US warns Zimbabwe over US$3bln Russia deal – by Staff Reporter (New Zimbabwe – October 3, 2014)

http://www.newzimbabwe.com/index.aspx

THE United States has reportedly warned Zimbabwe about its growing economic dealings with Russia after Harare recently sealed an agreement with Moscow for a US$3 billion platinum mine.

According to Herald columnist Nathaniel Manheru, who is thought to be President Robert Mugabe’s spokesman George Charamba, the Obama administration threatened further sanctions against Zimbabwe over its ties with Russia.

Manheru’s claims could not be verified with the US embassy in Harare late Friday night. The US has imposed sanctions against Moscow, tightening restrictions on major Russian state banks and corporations, after accusing the Kremlin of providing military backing to Ukrainian separatists and generally destabilising the region.

Zimbabwe’s Pen East Investments has teamed up with Afronet, a consortium of three Russian partners, to form Great Dyke Investments, which is developing the US$3 billion Darwendale platinum project.

At full development in 2024, the mine will produce 800,000 ounces of platinum, pushing Zimbabwe’s output over one million ounces, and create 8,000 jobs.

Read more

Sourcing practices changing as US law on mineral imports from Africa’s Great Lakes region takes hold – by Anine Vermeulen (MiningWeekly.com – October 3, 2014)

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

For decades, the trade in tin, tantalum, tungsten and gold (also known as 3TG), along with various other minerals and resources, has played a central role in funding and fuelling some of the world’s most brutal conflicts.

According to international nongovern- mental organisation Global Witness, revenues from the extraction and sale of these natural resources, also known as ‘conflict minerals’, not only provide armed groups with the means to operate but also provide State security forces and corrupt officials with off-budget funding.

Section 1502 of the Dodd Frank Act – the US’s conflict minerals law – is the first piece of legislation that aims to break the links between the lucrative minerals trade in certain African regions and the abusive armed groups that prey on and profit from these regions’ minerals trade.

The Dodd Frank legislation was passed in July 2010 and the final rules for Section 1502 were released in 2012.

“The Dodd Frank Wall Street Reform and Consumer Protection Act came into effect in January last year, and Section 1502 on conflict minerals requires compliance from all public companies that are listed with the US Securities and Exchange Commission (SEC),” ENSAfrica mining and environmental law director Lloyd Christie tells Mining Weekly.

Read more

Diamond crunch: Exploration dries up – by Thomas Biesheuvel (Mineweb.com – October 3, 2014)

http://www.mineweb.com/

“You need deep pockets to find kimberlites,” one expert notes. Meanwhile money, efforts have dried up.

(BLOOMBERG) – Diamonds are so hard to find that explorers have pretty much given up trying.

More than $7 billion has been plowed into the hunt for the gem since 2000, according to top supplier De Beers, and the results have been meager, with no major finds. That’s led producers including BHP Billiton Ltd. to pack up their maps and drills and head for home. The amount spent looking for diamond- rich kimberlite formations underground has dropped by half since 2007, when exploration investment topped $1 billion.

The dearth of new projects is putting pressure on an industry where supplies of accessible diamonds near the surface are depleted and the cost of going deeper is rising. De Beers opened the Orapa mine in Botswana in 1971 and its Jwaneng project, the world’s largest diamond mine by production value, in 1982. Botswana, the top producer, saw output drop to 22.7 million carats last year from 33.6 million carats in 2007.

“The odds of finding an economic kimberlite are extremely against you,” said Johan Dippenaar, chief executive officer of Petra Diamonds Ltd., which spent just $2.1 million looking for new mines last year and has abandoned prospective projects in Angola and Sierra Leone. “Exploration, for the foreseeable future, will remain something that we will be involved in, but it won’t command very much of our cash flows.”

Read more

Smacked by Ebola, low prices, West Africa iron mining faces reshape – by Silvia Antonioli and Karen Rebelo (Reuters Africa – September 29, 2014)

http://af.reuters.com/

LONDON/BANGALORE, Sept 29 (Reuters) – Plunging prices and the spread of Ebola are reshaping the iron ore mining sector in West Africa where some companies risk sinking if they cannot find new partners, lenders or owners.

West African iron ore miners already are in a critical situation due to a 40 percent plummet in prices this year which is making most mines unprofitable and projects hard to finance.

Costs are also rising, partly due to measures to fend off the Ebola epidemic that has so far killed about 3,000 people in the region. The virus is also making it difficult to move workers and goods and threatens to disrupt logistics.

Shares of companies such as Sierra Leone-focused African Minerals and London Mining have plummeted by 89 and 91 percent respectively, versus a 4 percent fall of the UK-listed mining sector this year.

“It’s pretty devastating. The perception of West African mining has completely changed. At the moment we don’t see any upside,” said Ed Bowie, director of Altus Capital, a fund focused on medium and small mining companies. Altus has exited its investments in West Africa iron ore in the last two months due to concerns about Ebola and low prices.

