from major producer “predatory” By Joel McKay

ancouver’s Hathor Exploration (TSX:HAT) has resoundingly rejected a hostile takeover bid targeting its Roughrider uranium deposit, but critics are beginning to question if the company has over-valued

the flagship project. Last week, during a conference call with investors, Hathor president and CEO Mike Gunning blasted Cameco’s (TSX:CCO) $520 million bid for his company, calling it “predatory and opportunistic.” C a m e c o , C a n a d a ’s

largest uranium producer, launched an unsolicited allcash bid for Hathor in August, valuing the company at $3.75 per share. The Vancouver company’s flagship Roughrider project made waves in uranium circles after an updated estimate doubled its

resource potential. The company believes there could be as much as 60 million pounds of uranium sitting in the ground beneath Roughrider, which is in Saskatchewan’s Athabasca Basin, one of the world’s premier uranium see Meltdown, 5

Dominic Schaefer

But Cameco believes Vancouver’s Hathor Exploration has over-valued its flagship project and underestimated its cost

Hathor CEO Mike Gunning: “the timing of the offer takes advantage of depressed uranium prices”

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News

Daily business news at www.biv.com September 20–26, 2011

HST loss, faltering economy squeeze fiscal plan B.C.’s three-year outlook calls for $458 million in cuts, but HST referendum defeat threatens to weaken public finances for years By Jenny Wagler

ith the harmonized sales tax (HST) nixed and global economic fears on the rise, challenges to the B.C.’s public finances are mounting. The province just released a revised three-year fiscal plan that anticipates $458 million in cuts to eliminate the deficit in 2013-14, adjusting for a weaker economy and the costs of reverting to a PST/GST regime.

”When you throw all those different pieces into the equation, it’s a fairly major hit to the province’s longterm public finances” –Jock Finlayson, executive vice-president of policy, Business Council of BC

The adjusted plan lowers the province’s revenue growth expectations to 2.8% annually over the next two years compared with budget 2011’s 3.3% projection.

Even before the PST transition is factored in, the province is now anticipating lower revenue from Crown corporations and natural resources. The result is a projected cumulative loss of $537 million over the plan’s three years. “They have a tough financial elephant to push up the stairs here,” said Jordan Bateman, B.C. director for the Canadian Taxpayers Federation (CTF), who commended the province for sticking to its balanced-budget commitment. “[But] we would have felt a whole lot better if the quarterly report had a zero [bottom line] instead of a minus-$500 million.” Bateman said the CTF is encouraging the government to get back to its core spending priorities by eliminating some legacy programs brought in by former premier Gordon Campbell, such as the Pacific Carbon Trust. “The problem for this government is that they’ve almost doubled spending in 10 years, and when you’re growing like that, you need everything to keep going right in order to balance the budget.” Bateman said that while the government weathered the first recession, it’s now facing the “second

punch” of the HST loss and, potentially, a double-dip recession as a third. “So they’re going to now have to really roll up their sleeves and make some cuts in order to get things to where they need to go.” Jock Finlayson is executive vicepresident of policy for the Business Council of BC and a past president of both the Association of Professional Economists of BC and the Ottawa Economics Association. He said the biggest challenge ahead for B.C.’s public finances, as the province reverts to PST/GST, won’t be the near-term $1.6 billion hit of returning federal transition money but the longer term revenue lost from moving to a worse tax regime. Finlayson said the less efficient PST will reduce Victoria’s revenue by between $300 million and $400 million annually – and that number will increase as the economy grows. Beyond that, he said, the province’s productivity will suffer under the PST. “The level of productivity and productivity growth will be lower than it would have been if we’d kept the HST because the HST is a better tax in terms of encouraging

Jordan Bateman, B.C. director for the Canadian Taxpayers Federation: “[the BC Liberals] have a tough financial elephant to push up the stairs here”

business investment into the capital stock.” The transition, he said, will increase the cost of doing business in B.C. by about $2 billion a year. “When you throw all those different pieces into the equation, it’s a fairly major hit to the province’s long-term public finances,” he said. “It’s not catastrophic, but it’s certainly going to be felt.”

Finlayson said it’s too soon to say what effect the government’s handling of the HST and its current public finances will have on its political support from Vancouver’s business community. But he pointed out that there will be lasting economic consequences from the loss of the HST, “and those consequences will be preponderantly negative.” • jwagler@biv.com

15th Anniversary Celebration

15 Brilliant Years and Counting . . . The honour of your presence is requested for the the 15th Anniversary of the founding of the Professional Women’s netWork. Come celebrate our organization’s 15 years of growth and expansion, applaud the successes of our members, and pay special tribute to those gems in our business community who have contributed significantly to the advancement of women in business.

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News

September 20–26, 2011 Business in Vancouver

Meltdown: Investors leery of uranium in wake of tsunami from B.C., 3

mining districts and Cameco’s backyard. But the value of Hathor’s shares was hit hard earlier this year following the earthquake and tsunami in Japan, which resulted in a meltdown at the Fukishima Daiichi nuclear plant. Since t hen investors have fled the uranium sector fearing a pullback in worldw ide government programs to build new reactors (see “Junior firms face meltdown as investors run for cover after quake rattles Japan” – issue 1117; March 22-29). Gunning said during the conference call that Cameco’s bid has taken advantage of volatile market conditions to seize control of a premier asset. “The timing of the offer takes advantage of depressed uranium prices … since the Fukishima event, not to mention the general downturn in equity markets in recent months,” said Gunning. Although Cameco tendered its bid for Hathor last month, the junior explorer waited to release a preliminary economic assessment (PA) for Roughrider before it formally rejected the offer. The PA estimated the project had a pre-tax net

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BUSINESS TODAY Burrard Street 11th priciest for offices in North America Burrard Street is the 11th most expensive street in North America for office rental space, according to a study of 40 office markets released this week by financial and professional services firm Jones Lang LaSalle. Gavin Reynolds, senior vice-president at Jones Lang LaSalle’s Vancouver office, said the survey represents what’s happening in Vancouver, which he deemed “the healthiest office market in North America” from a landlord’s perspective. Wednesday, September 14

Full stories and other local business news at www.biv.com/businesstoday Daily business news direct to your inbox! Sign up at www.biv.com/newsletters

hathor exploration ltd. (TSX:HAT) $5 $4 $3 $2 $1 $0

Vancouver CEO: Mike Gunning Employees: N/A Market cap: $510m P/E ratio: N/A EPS: ($0.06) Sources: Stockwatch, TSX

present value of $1 billion, far in excess of what Cameco offered in its bid. Hathor a lso said the projec t wou ld cost approximately $567 million to build, a number that Cameco has since disputed. In a response to Hathor’s formal rejection of the takeover bid, Cameco said last week the junior company had missed the mark on the project’s value and costs. “We believe Hathor’s PA significantly underestimates the costs, timelines and risks associated with development of the Roughrider deposit and so, by inference, significantly overstates the value of the Roughrider deposit and Hathor as a company,” said Tim Gitzel, Cameco’s president and CEO. Raymond James analyst Bart Jaworski wrote in a research note to investors that Hathor’s estimated capital costs for the project were “quite low.” Still, Raymond James has set a target price of $5 per share for the company, implying that Hathor is worth more than what Cameco has offered. Another analyst, who asked to remain anonymous, said there’s a “greater than 50% chance” Cameco could increase its bid for Hathor or a white knight wou ld swoop in w it h a competing offer. During the conference call, shareholders repeatedly pressed Gunning to divulge what he believes would be a fair offer for his company, but the chief executive refused to quote a number. At press time, Hathor’s shares were valued at $4. • jmckay@biv.com

Making VancouVer More energy efficient, one Dazzling lighting Project at a tiMe Being PoWer SMart MakeS BuSineSS SenSe Ever been dazzled by Vancouver at night? Chances are, you were looking at buildings with lighting designed by Nemetz (S/A) and Associates Ltd. For more than 50 years, Nemetz has provided electrical engineering and lighting design services for some of the most spectacular high-rises in Vancouver, including hotels, residential buildings and office towers. Lately, they’ve also worked with BC Hydro’s New Construction Program to help their clients incorporate energy efficiency into their new buildings, from the ground up. “Energy efficiency is one of the most important design considerations for most major projects,” says company President Steven Nemetz, “because you really can achieve significant savings through the right lighting sources and controls. We’re well-versed in what BC Hydro requires to qualify a project for the New Construction Program, and can help our clients take advantage of the program’s benefits, including incentives based on electrical savings.” BC Hydro’s New Construction Program helps reduce the cost of building better, greener, more energy-efficient buildings. Visit bchydro.com/construction or call 1 866 522 4713.

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News

Daily business news at www.biv.com September 20–26, 2011

full disclosure

B.C. merchants weary of shouldering credit card fees By Richard Chu

d Des Roches has been accepting credit cards at his women’s fashion stores for years. When he was first being pitched on their use at his Vancouver-based chain of Plum stores, he was sold on the idea that accepting Visa and MasterCard would increase sales. But now he prefers his clients to pay by Interac debit. For Des Roches, and the tens of thousands of merchants across the country, the reason is simple economics: debit payments are a fixed cost of mere pennies; with credit card payments, the sky’s the limit. Depending on the size and sales volume of a merchant, the per-transaction price for debit ranges between $0.07 and $0.20. Des Roches said he was able to negotiate a debit fee of only $0.08 per transaction. But he said he has neither the control nor the ability to accurately predict his monthly credit card fees. That makes it difficult for him to establish competitive pricing and run his business efficiently. New fee structure costs retailers Visa and MasterCard have come under fire from merchants in recent years over new fee structures for the various types of credit card issued by banks and credit unions. For example, in 2008, Visa created seven separate merchant categories that each had a distinct interchange fee – a percentage of a merchant’s credit card transaction that’s paid to the customer’s bank. The fees ranged from 1.21% for gasoline merchants to 1.65% for retailers that accepted credit card payments by phone or online. At around the same time, Visa introduced its premium Infinite card. Its interchange fees range from 1.41% for gasoline merchants to 1.85% for transactions where the merchant doesn’t swipe the card in person. MasterCard’s basic interchange rates are similar. They range from 1.21% for gasoline merchants to 1.72% for standard credit card transactions. However, for its premium cards, the per-transaction interchange rate is as high as 2.65%. While merchants pay other transaction fees to the payment processors that provide the point-ofsale terminals, the interchange fees

set by Visa and MasterCard account for the bulk of the service fees retailers pay for each credit card transaction. With premium credit cards from Visa and MasterCard, merchants can face per-transaction fees of up to 3.5% and even higher for American Express cards. While that arrangement might make sense for the credit card network providers, it creates a practical problem of survival for merchants. Because there are more than 200 types of credit cards available from banks and credit unions in Canada and because costs vary depending on the type of credit card a customer uses, merchants have no way of realistically estimating their transaction costs each month. “It’s often a surprise,” Des Roches said. “I don’t know how much [the costs are] until I get the bill, which creates a problem when I do my pricing, because I have to accommodate for [the credit card costs], and you can’t anticipate it.” Brian Weiner, Visa Canada’s head of strategy and interchange, said the new fee structure was designed to create more flexibility that better reflected merchant costs and risks than the previous one-size-fitsall approach. He noted that while the changes affected different retailers in different ways, overall the fees are “revenue neutral” to the system. Weiner was quick to point out that while credit card companies set the interchange fee, credit network providers like Visa and MasterCard receive none of it. It goes straight to the bank to cover its costs of providing credit cards to consumers. Those costs include: •creating and mailing the cards; •marketing; •fraud liability insurance; •call centres; and •extending unsecured credit to cardholders. “So there are a lot of the costs borne on that side of the equation and relatively little revenue coming in because of the fundamental premise that consumers need to be given the card.” Weiner added that interchange fees for premium Infinite cards and corporate credit cards are higher because of their higher fraud risks.

Dominic SCHAEFER

Predictability of cash and debit payments becoming far more appealing as wide range of options and costs increasingly making credit cards a business liability

Ed Des Roches, owner of the Vancouver-based chain of Plum fashion stores: “rather than paying for the advantage of giving customers credit, we are now paying for all the miles, points and marketing they’re doing to sell the cards”

“I don’t buy it,” simmered Des Roches. “I really don’t. “We can pay as much as 1.5% more because of the premium card, which should be lower risk. But we’re actually paying more, because of the points and the marketing, and there is no ceiling to that. There is no end to what they can charge. That’s a fundamental problem, because rather than paying for the advantage of giving customers credit, we are now paying for all the miles, points and marketing they’re doing to sell the cards. All that is being passed on to the retailer.” Weiner declined to disclose how Visa sets interchange fees. But he said each card has a different cost and a different value for merchants. That explanation rings hollow for retailers, who complain that the secretive way interchange fees are set creates a hidden cost they’re forced to accept.

Competition Bureau push panned The competition commissioner’s case against Visa and MasterCard aims to help merchants mitigate those costs. In her application to the competition tribunal, Competition Bureau commissioner Melanie Aitken wants Visa and MasterCard to allow merchants: •to apply a surcharge to customers at the point of sale if they choose to pay with their credit card; and •to decline credit cards that carry higher interchange fees, which would eliminate a basic Visa and MasterCard stipulation that merchants must accept all types of branded credit cards. But both options create new problems for consumers and might not help retailers mitigate the costs of accepting credit cards. Va ncouver’s Bruce Cran, president of the Consumers Association of Canada, said placing a surcharge at the point of sale would

increase prices for consumers who use credit cards. He was skeptical retailers would reduce their prices if they were allowed to add surcharge for credit card payments. Cran said that, if anything, merchants could make money from instituting surcharges. A November 2010 report by the Australian consumer group Choice, which was commissioned by the New South Wales Office of Fair Trading, found that since surcharging was allowed in Australia in 2003, a third of consumers (32.7%) have had to accept surcharges of between 4% and more than 10% at the point of sale, far higher than the average 2% cost of accepting credit cards. Canada’s Competition Bureau contends that surcharging would benefit small and medium-sized businesses (SMEs), but the Choice report found that larger retailers were more likely to apply surcharges

News

September 20–26, 2011 Business in Vancouver

full disclosure Fee fight game plan

Down Under: credit card use grew even after fee regulation was instituted in 2003

$16

$14 $12

$10 6

$8 $6

$4 2

0 y

Value of credit card purchases ($ billions)

Number of credit card accounts (in millions)

$18

Retailers’ surcharge gambit a game of chicken

$20

4 199

5 199

6 199

7 199

8 199

9 199

0 20

Number of accounts (millions)

0 20

10 20

11 20

Value of purchases ($ billions) Source: reserve bank of australia

Adding up credit card numbers $240 billion $5 billion 670,000 204 75%

Estimated total of Canadian credit card purchases in 2009 Estimated annual total in Canada of merchant fees paid to accept credit cards Number of merchants that accept credit cards in Canada Number of credit card types available in B.C. Proportion of Canadians who strongly oppose surcharging

Sources: Financial Consumer Agency of Canada, Competition Bureau, Consumers Association of Canada,

than smaller competitors. “It’s become a huge profit centre for a lot of companies,” Cran said. “If the Competition Bureau gets its way, there’s no benefit to consumers.” From a merchant’s perspective, even if retailers were allowed to surcharge, most wouldn’t because it would be a competitive disadvantage. The Choice report noted that seven years after surcharging was allowed in Australia, 80% of SMEs and 60% of large merchants still didn’t surcharge credit card customers. While the competition commissioner was unavailable to speak to BIV about the issue, a Competition Bureau spokesman said that

regardless of whether merchants would apply credit card surcharges, they’re contractually prohibited from doing so, which the bureau contends is anti-competitive. Last week, the Canadian Federation of Independent Business released a table listing the average merchant fees for the hundreds of credit cards on the market. But even with that list, having the option to decline some credit cards would be impractical. “I can’t expect my staff to be able to identify it,” Des Roches said. “And would I reject it anyway? Probably not.”

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Compromise needed If surcharging and removing the merchant requirement to accept all credit cards are not answers to reducing credit card costs, what is? Possible alternative solutions include having the government regulate credit card interchange fees and eliminating credit card reward points. In 2003, Australia allowed surcharging and began regulating interchange fees for the country’s credit card providers. The changes transformed the industry, and the number of credit cards available on the market dropped. But while Visa and MasterCard argue that regulating interchange fees would hurt their business, Reserve Bank of Australia statistics suggest that credit card use did not decline as much as the credit card companies had feared. And while premium reward cards disappeared for a few years, they’re returning to the market, albeit with much higher annual fees. Nevertheless, studies suggest that piecemeal changes could open a Pandora’s box of issues that would hurt merchants and consumers alike. For instance, a 2008 Federal Reserve Bank of Kansas City research paper warned of the unintended consequences from improperly

setting interchange fees or too tightly regulating reward programs. In the past year, a federal task force has been looking into the future of Canada’s payment system. By the end of the year, the group set up by federal finance minister Jim Flaherty will present recommendations that will also address merchant fees on credit cards. Des Roches, who participated in the Vancouver roundtable, said the government should focus on the interchange fee rather than create solutions that ding consumers at the point of sale. He said the fee should include only the costs associated with providing credit to consumers. The banks that issue credit cards should absorb the costs of marketing the cards and all the rewards they offer consumers. “There’s no way retailers should be paying for the marketing,” said Des Roches. “Customers have a relationship with their bank and their credit card provider, but when they walk into my store, they’re my customer. When they come to pay, every customer should be treated equally. If they have an outside relationship [with a financial institution], they’re choosing that relationship to make the payment. It shouldn’t have anything to do with me.” • rchu@biv.com

For years, merchants absorbed the cost of accepting Interac debit payments from customers. But an increasing number of fast-food outlets in shopping centres and other low-volume merchants now charge an extra $0.25 or require a minimum purchase from customers who use Interac. According to Caroline Hubberstey, Interac’s director of public affairs, such surcharging remains rare but is becoming more common as retailers look for ways to mitigate the rising costs of doing business. She noted that most retailers have resisted applying surcharges. Merchants that depend on customers who pay by credit card, however, will face a high-stakes game of chicken with their competition over who will surcharge first. Linda Bustos, director of e-commerce research at Vancouver’s Elastic Path Software, warned that any surcharge at the point of sale creates the kind of friction that turns customers away. She said customers in-store and online loathe surprises when they check out, and they don’t like paying extra for using debit or credit cards – “especially after all these years we’ve been using them without having to pay for the privilege.” If given the option to surcharge, Bustos said retailers should accept credit cards as a business expense rather than apply a surcharge, which often requires disclosure at the point of sale. She said studies have shown that customers believe they’re entitled to basic business services and are willing to pay more for products when services like free shipping are included. Bustos cited one report that found customers were willing to pay $79.95 for an item that came with free shipping rather than pay $69.95, a price that included an additional $6.99 shipping charge tacked on at the point of sale. “People will be slow to accept [surcharges] as a normal part of shopping life and will be resistant to it.” • rchu@biv.com

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Finance

Daily business news at www.biv.com September 20–26, 2011

BY THE NUMBERS

Losses are shown in brackets. Graph information by Stockwatch.

ESI Entertainment Systems Inc. (CNSX:ESY) Software sink: Although ESI didn’t turn a profit in 2012’s first quarter, the software developer’s net loss decreased 8% to $391k compared with the same period the year before. Meantime, revenue from its Integrity software brand dropped 4% to $417k, while revenue from its Citadel brand Earnings per share was up 70% to $526k. Still, the company’s direct costs 3 months 2012 increased to $809k from $497k the year before.

$0.10

▲27% ($391k) ($0.03) Revenue: $943k 3 months 2012

Net income 3 months 2012

$0.08 $0.06 $0.04 $0.02 $0.00

Taiga Building Products Ltd. (TSX:TBL)

▼11% $3.6m Revenue: $264m 3 months 2012

Net income 3 months 2012

Building bungle: The Burnaby-based construction product distributor said sales dropped in the first quarter due to stagnant commodity prices and weaker demand from the building sector. The company also posted an $18.6m increase in its revolving credit facility, which now totals Earnings per share $108m. Taiga’s EBITDA also decreased to $11.8m from $13.6m 3 months 2012 in the same period the year before.

$1.50

$0.11

$1.20 $0.90 $0.60 $0.30

Rusoro Mining (TSX-V:RML) Figures in U.S. dollars Gold gamble: Lower production rates and higher cash costs resulted in a $9.8m loss for Rusoro in the second quarter. Although the company was finally able to export gold from its operations in Venezuela, it was unable to complete a gold delivery contract. On top of that, Rusoro did not repay its Earnings per share $30m loan, and the government of Venezuela has declared it 6 months 2011 will nationalize all gold production in the country.

