Africa Mining – Page 135 – Republic of Mining

New S.Africa mines minister faces platinum baptism of fire – by Zandi Shabalala (Reuters U.K. – September 23, 2015)

September 23, 2015

http://uk.reuters.com/

JOHANNESBURG, Sept 23 (Reuters) – For South Africa’s new mining minister Mosebenzi Zwane, until now a little-known provincial agriculture official, it was not the ideal first day in the office.

Taking over a sector already bleeding jobs due to the commodity price slump, Zwane was confronted with the price of platinum, one of South Africa’s most valuable exports, hitting a 6-1/2 year low due to the Volkswagen emissions tests scandal.

The concern is that any European consumer backlash against diesel cars, which use platinum in catalytic converters, could torpedo already shaky demand for the white metal, nearly all of which is produced in South Africa.

Platinum’s biggest daily drop in two years is a stark reminder of what lies in store for Zwane as he tries to walk a line between hostile unions, hardline communists in the ruling ANC and mining firms that have done little to change their ways since the end of apartheid two decades ago.

And the platinum sector is still reeling from a five-month strike, the longest in South African history, last year that has forced shaft closures and mine sales.

Platinum prices hit by Volkswagen scandal – by Henry Sanderson (Financial Times – September 23, 2015)

September 23, 2015

http://www.ft.com/

Volkswagen’s emissions scandal has hit the price of platinum — the precious metal used to make diesel catalysts fitted in some of the vehicles at the heart of the affair.

Platinum fell to a six-and-a-half year low of $925.30 a troy ounce on Wednesday, after dropping 4 per cent on Tuesday, its biggest one-day fall in more than two years.

The metal, which is used mostly to make catalysts for diesel vehicles, is already down more than 20 per cent so far this year.

Shares in Johnson Matthey, a maker of car catalysts, have fallen 11.8 per cent this week. They were down 1.9 per cent in morning trading on Wednesday, the worse performer in the FTSE 100 stock index.

Investors are worried VW’s admission it cheated on US emissions tests could hasten the demise of diesel cars in Europe, where they are already under fire in cities such as London and Paris due to air pollution concerns.

Sherritt moves to protect liquidity (Northern Miner – September 18, 2015)

September 22, 2015

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry.

Sherritt International’s (TSX: S) president and CEO David Pathe did not mince words when he said the firm must take action to protect its balance sheet in order to withstand lower commodity prices at a time when “more than 60% of global nickel production is underwater on a cash cost basis.”

After markets closed on Sept. 17 Sherritt suspended its 1¢ per share quarterly dividend, noting that at current spot prices of US$4.50 per lb., nickel is down 32% since the company last cut its dividend in the first quarter of 2014 from 4.3¢ per share to 1¢ per share.

A world leader in the mining and refining of nickel from lateritic ores and the largest independent energy producer in Cuba with oil and power operations across the island, Sherritt said prices for nickel and crude oil haven’t traded this low since 2009.

Sherritt also said it would cut capital expenditures in 2016 by as much as 25%-35%. Earlier this year the company trimmed its 2015 capex guidance by $15 million to $195 million.

Analysis – Copper market may get a 2003-style supply shock from Glencore closures – by Josephine Mason (Reuters U.K. – September 22, 2015)

September 22, 2015

http://uk.reuters.com/

NEW YORK – As copper miners start to slash spending and shutter mines because of the plunge in the price of the metal, experts who analyse the market in the base metal are suddenly getting a little more cheery.

They are seeing the potential for a re-run of 2003 when Chile’s Codelco [COBRE.UL], the world’s top copper producer stockpiled 200,000 tonnes of the metal that is used in everything from pipes to autos, providing the market with a supply shock that soon drove copper prices back up.

This time around hopes are pinned on the announcement earlier this month from Glencore (GLEN.L) of a sweeping strategy to shore up cash and cut spending, including plans to shutter two major, high-cost copper mines in Zambia and the Democratic Republic of Congo over the next 18 months. That will cut company output by 400,000 tonnes and remove some 2 percent of global supply from the market.