Read more

In depressed platinum market, Amplats struggles to go solo – by Clara Denina and Silvia Antonioli (Reuters U.K. – October 1, 2014)

http://uk.reuters.com/

LONDON, Oct 1 (Reuters) – Less than a year after tearing up a $57 million annual supply contract with its main buyer, Anglo American Platinum is struggling to implement a new strategy of selling directly to end-users against a backdrop of weak prices, sources say.

The world’s top platinum producer, known as Amplats , late last year ended a long-standing deal through which it had sold the bulk of its output at a discount to refiner Johnson Matthey, in exchange for marketing.

The idea was to make more money by cutting out the middleman, going direct to traders and carmakers and seizing profit opportunities by financing or lending metal and arbitraging different locations and grades.

To achieve that, the company, which mines platinum in South Africa and Zimbabwe, expanded marketing and sales teams in London and Singapore.

Amplats’ parent company Anglo American, whose portfolio spans iron ore, thermal coal, nickel and copper, is also undergoing a big overhaul as it tries to improve returns after years of underperformance compared with its peers. It has made a series of high-ranking personnel changes within its wider commercial department, hoping to boost the division’s earnings by $400 million by 2016.

Read more

Environmental Disturbance and the Emergence of Tropical Disease: Lessons From the Gold Fields of Ghana – by Mario Machado (Huffington Post – September 29, 2014)

http://www.huffingtonpost.com/theworldpost/

Mario Machado is a recently returned Peace Corps volunteer (RPCV) and Independent Scholar.

This forest feels like an eternity as our four-wheel drive vehicle plods down yet another washed-out dirt road. This is the Central Region of Ghana and the lack of infrastructure only adds the ambiance as groups of women pass by with their loads of firewood balanced effortlessly on their head, their babies dozing comfortably in tow.

Abruptly, the trees stop and a barren dirt-scape throws the equatorial sun back into our faces. Compared to the shade of the canopy, this feels like the surface of the sun. And yet, despite the devastating heat, I can easily make out the distant silhouettes of people shoveling and sifting and working through this terrible hole in the earth.

As we get closer, the figures assume the faces and nuances of the tired men and women that they are. Holes in boots; tattered, stained clothing; knee deep in stagnant water with shovels or pick-axes or buckets of mud in hand. All for a paltry daily bounty of gold and the eternal promise to strike it rich someday. It’s enough to keep them busy and fed for now, but at a terrible cost to their bodies and the land. This is the face of unregistered small-scale mining in Ghana, called “galamsey” by the locals.

Ghana, the proverbial “Gold Coast”, has furnished the world with the gold for hundreds of years and although the mechanisms have changed — a colonial administration has been replaced by economic structures that are equally exploitative — the fundamental ethos remains the same: the wealth contained within this land does not belong to those that live and work it, but to those with the might to control it.

Read more

AngloGold sets about ‘new’ old strategy – by David McKay (MiningMx.com – September 25, 2014)

http://www.miningmx.com/

[miningmx.com] – THE flight from gold amid expectations of rising rates and a stronger dollar have to some extent masked the impact of AngloGold Ashanti’s aborted rights issue and de-merger strategy on the gold firm’s share price.

The share was already under pressure from September 1 losing about 7% over seven days as the dollar gold price sank – now down to its lowest levels for the calendar year . On September 9, however, it shed 15% as investors took a dim view of the $2.1bn rights issue proposal.

It regained ground by September 15 when the de-merger was formally rejected by management, but has since fallen another 4% as the pressure on it and all other South African gold stocks has intensified.

Not even Harmony Gold or Sibanye Gold, which have seen the rand gold price strengthen whilst the dollar gold price has fallen 6% this month, have been immune from the selling.

“I don’t anyone thinks the gold sector has been over-bought, there is just negativity about the outlook with most people expecting a stronger dollar, with rising interest rates but with no real inflationary pressures,” an analyst said. “Investors are obviously concerned about cash flows and future impairments. And there are quite a lot of redemptions from funds,” he said.

Read more

Ebola and Mining: The need for action – by BEn Hagemann (Australian Mining – September 5, 2014)

http://www.miningaustralia.com.au/home

The African continent is rich in mineral reserves, and a great deal of interest has been generated in Australian companies wishing to invest, explore and mine there.

Interest in the prospect of investing in Africa has grown over the past five years to a reported $686 billion worth of discoveries across the continent with Australian involvement.

The Africa Downunder Conference in Perth focussed on the upturn in sentiment for investment there, however a discussion about the recent Ebola outbreak in western Africa highlighted one of the key concerns in terms of making positive investments in the region: Stability.

Dr David Heymann, director and head of global health security at the British policy think tank Chatham House, addressed the Perth conference on the subject of Ebola with some positive, albeit grisly news.