▼48% ($9.8m) ($0.02) Revenue: $27m 6 months 2011

Net income 6 months 2011

$0.50 $0.40 $0.30 $0.20 $0.10 $0.00

Cascadian Connections

Michael Orbach/Kushal Saha Second-quarter surge in cross-border technology M&As bodes well for Canadian innovation

ven as the U.S. and other economies struggled through 2011’s second and third quarters, the technology industry has shown no sign that it’s feeling a pinch. According to a recent Ernst & Young report, tech-sector mergers and acquisitions activity exploded during 2011’s second quarter, driven primarily by cross-border transactions. According to the report, aggregate disclosed cross-border deal value grew 118% and volume grew 16%, while in-border deal value grew only 75% and deal volume actually declined by 11%. Canada led the pack in crossborder technology transactions during Q2. Outshining perennial tech heavyweights, including Japan and Taiwan, Canadian technology companies closed 30 deals during the second quarter of 2011 alone, a nearly 50% increase in deal volume over

2010’s second quarter. A large portion of these deals involved cross-border acquisitions: Canadian technology companies spent roughly $240 million to acquire foreign companies; foreign companies spent approximately $480 million to acquire Canadian companies. Only the U.S. outranked Canada in the number and valuation of cross-border transactions in Q2 2011. Cascadia believes the strong foundations Canadian tech companies have laid across several hot sectors are key drivers behind the surge in Canada’s cross-border deal volume. Security, health-care information technology, social networking, mobile and cloud technologies all proved to be top M&A targets during Q2 2011. The strength of Canadian companies in these sectors was apparent in the number of

transactions companies successfully closed across the country. Cross-border prospects have remained open to Canadian companies during the third quarter as well. Despite the strong growth in Q2 and Q3, technology companies – on both the buy and sell sides – need to carefully plan their acquisition or exit strategies as the U.S. economy continues to struggle. Technology companies looking to make strategic acquisitions have recently been stockpiling cash, and cash and investments held by the sector’s top 25 companies saw an 18% year-over-year increase between the 2010-11 second quarters – to US$591 billion from US$499 billion. This wealth of cash and assets has given these companies the flexibility to act quickly when strategic acquisition opportunities arise, fuelling the higher second-quarter transaction volume.

While available cash affords strategic investors flexibility, companies on both sides of the M&A divide need to consider the broader issues in order to continue to drive M&A activity. Several factors, including increasing divergence between buyers and sellers over valuation, geopolitical unrest and global debt issues, continue to build a barrier to successful M&A transactions, and available cash will likely not be enough to overcome these significant hurdles. While challenges exist, the trend toward cross-border deals will help sustain deal volume in the tech sector. At 311 deals worldwide, crossborder transactions accounted for 40% of all deals in Q2 2011, a significant increase from 34% in the year’s first quarter, as well as all of 2010. The average value of cross-border transactions also grew 49% yearover-year to $229 million in Q2 2011

from $154 million in Q2 2010, while the average deal value for all transactions, including domestic and cross-border, increased only 39% year-over-year. For companies looking for an exit, cross-border deals are generally garnering better valuations and stronger deal terms. For companies looking to expand through acquisition, cross-border deals afford them the opportunity to not only diversify their assets, but also to provide them with geographic diversity and new market opportunities. • Michael Orbach and Kushal Saha are managing directors at Cascadia Capital (www.cascadiacapital.com), a Seattle-based boutique investment bank serving companies in diverse industries, including information technology, sustainability and middle market.

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finance

September 20–26, 2011 Business in Vancouver

B.C. unemployment rises

Insider Trading

August jobless rate edges up to 7.5%

▼5.6% ▲0.9% ▼0.7% ▲1.3% August August August August employment employment employment employment (public (private (full(partsector) sector) time) time) B.C.’s unemployment rate inched up to 7.5% (seasonally adjusted) in August, as a drop in the number of jobs (-0.3%, or -6,000) was accompanied by next to no change (0.0%, or 1,100) in the number of people who were either working or looking for work. Employment dropped in the public sector (-5.6%), while there were noteworthy increases in the private sector (0.9%) and among the province’s self-employed (1.4%). Full-time employment edged down 0.7%, while the number of people with part-time jobs climbed (1.3%).

Employment rates differ by region Among the regions, jobless rates ranged from 4.2% (three-month moving average, unadjusted) in Northeast to 9.5% in Kootenay. Unemployment rates were down in Vancouver Island/Coast, ThompsonOkanagan and Northeast, but climbed in other regions.

-BC Stats Infoline, Issue 11-36, September 9

Goods sector employment rises Employment in the goods sector climbed 1.7%, with the number of jobs increasing in some industries. The job count in construction jumped 3.1% and the manufacturing industry took on more workers (6.9%) for the first time since April. At the same time, there were substantially fewer jobs in utilities (-38.2%).

-BC Stats Infoline, Issue 11-36, September 9

Building permits dip in BC municipalities in July The value of building permits issued by B.C. municipalities dipped 8.1% (seasonally adjusted) in July, as an increase in non-residential permits (11.4%) was unable to offset a 17.1% decline in planned spending on residential building projects.

-BC Stats Infoline, Issue 11-36, September 9

The following is a list of the largest stock trades made by corporate executives, directors and other company insiders of B.C.’s public companies filed by the week ending September 8. The information comes from a compilation of required reports filed with the BC Securities Commission within five calendar days of a change in an insider’s holdings. Insider: Mark Rachesky, director Company: Lions Gate Entertainment Corp. (NYSE:LGF) Shares owned: 40,297,050 Trade date: September 2 Trade total: $77,283,451 Trade: Purchase of 11 million shares from Carl Icahn for US$7 per share. Insider: Colette Rustad, senior vice-president, corporate controller Company: Goldcorp Inc. (TSX:G) Shares owned: 1500 Trade date: September 7 Trade total: $1,304,850 (net) Trade: Sale of 55,000 shares for $54 per share following the acquisition of 30,000 shares for $35.62 per share and 15,000

shares for $39.77 per share through the exercise of options. Insider: Horacio Bruna, vicepresident, Canada and the U.S. Company: Goldcorp Inc. (TSX:G) Shares owned: 0 Trade date: September 8 Trade total: $1,101,688 (net) Trade: Sale of 61,667 shares for US$56.08 per share following the acquisition of 20,000 shares for US$30.73 per share, 20,000 shares for US$40.05 per share and 21,667 shares for US$43.43 per share through the exercise of options. Insider: Robert Gilmore, director Company: Eldorado Gold Corp. Shares owned: 9,500 Trade date: August 29 Trade total: $949,177 (net) Trade: Sale of 81,300 shares for prices ranging between $18.90 and $19.15 per share following the acquisition of 13,300 shares for $9.81 per share, 34,000 shares for $6.44 per share and 34,000 shares for $7.12 per share through the exercise of options. Insider: Rui Feng,

chairman and CEO Company: Silvercorp Metals Inc. (TSX:SVM) Shares owned: 3,854,500 Trade date: September 6 Trade total: $787,000 Trade: Purchase of 100,000 shares for US$7.87 per share.

Shares owned: 6764 Trade date: September 7 Trade total: $551,400 (net) Trade: Sale of 30,000 shares for $54 per share following the acquisition of 30,000 shares for $35.62 per share through the exercise of options.

Insider: Ronald Bertuzzi, director Company: TAG Oil Ltd. (TSX:TAO) Shares owned: 343,356 Trade date: September 7 Trade total: $756,085 Trade: Sale of 100,000 shares at prices ranging between $$7.50 and $7.65 per share.

Insider: Frank Crema, vicepresident, treasurer Company: Goldcorp Inc. (TSX:G) Shares owned: 2,103 Trade date: September 6 Trade total: $428,800 (net) Trade: Sale of 15,000 shares for $55.10 per share following the acquisition of 10,000 shares for $39.77 per share through the exercise of options.

Insider: Bradford Cooke, chairman and CEO Company: Endeavour Silver Corp. (TSX:EDR) Shares owned: 1,087,837 Trade date: September 1, 6 Trade total: $599,500 Trade: Sale of 50,000 shares at prices ranging from $11.65 to $12.33 per share. Insider: Wendy Louie, vicepresident, assistant controller Company: Goldcorp Inc. (TSX:G)

Insider: Rohan Hazelton, vicepresident, finance Company: Goldcorp Inc. (TSX:G) Shares owned: 2168 Trade date: September 8 Trade total: $292,650 (net) Trade: Sale of 15,000 shares for $55.13 per share following the acquisition of 15,000 shares for $35.62 per share through the exercise of options. • rchu@biv.com

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Real estate

Daily business news at www.biv.com September 20–26, 2011

real estate roundup

Peter Mitham

Port of call Three Point Properties Ltd. of Victoria is proceeding with Wild Coast Cottages in Port Renfrew, a project initially launched in 2008 with the vision of offering affordable vacation home sites on par with Tofino but within a two-hour drive of Victoria.

“We have economically viable agriculture because we have efficient agriculture and because we have the infrastructure [for agriculture] to be able to perform efficiently” – Darrell Zbeetnoff, principal, Zbeetnoff Agro-Environmental Consulting

Unfortunately, site servicing costs and the financial meltdown of late 2008 nixed the original plans. The vision of “two-, three- and four-bedroom cottages ranging in size from 1,180 to 1,900 square feet” on lots starting at 5,000 square feet have given way to one-bedroom microcottages averaging 400 square feet. Developed on a portion of the 430 acres of land Three Point owns above Port San Juan, the inlet off the Strait of Juan de Fuca where Port Renfrew lies, the Wild Coast development has attracted 43 buyers since relaunching late last year. A selling point is the price: Unlike the original properties, which started at $299,000 for a lot and house, prices at the new project began at $149,900 (including HST). The lower pricing is possible thanks to the site following the layout of a former RV park and the prefabrication of the cottages themselves in Sooke by Westco

Construction Ltd. Westco manufactures wall segments for various residential projects on Vancouver Island and counts Bear Mountain among its clients. Its cottages are also ideal for laneway homes (“garden suites” in the local terminology). A site visit last week acquainted travel and business media (including yours truly) with the cottages and all Port Renfrew has to offer – including a host of sport fishing, ecotourism offerings and the company of colourful locals (more than a few of which noted that severe winters militate against Port Renfrew achieving year-round destination status, unless you’re into high surf). The cottages themselves were pleasant enough for a weekend getaway and have drawn several buyers from Alberta (some of whom were enjoying their purchases last week). Sales at Three Point’s project is mirrored elsewhere, according to Westco owner Dan Melville, a 30-year-old entrepreneur who noted that this summer has been twice as busy as last year. The sales activity is a good sign in a market where tourism has generally been sluggish this year, with Alberta traffic offsetting a decline in U.S. visitors. Infrastructure issues Delta presented its draft agricultural plan at an open house that attracted just over 40 people last week, and the document sparked conversation regarding funding for Lower Mainland’s infrastructure – specifically, infrastructure related to agricultural land uses. Darrell Zbeetnoff of Zbeetnoff Agro-Environmental Consulting, who Delta council charged with drafting the plan in conjunction with Quadra Planning Consultants and Delta staff, framed the document as looking ahead at the implications for agriculture through 2050 (coincidentally, the

Peter Mitham

Alberta buyers drawn to affordable island cottages; boss of horticulture council suggests regional taxpayers should contribute to farm infrastructure upkeep

On the edge: Three Point Properties Ltd. is finding buyers for microcottages in Port Renfrew, an ecotourism destination two hours west of Victoria at the south end of Pacific Rim National Park

same date on which the B.C. chapter of the Urban Land Institute is focusing its ongoing discussion series regarding urban issues). “We have economically viable agriculture because we have efficient agriculture and because we have the infrastructure [for agriculture] to be able to perform efficiently,” Zbeetnoff explained. Delta farms are productive enough to account for 26% of Metro Vancouver’s farm cash receipts and approximately 7.9% of the provincial tally. Zbeetnoff said roads, irrigation and water systems and distribution networks for energy are all factors in the success of local agriculture. He was largely preaching to the choir, given the number of farmers in attendance. But during the question-andanswer period that followed, Jack Bates – a veteran local farmer and current president of the Canadian Horticultural Council – offered one of the most startling suggestions of the night. Sizing up the benefits to the Lower Mainland

of Delta agriculture – everything from greenhouse production to potatoes and berries – Bates suggested that regional taxpayers contribute to the upkeep of the infrastructure needed to feed themselves. “It’s probably a fair number that the taxpayers of Delta put into roads, irrigation, water,” he said. “I know there’s some charges on our taxes, but I think the households of Greater Vancouver and the whole [Fraser] Valley should be paying something to put food on their tables.” Solar study Thirteen months ago, this column mentioned that Okanagan College was one of several B.C. schools participating in the “Living Building Challenge” spearheaded by the Seattle-based International Living Building Institute (ILBI) and the Cascadia Green Building Council. A pair of press releases issued last week trumpeted the fact that the school’s $28 million Centre of

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Business tool kit

September 20–26, 2011 Business in Vancouver

BizPharmacy

Cyri Jones and Ivan Surjanovic How to tap student talent pools to help build your business Symptom: “We had some great students working with us over the summer. They had lots of energy, creative ideas and had great tech skills, but now they have all returned to school. We have a solid group of permanent employees, but this exodus of our student workers has left us with a bad case of SLTS Syndrome (Student Employees Leaving Too Soon).” Recommended medications: Ivan: I get a lot of inquiries this time of the year for this difficult condition. The good news is that most companies are facing the same thing each fall, so at least you’re not suffering alone. The better news is there are a lot of easy ways to overcome this condition, and you can soon have some younger folks once again thinking outside the box. Cyri: Yes, with social networking and online recruitment tools, you can keep in touch with your student workers once they have gone back to school and with some nextgeneration medicine, you can even get them back working on school projects focused on your business throughout the year. Ivan: The obvious tool to use if you aren’t already doing so is LinkedIn (www.linkedin.com). More than 95% of recruiters use LinkedIn to find prospective employees, and students are starting to realize the importance of being on this network.

Make sure your student workers are in your LinkedIn network to make it easy to stay in touch. Cyri: There’s also Google+ now where you could set up a “circle” of students that have worked with you or others interested in keeping in touch with company news (www. plus.google.com). That way you can direct relevant information to them without overwhelming them with your plethora of social media. Ivan: And don’t you have your own homegrown medication to help with this condition? Cyri: I thought you would never ask! Just for full disclosure sake, I do have a stake in the research, development and also sales of this medicine so I might not be a fully neutral doctor on this one. But I’ve seen it work for several years first hand, and I’m a believer. Zen Portfolios (www. zenportfolios.ca) enables students to create professional e-portfolios that showcase their work, career direction and interests. It also offers a subscription-based recruiting service for industry wanting to connect with local upcoming talent and an industry project matchmaking service. Employers can find upcoming, local talent with specific skills and search for prospective grads based on personal characteristics and values. With the industry projects service, students looking for real-life projects to work on for their course work can hook up with companies,

government or non-profit organizations looking for temporary help with a challenge they’re facing. Ivan: I can see how that medication would work well for companies but isn’t that putting the students in worse health, getting them to work for industry without getting paid? Cyri: There’s a small honorarium for each student project that goes into a fund that supports student scholarships, subsidizes student attendance at industry events and helps support student clubs. More importantly, the real-life work experience students get is invaluable. They can apply what they’re learning in school and showcase what they’ve done for the project sponsor on their e-portfolio. Prognosis: Ivan: Isn’t the medicine a bit dangerous, getting students who are still learning to work on real-life problems facing your organization? Cyri: It may seem that way, but companies that have tried this treatment have found the students offer a great out-of-the-box perspective and work really hard. Many also go on to work for their companies after they graduate. Companies are asked at the end of the student projects how much money they saved compared with buying the services of consultants, and the amount saved is usually in the thousands. In one case a company said the ideas the students

came up with saved them $250,000. Ivan: Sounds good in theory, but is anyone actually using this medication? Cyri: It’s not a generic product just yet, but it is growing fast. Locally, it’s being used at Capilano University (www.capilanou.ca) and the British Columbia Institute of Technology (www.bcit.ca) as well as at dozens of schools outside of British Columbia. Future management of this condition: Cyri: Being proactive is the best approach. Some people think that with the economic hard times, it’s a “buyer’s market” for labour. That’s shortsighted. In any labour market, you want to get the best people you can, because people make the difference in successful organizations. Alternative medicine: Ivan: OK, enough about your home brew, what are other options for finding upcoming talent to ensure your organization doesn’t suffer from SLTS? How to you keep finding new, creative and talented workers? Cyri: There are a number of options. There are the big job posting sites that have large resume banks like Workopolis (www.workopolis.ca) and Monster (www.monster.ca). New entrants like Simply Hired (www.simplyhired.com) are attempting to aggregate all the job

Winnie-the-Pooh on Management by Roger E. Allen, Penguin, May 2011 (reprint)

“

Oh bother! Yet another management-theory book.” But this one is simple and straightforward. Allen, a management consultant, effectively and charmingly uses the adventures of the familiar characters of One Hundred Acre Wood – Pooh and his friends – to illustrate the six basic functions of a manager, and how to avoid the Horrible Heffalump Traps. I found the chapter entitled “In Which Piglet, Pooh and Tigger Communicate After a Fashion” to be especially relevant. I would recommend this book to newly promoted or first-time managers as a companion to

Cognitive surplus by Clay Shirky Penguin Books, May 2011

hat is “cognitive surplus?” In his new book, social media guru Shirky (Here Comes Everybody) coins this phrase to refer to society’s historical uses of free time and how these have changed over the years. Shirky notes that “social uses of our new media tools have been a big surprise, in part because the possibility of these uses wasn’t implicit in the tools themselves.” One only has to think of many of

this year’s riots around the globe – some of which are referenced in the book – as an example of how social media has sometimes transformed mere consumers into active participants. We see these events on TV (unbalanced and one-way communication), but because three billion consumers (and counting) have a mobile phone with a camera, traditional notions of the media have been transformed. This isn’t the first time such a transformation has taken place. Shirky relates how society has changed as early media evolved – from Gutenberg’s printing press to present-day civic-minded websites like Ushahidi. com or the very social Facebook. The last chapter of Shirky’s book offers lessons learned as a guide for new projects and asks, “What is the ideal way for new technology to be integrated into society?” He is a strong advocate for “as much chaos as we can stand” as we look for answers.

Precautions/Warnings Cyri: Don’t underestimate the abilities of talented students. You might think you’re doing a community service helping students get reallife experience, but you’ll soon discover your organization benefits enormously. • Cyri and Ivan’s medication rating: ✶✶✶✶ Cyri Jones teaches entrepreneurship, project management and information technology at BCIT and Capilano University and is the co-founder of ZedPress.com, a lifelong learning publishing platform and social network. He blogs at 24posts.com. Ivan Surjanovic is a marketing faculty at Capilano University and CEO of iPower Lab. He blogs at whereispuck. com and at bizpharmacy.com.

>”What we have been trying to teach women entrepreneurs is that it’s not just about the revenue or staff, but about what you define as success and what’s most important to you. It comes back to demanding more out of your business than money”

Book Reviews Peter Drucker’s Effective Executive. It will not leave one “confuzzled,” but will provide the basis for more in-depth organizational and management theory.

sites. For local jobs, your best starting point is of course Business in Vancouver’s own localized careers site it offers in partnership with Workopolis (www.biv.com). Business in Vancouver also has a great listing of local recruiters in its Book of Lists. It comes free with a Business in Vancouver subscription, or you can buy it individually. Ivan: For students, especially those in business programs, the best way to network with local industry is of course a subscription to Business in Vancouver!

Consumer Republic by Bruce Philp McClelland & Stewart, 2011

emember Dave Caroll, the Nova Scotia folk singer whose guitar was broken by United Airlines? His song, “United Breaks Guitars,” went viral on YouTube and hit No. 1 on iTunes. United’s stock plunged by 10% and cost shareholders approximately $180 million. Philp uses this story to illustrate two very important things about the consumer republic: we have a voice and the means to make it heard. And to demand better – better service, a better toaster – the possibilities are endless. • Donna Kaye is an assistant trade buyer at UBC Bookstore.

Diana Stirling, co-founder, OnTrack Media and Insider Trading, on women getting meaningful returns from owning businesses. From a BIV list story (issue 1141; September 6-12)

>”The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency” Bill Gates, Microsoft chairman

>”Innovation distinguishes between a leader and a follower” Steve Jobs, Apple chairman

>”Success is walking from failure to failure with no loss of enthusiasm” Winston Churchill, British prime minister between 1940–45 and 1951–55

Sustainability

Sponsor’s Message

Daily business news at www.biv.com September 20–26, 2011

When the rubber hits the road By Ingrid de Jong Joffe

Nigel HodgsoN, Practice leader Buildings group, Vancouver

stantec is proud to contribute to the City of Vancouver’s goal to be the Greenest City in the World by 2020. Protection and improvement of the environment for the benefit of our clients, our colleagues and our neighbors is core to our way of doing business. Whether we are protecting Howe Sound from copper pollution, helping to deliver a LEED platinum Convention Center, planning a new downtown Urban Development, creating a ground source energy system for a private school, conceiving a new biomass fuel district energy system for a university campus, taking part in an annual Bike to Work challenge, or actively reducing the environmental footprint of our offices, we will continue to advance our integrated sustainability message in everything that we design for the water that we drink, the routes on which we travel, and the buildings in which we live, work and play.

h i le mo s t p e ople know to return their used car tires for recycling, bicycle tires often get tossed into the garbage and end up in the landfill. Recently, the Tire Stewardship Council of BC (TSBC) announced a voluntary bicycle tire recycling initiative that adds to an existing car tire collection infrastructure managed by the council. With the help of Western Rubber Products (WRP), used bicycle tires and tubes can now be recycled with no eco-charge to the consumer or disposal fee for bike store owners. “Bike tire and tube recycling is a great addition to our recycling program. It completes the life cycle of the product,” said Kirsten Blondal, sustainability co-ordinator for Mountain Equipment Co-op (MEC). MEC encourages its employees to find new ways to recycle material. Its bicycle tire recycling program began a few years ago, and the TSBC initiatives enhance their ability to return more bicycle tires and tubes for recycling at no cost. “Recycling fits into our sustainability mandate. Our employees are really engaged and excited to participate and initiate programs,” said Blondal. “Our bike tire recycling program was spearheaded by one employee that found a local plant that recycles the tires, which is pretty rare. He did his own research and originally loaded all the tires onto his own truck and personally took them to the plant.” That plant is the Western Rubber Group in Delta.