For Glencore CEO Ivan Glasenberg, the plan helped placate shareholders worried about $30 billion (£19 billion) of debt as prices of its main products from copper to coal sank to six-year lows amid worries about China’s waning appetite for such commodities.

Guinean Boom in Top-Quality Bauxite Set to Boost Economy – by Franz Wild and Ougna Camara (Bloomberg News – September 21, 2015)

September 21, 2015

http://www.bloomberg.com/

Red bauxite powder mined by Guinea’s biggest producer — flowing past a mangrove swamp on a conveyor belt and plunging through a giant funnel into the Rio Tamara ship — has been the country’s steadiest source of income since it was first mined four decades ago.

The company churning out the ore — owned by Rio Tinto Plc, Alcoa Inc., Dadco Alumina & Chemicals Ltd. and the government — will also lead a new wave of investment that may spur the West African nation’s economy and more than double bauxite output, which is refined and then smelted into aluminum.

Compagnie des Bauxites de Guinee’s $1 billion plan will almost double its annual production to 28.5 million metric tons within five years, Chief Executive Officer Namory Conde said. Four other developments could see a further 20 million tons added to Guinea’s annual exports.

“There’s going to be a lot more bauxite coming out of Guinea,” Conde said at CBG’s headquarters in the town of Kamsar, where the ship was being loaded. “Our quality is much better than around the world.

Kinross Gold struggling to reverse losses at Mauritania’s Tasiast mine – by Geoffrey York (Globe and Mail – September 21, 2015)

September 21, 2015

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

NOUAKCHOTT, MAURITANIA — When the executives of Kinross Gold Corp. fly in from their Canary Islands office to the dusty capital of the desert country where their flagship African gold mine is located, they can’t avoid seeing the hulking symbol of mining failure that dominates the skyline: the empty shell of a 15-storey skyscraper that the state mining company had started building.

Mauritania’s state-owned iron-ore company, SNIM, was due to finish the tower months ago. Instead it sits half-built and abandoned, flanked by a pair of idle construction cranes. There are no signs of life. The foreign construction contractors are long gone, leaving behind piles of sand and cement blocks.

Plagued by strikes and weak iron-ore prices, SNIM is in deep trouble, while most of Mauritania’s other resource projects are winding down or shelved. The national economic slump has compounded the pressure on Kinross as it struggles to reverse the losses at its huge Tasiast gold mine on the edge of the Sahara in northwestern Mauritania.

Lab-grown diamonds set to fill projected deficit as mined production declines – by Zandile Mavuso (Mining Weekly – September 18, 2015)

September 18, 2015

http://www.miningweekly.com/page/americas-home

JOHANNESBURG (miningweekly.com) – Technological developments that enable manufacturers to produce grown diamonds have presented the industry with a significant growth opportunity, with a noticeable influence on the economy and the diamond value chain, as researchers predict the demand for grown diamonds to double in the next ten years.

This is because, in addition to the jewellery industry, manufacturing and energy companies also use grown diamonds. Singapore-based grown diamonds manufacturer IIa Technologies (pronounced ‘2a Technologies) says this is a result of the projected decline of mined diamond supply, as the quality levels of mined diamonds are unpredictable for high-technology applications; further, almost all of the mined diamond production is absorbed by the gems and jewellery industry.

Owing to this, grown diamonds are filling an important gap in the diamond industry as a new source of raw material.

Consulting firm Frost & Sullivan’s ‘Grown Diamond Impact 2050’ report, published last year, indicates that mined diamonds are a finite resource, considering the extreme and rare occurrence of the natural surroundings in which they are formed. Therefore, the sustainability of the mined diamond industry as a primary source for the industry is declining.

Forced labour built Canada mine in Eritrea, ex-official says – by Chris Arsenault (Reuters/Globe and Mail – September 18, 2015)

September 18, 2015

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Hundreds of men drafted into Eritrea’s army were used as forced labour to build a Canadian company’s copper-gold mine in central Eritrea, according to a former construction official, in a case testing the global responsibility of foreign firms to workers.