For approximately 12 years it has been the only recycling business in the area that takes bicycle tires from stores and repurposes them into different products. The rubber is processed into a range of finely ground crumbs and then manufactured into running tracks, anti-fatigue mats, railway ties, speed bumps, playground tiles and more. They used to charge a fee for recycling as mandated by the TSBC until it lifted those fees. This is welcome news to people like Bob Heilker, manager of Different Bikes in Vancouver, a chain of four stores. Each day, cyclists come into his store to have flat tires repaired after run-ins with glass or other debris on the road or riding with under-inflated tires. “I take tires in for repairs and for those that can’t be repaired, I take away for recycling,” said Heilker. “There are so many used tires that come into the shop that I don’t want to end up in the garbage. It hasn’t been a consumer-driven initiative but it’s something I do to get rid of them in an environmentally responsible way.” In a week, staff members collect between 25 and 40 tubes and about 10 to 15 tires in the busy summer season. Different Bikes uses a delivery van to drop them off at Urban Garage in West Vancouver to be taken away for recycling. Stores are given specific instructions on how to prepare the tires and tubes for recycling. It can be a time-consuming process but MEC employees have adopted it into their daily tasks.

Dominic Schaefer

Spurred by the voluntary efforts of local retailers, bike tire recycling is growing in British Columbia

Bob Heilker, owner, Different Bikes Vancouver: “it hasn’t been a consumer-driven initiative but it’s something I do to get rid of [bike tires] in an environmentally responsible way”

“We have such a high level of commitment from our staff members,” said Blondal. “This is a task that the MEC employees take on

“Bike tire and tube recycling is a great addition to our recycling program. It completes the life cycle of the product” – Kirsten Blondal, sustainability co-ordinator, MEC

that shows how committed everyone is to sustainability and what they do to make it happen.” For 1-800-GOT-JUNK, recycling and diverting

appropriate materials from the landfill are its mandate. “We try to recycle bikes or donate them to the BC Development Disabilities group,” said Richard Bender, owner, 1-800-GOTJUNK Vancouver. “Rubber is brutal on the environment. If we get bicycles then we can reuse it and donate it. If not, we separate the different materials for recycling.” Bender noted there is a growing awareness about the company’s recycling program that has become a main reason many customers use 1-800-GOT-JUNK. “We offer recycling as part of our service and divert appropriate materials. We track recycling and have diverted 61% of items from the landfill. Our goal is to reach 80%.”

He added, “It is a function of our resources to get rid of recyclable items in a timely manner. We get about four to five bikes a week and recycle the different parts if they are not salvageable for donation. We take the tires to gas stations and stores like Canadian Tire. It’s an opportunity to raise awareness to point-ofsale locations.” For MEC members in Vancouver and North Vancouver, a bright pylon with a sign next to the front doors continues to spread the word about the bicycle tire recycling program. “The container fills up quickly,” said Blondall. “It is a hugely popular program; our issue now is finding storage space for all the tires.” • news@biv.com

www.stantec.com

sustainability 15

September 20–26, 2011 Business in Vancouver

Sustainability

daily online edition

Nina Winham

BUSINESS TODAY

Fiction or future reality?

tool you may have used in strategic planning, and which is often used in sustainability planning, is backcasting. You envision the future as you want it, then work backward to determine how to get there. But what about envisioning the future you don’t want, and trying to figure out how to avoid it? This summer I read a novel that had me backcasting furiously. Set in Bangkok a couple hundred years from now, The Windup Girl by Paolo Bacigalupi painted a picture that felt all too uncomfortably like a future we would never choose, but may be heading smack into. And the book gave plenty to consider about the role of business in shaping that future. It’s a great read – good characters, compelling plot, intrigue and drama. (It also won five awards and dozens of accolades from respected reviewers, so you don’t have to take my word for it.) The story and characters take precedence over the apocalyptic backdrop; far from preaching, this book leaves you wishing for more detail about the author’s well-imagined future world. It’s not a pretty one, unfortunately. But it is painfully believable: cheap, plentiful oil is a thing of the distant past. Governmentregulated methane is available for high prices with appropriate permits; non-sanctioned methane can be used if you pay the bribes. Somewhere in the distance, coal wars rage. The most available form of energy is human, either used directly (e.g. “treadle computers”) or transferred into “kink springs” which power everything from boats to ceiling fans to bicycles. If you have a company with overhead fans to keep people cool, you likely contract a “winding man” to come daily and wind up the spring that keeps it going – a direct transfer of his energy

(calories) into your system’s storage spring energy (joules). Improving the efficiency ratio of calories to joules is at the forefront of technological development. (And there is humour; the posse of “ballast men” who repeatedly run back upstairs to counter-weight an elevator in a rich man’s home, for example.) The time we live in today is understood in the novel as a past era called “the Expansion.” Expansion-era highrise towers have become slums; few wish to climb the miles of stairs, and there is no ability to perform maintenance on such towering monoliths. There are artifacts left over from the Expansion – a rare diesel car moves through the book at one point, and there are images in a museum of smiling people enjoying easy wealth. The era that came after the Expansion – “the Contraction” – is also now history. One character recalls how his Contraction-era grandparents would make several days’ journey – with no mechanized transport available – to visit abandoned Expansion suburbs in search of useable materials. The book is set as some people are envisioning a new Expansion – there are kink spring vehicles, and traversing the world is once again possible by sail and dirigible. Despite the obvious crash during the Contraction – about which, tantalizingly, Bacigalupi only gives glimpses – people are adapting and moving forward. It is a much-changed world, however, and this is where there are some chilling things for business to consider. Most of the world’s cities that lay close to today’s sea level have disappeared underwater – New York, Mumbai, New Orleans, Rangoon. Bangkok has protected itself with massive dykes and pumps, as a matter of national pride. Food is mostly produced from single-use

seeds engineered to be infertile. “Calorie companies” are hated, to the point where being suspected of being one of their agents – a “calorie man” – is to be at risk of death at the hands of angry citizens. Exactly why, we are never sure, but horrible plagues have swept the earth, killing both people and crops, and it appears the food companies, in their competitive efforts for supremacy and profit, intentionally released some of them.

[With backcasting], you envision the future as you want it, then work backward to determine how to get there. What about envisioning a future you don’t want and then figuring out how to avoid it? Others, it appears, may be spawned by Mother Nature fighting back – unpredictably – against the intense manipulations of the genetic fabric of life. Food is constantly re-engineered; ensuring you have the latest “gene-ripped” product that is resistant to the newest agricultural scourges is part of normal grocery shopping. Fear of contagion is a constant backdrop. Given this history, two political departments are struggling for power: environment, which has sweeping powers over everything to do with carbon (e.g. methane use), agriculture, public health and more; and trade, which is pressing to open Thailand’s closed borders. The story’s plot plays out as the two clash, with a hidden Thai seedbank – rare authentic genetic material – one of the objects of corporate desire.

The story’s title character, Emiko, is one of the “New People” – herself a genetically modified human, bred for servitude. It is rumoured some New People have 10 arms, created for factory work, and those produced for military service are feared. Emiko is an administrative model, created to provide services ranging from translation to escort and, above all, to be obedient (it is conjectured that Labrador genes were used to ensure her overriding need to follow orders). Her place in the story – just one of several compelling characters including an aging Chinese refugee, a Midwestern calorie man working incognito to tap the seedbank, several champions of the Environment Ministry (and thus, Thai nationalism), and some assorted expats – makes us consider elements of what makes us human. Is our ability to tinker with the building blocks of life itself part of the inevitable story of natural selection and adaptation? Or is it a perversion of that process? And where does private enterprise, and pursuit of profit, fit into this picture as resources shift, government powers react, cheap energy wanes, and the population continues to surge? The story is fiction, yet wherever you cast your vision of the future, these are real questions we are facing. Read the book. It’s entertaining and, whether you’re a sustainability wonk or not, it lets you leap out of today’s pellmell rush and ponder a future we could build, despite our best intentions. • Nina Winham (nina@newclimate. ca) is principal of New Climate Strategies, helping clients build value through sustainability and communications strategy. She writes regularly on sustainability topics. www.newclimate.ca.

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Building Homes. Building Hope. Habitat for Humanity ReStores accept donations of new & used building materials, appliances & décor items from businesses, trades & individuals. Sold to the public at 50 to 80% off, proceeds help build homes for people in need of safe, decent & affordable shelter. Details & store locations at: www.vancouverhabitat.bc.ca/restores Diverting over 1,000 tons from landfills through sales & recycling!

B.C. releases new woodframe construction guide The province has released a new wood-frame construction guide it claims will help residential builders shape better buildings. On September 13, the provincial government released its Building Enclosure Design Guide, which focuses on wood-frame, multi-unit residential buildings and offers “practical solutions to help ensure that new residential buildings are well-constructed for B.C. families and residents.” The guide outlines the latest research, design and construction best-practices for building envelopes and is designed to be a key tool for construction industry insiders. “The province is committed to working with industry to advance knowledge and generate new technology, particularly when it comes to wood-frame construction, which is the predominant method of residential construction in B.C,” said Rich Coleman, the minister responsible for housing. “Our goal is to ensure that our residential buildings are among the most comfortable, durable and energy efficient in the world.” The guide is available through the Homeowner Protection Office for $70. Thursday, September 14

Full stories and other local business news at www.biv.com/businesstoday Daily business news direct to your inbox! Sign up at www.biv.com/newsletters

grow Centre your business in a strong, liveable, healthy community 25% PARKS AND OPEN SPACE FOUR VIBRANT TOWN CENTRES Go to Burnaby’s Economic Development Strategy 2020 online www.burnaby.ca/eds2020 or contact the Planning Department at 604.294.7400 to learn more.

List

Daily business news at www.biv.com September 20–26, 2011

Park Place 500-666 Burrard Street Vancouver BC V6C 3P6

cell 778 227 8715 office 1 800 998 4547 pauline@paulineomalley.com

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Ranked by number of local staff Top local executive

Services

Partial list of major clients

Year founded

Ideal class size

No. local staff '11/ '10

Bryan Burns, chief edu-tainment officer Barbara RossDenroche, president and CEO Bruce Wiesner, associate dean

Team building, HR and business consulting, corporate events, fun casinos, entertainment, company picnic and holiday parties Total leadership offering that takes a comprehensive approach to leadership and management development Strategy, leadership, management, finance, marketing

2004

43 NP

Cameco Corporation, Coast Capital, Goldcorp 2002 Inc., Teck Resources, Kinder Morgan, New Gold,

23 21

Telus, BC Hydro, BC Assessment, BC Liquor, 1969 Aritzia, London Drugs, YVR, Vancouver Coastal Health, Fraser Health, ICBC

22 21

Edge Training and Consulting Ltd

134 Abbott St Suite 303, Vancouver V6B 2K4 P: 604-683-6466 F: 604-683-6496 www.edgeltd.com

Kirsty Farquharson, president

BC Hydro, Fisheries and Oceans Canada, RCMP, 1987 UBC, Alderwoods Group, Lehigh Cement, REBGV, ITA, Intrawest, SFU, MTS/AT&T, Bell Canada, Vancity

10 to 15

20 20

Corporate Explorer Training

Kerry Ward, CEO

20 NP

Anson Frost, president Laura Ryane, manager of operations Mark Wardell, president and founder Alex Wray, senior partner

Air Canada, Microsoft, Sony, UBC, Yokohama, 2008 Lululemon, Correctional Service of Canada, BCIT, Canadian Red Cross, Scotiabank, Statoil, Pepsi, BDO, DFAIT, Encorp, BCLC, EDC 1984 Coast Capital Savings, Westminster Savings, Fraser Health, City of Vancouver, Government of Canada, BC LDB, Marine Harvest, bcIMC, VCC

12 to 120

Priority Management - Vancouver

Content management, business process improvement, strategic planning, performance management, privacy implementation, customer relationship management, contact centre management, knowledge management Communication, project management, collaboration, time management, public speaking/ presenting, team building, sales training, organizational development, strategic planning Training courses in time (workload) management using MS Outlook, Lotus Notes and BlackBerry; project planning; customer service; sales and negotiating; influencing; and meeting management.

13 13

Assisting in growth management in private enterprises

Kin's Farm Markets, Mainland Machinery, Atomic Cartoons, Globe Printers

1988

13 NP

1993

Unlimited

13 NP

Individual coaching to keynotes

11 10

One-to- one

11 7

1994

8 8

1996

20 to 500

8 8

1995

7 7

1996

10 to 12

7 7

1988

16 to 24

7 7

7 NP

Varies

5 8

1 2 3

Corporate Play People Inc

101-1865 Dilworth Dr Suite 225, Kelowna V1Y 9T1 P: 866-351-7529 F: NP www.corporateplaypeople.com

The Refinery Leadership Partners Inc

375 Water St Suite 385, Vancouver V6B 5C6 P: 604-899-4192 F: 604-899-4193 www.refineryleadership.com

UBC Sauder School of Business Executive Education

1600 - 800 Robson St , Vancouver V6Z 3B7 P: 604-822-8263 F: NP www.sauder.ubc.ca/Exec_ed

4 5 6 7 8 9 10 11 11 13 13 13 16 17 18

332 East Esplanade , North Vancouver V7L 1A4 P: 604-924-4504 F: NP www.CorporateExplorerTraining.com 11160 Silversmith Pl Suite 110, Richmond V7A 5E4 P: 604-303-5963 F: 604-214-7773 www.prioritymanagement.com/ pcg

Wardell Professional Development Inc

1200 73rd Ave W Suite 610, Vancouver V6P 6G5 P: 604-733-4489 F: 604-648-9210 www.wardell.biz

Wray Group

1544 Marine Dr Suite 203, West Vancouver V7V 1H8 P: 604-921-1321 F: 604-921-1341 www.wraygroup.com

Insights Learning & Development Vancouver

Joyce Gwilliam, principal

Pauline O'Malley Enterprises Inc.

Pauline O'Malley, CEO and founder

Dynamic Achievement Group Inc

Eitan Sharir, president

JTE Management Inc

Jim Fish, vicepresident, sales

Buckhiester Management Limited

Bonnie Buckhiester, principal Dan Monteiro, president

17 Fawcett Rd Suite 339, Coquitlam V3K 6V2 P: 604-522-4229 F: 604-522-4230 www.insightsvancouver.com 666 Burrard St Suite 500, Vancouver V6C 3P6 P: 800-998- 4547 F: NP www.PaulineOMalley.com 1296 Haywood Ave, West Vancouver V7T 1V1 P: 604-926-6465 F: 604-922-3265 www.dynamicachievement.com 535 Howe St Suite 400, Vancouver V6C 2Z4 P: 604-274-6610 F: NP www.jtemgt.com 980 21st Ave W Unit 103, Vancouver V5Z 1Z1 P: 604-757-3527 F: 703-348-4615 www.buckhiester.com

Catalyst Training Services Inc

1200 - 73rd Ave W Suite 1100, Vancouver V6P 6G5 P: 604-298-5505 F: 604-940-8035 www.catalysttraining.ca

MDA Training Inc

Scott Powell, president

SFU Management and Professional Programs

Susan Burgess, director, management and professional programs Ralph Kison, president

302 Water St Suite 300, Vancouver V6B 1B6 P: 778-588-7230 F: 866-203-8715 www.mdatraining.com 515 Hastings St W Suite 2300, Vancouver V6B 5K3 P: 778-782-5095 F: 778-782-5098 www.sfu.ca/cstudies/mpprog

Kison Inc

10551 Shellbridge Way Suite 35, Richmond V6X 2W9 P: 604-284-5133 F: 604-284-5132 www.kison.com

19 19 22

Sales training, management and leadership development, employee assessment and performance coaching Sales and management training, coaching, business consulting

Campeau Learning and Development Inc

Gregory Campeau, Leadership, coaching, team-building, founder communication skills, time management, sales

Life Strategies Ltd

Roberta Neault, president

Walkabout Seminars International Inc

Michelle Ray, CEO

Dale Carnegie Training of BC

Paul Sinkevich, president

26907 - 26 Ave, Aldergrove V4W 4A4 P: 604-856-2386 F: 604-856-2398 www.lifestrategies.ca 265 15th Ave E Suite 303, Vancouver V5T 4K4 P: 604-677-5272 F: 604-909-5201 www.michelleray.com 4710 Kingsway Suite 1028, Burnaby V5H 4N2 P: 604-299-5115 F: 604-299-5657 www.bc.dalecarnegie.com

Sources: Interviews with above firms and BIV research. ranked

NP Not provided

NR Not

2000 Municipal governments, Province of BC, Canada School of Public Service, ICBC, Ledcor, Great Canadian Gaming, multiple financial organizations 1996 RBC, Lamar, Kryton, MultiTrendsIT, Investors Group, TEC-Canada, Gorski Bulk Transport, CMA, Packaging Logistics, Nexus Exhibits, BIV TELUS, London Drugs, Corix, Interior Savings Credit Union, PCL, Vancity, Kwantlen University Molson, TSI, Smart Technologies, Coalfire Systems, Schulich School of Business

Fairmont, Delta Hotels, Atlific, Tourism BC, BC Hotel Association, Terminal City Club Hotel, Tourism Vancouver ALS Laboratory Group, CKF Inc., Ecco Heating Products, Falcon Equipment, Freybe Gourmet Foods, Honeywell Process Solutions, Intertek, JD Sweid, MCL Motorcars Financial leadership and business skills, training for ICBC, ATB Financial, Brandes, Bank of America corporate and commercial banks, training for Merrill Lynch, Accenture, BC Ferries, British equity and asset managers, training for insurance Airways, CISCO Systems, Credit Suisse, JP companies Morgan, Siemens, Swiss Re, Tesco Business and management, career and life NP planning, justice and conflict resolution programs

Randy Hnatko, president and CEO

1406 Magnolia Pl, Coquitlam V3H 4S8 P: 604-944-0642 F: 604-944-0692 www.campeaulearning.com

Sell More. Enjoy Life! • www.paulineomalley.com

Improved organizational performance by increasing the effectiveness of individuals, teams, sales, leadership and managing organizational change Business development strategist and sales coach exclusively for privately owned B2B companies. Deliverables include coaching, consulting, training, workshops and webinars Culture transformation, leadership, executive coaching, strategic and advanced selling, service excellence Financial and business literacy training, sales training, simulation training, customized e-learning, private-labelled e-learning systems including onboarding and compliance training Consulting, developmental education to the hospitality industry in the field of revenue management Leadership training for managers and supervisors, personality assessments for selection, coaching and succession planning process

Sandler Training/Trainwest Management & Consulting

4170 Still Creek Dr Suite 110, Burnaby V5C 6C6 P: 604 291-1272 F: 604-291-1279 www.trainwest.ca

Situational leadership, coaching skills training, team building, facilitation skills training

training Training, human resources, e-learning, career management, psychometric assessments

In-house professional development training and conference keynote presentations, management consulting services - recruitment, retention, multigenerational workplace, leadership coaching Business strategy, training and coaching

Construction, Engineering, Architecture, HVAC 1991 and Insurance companies Burnaby Board of Trade, BFI Canada, Great Little Box Company, CHUM, Re/Max, Konica Minolta, BC Government, BMO, Inland Kenworth

2004

5 5

Lafarge, NHL coaches, Finning, Terasen, Canadian and US federal governments, BC Hydro, Royal Bank NA

1991

4 4

1993

Unlimited

4 4

1995

4 4

RSL, Houle Electric, Cactus Club, Design Roofing, Jeld-Wen, Esco, General Paint, Craftsman Collision,

1943

30 to 40

4 NP

Business in Vancouver makes every attempt to publish accurate information in The List, but accuracy cannot be guaranteed. Researched by Richard Chu, lists@biv.com.

Do not miss the Book of Lists, a compilation of lists featured in BIV, including biggest law firms, construction companies, biotech firms and many more. Free to subscribers ($79.95 plus HST for one year) or $35 plus HST as a separate purchase. Purchase lists as Excel files at www.biv.com/listsforsale.

More Than Sales Training: A Proven Approach to Business Development Park Place 500-666 Burrard Street Vancouver BC V6C 3P6 cell 778 227 8715 office 1 800 998 4547 pauline@paulineomalley.com

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IndIvIdual & Team CoaChIng | Personnel assessmenTs | new emPloyee TraInIng

Enterprises Inc.

Address

Pauline O’Malley

Rank '11 Company

1.800.998.4547

Mining Report Quarterly News Report

September 20–26, 2011; issue 1143

M&A to slow in second half New mining boss The commodities boom led to a record amount of deals in the first six months of 2011, but investors are shying away amid increasingly volatile markets

E&Y Canadian mining leader Tom Whelan: “companies have learned the lessons of 2007 and 2008 … and they’re really thinking through the deals” By Joel McKay

ash was exchanging hands in record amounts in the first half of 2011, but mining industry analysts say the rest of the year might not be so rosy. Earlier this month, PwC released a new report that pointed to a slowdown in global mining mergers and acquisitions (M&A) in the second half of the year. John Nyholt, PwC’s national leader of transaction services, told Business in Vancouver the drop off in corporate transactions began immediately after the end of the first half. In fact, PwC said, on aggregate, deal values and volumes were down 49% and 25% respectively in July and August. “That’s pretty significant,” said Nyholt. “And the primary driver of that slowdown we believe is the rather fractured markets that we’ve seen in terms of global economic markets.” He explained that ongoing debt concerns in Europe and the U.S., plus fears in Canada about an economic slowdown, have triggered a new wave of volatility in public markets

that have caused investors to back away from dealmaking. “All of these things end up creating additional uncertainty in the marketplace, and that makes it less likely companies are going to move forward on the M&A front,” he said. “The mining sector is probably more [focused on] big bets, and you want some of those fundamentals to be in better shape before you make some of those big bets.” Still, Ernst & Young’s (E&Y) Canadian mining leader Tom Whelan said things aren’t all bad in the Canadian mining sector. In fact, Canada led the world in acquisitions (196) in the first half of the year, and was also the leading ta rget dest i nat ion (129 deals). Whelan said although there were fewer deals in the first half of the year compared with 2010, the dollar value of deals was larger. The total value of global mining transactions from Ja nu a r y to Ju ne more than doubled this year to US$96.3 billion compared with US$47.9 billion last year.

W hela n sa id t he i ncrease in deals focused on safe mining jurisdictions such as Canada is likely a result of investors increasi ng ly concer ned about operations in developing nations. “2011 saw a return to deals in lower-risk jurisdictions, which is why Canada topped the list,” said Whelan. “And that I think also speaks to the risk appetite that’s out there as people are obviously worried about what’s going on in the global economy.” Last week, E&Y said resource nationalism topped its annual list of risks for miners. “In the last four months, 25 jurisdictions around the world have i nt roduced some form of additional taxation or royalty, and if you’re uncertain about what kind of tax regime you’re going into, naturally, you’re going to be a little more cautious about pulling the trigger on a transaction,” Whelan said. Still, the increase in riskaversion in the sector could be good news for Vancouver’s throng of junior mining companies. Nyholt said large mining companies might increasingly target junior companies as potentia l takeover targets because the deals are smaller and

don’t necessarily come with a heap of risk. “Junior stage companies are always good marks for being swallowed up by larger companies,” Nyholt said. And even though the markets might cool off, he doesn’t believe the boom in mining transactions has come to a screeching halt.

“The mining sector is probably more [focused on] big bets, and you want some of those fundamentals to be in better shape before you make some of those big bets” – John Nyholt, leader of national transaction services, PwC

“With increasing dema nd f rom Ch i na a nd some of the more significantly developing countries like India and Brazil, that is going to fuel further demand for minerals, and more demand for the commodity typically leads to more acquisitions.” • jmckay@biv.com

adopts “open dialogue” policy

Karina Briño comes to B.C.’s mining industry with a strong pedigree in public policy and believes good communication with all stakeholders is the key to sector success By Joel McKay

orget the old boys club; the new voice of mining in B.C. belongs to a woman. Karina Briño joined the Mining Association of BC (MABC) as chief executive in August, leaving behind a top-notch job at the Ministry of Energy Mines as an assistant deputy minister in the Mines and Mineral Resources Division. Briño, a sure-handed veteran of one of the most challenging public-policy sectors in the province, sat down with Business in Vancouver earlier this month to talk about her new role. The 47-year-old native of Santiago, Chile, said she’s big on communication, open dialogue and work ing w it h t he various industry stakeholder groups to ensure the sector continues its so-called renaissance. In the past, Briño led t he i mplement at ion of B.C.’s mining plan, the core

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public policy document that guides the ministry’s approach to the industry. Now, she’s hopped to the other side of the fence where she’ll lobby on behalf of the province’s miners.

My goal right now is to be the best and most effective voice for the industry that I can be” – Karina Briño, president and CEO, Mining Association of BC

Why did you take this job? I have been attached to the industry for the last six or seven years, but my interest has always been in getting the complete picture. So from the policy side this is what it looks like, from the regulatory side this is what it looks like, but I had never really experienced the business side of the industry so this brings it full circle. see Improving, 18

18 Mining

Daily business news at www.biv.com September 20–26, 2011

Sponsor’s Message

from New, 17

Tom Whelan Partner, Ernst & Young Vancouver Canadian Leader, Mining & Metals In an industry that’s ever-evolving it’s hard to predict what’s coming around the corner. And that’s what makes the mining and metals industry so exciting — there’s never a dull moment. It’s also why Ernst & Young’s annual report Business risks facing mining and metals offers a snapshot of the top-10 risks facing the industry each year. While we can’t predict exactly where the industry will go, we can provide our perspective on the key risks facing mining and metals companies based on our discussions with executives around the globe. Resource nationalism jumped to the number-one risk spot this year. With strong commodity prices since 2009 and bare government treasuries, we’ve seen approximately 25 countries, including Ghana, South Africa, and Australia, announce plans to ramp up their taxes and royalties on mining projects — an added cost burden set to increase the complexity of multibillion-dollar investment decisions for long-life mines. But that’s not all. Governments around the world have also been looking to increase local participation in projects. The other interesting story of this year’s top-10 list is how quickly supply capacity constraint issues, including skill shortages, infrastructure access and capital project execution, have risen back to the top of the risk agenda. And it’s these supply side risks that speak to why we believe commodity prices will stay stronger for longer. Yet despite this, companies should still prepare for continued price and foreign exchange volatility in the short term. It’s also interesting to note what certain leading jurisdictions, such as Quebec and its “Plan Nord” initiative, are doing to strategically address these capacity constraint issues in Canada. If last year’s spate of natural and environmental disasters proved anything, it’s that unpredictable and under-the-radar risks can cause the biggest challenges for mining and metals companies. While we’re starting to see a body of risk management practices emerge around the world, several companies are still doing too little to address these up-and-coming threats. In today’s global business environment, being caught unprepared can mean farreaching implications on cost, future supply and most important of all: share price.

Tom Whelan Partner, Ernst & Young Vancouver

How would you describe your role? [The role is] really to be the voice of mining, but in order to be an effective voice of mining we need to get out there and get to know people who are actually involved in mining. You’ve said you always set ambitious goals for yourself and reach for the top. What’s the benefit of approaching a career that way? If you don’t allow yourself to dream, you’ll never get anything done; you have to strive for the stars. At the end of the day, my goals are really small, and if you set realistic goals for yourself it’s a lot easier to feel confident about what you can and can’t do. My goal right now is to be the best and most effective voice for the industry that I can be, but I’m not going to do that by promising that I’m going to build three mines or four mines or 10 mines, that’s ridiculous. There are tremendous opportunities here, but there is a lot of hesitation and a lot

of trust that needs to be built around some of the things we need to do.

should all expect is clarity around how land-use decisions are made.

B.C. is renowned for its mining history and geological roots, but every year the province’s mining industry suffers from ongoing land-use issues. Has government gone far enough in improving those issues? I can’t speak to what government has or hasn’t done. I have an agreement with the province that I will not comment on provincial policies.

What strengths do you bring to the industry side of mining from your time in government? The fact that I’ve spent a number of years on the government side of the industry with a pretty strong knowledge of how the regulatory system works and even how to navigate the system, I think it’s going to allow ourselves on the industry side to focus our attention on things where we can achieve some collective success in providing predictability and clarity on how the process works.

How long is that agreement in place? Twelve months. But, having said that, where are we going to focus our attention? Obviously that’s an issue that needs to be addressed. I think there are always opportunities to improve our dialogue and make sure there is a clear understanding of what the rules of the game are. British Columbia is very rich in mineral potential and there just might be areas where it’s more controversial or sensitive to allow certain activities, but what we

Where do you stand on improving the provincial and federal environmental assessment processes for industry? I think there is an opportunity to ensure there is less duplication in the process and more timely decisions. One of the things the industry is accustomed to is that you don’t build a mine overnight. It’s a lengthy process, but if you have a

NEWS RELEASE Allnorth Consultants Limited (“Allnorth”) is pleased to announce the successful acquisition of Axxent Engineering Ltd. Axxent was founded in 2006, and has been providing a wide range of services to the mining resource and forestry sector. Axxent brings over 45 highly motivated professionals to the Allnorth team, who are currently working on projects in British Columbia, Northwest Territories, Nova Scotia and Mexico. Together we will provide our clients with a fully integrated engineering and technical services team in the following areas: • • • • • • • • • •

Mechanical/Structural/Civil/Process/E&I Engineering Environmental Permitting and Planning Capital Cost Estimates Project and Construction Management Pre-feasibility and Feasibility studies (NI43-101 compliant) Constructability and Optimization reporting Legal and Construction Surveying Material Testing & QA/QC services Planning & Scheduling 3 D Scanning & Modeling

Allnorth will continue to provide services from the office located in Surrey, British Columbia. Mr. Mark Dobbs, PEng, will assume the position of the Surrey Division Manager. Allnorth looks forward to integrating our two teams into a single cohesive unit that will create exciting opportunities for our clients, employees and partners.

Canadian Leader, Mining & Metals

For additional information please contact Allnorth at 604-572-7722 or visit our website at www.allnorth.com

Dominic Schaefer

Improving dialogue: Clarity needed around how land-use decisions are made

Mining Association of BC CEO Karina Briño: “there are tremendous opportunities here, but there is a lot of hesitation and a lot of trust that needs to be built”

regulatory process that is not aligned or not in synch, that doubles the time. How does the decision to axe the HST impact the mining industry? MABC has expressed its disappointment in the results of the referendum as it compromises its competitive advantage. Having said that, we look forward to working with the province to ensure the transition to the new tax regime is smooth and timely. Are you at all concerned about the impact it could have on future investment in the B.C. mining sector? What I’m concerned about is that we do stay on top of things. This is one of those things where our role is to figure out what’s going to happen next and provide that information to investors and potential companies coming into British Columbia. We continue to have the opportunities we had before we had the HST. How are you going to work with government to avoid a repeat of decisions such as the ban on uranium exploration and mining in the Flathead Valley? It’s going to come down to effective dialogue, timely conversations and our ability to

provide prompt feedback and input into those discussions. Other than that, I don’t think this is a situation that is unique to British Columbia. It happens everywhere. Governments make decisions, governments change and governments come and go. The nature of what we do doesn’t change. The mineral potential is here, how we mine, when we mine, when the opportunities come, that doesn’t change. So our role will be to work with those bodies, federal municipal and provincial, to ensure we are staying true to our role to advocate for the industry. How are you going to work with first nations to bridge the gap between the industry and aboriginals? I am quite excited about that opportunity. I have very, very strong commitment to open dialogue. I believe all of our relationships begin with trust. I’m open for conversations. Again, going back to the role of the association as the “voice of mining,” that voice will only be as good as our ability to listen, to hear what people are saying to hear their concerns and to have some very open and frank discussions. • jmckay@biv.com

mining 19

September 20–26, 2011 Business in Vancouver

Walter Energy shares jump amid takeover speculation B.C. coal producer becomes subject of yet another bid rumour amid management upheaval By Joel McKay

ne of B.C.’s biggest coal players saw its share value soar earlier this month after rumours surfaced that it could be the subject of a takeover bid. The London-based Times reported that mining giants Anglo American PLC (LSE:AAL) and BHP Billiton (NYSE:BHP) were considering separate bids for Walter Energy (TSX:WLT), an Alabama-based steel-making coal producer with three mines near Tumbler Ridge. The rumours ignited an immediate frenzy of trading activity in Walter shares, pushing the company’s stock value up more than 20% to $90.35 on Sept. 7. The Times didn’t cite any particular sources, but the rumours came during a less-than-favourable summer for Walter, which has seen its share value drop 48% between May and August to a 52-week low of $69.54 amid

management trouble and shareholder discontent. In July, Business in Vancouver reported the company’s Vancouver-based chief executive, Keith Calder, had resigned citing differences in “management philosophy.” (See “Walter Energy’s Vancouver-based CEO bows out amid takeover speculation” – issue 1134, July 19-25.) Calder’s resignation came just months after a $3.3 billion takeover deal that saw his previous company, Western Coal, taken out by Walter. In a one-on-one interview in June, Calder told BIV he had no plans to leave the company. Within hours of his resignation, rumours began to swirl that Calder’s departure was related to a potential sale of the company. A week later, BIV reported that one of Walter’s key shareholders, London-based Audley Capital Advisors LLP, had urged the company to put itself up for sale. (See

Walter Energy, which has been the subject of recent takeover rumours, operates the three coal mines near Tumbler Ridge, B.C.

“Walter energy shareholders urges the company to sell” – issue 1135, July 26-August 1.) In a July 17 letter to shareholders, Audley claimed the company lacked “strong leadership.” Davenport & Co. LLC analyst Christopher Haberlin told BIV at

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the time that Calder’s departure increased the possibility that Walter could be acquired. Despite the recent surge in its stock price amid takeover rumours, Walter said September 7 it was “not aware of any corporate developments to account for” the

trading activity. Five days later, the company named Walt Scheller, the company’s president of U.S. operations, its new CEO. Walter’s stock value has since pared back to $82.48 per share. Earlier this summer, the sector saw two major mining companies increase their stake in B.C. coal deposits. In August, Anglo American announced a deal to take full control of the Peace River Coal Partnership, which operates the Trend mine near Tumbler Ridge. A week earlier, Switzerlandbased diversified miner Xstrata (LSE:XTA) paid $147 million to buy privately held First Coal Corp. and take control of its exploration properties in northeast B.C. Mike Plaster, a Vancouver coal analyst with Salman Partners, said the recent merger and acquisition activity in B.C.’s coal sector highlights the strategic value of many projects. Said Plaster: “I think the increased M&A activity that we’ve seen recently involving metallurgical coal assets in general reflects the desire to secure additional supply in a rapidly consolidating market, particularly now that the equity prices of most of the publicly traded met coal companies have come off the highs earlier this year.” • jmckay@biv.com

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List

Daily business news at www.biv.comâ&#x20AC;&#x192; September 20â&#x20AC;&#x201C;26, 2011

Biggest mines in B.C. Biggest mines in B.C. Ranked by number of mine employees in 2011 Rank '11 Mine

Mine operator

Year founded

Type of operation

Commodities produced

Amounts produced '10

Years in operation/ Mine revenue years remaining '10

No. mine employees '11

Highland Valley Teck Resources Ltd 550 Burrard St Suite 3300, Bentall 5, Vancouver V6C 0B3 Copper

2001

Open-pit mine

99,000 tonnes of copper

NP/ 14

$872,000,000

1,200

Logan Lake

Copper, molybdenum

P: 604-699-4000 F: 604-699-4750 www.teck.com

Fording River1 Elkford

Teck Resources Ltd

550 Burrard St Suite 3300, Bentall 5, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com

2001

Open-pit mine

Metallurgical coal

42/ 33

$1,540,000,0002 1,1703

Elkview1

Sparwood

Teck Resources Ltd

550 Burrard St Suite 3300, Bentall 5, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com

2001

Open-pit mine

Metallurgical coal

43/ 41

$990,000,0002

8904

Greenhills 1 Elkford

Teck Resources Ltd

550 Burrard St Suite 3300, Bentall 5, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com

2001

Open-pit mine

Metallurgical coal

29/ 18

$800,000,0002

6305

Gibraltar

Williams Lake

Taseko Mines Ltd

1040 Georgia St W, 15th floor, Vancouver V6E 4H8 P: 778-373-4533 F: 778-373-4534 www.tasekomines.com

1966

Open-pit mine

Copper, molybdenum

92.3 million pounds of copper 8/ and 941,000 pounds of 27 molybdenum

$278,460,000

500

Line Creek1 Sparwood

Teck Resources Ltd

550 Burrard St Suite 3300, Bentall 5, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com

2001

Open-pit mine

Metallurgical NP and thermal coal

30/ 15

$510,000,0002

4806

Wolverine/ Perry Creek

Walter Energy Western Coal7

1997

Open-pit mine

Coking coal

2 million tonnes of coal

5/ NP

4348

Tumbler Ridge

885 Dunsmuir St, Suite 1000, Vancouver V6C 1N6 P: 604-608-2692 F: 604-629-0075 www.westerncoal.com

Mount Polley Williams Lake

Imperial Metals Corp

580 Hornby St Suite 200, Vancouver V6C 3B6 P: 604-669-8959 F: 604-687-4030 www.imperialmetals.com

2001

Open-pit mine

Copper, gold, silver

34.8 million pounds of 10/ copper, 46,771 ounces of 5 gold, 206,812 ounces of silver

$164,091,000

367

Endako Mine Fraser Lake

Thompson Creek Metals Co Inc

401 Bay St Suite 2010, Toronto M5H 2Y4 P: 416-860-1438 F: 416-860-0813 www.thompsoncreekmetals.com

Open-pit mine

Molybdenum

10 million pounds of molybdenum9

46/ 16

$105,600,00010

336

Myra Falls

Campbell River

Breakwater Resources Ltd

95 Wellington St W Suite 950, Toronto M5J 2N7 P: 416-363-4798 www.breakwater.ca

Underground mine

Copper, gold, silver, zinc

NP/ NP

308

Kemess South Smithers

Northgate Minerals Corp

815 Hornby St Suite 406, Vancouver V6Z 2E6 P: 604-681-4004 F: 604-681-4003 www.northgateminerals.com

1919

Open-pit mine

Gold, copper

732,796 ounces of silver, 20,003 ounces of gold, 32,686 tonnes of zinc, 4,769 tonnes of copper, 511 tonnes of lead 100,790 ounces of gold, 40.67 million pounds of copper

12/ 1

$296,242,50011

300

Trend

Tumbler Ridge

Peace River Coal LP

1055 Hastings St W Suite 1900, Vancouver V6E 2E9 P: 778-786 7400 F: 604-688 5210 www.peacerivercoal.com

Open-pit mine

Coking coal

5/ NP

3008

Coal Mountain1 Sparwood

Teck Resources Ltd

550 Burrard St Suite 3300, Bentall 5, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com

2001

Open-pit mine

Metallurgical NP and thermal coal

36/ 9

$510,000,0002

29012

Copper Mountain13

Copper Mountain Mining Corp

Open pit mine

Copper

013/ NP

$013

270

Princeton

700 Pender St W Suite 1700, Vancouver V6C 1G8 P: 604-682-2992 F: 604-682-2993 www.cumtn.com

Huckleberry Houston

Imperial Metals Corp

580 Hornby St Suite 200, Vancouver V6C 3B6 P: 604-669-8959 F: 604-687-4030 www.imperialmetals.com

2001

Open-pit mine

Copper, silver, molybdenum, gold

$164,020,000

245

Burnt River Brule

Walter Energy Western Coal7

1997

Open-pit mine

1718

Chetwynd

885 Dunsmuir St, Suite 1000, Vancouver V6C 1N6 P: 604-608-2692 F: 604-629-0075 www.westerncoal.com

45.5 million pounds of 14/ copper, 223,557 ounces of 3 silver, 84,027 pounds of molybdenum, 3195 ounces of gold PCI metallurgical 1.5 million tonnes 3/ coal NP

Quinsam

Campbell River

Hillsborough Resources Ltd14

355 Burrard St Suite 1100, Vancouver V6C 2G8 P: 604-684-9288 F: 604-684-3178 www.hillsborough resources.com

1995

Underground mine

Thermal and PCI NP coal

NP/ NP

140

Max Molybdenum

Roca Mines Inc

2002

Underground mine

Molybdenum

1.4 million pounds of molybdenum

3/ 10

$17,649,841

Nearest town

Revelstoke

1122 Mainland St Suite 490, Vancouver V6B 5L1 P: 604-684-2900 F: 604-684-2902 www.rocamines.com

Orca Quarry Port McNeill

Polaris Minerals Corp

1055 Georgia St W Suite 2740, Vancouver V6E 3R5 P: 604-915-5000 F: 604-915-5001 www.polarmin.com

1999

Open-pit

Construction aggregates

4/ NP

Gillies Bay quarry

Texada Quarrying Ltd15

Open pit

Limestone

59/ NP

302

Barkerville Gold Mines Ltd

Underground mine

Gold

1/ NP

$8,074,494

1978

Open-pit mine

Aluminum silica 55,112 tonnes of chalky geyserite (aluminum silica)

8/ NP

$1,015,428

Van Anda

QR Mine and Mill Likely

PO Box 160, Van Anda V0N 3K0 P: 604-486-7627 F: 604-486-7280 675 Hastings St W, 15th floor, Vancouver V6B 1N2 P: 604-669-6463 F: 604-669-3041 www.barkervillegold.com