Claims of forced labour at the Bisha mine, jointly owned by Nevsun Resources Ltd. and state-owned Eritrean National Mining Corp., date back to 2008 but are now the subject of a class-action lawsuit at British Columbia’s Supreme Court.

Eritrean plaintiffs, living in exile in Ethiopia, say in the lawsuit filed last November that they were forced to build the only operating mine in the Horn of Africa country during national service, enduring filthy conditions, little food or scarce payment.

Although Nevsun was not directly responsible for hiring local staff – that was done through local contractor firm Segen – plaintiffs argue the Canadian company was complicit in their servitude, a claim the Vancouver-based company denies.

South African Commodity Exporters Brave Rout to Protect Market – by Andre Janse Van Vuuren and Liezel Hill (Bloomberg News – September 18, 2015)

September 18, 2015

http://www.bloomberg.com/

South African miners are largely maintaining export volumes of commodities including coal and iron ore despite a pricing bloodbath in those markets, according to the head of the state-owned freight-rail and ports operator.

Transnet SOC Ltd. expects to move about 75 million metric tons of export coal and 60 million tons of iron ore on its railways in its financial year through March 31, Acting Chief Executive Officer Siyabonga Gama said. That’s largely unchanged from 76.3 million tons and 59.7 million tons in fiscal 2015. Miners have indicated they’re concerned about losing market share if output slows, Gama said.

“There is a bloodbath in the commodities market, but the extent to which we have experienced it, it is much less than what we thought might actually happen,” Gama said in an interview last week at Bloomberg’s Johannesburg office. “When I talk to the customers, some of them feel very strongly that if they responded to the market they would be squeezed out completely.”

The company had budgeted for export coal volumes of 77 million tons and 62 million tons of iron ore in the current financial year, Gama told reporters in July.

The sexiest mining company in the world – by Warren Dick (Mineweb.com – September 16, 2015)

September 17, 2015

http://www.mineweb.com/

And it’s not just Mila Kunis that’s bringing a sparkle to investors’ eyes.

JOHANNESBURG – So you’re probably thinking the world’s sexiest mining company is a gold company? Heavens, no! (BTW that’s so 1980’s). Is it a diamond company? Mmmm, close. But no cigar. So what is it then? Why, it’s actually a coloured gemstone miner called Gemfields, listed in London.

Gemstones comprise rubies, sapphires and emeralds – amongst many others – and Gemfields has been very good at pulling them out, hand over fist, from its Kagem emerald mine (Zambia) and Montepuez ruby mine (Mozambique).

But to call it just a mining company might be a bit restrictive. “We’re in the business of stimulating both demand for, and supply of, our gemstones,” said CEO Ian Harebottle in an interview with Mineweb recently.

INTERVIEW-Zambia to triple power generation in two years with solar – by Stella Mapenzauswa and Chris Mfula (Reuters India – September 16, 2015)

September 16, 2015

http://in.reuters.com/

LUSAKA, Sept 16 (Reuters) – Zambia expects to triple power output to 6,000 megawatts (MW) in 2 years through expansion of solar energy by foreign investors, the head of its investment agency said.

Erratic electricity supplies have hit mining in the continent’s second biggest copper producer, where the bulk of its generation capacity of 2,200 MW of power is water-powered.

The power problems and copper price slide have driven the kwacha currency to record lows amid a selloff in commodity-linked currencies as top copper consumer China’s economy has slowed.

Zambia Development Agency (ZDA) Director General Patrick Chisanga said he had held “very positive” talks with an unnamed German company aiming to invest $500 million in a solar power plant but did not disclose its planned location.

“It is planned that they could produce about 400 megawatts of power in two steps,” Chisanga told Reuters.

Glencore Gives New Details on Debt-Reduction Plan – by Alex MacDonald (Wall Street Journal – September 15, 2015)

September 16, 2015

http://www.wsj.com/

Commodities firm will issue new shares representing just under 10% of existing share capital

LONDON— Glencore PLC on Tuesday said it would issue new shares representing up to 9.99% of its existing share capital to institutional investors to further reduce its debt.