PEM100 Quarry Electra Gold Ltd Port Hardy

2330 Tyner St Unit 5, Port Coquitlam V3C 2Z1 P: 604-696-1022 F: 604-944-6102 www.electragoldltd.com

Sources: Interviews with mining operators and BIV research. NP Not provided NR Not ranked 1 - Operated by Teck subsidiary Teck Coal Ltd. 2 - BIV estimate 3 1,1100 full-time plus 70 contractors 4 - Includes 860 full-time employees and 30 contractors 5 - Includes 530 employees and 100 contractors 6 - Includes 430 fulltime staff and 50 contractors 7 - Formerly Western Coal Corp., which was acquired by Walter Energy in a $3.3 billion deal that closed April 1, 2011 8 - 2010 figure 9 Amount includes production accounted to Sojitz Corporation of Japan which owns a 25% stake in the mine 10 - In U.S. dollars 11 - Converted from U.S. dollars 12 Includes 260 full-time staff and 30 contractors 13 - Began operations in June 2011 14 - Acquired by Vitol Anker International BC in the fourth quarter of 2009 15 Subsidiary of Lafarge Canada Inc

>Next week: Biggest financial planning firms in Metro Vancouver

Business in Vancouver makes every attempt to publish accurate information in The List, but accuracy cannot be guaranteed. Researched by Richard Chu, lists@biv.com.

mining 21

September 20–26, 2011 Business in Vancouver

financing resources

Gordon Chambers Mining and exploration financing deals help sustain economy in Vancouver

s global markets continue to suffer through uncertainties and turmoil, many mining companies have turned their eyes to Canada to raise funds. Canadian markets are a viable and prolific source of funding for foreign mining companies, particularly for those aware of the advantages Canadian stock markets present over their local stock exchanges. Many of these foreign companies are turning to Vancouver-based professional services companies in search of mining finance expertise, creating an often unseen but nonetheless lucrative economic opportunity for Vancouver professionals. One of the great strengths of Canadian capital markets is that they will support a mining project based on an assessment of its geological merit and political risk, regardless of where it is located. The local stock markets in many countries, including Australia, often fail to support companies with projects based in far-flung regions of the planet. Other internationally minded stock exchanges, such as the London Stock Exchange, tend to be successful capital-raising venues for only the biggest companies. As a result, the Toronto Stock Exchange (TSX) and the TSX Venture Exchange (TSXV) are attractive to mining companies from across the world. Offering unrivalled sector expertise, the two exchanges have the most diversified roster of public mining companies by commodity and stage of development. Mining companies listing on the TSX benefit from experienced mining analysts, specialized indices, flexibility and tailoring of listing requirements not offered by any other global exchange. In 2010, more mining companies were listed on the TSX and TSXV than any other market in the world, with 60% of the world’s mining equity capital – totalling $17.8 billion – being raised on these two exchanges alone. In comparison, its nearest rival, London’s sub-market AIM exchange, raised only 7.5% of the mining world’s equity financing. This st rong grav itation toward the Canadian

exchanges has continued unabated in 2011, with 123 mining companies listed in Canada by July. A substantial number of foreign mining companies are coming to Vancouver for the professional services and merchant banking advice they require for their financing. These companies are often headquartered abroad and are raising funds for exploration, surveys, feasibility studies and the development of projects mainly outside of B.C. In fact, 50% of more than 9,500 mineral exploration projects held by TSX and TSXV companies are outside of Canada.

Many of these foreign companies are turning to Vancouver-based professional services companies in search of mining finance expertise, creating [a] ... lucrative economic opportunity for Vancouver professionals However, a significant volume of this professional and banking work is being channelled through Vancouver, which is a facet of the economy that many in our city are unaware of. Companies are attracted to Vancouver for its reputation as one of the world’s preeminent mining centres, and numerous leading mining companies are headquartered here. For many of the almost 40 Australasian companies listed on the TSX and TSXV, Vancouver’s professional advisers offer another more practical advantage over competitors in Toronto: a more amenable time zone. Being in the Pacific Time zone, several hours of the workday overlap with mining clients based in Western Australia, facilitating better client service. For gold mining companies in particular, the current market turmoil is a blessing. It has resulted in a spike in the price of gold and increased demand for their shares.

Many copper producers (and those nearing production) have also seen rising demand for their shares. However, the ability of companies to raise financing in the current markets is commodity specific. For example, uranium producers have faced great challenges in the aftermath

of Japan’s Fukushima disaster earlier this year. Despite the market challenges facing other industries, the mining sector appears to be weathering the storm well. For the Canadian exchanges and Vancouverbased advisers in particular, their in-depth mining expertise has become a commodity

of its own, and is more attractive than ever to foreign mining companies looking to finance current operations and future growth. Indeed, it would be fair to say that mining finance remains one of Canada’s great exports and one of Vancouver’s competitive advantages. •

Gordon Chambers is a Partner at Lawson Lundell LLP in Vancouver and head of the firm’s corporate finance and securities group. He has a particular focus on corporate finance for mining companies with extensive experience advising dual-listed issuers. grchambers@lawsonlundell. com

22 AdvertiSing FeAture

Business in Vancouver September 20-26, 2011

FOCUSONSUCCESS n

A d v e r t o r i A l

p r o f i l e

Best of breed just keeps getting better at Roughrider With a stellar year behind it, junior uranium mineral explorer Hathor Exploration gears up for more success in 2012

TSX: HAT

Hathor Camp

hat a difference a year makes! Last November, Va n c o u v e r - b a s e d Hathor Exploration Ltd. (TSX: HAT) – a junior uranium mineral exploration company – updated the mineral resource estimate for its Roughrider uranium deposit, discovered in 2008 in northern Saskatchewan’s Athabasca Basin, the western world’s pre-eminent uranium producer and the world’s premier high-grade uranium exploration and mining district, period. The results from Roughrider, located on Hathor’s Midwest Northeast property, were off the charts. The previous, preliminary mineral resource estimate included about 12 million pounds of uranium, but the updated estimate last November outlined more than double that estimate, including 10 million pounds in the indicated category and another 14 million pounds in the inferred category. Then-COO Michael Gunning focused his energies in 2010 on building a team at Hathor capable of advancing the project using internal expertise. It worked. Geological modelling of a fully integrated and expanding exploration drill database established a framework to understand the distribution of ultra-high-grade pitchblende mineralization at the West Zone of Roughrider. The result: not only did the mineral resource estimate grow significantly, so did the understanding of zone continuity. In short, Roughrider didn’t simply get bigger, it also got better. Bolstered by the positive results, Hathor forged ahead, making strategic changes to its management to ensure it had a top-notch team in place. Gunning, a widely recognized expert in the uranium sector

and formerly with Teck, was promoted from COO to president and CEO, while Jim Malone, former VP of fuel procurement at Exelon, was made chairman. And as Roughrider continued to grow via the discovery of the East Zone, Jay Fredericks, an expert in the fields of economic modelling and regulatory framework for Saskatchewan’s uranium industry, was hired as VP of project development in order to initiate and steer an internal scoping study at Roughrider. The company then embarked on an ambitious 2011 winter drill program, which included Roughrider’s East Zone and a new discovery in February: the Far East Zone. Initial exploration of this third mineral zone in the Roughrider system looked promising, and Gunning was optimistic about the eastward expansion. “It is easy to see the resource potential at Roughrider East such that it could be as big as the original West Zone at Roughrider, or perhaps more,” he told the Northern Miner. “When you look at thickness, vertical extent, copper content, there is a lot of evidence that points to the East Zone being the meat of the Roughrider system in terms of fluid flux, fluid mixing and uranium.” Uranium exploration and mining companies around the world felt the impact of the March earthquake in Japan, with share values plummeting as investors panicked due to the pull-back in interest in uranium and nuclear in particular. Hathor saw its own shares drop 37% to $1.78 in two days of trading. Speaking to Business in Vancouver on March 28, Gunning said, “The biggest impact of this event, sadly, is that although the supply-demand

fundamentals haven’t changed for uranium, access to capital has changed and that’s a situation we’re all going to have to grapple with.” But, he added, an ongoing uranium-supply shortage and a revitalized global interest in nuclear energy as a cost-effective, emissionfree electricity source would continue to drive growth and, as such, move the uranium price back up. Indeed, as of late April, Hathor’s stock had recovered to $2.15 following the company’s graduation from the TSX Venture Exchange to a full listing on the Toronto Stock Exchange. In addition, Hathor received three mineral leases from the Government of Saskatchewan to cover Roughrider, marking a major milestone for the project with the issuance of the first new uranium lease by the province in some 25 years. Like advancing to the TSX, conversion from claim is both timeconsuming and costly, which is why it’s seldom done in the Basin. That said, it’s a necessary step to achieving the rights to extract minerals from a property; that is, to build a mine. The lease conversion, along with the move to the big board, told both the market and the mining industry that Hathor is a serious and going concern. Another milestone was met in April when Hathor announced it would acquire Terra Ventures Inc., the investment company that had owned a 10% interest in the Roughrider deposit. Consolidating 100% interest in Roughrider establishes a clean ownership structure on a discovery that’s rapidly gaining global recognition in the

Above: Aerial view map of Roughrider Uranium Deposit Left: Core from Roughrider with U-shape mineralization industry. In this case, the sum is greater than the parts and, as Gunning says, “In the world of mining, the difference between owning 100% versus 90% is a lot more than 10!” In May, the final assay results from the 2011 winter drill program at Roughrider revealed that the Far East Zone established significant new potential for the overall mineral resources for Roughrider. May turned into an even bigger month for the company with the completion of the first mineral resource estimate for the East Zone, which added some 30 million pounds to the project, inferred category, and very high grade at nearly 12% U308. Overnight, Roughrider nearly doubled in size. The news sparked Dundee Securities analyst David Talbot to raise his 12-month share target price for Hathor to $5.60 per share. By June, Hathor was set to embark on an extensive drill program in the Far East Zone while simultaneously transitioning from its own internal scoping study of the East and West zones at Roughrider to an inde-

pendent and NI 43-101-compliant Preliminary Economic Assessment. By summer’s end all 19 holes at Far East came back with uranium mineralizion, some with truly bestof-breed, world-class grade and thickness intersections. Indeed, Far East has the potential to make a material difference to the overall mineral resource potential for Roughrider. And it’s still growing, still open, with aggressive drilling planned for this winter. What a difference a year makes is right. A resource growing nearly five-fold from the first estimate, mineral leases obtained, big board exposure on the TSX established, an unsolicited, all-cash offer from one of the world’s largest publicly traded uranium companies and, just days ago, an independent economic assessment study (PA) delivering a robust model that establishes Roughrider as potentially one of the lowest-cost – if not the lowest-cost – uranium producer in the world. Wow. With this track record, the message to shareholders in light of the hostile from Cameco is clear: hold on to your HAT! •

mining 23

September 20–26, 2011 Business in Vancouver

BREAKING GROUND Resource industry in brief

Gargantuan gold

Ironclad

Perennial precious metals explorer NovaGold Resources (TSX:NG) has unveiled another whopper of a mine project. Earlier this month, the Vancouver-based company, which is known for its trove of highvalue resource projects, published an updated feasibility study for its massive Donlin Gold project in Alaska. The updated project is expected to cost some US$6 billion, including US$1 billion for a 500-kilometre-long natural gas pipeline from Cook Inlet to the mine site. NovaGold president and CEO Rick Van Nieuwenhuyse said although the project costs more than the 2009 US$4.5 billion estimated cost, that project estimate didn’t include the natural gas pipeline. Van Nieuwenhuyse said the revised price tag for the project, which is a partnership between NovaGold and Barrick Gold (TSX:ABX), is in line with today’s capital costs. “The increase in the projected capital cost represents a fraction of the increase in the intrinsic value of the gold endowment at Donlin,” he said. The company said the project contains 38 million ounces of gold. In July, NovaGold released an updated prefeasibility study for its Galore Creek coppergold project, envisioning a mine that would cost $5.16 billion. At press time, NovaGold’s shares were valued at $8.48.

Resource nationalism is now the top risk for the mining industry, according to Ernst & Young’s annual report, Business Risks Facing Mining and Metals 2011-2012. Tom Whelan, leader of Ernst & Young’s national mining and metals practice, said the growing risk isn’t from countries nationalizing their resources but from governments looking for a return through taxes and royalties. “Just in the last four or five months, there have been over 25 countries that have announced intentions to increase their government royalties or taxes,” he said. Examples of this activity include South Africa’s new royalty regime and Ghana’s plans to double royalties. The trend, Whelan said, is being driven by cash-strapped governments viewing the mining industry’s recent success. In descending order, the top 10 risks the report identifies for mining for 2011-2012 are: resource nationalism, skills shortage, infrastructure access, social licence to operate, capital project execution, price and currency volatility, capital allocation, cost management, interruptions to supply, and fraud and corruption.

Joel McKay

Jenny Wagler

Resource nationalism tops mining risks: Ernst & Young

Alderon said the current net present value (NPV) of the project tops US$3 billion. “We are very excited to see such a high NPV, especially since this PEA is only based on the Rose Central zone of the Kami property. There is significant upside once we include North Rose and Mills Lake,” said Tayfun Eldem, Alderon’s president and CEO. The company expects to have a full feasibility study completed by the third quarter of 2012. At press time, Alderon’s shares were valued at $3.32. •

Alderon Resource Corp. (TSX-V:ADV) said earlier this month its Kami iron ore project would cost US$989 million to build. The junior company, which is based in Vancouver, issued the results from a preliminary economic assessment (PEA) September 8, outlining a mine that would produce eight million tonnes of iron ore per year at a 65.5% grade. The company said production of the mine would commence in 2015 and last more than 15 years.

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24 AdvertiSing FeAture

Business in Vancouver September 20-26, 2011

FOCUSONSUCCESS n

A d v e r t o r i A l

p r o f i l e

Copper Mountain Mine’s first copper shipment reflects four and a half years of hard work The Vancouver-based company is rampimg up to full production at its Copper Mountain Mine in Southern B.C. and continues exploration for additional mineral resources

n early September 2011, just 16 months after receiving permits to build its copper-gold open-pit mining project near Princeton, British Columbia, Copper Mountain Mining Corporation. (TSX:CUM) completed loading its first shipment of concentrate bound for Japan. That timeframe is a relative blink of an eye in terms of achieving any milestone in the mining industry, let alone constructing and advancing a mine to production. Vancouver-based Copper Mountain’s progress is doubly impressive considering that the company only began developing the project, which required $438 million in capital costs, in 2007 – just as economies across the globe were falling into recession. Describing how the company managed to maintain such a tight development timeline, Jim O’Rourke, President and CEO of Copper Mountain, recalled a speech he delivered in early 2011 to engineering sutdents at his alma mater, the University of British Columbia. “I explained to them how important it is to acquire a deeply thorough knowledge of any project you’re involved in,” said O’Rourke. “When you begin a project, be certain that you have every inch and every angle of the conceptual plan figured out. If you’re confident that you’re numbers are right, then go for it.” At full production, Copper Mountain will be Canada’s third-largest copper mine. It’s made up of a five-billion pound copper resource and scheduled to produce approximately 105 million pounds of copper annually with gold and silver credits. From the raw resource, the company is aiming to ship approximately 175,000 tons of concentrate each year. Construction of the mine required more than one million logged hours of labour, which was undertook primarily by local workers in the area – where a rich history of mining expertise exists – and from workers throughout the province of B.C.

In May 2010, Mitsubishi Materials Corporation., a 25% partner in the project, secured US$322 million debt financing for the mine from Japanese banks and JBIC, the Japan’s governmental credit agency for overseas investments. Mitsubishi’s agreement demonstrated confidence in Copper Mountain’s management team and provided the funds to stay on track with the development schedule – during a time when conventional bank debt was not available. “Having Mitsubishi join the project really added the strength we needed to complete it,” said O’Rourke. “That saved us from having to issue excessive shares and dilute the company’s stock. We’ve managed to take the project from exploration to production while only issuing roughly 100 million shares.” A syndicate network of investment firms in Canada helped secure the 25% equity financing required for the project. Copper Mountain came to the financial arena in a period of depressed metal prices and worldwide banking turmoil that made the financing of any new mine difficult. Underwriters were attracted to the project largely by the involvement of O’Rourke and the tight-knit team of mining experts that surround him. O’Rourke has been involved in the startup of seven major mines on three continents during his 47-year career. He and his team also have extensive experience with the Copper Mountain area. As President of Princeton Mining Corporation from 1987 to 1997, O’Rourke was responsible for the acquisition of the Copper Mountain open-pit copper mine from Newmont in 1988. One of the first things that O’Rourke did upon acquiring the mine was fly to Japan to personally tell the mine’s existing Japanese buyer of the concentrate, Mitsubishi, that Princeton Mining Corporation would honour all of their existing contracts. O’Rourke’s professional ges-

ture impressed the Japanese partner – and initiated what would become a fruitful partnership between O’Rourke and Mitsubishi. The mine closed in 1996 due to low copper prices and the need for a large capital injection for upgrades. However, O’Rourke believed there was much more high-quality ore that could be accessed with improved technology and higher copper prices. In 2006, he seized the opportunity with Copper Mountain CFO Rod Shier to acquire the mine again, this time under the banner of Copper Mountain Mining Corporation.

(left to right) Copper Mountain Ambassadors alongside Consulate General of Japan, Hideki Ito, President & CEO of Mitsubishi Materials Corporation, Hiroshi Yao and President & CEO of Copper Mountain Mining Corporation, Jim O’Rourke.

Aerial shot of the new concentrator building that will be processing 35,000 TPD and the coarse ore stock pile, looking south. “We all know the property very well and were confident in the resource, because we’ve all been involved with it previously,” said O’Rourke.

The company only began developing the project, which required $438 million in capital costs, in 2007 – just as economies across the globe were falling into recession. “But in 2007, we were a new junior mining company on the stock exchange with a market

An interior view of a portion of the new process plant: SAG mill on the left, ball mill on the right, and concentrate thickener in the foreground.

cap of $40 million and we were looking to do a $438 million project. A lot of people didn’t take us seriously.” The subsequent drilling confirmed the economic viability of creating a “super pit” by merging the three existing pits into one deeper and wider pit. In 2009, the company announced a 45 per cent resource increase, composed of five billion pounds of copper, nearly 500,000 ounces of gold and 4.5 million ounces of silver. When O’Rourke and Shier approached Mitsubishi with their updated resource and feasibility study, the Japanese conglomerate signed on as a 25 per cent partner. As well as a partner, Mitsubishi agreed to purchase 100 per cent of Copper Mountain’s copper concentrate for its Japanese copper smelters. The initial feasibility study for Copper Mountain was based

on copper selling at $1.80 per pound, but the bank dropped it to $1.60 per pound to be conservative. When the mine opened in August 2011, copper was selling at close to $4 per pound, providing a very healthy margin. Copper is a vital metal in many industries from electronic and telecommunications equipment to residential and commercial construction. Copper Mountain is confident there is substantial exploration potential remaining at the mine. There are still a number of near-surface zones of mineralization that have not been fully tested. As well, a number of outlying geophysical anomalies have yet to be explored. “One thing we want to do is make sure we maximize the resource,” said O’Rourke. “We still have a lot of targets to drill.” •

Law

September 20–26, 2011 Business in Vancouver

Trouble

DISCIPLINE •British Columbia

Securities Commission

The executive director of the British Columbia Securities Commission (BCSC) has issued a notice of hearing alleging that a Bahamian company breached securities laws by engaging in trading and advising in securities within B.C. without being registered, the regulator announced September 7. The notice alleges that Gibraltar Global Securities Inc., a company registered in the Bahamas that provides offshore securities brokerage, investment management and advisory services, carried out trades and provided securities advice on behalf of B.C. residents without being registered to do so. Furthermore, the notice alleges that the company refused to provide information regarding its B.C. clients to the BCSC and the Securities Commission of the Bahamas (SCB). The notice also states: • in 2010, the SCB performed an inspection of Gibraltar’s offices, during which it found some of the information requested by the BCSC. The inspection

was unrelated to the BCSC’s 2009 request. • on January 20, 2011, the SCB provided the BCSC with information disclosing that at least 16 B.C. residents were the beneficial holders of Gibraltar accounts. The BCSC later learned the identities of three more B.C. residents who hold Gibraltar accounts. • of the 20 B.C. residents known to hold Gibraltar accounts, one has been convicted of wire fraud and securities fraud in the United States, another is the subject of a BCSC hearing for which the decision is pending, and a third is the subject of a BCSC investigation for market manipulation that involved the deposit of securities in a Gibraltar account by a B.C. reporting issuer. • on August 5, 2011, the BCSC issued a freeze order under section 151 of the act against Gibraltar’s accounts at a Vancouver brokerage firm, freezing approximately $2.2 million. The notice states that Gibraltar’s refusal to provide the BCSC with the names, account information and account statements for all B.C. residents who have beneficially held accounts with it makes Gibraltar

unsuitable to engage in securities-related activities in, or connected with, B.C. These allegations have not been proven.

BUYER’S ALERT Companies listed below,

which are not members of the Better Business Bureau, have failed to respond, as of September 9, 2011, to Better Business Bureau of Mainland B.C.’s efforts to mediate complaints from August 29 to September 02, 2011. In some instances, the company may have taken care of the complaint and considered the matter closed, or may believe the complaint is unjustified; however, if the BBB has not received a response, records cannot reveal either position. Please note that BBB members must respond to customer complaints that are brought to their attention. Source: BBB. A Budget Inn Patricia, Vancouver Anderson Sod Farm Ltd., Dewdney Any Season Holdings Inc., Williams Lake Apsolute Communications, Richmond B&M Auto Accessories, Salmon Arm Baby Planet Boutique, Salmon Arm Bernhard + Zanders Hair

Design, Port Moody Blue Green Clean Team, New Westminster Blue Heron Waterfront Pub and Restaurant, Vernon Camtex Camera Inc #201, Vancouver Cana Creek, Vancouver Catalina Pool & Spa Ltd., Maple Ridge Catherine’s Bed & Breakfast, Vancouver Chatters Salon, Surrey Choices Interior Decorating Inc., Burnaby Clover Glass Ltd., Port Coquitlam Coast Solarium & Patio Inc., Langley ConsumersReward Solutions, Vancouver Co-Operation Garments Distributor Ltd., Richmond Core Education & Fine Arts, Langley Cornerstone Excavating Ltd., West Kelowna Dependable Doors Maintenance Ltd., Langley Dr. Defog-it, Burnaby Earls on Broadway, Vancouver Fiber Renew Fraser Valley, Chilliwack Hummingbird Medi Spa, Kelowna In Again Clothing (Fashion), Vancouver Jean-Paul Gravel Home Improvement & Custom Woodwork, Vancouver K&R Marine Ltd., Kelowna

KAL TIRE, Coquitlam Karma Optical, Vancouver Kascadian, West Vancouver Kennedy Kobbler Shoe Repair, Delta Kerrisdale Cleaners Ltd., Vancouver Kitchen Corner Super Store, Vancouver MSA Moving & Storage Ltd., Abbotsford Malibu Investments, Richmond McFarlane Accounting Solutions, Vanderhoof Metro Law Office, LLP, Burnaby Microtech Technologies Co., Vancouver Mister Dragon Furniture, Richmond Morrey Nissan of Burnaby, Burnaby Mountain Masonry Construction, Nelson Mountain Medical Supplies & Equipment, Kamloops New York Fries, Burnaby Ocean View Large Cottage, Gibsons Phoenix Roofing, Vernon Plentyoffish Media Inc., Vancouver Port Moody Locksmith Pro’s, Port Moody R and S Landscaping, Abbotsford RaeJen Contracting Ltd., Penticton Relocation Services Canada, Vancouver Sparkle Shine Reliable Cleaners, New

Westminster Star Rebates, Burnaby Sunquest Vacations, Vancouver The Canadian Society of Immigration Practitioners, Vancouver Trident Electric, New Westminster Vancouver Chair Covers, Vancouver Wish Canada Recruit Inc., Vancouver YearBook Alive, Richmond The following companies have responded to the BBB subsequent to being published: Chilliwack Motor Inn, Chilliwack Cloverdale Computers, Surrey Unique Marketing, Summerland Windsor Security Ltd., Surrey

Who’s Getting Sued These corporate writs were

filed with the B.C. Supreme Court registry in Vancouver. Information is derived from notices of civil claim. Civil claims have yet to be proven in court. Defendant: Victor Lansdown Address unavailable Plaintiff: International Partners for Life Corp.

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26 Law

Daily business news at www.biv.com September 20–26, 2011

Trouble

Lawsuit of the week

Saddle slip-up lands horseback company in court A North Vancouver fitness instructor has filed suit against a Langley horseback riding company after she fell off a horse. According to a July 21 B.C. Supreme Court notice of civil claim, Sandra Starrett has alleged that Langley’s Back in the Saddle Again Horse Guiding, Kenneth Darcy Campbell and Cynthia Doe are responsible for injuries Starrett received during a ride in 2009. The claim alleges that on Oct 12, 2009, Starrett was on a guided horseback ride when a fellow rider asked to dismount a horse to stretch. Starrett alleges she dismounted as well, and then asked for assistance from Doe to remount the animal. She further alleges she had one foot in the stirrup when the saddle slipped from Doe’s control, startling the horse, causing it to bolt and throw the plaintiff. Starrett claims she suffered neck, back, shoulder, arms and other injuries. She is seeking damages for pain, suffering and other injuries, as well as an in-trust award for family members and friends who have provided services as a result of the injuries, an award for dimunition in the ability to carry out household tasks, and a tax gross up and management fee. A notice of response had not been filed by press time.

and Kimberley Arnett 300–1122 Mainland St., Vancouver Claim: $303,980 for a shareholder loan; $36,673 for cremation, funeral, mail forwarding and utility expenses. Defendants: Whitestone Management Ltd. and Jia Guo 2236 E. 52nd Ave., Vancouver and address unavailable Plaintiff: Arman Shafazand carrying on business as Competitive Quality Contractors 3155 Silverthrone Dr., Coquitlam Claim: $137,405 for labour and construction materials; and a builders lien for $127,494. Defendants: AG Marketing Inc. and Andrew Lis Box 138, Qualicum Beach and 1859 Harness Rd., Qualicum Beach Plaintiff: Blake, Cassels &

Graydon LLP 2600–595 Burrard St., Vancouver Claim: $74,658 against AG Marketing, arising from a retainer agreement for legal services; a declaration the purported transfer of the AG Marketing Settlement amount was fraudulent and of no force and effect; a declaration that Lis holds the settlement amount in trust for AG Marketing; an order; and an injunction, or, damages, or, $10,000 against AG and Lis pursuant to the promissory note and guarantee. Defendants: Christopher James Smith and Edward Smith and CJS Ventures Inc. 13678 Malabar Ave., White Rock and 15007 Southmere Close, Surrey Plaintiffs: Gurdip Singh Dhaliwal and Onkar Singh Cheema

5680–145A St., Surrey and 8164 123 St., Surrey Claim: $69,000 for debt under a loan agreement. Defendants: Deltalok Inc. and Deltalok Green Inc. and Deltalok Eco-Systems Inc. and Deltalok Supply (B.C.) Ltd. and Deltalok Systems Inc. and Hun Su Kim 125 Charles St., North Vancouver Plaintiff: JP Gordon Consulting Ltd. 620–375 Water St., Vancouver Claim: $42,786 for debt for consulting services; payment for any outstanding invoices; and damages. Defendant: O.K. Tour Company Ltd. 208–15290 103A Ave., Surrey Plaintiff: Western Bus Lines Ltd. 700–686 W. Broadway, Vancouver

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Claim: $37,272 for debt for charters of commercial coaches. Defendants: Whitestone Management Ltd. and Xiao Yan Liang 2236 E. 53rd Ave., Vancouver and 2354 Nelson Ave., West Vancouver Plaintiff: Arman Shafazand carrying on business as Competitive Quality Contractors 3155 Silverthrone Dr., Coquitlam Claim: $36,237 for construction work; and a builders lien for $36,237. Defendant: Gouping Zhu aka Guo Ping Zhu 607–7555 Alderbridge Way, Richmond Plaintiff: Bellagio, LLC 1095 W. Pender St., Vancouver Claim: $35,224 for a Nevada judgment. Defendants: 767043 B.C. Ltd. and Christopher Paul Bragg and Denika Doiron 301–321 Wallace St., Nanaimo and 2320 Whitney Rd., Nanaimo Plaintiff: TorontoDominion Bank 2500–700 W. Georgia St., Vancouver Claim: $30,470 and $317 for debt related to a line of credit. Defendants: Vapoex Performance Packaging Ltd. and David Miskulin aka David R. Miskulin Box 21059, 1873 Spall Rd., Kelowna and 173–1865 Dilworth Dr., Kelowna Plaintiff: TorontoDominion Bank 2500–700 W. Georgia St., Vancouver Claim: $26,641 for debt related to a line of credit. Defendants: D&D Transportation Ltd. and Donald Dandenault aka Donald A. Dandenault and Donna Lynn Dandenault 201–101 1st St. E., Revelstoke, Box 2639 and 431 Reighmount Dr., Kamloops Plaintiff: TorontoDominion Bank 2500-700 W. Georgia St., Vancouver Claim: $21,210 for debt related to a line of credit. Defendants: Boundary Custom Homes Ltd. and Harvinder Singh Deol 200–8120 128th St., Surrey and 9777 160A St., Surrey and 3090 Wellington St., Port Coquitlam Plaintiff: Srpko Rakita dba Art Rock Construction 14068 Kindersley Dr., Surrey Claim: $20,560 for debt for a stonework improvement; and a builders lien for $20,650. Defendant: The Owners, Strata Corporation NWS3378 11580 Burnett St., Maple Ridge

Law 27

September 20–26, 2011 Business in Vancouver

Trouble Plaintiff: Pacific Peaks Roofing B.C. Ltd. 20572 96A Ave., Langley Claim: $18,385 for debt for a roof replacement and restoration work; and a builders lien for $18,385. Defendants: Timberview Developments Ltd. and Alan Darryl Vandermolen and Lucinda Kang Box 879, 710 Memorial Ave., Qualicum Beach and 3341 Panorama Ridge, Whistler and House 1, Emerald Ridge, 9 Cape Dr., Chung Hom Kok, Hong Kong Plaintiff: Modern Aluminum & Vinyl Products Ltd. 440–319 W. Pender St., Vancouver Claim: $15,860 for debt for the supply of aluminum windows and doors; and a builders lien for $15,860. Defendant: John Doe Address unavailable Plaintiffs: Kwantlen University College Student Association and Balninna Sandhu Room G1240, 12666 72 Ave., Surrey Claim: Injunctions arising from a defamatory website; and damages. Defendant: Ausenco Engineering Canada Ltd. 855 Homer St., Vancouver Plaintiff: Charles Birt 2445 Belloc St., North Vancouver Claim: Debt under an employment contract for Birt’s position as president of the company, following Birt’s position being declared redundant; and/ or damages. Defendants: Deltalok Inc. and Deltalok Green Inc. and Deltalok Eco-Systems Inc. and Deltalok Supply (B.C.) Ltd. and Deltalok Systems Inc. and Hun Su Kim 125 Charles St., North Vancouver Plaintiff: Environmental Management Systems LLC dba EMS Green 620–375 Water St., Vancouver Claim: Damages arising from breach of a contract for an engineering product. Defendants: Johnny Ho Cheung Wong and Kit Bing Lai and Kenneth Wayne Starr and Sandra May Cusak (nee Starr) and Peter Franz Bachmann and Carmel Philomena Bachmannj and Doris Wong and ABC Co. and Candice Searcy and David Boyes and Jennifer Searcy and Golden Leaf Electrical Services Ltd. 961 Broadview Dr., North Vancouver and 950 Broadview Dr., North Vancouver and 1005– 320 Royal Ave., New Westminster and 210–20 East St., North Vancouver and 1155 W. 50th Ave.,

daily online edition Vancouver and 805–2020 Bellwood Ave., Burnaby and address unavailable and 101–1610 Chesterfield Ave., North Vancouver and 35199 Skeena Ave., Abbotsford and 84–8400 Forest Grove Dr., Burnaby Plaintiff: Cora Rachelle Boyes, an infant, and Ellen Boyes, litigation guardian 600–1125 Howe St., Vancouver Claim: Damages for injuries suffered when the plaintiff came into contact with an electrical cord. Defendants: Westfair Properties Ltd. and Loblaws Inc. and Valley Properties Ltd. and The Real Canadian Superstore and John Doe and Jane Doe and ABC Ltd. 19851 Willowbrook Dr., Langley Plaintiff: Kari Lorraine Dayton 3–112 Tache ave. N.W., Calgary Claim: Damages for injuries suffered when the plaintiff, while walking through a department store at or near a produce department, was injured by a piece of metal protruding from a produce bin. Defendants: Global Mobility Laboratory Pte. Ltd. and Healthcare Messaging Systems Pte. Ltd. and Peter So Ka Lun and Patricia So Mei Chan 128 Bishan ST. 12, 15-231, Singapore and 205A Thomson Rd., Goldhill Shopping Centre, Singapore and 6122 Beatrice St., Vancouver Plaintiff: Healthmetrx, Inc. 307–2083 Alma St., Vancouver

Claim: A declaration the transfer of the business and assets of HMS to Global, which occurred during arbitration between HMS and the plaintiff, was a fraudulent conveyance and is void and of no effect as against the plaintiff; and an order. Defendants: WestJet Airlines Ltd. and ABC Corp. #1–2 and John Doe 2200–1055 W. Hastings St., Vancouver and addresses unavailable Plaintiff: Deborah Butkowski 780 E. 38th Ave., Vancouver Claim: Damages for injuries the plaintiff sustained when during a flight the passenger in the seat in front moved their seat back, causing hot water to spill onto the plaintiff. Defendant: Cascade Resources Ltd. 2080–770 Hornby St., Vancouver Plaintiffs: Eldore Mining Corp. and Sagacity Holdings (New Zealand) Ltd. and Mining Consultants Ltd. and Timothy Collver and Nalesbitan Mining Corporation Pty Ltd. 5th floor, Maripola Bldg., 109 Perea St., Legaspi Village, Makati City, Philippines and 78 Titirangi Rd. New Lynn, Auckland and 1st floor, Lolam House, Lini Hwy., Box 1019, Port Vila, Vanuatu and 202-8 Thomas St., Chatswood, New South Wales, Australia Claim: Specific performance of the May Agreements, arising from breach of contract, or, damages.

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Defendants: City of Vancouver and Coast Mountain Bus Co. Ltd. and South Coast British Columbia Transportation Authority (TransLink) 453 W. 12th Ave., Vancouver and 4th floor, 13401 108th Ave., Surrey and 1600–4720 Kingsway, Burnaby Plaintiff: Catherine Fisk 304–1450 Chestnut St., Vancouver Claim: Damages arising from injuries suffered when the plaintiff stepped off the back door of a bus and fell in a hole on City property. Defendant: Crissy Field Media Inc. Address unavailable Plaintiff: Borislav Trifonov 819 W. 70 Ave., Vancouver Claim: Compensation for the difference between a contractual obligation related to a vice-president position and the amount that was actually paid; compensation for overtime; and correction of the 2009 and 2010 tax forms. Defendant: Wal-Mart Canada Corp. Box 49314, 595 Burrard St., Vancouver Plaintiff: Snjezana Arevski 402-4211 Kingsway,

Burnaby Claim: Damages for injuries sustained after the plaintiff slipped on a liquid foundation spilled on the floor. Defendants: John Doe #1 and John Doe #2 and John Doe #3 and John Doe #4 and John Doe #5 Address unavailable Plaintiff: Allen Batchelar and British Columbia Corps of Commissionaires 14th floor, 550 Burrard St., Vancouver Claim: An injunction restraining the defendants from writing or publishing any further defamation; damages for defamation; orders; and an injunction. Defendant: 0790643 B.C. Ltd. 100A–3020 Lincoln Ave., Coquitlam Plaintiffs: Frank Xavier Burgstaller and Adolphine Burgstaller and Western Technical Supply Co. Ltd. 843 W. 15th Ave., North Vancouver Claim: Injunctions to halt the construction work that damaged the plaintiff’s property; and damages. •

BUSINESS TODAY Silvercorp faces more fraud allegations Silvercorp Metals’ (TSX:SVM) share value edged upward Wednesday after it responded to a second set of fraud allegations. The accusations, published by Alfredlittle.com, allege that the Vancouverbased mining company has misreported production and resource estimates at its mines in China and that its sales came from “two questionable” customers, among other things. Silvercorp has responded by publishing a 23-page report on its website countering all of the allegations. Silvercorp said the RCMP, BC Securities Commission and FBI were attempting to determine the identity of the anonymous authors of the report. Thursday, September 15

Full stories and other local business news at www.biv.com/businesstoday Daily business news direct to your inbox! Sign up at www.biv.com/newsletters

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For the record

Daily business news at www.biv.com September 20–26, 2011

People on the Move Email your For the Record

information to: fortherecord@biv.com. Please include a high-resolution, colour headshot where possible.

•Accounting

Jim Lawler and John Bunting have been named associate partner and leader of private company services in B.C., respectively, at PwC. Lawler was previously an independent consultant and Bunting is a partner in the audit and assurance group of PwC.

•

Associations/ Societies

Karina Briño has joined the Mining Association of B.C. as president and CEO. She was previously assistant deputy minister, mines and mineral resources division, for the BC Ministry of Energy and Mines. Robert Rothon has been appointed national executive director of Canadian Parents for French (CPF). He was previously executive director of CPF, B.C. and Yukon branch and will be replaced by Glyn Lewis as interim executive director.

•Communications/PR

Amanda Bates has been appointed managing partner at Curve Communications. She was previously the senior producer for Citytv’s

Karina Briño is president and CEO of the Mining Association of B.C.

Jim Lawler and John Bunting are associate partner and leader of private company services in B.C., respectively, at PwC

Benjamin Kang is vice-president of business development and senior interior designer at Ashley-Pryce Interior Designers

David Reid is head of Davis’ global mining group

Breakfast Television.

Kelly Backs, Lincoln Heller, Jen Pleadwell and Laura Vanderlinde have been appointed members of Circle Craft Cooperative. Backs is a blacksmith at Tree Studios, Heller is a leather artist at fiveleft, Pleadwell is a textile artist and Vanderlinde is a clay artist.

of fundraising and marketing at the VGH & UBC Hospital Foundation and vice-president, donor and community relations for United Way of the Lower Mainland.

projects, at Sherritt International Corp.

•Design

Benjamin Kang has been promoted to vice-president of business development and senior interior designer at Ashley-Pryce Interior Designers Inc. He was previously senior interior designer with the company.

•General

Jonathan Bennett has been appointed director, marketing and communications, for MRSI Benchmarking. He was previously director, corporate planning, and chief communications officer at Peterborough Regional Health Centre and creative writing instructor at Humber College, Trent University, Ryerson University and George Brown College.

Judy Darcy has stepped down as chief negotiator and spokesperson of the Hospital Employees’ Union after receiving the NDP nomination in New Westminster where she will be a candidate for election in 2013. She was previously national president of the Canadian Union of Public Employees.

•

Hospitality/ Tourism/Convention

Hamid Salimian has been appointed executive chef

at the Metropolitan Hotel Vancouver. He was previously opening executive chef at the Westin Wall Centre, Richmond and executive sous chef at the Westin Bear Mountain Victoria. Corey Bauldry has joined the Diva at the Met as restaurant manager and sommelier. He was previously at DB Bistro Moderne.

•Legal

D av i d R e i d h a s b e e n appointed head of Davis LLP’s global mining group. He is a senior partner at Davis and was previously founder and principal at Reid & Co.

•Non-Profit

Natalie Meixner has been appointed president and CEO of Richmond Hospital Foundation. She was previously senior vice-president

•Resources

Andrew Boetius has been appointed director, finance and administration at Petra Petroleum Inc. He was previously CFO of Index Oil and Gas and finance director at Amerada Hess Corp. Ron Halas has resigned as COO of Spanish Mountain Gold Ltd. Guy Bentinck has been appointed president and CEO of New Earth Potash Corp. He was previously vice-president and CFO, and senior vice-president, capital

Richard Huff has retired as president and CEO of Ainsworth Lumber Co. Jim Lake has been appointed president and COO. Lake was previously vice-president, operations, at Ainsworth and Grant Forest Products and vice-president, manufacturing, at Louisiana Pacific Corp. Henning Holmström has been appointed project development manager at Tasman Metals Ltd. He was previously client sector leader of mining in Scandinavia at Golder Associates and geochemist and project manager at the Geological Survey of Sweden. Jeff Pontius has joined the

Metro Vancouver BMW Retailers

vancouver retailers.bmw.ca

The Ultimate Driving Experience.®

2011 BMW 335i shown.

IncREDIBly, WE’VE MaDE ThE BMW 328i EVEn MoRE ExcITIng. ThE BMW 328i xDRIVE foR $328.

The BMW 328i xDrive Sedan continues to define the segment with athletic lines, xDrive® All-Wheel Drive, and a 230hp, six-cylinder engine. And for a very limited time, it’s available for just $328 a month. The BMW 328i offers grace, power, efficiency – and unparalleled value. so hurry to your nearest BMW Retailer, because the offer expires october 2.