The Switzerland-based miner and trader said it would issue 1.31 billion new shares, which at Tuesday’s closing price of £1.28, would add up to about $2.57 billion in new capital. The company is likely to offer the shares at a discount, said analysts, and had said it would raise only up to $2.5 billion.

Its announcement came just after the close of trading on the London Stock Exchange and a wild trading day for Glencore. The company’s stock plunged 8% in early trading to a new low of £1.18, before rallying late in the day. Glencore has been the worst performer in the U.K.’s blue chip FTSE 100 index this year and has been under pressure to cut debt and improve profits as prices collapse for a range of commodities it produces and sells.

The stock issuance was part of a series of moves Glencore last week proposed to shed up to $10 billion in debt. The company also scrapped its dividend, pledged to cut spending, sell assets and temporarily shut down two unprofitable mines in Africa.

UPDATE 1-Sierra Leone economy to shrink one-fifth amid mining crisis- IMF (Reuters India – september 15, 2015)

September 16, 2015

http://in.reuters.com/

(Reuters) – Sierra Leone’s economy will contract by 21.5 percent this year, following growth of 4.6 percent in 2014, due to a crisis in the mining sector triggered by a collapse in iron ore prices and the impact of the ongoing Ebola epidemic, the IMF said.

A shortfall in government revenues due to a halt in mining production will push the budget deficit to 4.8 percent of gross domestic product (GDP).

The International Monetary Fund said the near- and medium-term outlook for Sierra Leone was challenging, with the economic situation in 2016 to remain relatively unchanged.

“Sierra Leone continues to battle the adverse impact of two severe exogenous shocks: the Ebola epidemic and the crisis in the mining sector that began with the collapse of iron ore prices and culminated in the cessation of production in April 2015,” the Fund said in a statement after its staff completed a visit to Freetown.

African nations work together to rid supply chains of conflict materials – by Alison Moodie (The Guardian – September 14, 2015)

September 15, 2015

http://www.theguardian.com/

A group of African nations have developed a framework that will make it easier for companies to keep conflict minerals out of their supply chains.

The new certification framework, known as the Regional Certification Mechanism, was developed by the International Conference on the Great Lakes Region (ICGLR), an intergovernmental organization of 12 African countries, and released in August. It includes multiple steps and a system of checks and balances that experts say will make it easier for companies to clean up their supply chains.

“For the first time in Congo’s history, there is a thorough, multi-stakeholder process to assess whether rebel groups or the army are profiting from mines,” said Sasha Lezhnev, associate director of policy at the Enough Project.

The advocacy group works to end war crimes in Africa. “Considering the past decades of conflict mining and the more recent history of pillaging minerals to support war, this is a very important step,” she said.

According to the Enough Project’s latest report, out of 180 mines assessed in the war-stricken Democratic Republic of Congo, 140 have now been validated as conflict-free.

Women pay the price for Zambia mining expansion – by Magdalena Mis (Reuters U.S. – September 14, 2015)

September 15, 2015

http://www.reuters.com/

SHINENGENE, Zambia (Thomson Reuters Foundation) – The women sat quietly in a village church in northwest Zambia, the sun slanting down on their colorful Sunday outfits as they told how life had changed since their chief sold a tract of land to a foreign firm for a new copper mine, displacing hundreds of families.

“We had a vast land and we could do anything,” Seke Mwansakombe, one of the displaced women, told the Thomson Reuters Foundation.

“Here we are confined to 40 by 40 meter plots and our movements have been restricted because certain areas are now no-go areas.”

Kalumbila Minerals Ltd, a subsidiary of Canada-based First Quantum Minerals Ltd, signed a deal with Senior Chief Musele in 2011 to buy 518 square kms of surface rights for its mining activities, called the Trident Project.

As a result almost 1,000 families, most of them subsistence farmers, were relocated to Shinengene, or Southern Settlement, and to Northern Township, some 18 kms (11 miles) from their original village. Other villages are due for relocation soon.