Brian Jessel BMW 2311 Boundary Road, Vancouver (604) 222-7788 www.brianjesselbmw.com

LEASE PAYMENt

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lIMITED-TIME offER EnDs ocToBER 2. The BMW store 5th & Burrard, Vancouver (604) 736-7381 www.thebmwstore.ca

The 2011 BMW 328i xDrive all-Wheel Drive LEASE rAtE

* % 1.9 39 months

no-chaRgE aUToMaTIc TRansMIssIon

no-chaRgE schEDUlED MaInTEnancE 4 Year / 80,000 km

†

Park shore Motors Northshore Auto Mall, North Vancouver (604) 985-9344 www.parkshorebmw.com

auto West BMW 10780 Cambie Road, Richmond (604) 273-2217 www.autowestbmw.com

BMW langley 6025 Collection Drive, Langley (604) 533-0269 www.bmwlangley.com

European model shown. Features and equipment may vary in Canada. MSRP of a 2011 BMW 328i xDrive All-Wheel Drive starts at $41,550. Lease rates are those offered by BMW Financial Services Canada only on approved credit (OAC). *Lease rate of 1.9% available for up to 39 months. Lease example based on $328 a month for 39 months. Down payment or equivalent trade of $6,300. Freight and PDI of up to $1,995, licence, insurance, registration, taxes, EHF tire, filter, and battery fees and similar taxes levied on the manufacturer (if charged by the Retailer), and PPSA are extra. Total obligation is $22,288. The residual value of the vehicle at end of term is $19,944. Annual kilometres limited to 16,000; $0.15 per excess kilometre. Excess wear-and-tear charges may apply. Additional province-specific fees, taxes, and charges may be extra. Retailers are free to set individual prices and charge administration fees, which may change the APR or the price of the vehicle. Offer expires October 2, 2011. Delivery must be taken by October 2, 2011. Offer requires Retailer participation. Offer is subject to availability and may be cancelled or changed without notice. Certain conditions apply. See your local BMW Retailer or bmw.ca for full details. †Certain limitations apply; see Retailer for details. ©2011 BMW Canada Inc. “BMW”, the BMW logo, BMW model designations and all other BMW related marks, images and symbols are the exclusive properties and/or trademarks of BMW AG, used under licence.

for the record 29

September 20–26, 2011 Business in Vancouver

agency’s Study Buddy Program, which matches Little Sisters with volunteer tutors who offer them academic guidance and support. This funding will allow the agency to make five new Study Buddy matches in Burnaby and on the North Shore.

Natalie Meixner is president Terry Dinsmore, president, Dinsmore Media, launches new and CEO of Richmond Hospital Foundation sales division

I.D.C . Insura nce Direct Canada donated $5,000 to the Canadian Diabetes Association. Image Group Inc. has been recognized by the Advertising Specialty Institute’s Counselor magazine as one of the Best Places to Work in North America. •

FINd your energy FINd your STrengTH

board of Redstar Gold Corp. He was previously president and CEO of International Tower Hill Mines, U.S. and North American exploration manager for AngloGold Ashanti, and director of Anglo American (USA) Exploration Inc. Michael Winship has been appointed a director of Rubicon Minerals Corp. He is COO for Quadra FNX Mining Ltd. Eugene Chen has been appointed to the board of Firesteel Resources Inc. He is a partner in the securities, corporate finance, and mergers and acquisitions group with Gowling LaFleur Henderson LLP. Rolland Menard has resigned as a director and has been appointed a technical consultant to Firesteel. Rebecca Greco has been appointed manager, investor relations, for PMI Gold Corp. She is an investorrelations consultant and principal of Fig House Communications. Harry Barr has stepped down as president of Pacific North West Capital Corp. and William Stone has been appointed president and COO. Barr remains as CEO and has been appointed chair of the board. Stone was previously vice-president of exploration, Canada, for Magma Metals Ltd., and vice-president of exploration for North American Palladium Ltd. Richard Zimmer has been appointed to the board of Magellan Minerals Ltd. He was previously president and CEO of Far West Mining Ltd.

•Sales/Marketing

Ke v i n C ha n h a s b e en appointed vice-president, technology, at B’stro. He was previously head developer at B’stro and co-founder of Fix8 Creative.

•Technology

Neil Chan has been appointed CEO of iGen Networks Corp. He is chair and CEO of Gogiro Internet Group and was previously senior vicepresident worldwide sales and marketing at WebTech Wireless Inc. and managing director of Motorla Inc.

•Telecommunications

Karen Mongelli and David

Greer have been appointed vice-president of government sales and account management and vice-president of marketing, respectively, at Webtech Wireless Inc. Mongelli was previously director of operations and manager, operations, at Automotive Resources International. Greer is an adviser at VanRx Pharmaceuticals Inc. and president at DJ Greer Business Solutions and was previously president, CTO and owner of Robelle Solutions Technology. Caroline Dunn has been appointed CFO of DDS Wireless International Inc. She was previously CFO at the Courtyard Group and Sierra Systems Group Inc.

Russ Smart, CEO and founder, I.D.C. Insurance Direct Canada and Connie Abram, executive director for Western Canada, Canadian Diabetes Association

■ New & expanded locker rooms ■ Exclusive indoor cycling studio ■ Extensive cardio & weight room ■ Co-ed adult facility

Sheldon Trainor and wife Emelda Wong

comes submissions from local small businesses and large corporations alike that demonstrate examples of corporate philanthropy and community involvement in the Vancouver area. High-resolution images are also welcome. Sheldon Trainor and his

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COMPeTITIVe

■ 25 metre ozonated pool, lane swimming available all day

Companies on the Move Dinsmore Media ha s launched a sales division with Flavours Magazine, published by Business in Vancouver Media Group, Scan 2 Mobile and Brand Driven Media, being the first publication to join the roster.

FINd your

ywcahealthandfitness.com

With 180 girls waiting to be matched with a mentor, there are

180 REASONS TO ATTEND… George Pitman, board member, Variety; Barbie Hislop, executive director, Variety; and Steve Thompson, merchandising and marketing manager, Pharmasave Drugs

wife Emelda Wong donated $500,000 to Capilano University to establish the Sheldon Trainor and Emelda Wong Centre for International Experience at the school.

Charity.

The Pharmasave Charity Golf Classic raised $45,000 for Variety – The Children’s

Vancity donated $10,000 to Big Sisters of BC Lower Mainland in support of the

TD Bank Group donated $15,000 to Junior Achievement of BC in support of its business education programs.

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Guarantee the publication of your listing for $50 per issue (plus hst). 604-608-5189 or datebook@biv.com www.bivdatebook.com Deadline for Datebook listings is noon Tuesday for the following weekâ&#x20AC;&#x2122;s paper. Listings are published on a guaranteed basis for $50 per week, plus hst. Free listings will run in print as space permits. Go to www.bivdatebook. ca to post your listing. Published Datebook listings are at the discretion of BIV.

Breakfast, Luncheon, Dinner Meetings Business in Vancouverâ&#x20AC;&#x2122;s BLUE Breakfast Panel: Investment in Marketing September 21, 2011, 7:00 AM: The upcoming BLUE breakfast panel will be discussing what companies are doing with their marketing budgets in this era of rapidly changing marketing solutions. Subscriber $49, Non-subscriber $59. SFU Segal School of Business, 500 Granville Street (at Pender). Vancouver. Azadeh Hollmann: 604-608-5197 or ahollmann@biv.com. http://www.biv. com/colour/index.asp. The City in 2050 Part 9: A Provincial Perspective Working Together to 2050! September 22, 2011, 12:00 PM: The ninth instalment of The City in 2050 series will feature Mike Harcourt in dialogue with Gordon Price and will focus on how to bring federal, provincial, and municipal parties together on the delivery of key regional land use issue. $75 Nonmembers; $60 Members; $45 Young Leaders. 837 Hastings Street West. Vancouver. leanne.buck@uli.org, 604-761-8060. https://netforum.uli. org/eweb/DynamicPage.aspx?site =ULIMC&webcode=DCouncilEvent Info&Reg_evt_key=1ecdd7f8-e9044bc9-beaa-. How to Close Larger Deals More Quickly September 22, 2011, 5:00 PM: Learn specific actionable things you can do to increase the dollar size of your deals, and how you can close large deals more quickly! The presenter for this session is Rob Malec who has 23 years in sales and business development

experience. SMEI Members $55/ Non-members $75. Terminal City Club, 837 West Hastings. Vancouver. 604-266-0090 or vancouver@smei. org. smeivancouver.org. Business Women Dinner Meeting and Speaker September 29, 2011, 6:00 PM: Burnaby Business Women invite women to a monthly social dinner meeting and speaker. Join us for a relaxing and interesting evening. Non-members welcome. Door prizes donated by attendees. Reservations required. $24.00 non-members, $21.00 members. ABC Country Restaurant, 6500 East Hastings. Burnaby. Sharon: 604-434-7221 or sharon@donndean.com. http:// upcoming.yahoo.com/venue/93820/ BC/Burnaby/Burnaby-BusinessWomen-One-to-One/. One Night by Lora Frost - Success Party October 19, 2011, 7:00 PM: A unique opportunity for entrepreneurs to embrace their power. Guests attending the One Night party will arrive as the person they want to be in five years. They will act as though they have already achieved their goals. $ 150. Shangri-La Terrasse. Vancouver. Marion Houchard, mhouchard@ karranfinlaymarketing.com. www. onenightbylorafrost.com. Boughton/BCLI Great Debate October 26, 2011, 5:00 PM: The GREATdebate offers a fun, engaging evening of dinner and light-hearted debate. This yearâ&#x20AC;&#x2122;s debate resolution: â&#x20AC;&#x153;Resolved that the torts of champerty and maintenance should be abolished in British Columbia.â&#x20AC;? $145 per person/$1,100 per table of 8. Pan Pacific Waterfront, 300-999 Canada Place. Vancouver. Elizabeth Pinsent: 604-822-0142, epinsent@bcli.org. http://www.bcli.org/news/events/ great-debate-2011.

Conferences, Conventions, Tradeshows 7th Annual Connections to Employment Job Fair September 21, 2011, 10:00 AM: Exhibitors include WorkSafeBC,

Sears, Staples, Canada Safeway, Home Depot, London Drugs, Dairy Queen/Orange Julius, Coast Plaza Hotel, Edgewater Casino, T & T Supermarket, Natural Factors, UPS Canada, Spectra Energy, JW Research, andTD Canada Trust. Admission is free. Vancouver Public Library, Library Square, 350 West Georgia Street. Vancouver. Carol Cordeiro, Marketing Specialist, PICS Vancouver: 604-324-7733, carol.cordeiro@pics.bc.ca. www. pics.bc.ca. iTech Infrastructure Technology Summit September 22, 2011, 8:30 AM: Featuring a comprehensive conference program, large exhibitor area and live product demonstrations, iTech Summit offers the educational content IT professionals need to maximize their business operations. Passes valued at $295 are free for qualified IT. Vancouver Convention Centre, 1055 Canada Place. Vancouver. Jennifer Wittkopp, 905-948-0470. www.itechsummit.ca. 15th Annual SOHO|SME Expo September 30, 2011, 8:30 AM: The SOHO|SME brings together likeminded business entrepreneurs, exe cu tive s , ma na g er s a n d professionals to inspire, drive and motivate business success. Small business is defined as a business with less than 50 employees. Register online for your free tradeshow & conference pass. 655 Burrard. Vancouver. cassandra@ soho.ca. http://www.soho.ca/ sme/2011/vancouver/. Internet Marketing Conference - IMC Vancouver October 3, 2011, 7:30 AM: Expand your knowledge, improve your skills and become a better manager of digital media, marketing & communications. Connect with an international community of digital marketers. $1,195. Renaissance Vancouver Hotel, 1133 West Hastings St. Vancouver. Registration Support: regvancouver@risingmedia. com, 1-877-883-7345. http://www. internetmarketingconference.com/ vancouver/event-home.

industry event on best HR practices to grow your business (revenue, talent, leaders). Featuring keynote Don Bell, Co-founder of Westjet Airlines. $275 before Sept 30th; $350 after. Sutton Place Hotel, 845 Burrard St. Vancouver. Allison Rutherford, HR Tech Group: 604-8742653; arutherford@hrtechgroup. com. www.hrtechgroup.com. Business After Business Tradeshow October 26, 2011, 5:00 PM: The Vancouver Board of Tradeâ&#x20AC;&#x2122;s signature Tradeshow. $20 members and guests/$30 future members (+HST ). The Fairmont Hotel Vancouver - Pacific Ballroom, 900 West Georgia Street. Vancouver. reservations@boardoftrade.com. www.boardoftrade.com.

Courses, Workshops, Seminars Selling Your Business Featuring Don Sihota, Business Lawyer, Clark Wilson LLP September 22, 2011, 8:30 AM: If youâ&#x20AC;&#x2122;re a business owner over 50, a business succession plan is essential. Buyers are now looking for great businesses - donâ&#x20AC;&#x2122;t be left behind! Learn how to get the best price, negotiate the best terms and avoid critical errors when you sell your business. $265. 800 - 885 West Georgia Street. Vancouver. Contact Jessica Mitchell at 604-687-5700, ext 4229 or jcm@cwilson.com. http://www.cwilson.com/DonSihota/ SellingYourBusiness/.

HR Tech Group: Human Capital Symposium October 26, 2011, 8:00 AM: Tech

Breakthrough Leadership Training September 27, 2011, 9:00 AM: To be a leader requires a strong inner sense of self, a deep desire to share your passion, and the confidence and skills to get your message across. It all comes down to 3 things: who you are, what you stand for and your ability to build trust. $1597.00 (+HST). Lake City Business Centre, 3292 Production Way, Suite #501, Burnaby. 604-5423008/info@therobinsongroup.ca. http://therobinsongroup.ca/wp/ breakthrough-leadership/.

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Datebook 31

September 20–26, 2011 Business in Vancouver

Toastmasters Area 75 Speech Contest September 27, 2011, 7:00 PM: Humorous Speech Contest & Table Topics Impromptu Speech Contest. Area 75 is composed of several Toastmasters clubs: Politically Speaking Advanced, Positive Thinkers , Royal-T, Vancore, Lab:orator y. Ring buzzer for Security. Gather at 6:30 pm. No charge. BC Hydro Building, 2nd Floor. Vancouver. Kevin Pendergraft, kpend@shaw. ca. http://www.d21toastmasters. ca/events/all-events/icalrepeat. detail/2011/09/27/319/-/area-75speech-contest. Applications in Sustainable Community Development September 30, 2011, 9:00 AM: Through field trips and presentations by sustainability project champions, you will explore the application of sustainability principles in a variety of programs, projects and business ventures. $600. 515 W. Hastings St. Vancouver. Joshua Randall, 778782-5254. http://www.sfu.ca/city/ course2popup.htm. Bullet Proof Your Portfolio and Sleep at Night October 5, 2011, 6:45 PM: Jennifer Fabre Investment Advisor DWM Securities Inc presents a Bullet Proof Portfolio for experienced investors. This seminar is ideal for those seeking: preservation of capital, lower volatility, regular income and performance in difficult markets. Complimentary seminars. 700 - 609 Granville St. Vancouver. mevans@dundeewealth.com or 604-895-3478. www.jenniferfabre. com. Leadership Assessment Essentials for Selection and Development October 12, 2011, 8:30 AM: High quality assessment is essential to HR’s ability to provide real business value - they improve the accuracy of decisions regarding selection, development and succession. Prices vary - please see our website for details. BC HRMA, 1101-1111 West Hastings Street. Vancouver. Jace Ardiel, Professional Development Coordinator, jardiel@ bchrma.org. http://www.bchrma. org/content/events/ls/details. cfm?EventID=035-303. BCIC Commercialization & Business Planning Workshop October 21, 2011, 9:00 AM: An

intensive workshop that compels the entrepreneur to think critically and develop the successful elements for the commercialization and positioning of their business idea. It covers business planning and product management. Oct 21, 28 & Nov 4. $269 (a $4,000 value). 1188 West Georgia Street, 9th Floor. Vancouver. lthom@bcic.ca. http:// www.bcic.ca/programs/talent/ entrepreneurship-workshop. CAPS Vancouver: Todd Hunt - Creating a Killer Keynote October 29, 2011, 8:30 AM: Learn the secrets to creating a great keynote address. For both emerging and experienced speakers. Plus, “Rising Stars” contest for new speakers. Members & 1st time guests $57 ($62 at the door); Guests $87. Morris J. Wosk Center for Dialogue (SFU), 580 West Hastings St. Vancouver. Ron Grender, CAPS President: 778-688-7065. www. capsvancouver.com.

Fundraisers, General Events Women Against MS Gala Breakfast October 13, 2011, 7:00 AM: There is no known cure for multiple sclerosis which affects women three times more often than men. Funds raised support MS research. Special guest speaker Cassie Campbell-Pascall. 125 per ticket; 1,000 table for eight. Terminal City Club, 837 West Hastings Street. Vancouver. Kristina Keith: 604-602-3220, Kristina.Keith@ mssociety.ca. www.mssociety.ca/bc/ wams.htm.

Gala Events Fastest Growing Awards Ceremony September 27, 2011, 5:30 PM: A gala awards dinner honouring the Top 100 Fastest Growing Companies in B.C. This event coincides with the publishing of the Top 100 Fastest Growing Companies list. Subscriber $125, Non-subscriber $149. The Fairmont Waterfront Hotel, 900 Canada Place Way. Vancouver. Azadeh Hollmann: 604-608-5197 or ahollmann@biv.com. http://www.biv. com/events/top100fastestgrowing/ index.asp. PWN 15th Anniversary Celebration September 29, 2011, 5:00 PM:

Come celebrate PWN’s 15 years of growth and expansion, applaud the successes of our members, and pay special tribute to those gems in our business community who have contributed significantly to the advancement of women in business. $75.00. Fairmont Waterfront Hotel. Vancouver. Please make cheques payable to Hayley Renfrew c/o Fasken Martineau, 2900-550 Burrard St. Vancouver, BC, V6C 0A3.

BCIT Distinguished Alumni Awards October 27, 2011, 5:45 PM: The 9th annual BCIT Distinguished Alumni Awards celebrates and honours BCIT alumni and faculty who have notable achievements in their careers and community endeavours. Tickets $125; Table of 10 $1,200. Four Seasons Hotel - 791 W. Georgia St. Vancouver. Phone: 604-432-8847, email: alumni@bcit. ca. bcit.ca/alumni.

Big Sisters Gala October 6, 2011, 5:30 PM: Join Big Sisters for an inspiring evening as we raise funds to help match 180 girls on the waitlist with a supportive mentor. Event will feature a champagne reception, auctions, dinner and live entertainment by Paramount. $250. Pan Pacific Hotel (300 - 999 Canada Place). Vancouver. Kelly: 604-873-4525 x302 or kmorrison@bigsisters. bc.ca. www.bigsisters.bc.ca.

2011 T. Patrick Boyle Founder’s Award November 17, 2011, 5:30 PM: The Fraser Institute will be honouring Darren Entwistle, CEO & President of Telus, with the T. Patrick Boyle Founder’s Award at a gala reception. Sponsorship, single tickets, and premium/ standard tables available. Tickets $500/$700; Table $5000/$7000. Vancouver Convention Centre East, 1055 Canada Place. Vancouver. 604-688-0221 ext 537 or paige. mackenzie@fraserinstitute.org. http://www.fraserinstitute.org/ events-multimedia/eventdisplay. aspx?id=17774.

BCAMA’s 2011 Marketer of the Year Awards October 13, 2011, 5:00 PM: Join us at our gala event to hear an inspiring story about how Pacific National Exhibition, the 2011 BCAMA Marketer of the Year, has positioned itself as a premier entertainment fair destination with its outstanding integrated marketing campaign. $170 non member; $130 member; $1600 corporate table. The Westin Bayshore, 1601 Bayshore Drive. Vancouver, BC. Call 604-983-6AMA (6262), email info@bcama.com or visit www.bcama.com to register online. Ridge Meadows Hospital Foundation Gala Evening October 15, 2011, 5:30 PM: Proudly presented by Fraser River Pile and Dredge, this is a dazzling fundraising evening of fine dining, shopping and fun with proceeds used to purchase life saving equipment for Ridge Meadows Hospital. $175. Meadow Gardens Golf Course. Pitt Meadows. Laura Butler: 604-466-6958, laura. butler@fraserhealth.ca. www. rmhfoundation.com. Torch Awards 2011 October 26, 2011, 11:30 AM: Torch Awards is a gala awards luncheon recognizing ethical and sustainable businesses from across British Columbia. The Metropolitan Hotel, 645 Howe Street. Vancouver. susanh@mbc.bbb.org. www.mbc. bbb.org/torch.

Golf Tournaments The B2Gold Big Brothers Golf Classic September 26, 2011, 10:30 AM: Join us at BC’s premier charity tournament for a day of golf at the home of the 2011 RBC Canadian Open, followed by a lavish cocktail reception, silent auction, banquet

dinner and live auction, benefiting Big Brothers of Greater Vancouver. $575. Shaughnessy Golf and Country Club, 4300 SW Marine Drive. Vancouver. golf@bbgvf. com or 604-876-2447 x244. www. bigbrothersvancouver.com. Mortgage Investment Association of BC (MIABC) Annual Charity Golf Tournament September 27, 2011, 11:45 AM: Net proceeds will be donated to the Greater Vancouver Food Bank Society’s Kid’s Picks Program. Please visit our website for details. Morgan Creek Golf Course, 3500 Morgan Creek Way. Surrey, BC. contactus@ miabc.com. www.miabc.com.

Networking functions Wired Woman Society 15th Year Anniversary Celebration September 22, 2011, 6:00 PM: The Wired Woman Society is proud to be celebrating its 15th Anniversary this year. Come join us for a night of networking, hors d’oeurves, wine tasting, door prizes and good company. $25 for members and $30 for non-members. Jewel Ballroom, 4th Floor, 1495 West 8th. Vancouver. Maureen: 604-908-5058 or mlmckinnon@telus.net. www. wiredwoman.com. Vancouver AM’s 35th Birthday Celebration September 23, 2011, 5:00 PM: Celebrate Vancouver AM’s 35th Birthday! You are invited

to Va n c o u v e r A M To u r i s m Association’s Reunion of the Decade. Entertainment by Dal Richards’ Trio $50 (+ HST). Cash bar. Terminal City Club, 837 West Hastings Street. Vancouver. 604738-5506; office@vancouveram. ca. www.vancouveram.ca. C3: Coffee, Conversations & Connections October 11, 2011, 9:00 AM: These “Casual Conversations” are designed to connect you with smart, savvy women and start your day off right! Tell us your thoughts, share your knowledge and learn from other women’s experiences over a freshly brewed cup of coffee (or tea!) Guests $12.50; Members $10 (+HST). Cheers Restaurant, 125 East 2nd Street. North Vancouver, BC. Cathy, theconnectedwoman.com. www.theconnectedwoman.com. Women in Biz Network Presents: Branding your Biz with Rebecca Bollwitt & Heather White November 1, 2011, 6:30 PM: Women in Biz Network presents its first Vancouver event. Become brand savvy with Miss 604’s Rebecca Bollwitt and Heather White of 2020 Communications $24. Opus Hotel, 22 Davie St. Vancouver. kerry@ womeninbiznetwork.com. http:// womeninbiznetwork.com/2011/09/11/ our-first-vancouver-event-brandingyour-biz-with-rebecca-bollwittheather-white/.

Comment

Daily business news at www.biv.com September 20–26, 2011

letters

Board of trade raises Surrey education funding concerns The Surrey Board of Trade’s “Education Today, Productivity Tomorrow” campaign, including the City of Surrey, School District 36, Kwantlen and Simon Fraser, is concerned that inadequate education funding for Surrey may result in negative and long-term economic and social impacts on this region. Due to the dramatic population increases, which continue, there are enormous pressures on school and post-secondary institutions. Kindergarten to Grade 12 needs $273 million for school construction to house the 7,000 students currently in portables (which could rise by as many as 5,000 in five years), and Simon Fraser and Kwantlen have half the post-secondary seats, per capita, in Surrey and the south Fraser, compared with the rest of the province. Kwantlen is funded at the lowest rate per student of any university in the province. We agree money is hard to find, but the future consequences of not responding to these education funding shortfalls will impact our economic wellbeing, and force our youth and mature students to go elsewhere to learn, or worse still, not go on at all. We cannot afford that either. Please speak to your MLA. Anita Huberman, CEO, Surrey Board of Trade

At Large

Dump Metro Vancouver garbage incineration plan

Peter Ladner

Plans to incinerate Metro Vancouver’s garbage are not going over well in Fraser Valley communities like Abbotsford and Chilliwack. This is not surprising considering the fact that pollutants released into the Lower Mainland’s air always end up hovering over the Fraser Valley, where they become concentrated. People in the Fraser Valley fought hard to stop the Sumas 2 project a few years ago. They were equally relieved when it was announced that Burrard Thermal was being permanently shut down (once the biggest single source of greenhouse gas pollution in the whole province). So why would they be happy to hear about plans to incinerate Metro Vancouver’s garbage? To be fair to supporters of the garbage incineration plan, electricity would be generated through the incineration process. But B.C. has more than enough renewable green energy resources that we’ve barely even begun to tap into. Supporters of the incinerator plan might also point to jobs being created. But many more jobs would be created by tapping into B.C.’s renewable energy resources. Therefore, jobs and electricity from any garbage incineration plan would essentially cancel out, which leaves us with air pollution as the only distinguishing feature of the incinerator plan. And if that’s the case, then perhaps a better plan than incinerating Metro Vancouver’s garbage downwind of Fraser Valley residents still needs to be found. Mike Taylor, Port Moody

Minister says Site C makes good green sense Re: “Adding up summer 2011 math problems” (Timothy Renshaw’s Public Offerings column – issue 1140; August 30-September 5). A recent column in BIV did not accurately portray the government review panel’s comments about the Site C clean energy project (Site C). In fact, the government-commissioned review of BC Hydro stated the following about Site C: There is justification for the Site C dam and hydroelectric generating station based on the projected demand and it appears to be a clean, affordable option. Site C is seen as cost effective, as the cost of energy, at $87 to $95 per mWh, compares favourably with other benchmarks for clean energy. Site C is a reasonable cost alternative to meet load growth. The new energy supply would be unaffected by market fluctuations that impact the cost of natural gas and carbon-generated power, so Site C unit costs should not result in spikes in price. Rich Coleman, Minister of Energy and Mines

What’s your opinion? BIV welcomes readers’ opinions. All letters, including those sent by e-mail, must include the author’s name, address and daytime telephone number. Business in Vancouver, 102 East 4th Avenue, Vancouver, B.C. V5T 1G2. Fax: 604-688‑1963. E-mail: news@biv.com. We reserve the right to edit for brevity, clarity and legality.

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Economic toll from income inequality keeps adding up

s the real message of the HST vote that people wanted to stop the flow of wealth from the bottom to the top, from business to consumers? There was obviously a mix of motivations to vote against it, but that reason would explain why the vote split so clearly along income lines. Economist Iglika Ivanova from the Centre for Policy Alternatives discovered that in Vancouver, the poorer the electoral district, the higher the voters’ opposition, while the richer electoral districts were the strongest supporters. This is just the latest example of how business interests are being hurt by the growing split between rich and poor in Vancouver, B.C. and Canada. British researchers Richard Wilkinson and Kate Pickett (Equalitytrust.org) make an irresistible argument that the vast majority of people in any developed country would be better off not by raising GDP, but by reducing the gap between the top and bottom income earners, even with the same level of overall GDP. “Greater equality improves health and life expectancy and dramatically reduces the frequency of a wide range of social problems, including violence, incarceration, illiteracy, mental illness, drug addiction and obesity,” they write. Ironically, social mobility, the measure most often celebrated as an available path to prosperity in countries with less equality, is lowest in

unequal countries, and highest in the more equal countries. It is far easier to get ahead in Norway than it is in the U.S. “Many people worry about what has gone wrong with modern societies without recognizing how

Changes in relative income have a much larger impact on happiness than changes in absolute income many of the problems originate in the effects of low social status and status competition which are exacerbated by greater inequality,” says Wilkinson. Aside from the obvious moral issues that tend to divide people on this topic, Wilkinson points out that “high inequality can diminish economic growth if it means that the country is not fully using the skills and capabilities of all its citizens or if it undermines social cohesion, leading to increased social tensions.” The Conference Board of Canada has been hot on this topic over the last year, noting that changes in relative income have a much larger impact on happiness than changes in absolute income. Their data shows a disturbing growth in income inequality in our country – especially in Vancouver. It notes that the gap between the real average income of the richest 20% of Canadians and

the poorest 20% grew to $117,500 in 2009 from $92,300 in 1976. “Thus, while the poor are minimally better off in an absolute sense, they are significantly worse off in a relative sense,” their study pointed out. By contrast, the richest 1% of the population (average income $405,000) took home almost a third of all the growth in incomes in Canada from 1998-2007, mostly due to lavish corporate compensation packages. Extreme case: Jim Shaw retired from Shaw Cable with a $6-million-a-year pension. In 17 hours he will collect the maximum yearly retirement benefit for the Canada Pension Plan ($11,520). Last week the conference board reported that the gap between the rich and the rest has been growing faster in Canada than in the U.S. since the mid-1990s – especially in B.C. Within Canada, low-income rates rose higher in B.C. than in any province except Alberta in the latest recession. Between 2008 and 2009, Vancouver had the highest share of its population in low income of any city in Canada. This growing rift is unsustainable and damaging to individuals, our community and the province’s economy. Low-income voters pushing back against the HST cared more about inequality than helping the economy. That hurts everyone. Next week I’ll talk about what can be done about it. • Peter Ladner (pladner@biv.com) is a founder of Business in Vancouver and a former Vancouver city councillor. His book, The Urban Food Revolution: Changing the Way We Feed Cities, will be published by New Society in October 2011.

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comment 33

September 20–26, 2011 Business in Vancouver

Podium

Laura Jones Unrealistic demands undermining integrity of B.C. teachers’ union

abour Day is barely in the rear-view mirror and our kids are heading back to school. Teachers are heading back too – for now. The usual relief that parents feel at this time of year is tempered by the British Columbia Teachers’ Federation’s (BCTF) threat to strike for higher pay, more benefits and better working conditions. How reasonable are these demands? Many other public-sector unions in the province, recognizing the current economic climate, have settled within the government’s negotiating framework of nonet compensation increases for two years. But the BCTF is asking for: •a dou ble - d i g it p ay increase; •26 weeks of paid leave to look after a sick friend or relative; •a year’s pay as a “bonus” for retiring; •two weeks’ leave on the

death of any friend; and •two sick days a month that can be banked. As eye-popping as the demands are, the BCTF does sound more reasonable when it points out that teachers in provinces such as Alberta and Ontario earn more than they do. How reasonable is it to complain about your wages when you are among the best-paid teachers in the world? The Organization for Economic Co-operation and Development (OECD) produces an annual report of education indicators showing the OECD average starting salary for teachers is US$28,949. Teachers in the U.S. start at US$35,999, while those in France begin at US$23,735. With a starting salary of $47,000, B.C. teachers make more than those in every other OECD country except Luxemburg. At $75,000, the average top sa lar y for B.C.

teachers is also far higher than the OECD average of US$48,022. By comparison, U.S. teachers top out at an average US$50,922 and French

A B.C. teacher can retire at age 55 with an inflation-indexed pension worth more than $50,000 a year teachers at US$47,108. B.C. teachers also get to the top salar y faster than those in most other countries. But salaries don’t tell the full story. Holiday time is pretty good for a teacher with a two-month summer break. The pensions are nice, too, providing for 70% replacement income. This means a B.C. teacher can retire at age 55 with an inflation-indexed

Bui omen ld re w f o ds lationshi ps with thousan

ranking even below banks and government. Making outrageous demands at the expense of other citizens is what put them there. •

en’s m o lar W u p o ost p m and t s e g e lar h t t a

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Laura Jones (msbc@cfib. ca) is senior vice-president for research and economics (Western Canada) with the Canadian Federation of Independent Business.

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BUSINESS TODAY The PEAK to swap signals with Co-op Radio Jim Pattison Broadcast Group’s the PEAK radio station will get a stronger radio signal from Vancouver Co-operative Radio.

The CRTC is allowing the PEAK, broadcasting at 100.5 on FM, to switch frequencies with Co-op Radio (102.7 FM) as part of a $1.437 million signal swap deal. Monday, Septmber 12

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pension worth more than $50,000 a year. Many will retire for more years than they worked. Salaries, benefits and working conditions can’t be that bad in B.C. as more people want to teach than there are jobs. B.C. teachers are well compensated. To meet half of the current demands would blow a giant hole in B.C.’s already strained budget, which means higher taxes – either now or later – for the rest of British Columbians whose incomes have not risen as fast as those of teachers. As for those even more generous salaries in Ontario and Alberta, simply because their governments caved in to unreasonable demands doesn’t mean that B.C. should. T he BC T F i sn’t do ing itself or its reasonable union brethren any favours. A recent poll found that unions are the least respected groups in the country,

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he future of basketball in Canada was dealt a blow when the men’s national team failed to qualify from the Americas tournament in Mar del Plata, Argentina, for the London 2012 Summer Olympics. Steve Nash, the best player ever produced by Canada, was conspicuously absent from the tourney. Back in Vancouver, he was showing off his soccer skills for cameras at a Vancouver Whitecaps practice. The photo opportunity was smartly timed to keep the last-place Major League Soccer club he co-owns top-of-mind amid the surging BC Lions and the returning Vancouver Canucks. The national team, like the Whitecaps, wears Bell’s wordmark on its jersey. But even that wasn’t enough to draw Nash back into the fray, while he waits to learn whether the National Basketball Association season will be shortened or cancelled by the owners’ lockout of players. Canada’s last medal in a summer Olympics’ team sport was silver in men’s basketball at Berlin 1936, and the drought is perhaps the biggest challenge facing Own the Podium. Nash went to Twitter to plead his case with fans. “I was asked to do a lot for the (Phoenix) Suns and after 13 years with the national team I felt I had to choose one or the other to prolong my career and the NBA is my livelihood,” Nash wrote. “The moments and memories I had playing for Canada are the best of my career. It wasn’t an easy decision nor one I wanted to make to stop playing for the national team, but something had to give. I was 30, playing year round, carrying injuries into both seasons.” Meanwhile, Nash’s commercial juggernaut continues and shows no signs of abating. On September 13, he opened the trading day at the Toronto Stock Exchange to promote Liquid Nutrition Group, a chain of six Montreal juice and natural foods bars that has designs on expansion to Toronto, Vancouver and Los Angeles. Other athletes on so-

c a l l e d “ Te a m L iq u i d ” include East York, Ontarioborn New York Yankees’ catcher Russell Martin, Atlanta Falcons’ quarterback Matt Ryan, Norwegian golfer Suzann Pettersen and Australian gold medal halfpipe snowboarder Torah Bright, who won on the Cypress halfpipe in 2010. Nash isn’t just a celebrity endorser. He owns a piece of the company. Team Li-

“It wasn’t an easy decision nor one I wanted to make to stop playing for the national team, but something had to give” – Steve Nash to Twitter followers

quid’s board of directors includes Brandon Kou, general manager of Steve Nash Enterprises. Nash, 37, has played in the beverage world as an endorser for Coca-Cola’s Vitaminwater and has his name on the Steve Nash Fitness World and Sports Clubs chain. He’s also part of t he BC Hydro Team Power Smart, appearing in one ad as a bobblehead. Time is running out for the two-time NBA most valuable player to earn a championship ring, but his prime earning time is now. His number 13 is more famous on a g loba l sc a le t ha n Wayne Gretzky’s 99 ever was, simply because basketball is played and watched more widely than hockey and because Nash is a star of the Internet era. Board room Don’t expect to see baseball anytime soon in BC Place Stadium. BC Pavilion Corp. chief executive Warren Buckley is still waiting for Major League Baseball to respond to a request to rule on whether a game could be played despite the giant centre-hung video board. “The reality is we’re not designing this for baseball,” Buckley said. “Nobody’s out there trying to acquire a major league baseball franchise, but we’d like to do some exhibition games.”

He said a likely scenario would be to temporarily remove the board, but conceded it wouldn’t be practical. “If you look at what the cost of what it would be to try and enhance the stadium to accommodate three games a year,” Buckley said. “I think most people would say, well, that’s a wise investment not to do it.” The video board might be the most important element for generating revenue at the renewed stadium, scheduled to open September 30. BC Place will join New Yankee Stadium, Cowboys Stadium and Rogers Centre in employing the Cisco StadiumVision video and digital content distribution system. At New Meadowlands Stadium, shared by the National Football League’s New York Jets and Giants, the use of 2,200 IP-linked screens means the venue can be rebranded depending on the tenant. That will be essential in Vancouver, where anticipated stadium naming rights sponsor Telus and Whitecaps’ sponsor Bell will be uneasy bedfellows. • 2010goldrush@gmail.com twitter.com/bobmackin

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BUSINESS TODAY Business booming at Nat Bailey stadium The Vancouver Canadians’ Northwest League championship win September 11 didn’t translate into a profit windfall for the team’s owners. Canadians general manager Jason Takefman said that, even though Nat Bailey Stadium posted a record attendance of 162,162 during the regular season, much of the post-season revenue goes to the league. “We don’t look at it as a revenue generator,” he said. “We look at it as something great for the fans and great for the team.” Tuesday, September 13

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Profile

September 20–26, 2011 Business in Vancouver

Warren Roy By Nelson Bennett

Data base

Accounting scandals in the U.S. have proved to be a boon for Global Relay’s electronic message archiving business

No. 19 on Business in Vancouver’s top 100 fastest growing companies list (see issue 1142; September 13-20). Most of Global Relay’s growth has occurred in the last two years. The company is owned by a core group of employees. Less than 10% of Global Relay is owned by outside investors. The company managed to bootstrap itself to the position it’s in today without borrowing or seeking venture capital because the core ownership group worked for next to nothing. Global Relay’s Vancouver headquarters – two floors of the Leckie building at 170 Water Street – looks like a typical Gastown high-tech company. There are no cubicles, which gives the office an open-collaborative ambience. Employees sometimes log long hours, but they can always blow off steam by going to the company’s lounge, where they can play foosball or table hockey, and pour a free beer from the company’s draft beer tap. In addition to its Vancouver headquarters, Global Relay has offices in New York, London and Singapore. Because most of its clients are in the U.S., the company is virtually an unknown in its hometown. (Only 5% of its revenue comes from Canadian customers – 85% comes from the U.S.) “Nobody in Vancouver knows who we are,” Roy said, “but in New York City, literally everybody in finance knows who we are.” In addition to providing archiving and data retrieval for things like e-discovery, Global has developed search applications that would allow employees within a company to tap into the wealth of archival data generated by them or colleagues. It has also created mobile search technology that allows employees to use their BlackBerrys or iPhones to do internal searches. “Every email ever sent to or from anybody is on record with us and you can leverage that as an employee,” Roy said. The company recently broke ground on a new $14 million data centre in North Vancouver, and it has plans to build a mirror data centre in Newfoundland. •

Dominic Schaefer

arren Roy is one of those people who just get things. With no background in architecture, he developed a successful design-build company and built dozens of homes. Then, in 1999, after reading a book on the Internet, he decided to start a software company – Global Relay – which has grown from three people in 2003 to 160 today. The company, with a worldwide customer base of 14,000, now posts annual earnings of approximately $20 million. Remarkably, Roy has built one of Vancouver’s most dynamic software companies with zero background in computer science. In fact, he doesn’t even have a university education. “Because I don’t have a technical background, I learned the industry from the ground up,” said the 47-yearold entrepreneur. Shannon Rogers, Global Relay’s president and general counsel, said Roy simply grasps things quickly and is conversant in all aspects of the business. “He thinks bigger than anyone I know,” she said. ”He gets concepts so quickly.” Born and raised in Ontario, Roy moved to Vancouver in 1990. Despite not having gone to university, he ended up running a design-build company. As part of that business, he learned computer aided design (CAD). From there he picked a fundamental knowledge of computers, and when the Internet came along, he “dove” into software development. Initially, Roy and his co-founders – Eric Parusel and Duff Reid – developed electronic data management for the architecture, engineering and construction industries. “We could not give away the services,” Roy said. “Nobody wanted to buy them.” But then a door opened when U.S. firms like WorldCom, Enron and its auditors, Arthur Andersen, were ruined by financial scandal. In the wake of those scandals, U.S. regulators like the Securities and Exchange Commission passed new laws. Among them were tighter electronic message archiving and supervision requirements – a niche that Global Relay managed to exploit with great success. The company provides secure storage and supervision of all electronic data for things like e-discovery (forensic auditing of email, instant messaging,

Warren Roy, founder and CEO of Global Relay: “we realized we had the perfect product for the wrong industry”

web transactions, etc.) Roy realized that the data-archiving software his company had developed for the architecture, engineering and construction industries could be retooled to meet the new financial services regulations. “We realized we had the perfect product for the wrong industry,” Roy said. “So we jumped from the architecture-engineering world to the financial services world.” The company – then just three people – refocused and managed to reinvent itself with no outside investment. “We had no money, no venture capitalist backing, the economy was unbelievably bad because the whole dot-com world imploded,” Roy said. “It’s one of those success stories,” said Bill Tam, president and CEO of the BC Technology Industry Association. “It’s three guys working off their credit cards trying to build something in the compliance space. I think they defied just about every textbook manoeuvre in setting up a multimillion-dollar success story, and they proved that it could be done on the back of tireless effort and just sheer willpower.” Once the company had retooled its software, Roy approached the Financial Industry Regulatory Authority

(FINRA), the largest securities firm regulator in the U.S., which helped Global Relay tailor its software to the new U.S. compliance-reporting regulations. One of its first big customers was Thomson Reuters. “We picked a few good distribution partners, and Reuters was one of them that we teamed up with early on,” Roy said. “As their partner, we were able to get credibility that we wouldn’t otherwise have had because of our size.” Another early customer was Bell Canada, which required archiving to be done in both official languages. Learning how to archive in languages other than English gave Global Relay an edge over competitors, because as other regions adopted stricter data-archiving rules, more countries needed those services in other languages. Roy added that simply being a Canadian company had its advantages. “Canadian privacy laws are quite strong globally, so financial firms outside of the United States generally prefer to deal with a Canadian company because our privacy laws are just at a higher standard than U.S. privacy laws,” Roy said. “And that’s really helped us grow in Europe.” Global’s worldwide clientele includes some of the world’s biggest banks and is one of Vancouver’s fastest growing companies. It currently ranks

Mission: To be No. 1 in the financial services sector for messaging and archiving globally Assets: One of Canada’s best software development teams, a good understanding of the company’s niche and excellent partners Yield: Since the end of 2006, the company has turned a profit and doubled in size

nbennett@biv.com

DiD you miss these recent eDitorial profiles? Darren Pylot

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Mark O’Dea

Capstone CEO’s deals helping limit shareholder risk in volatile sector Issue: September 13

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