Heymann said that a robust response was needed to prevent the spread of the disease, and despite the difficulties with a wide area distribution through Guinea, Sierra Leone and Liberia, he was “fairly certain that it will be contained and it will stop spreading.”

“It’s too virulent, it kills people too rapidly and it’s very easy then to get rid of,” he said.

Read more

Conflict minerals and the integral role of everyday Canadians – by Kristen Pue (The Varsity – September 14, 2014)

The Varsity is the University of Toronto’s student newspaper.

Kristen Pue is the Advocacy Director at STAND CANADA, a youth-led anti-genocide organization. She is a student in the Faculty of Law.

When consumers contribute to humanitarian crises

We all know about the crisis in Ukraine. We all know about the Ebola outbreak, and we are all aghast at the advance of ISIS in the Middle East. But are you aware of the single deadliest conflict since the World War II? More importantly, do you know if you are inadvertently contributing to this humanitarian catastrophe?

Although it is rarely in the news, the conflict in the Democratic Republic of the Congo (DRC) has claimed 5.4 million lives since 1996 and remains one of the world’s worst active crises. In addition to its high death toll, it is notable for its rampant sexual violence: an average of 48 rapes are committed per hour.

The conflict in the DRC is multifaceted, but here is the gist: the Rwandan genocide provided the trigger for the First Congo War, but the despotic rule of Mobutu Sese Seko certainly was an underlying factor. Following the genocide, Tutsi rebels took control of Rwanda. Two million refugees flooded into the DRC, most of them Hutu. Hutu extremists were among civilian refugees and used the eastern DRC as a base to continue the Rwandan civil war.

This stoked instability, and eventually resulted in an uprising. Rwanda and Uganda joined to help depose Mobutu.

Read more

AngloGold says asset split will add value – by Allan Seccombe (Business Day Live – September 11, 2014)

http://www.bdlive.co.za/

ANGLOGOLD Ashanti is the latest mining company in SA to split its assets, creating a debt-free local company that will become a multi-commodity player, and a large London-listed gold-focused company holding a suite of international mines and growth assets.

Two large operators in the South African mining sector have split their assets in the past two years. Gold Fields unbundled three deep-level, labour-intensive mines into a new JSE-listed company, Sibanye Gold, to allow Gold Fields to focus more fully on its international portfolio.

BHP Billiton has cherry-picked its best assets to retain in its portfolio and is creating a separate company to house the balance of its assets, which are largely in SA and comprise coal, manganese and aluminium.

AngloGold operates the deepest mine in the world — its Mponeng mine is 4km deep.

As part of its division process, which needs shareholder approval, AngloGold will need to raise $2.1bn, which will primarily go towards clearing most of its debt, which CEO Srinivasan Venkatakrishnan described on Wednesday as “too high”. AngloGold has about $3.5bn in gross debt.

The South African Reserve Bank, in its approval of the restructuring, demanded that the company housing the South African assets start debt-free.

Read more

Monkey Cage: In Eastern Congo, economic colonialism in the guise of ethical consumption? – by Christoph Vogel and Ben Radley (Washington Post – September 10, 2014)

http://www.washingtonpost.com/

The following is a guest post by Christoph Vogel and Ben Radley. Vogel is an Independent Analyst and a PhD candidate at the University of Zurich. Radley is a Director for Heartland Alliance and a PhD student at the International Institute of Social Studies.

When we think of the Congo today, we may think of bloody resource wars where women are being raped by armed groups to gain access to and control of the country’s minerals. If we do so, it’s because of the work of numerous NGOs, advocacy organizations, and activists such as the Enough Project or the “no blood in my mobile” campaign, who have been campaigning for several years to reduce conflict in the eastern Congo by “cleaning up” the region’s mineral trade. The struggle against so-called “conflict minerals” has literally become, borrowing Autesserre’s words, a lopsided “dominant narrative” spanning policy discourses and practical engagement in the sector.

The most significant policy result of this work to date, Section 1502 of the Dodd-Frank Act, was passed by the Congress and signed into law in July 2010. It requires companies registered on the U.S. stock market to report on an annual basis whether their minerals have been sourced from the eastern DRC or neighboring countries, and thus, potentially financing conflict. This has in turn led to recent announcements by electronics giants including Apple and Intel that more of their products will be “conflict-free” in the future.

In the meantime, a coalition of around 70 Congolese leaders and international experts argue that, in the Congo itself, the movement risks contributing to, rather than alleviating, the very conflicts it sets out to address. While not calling to keep transparency and regulation at the lowest level, their open letter urges governments, companies, and other stakeholders to carefully rethink and increase their engagement on the issue.

More than four years after the signing of the Dodd-Frank Act, only a small fraction of the hundreds of mining sites in the eastern DRC have been reached by practical measures emanating from Dodd-Frank legislation, such as supply chain traceability or mineral export certification.

Read more

UPDATE 2-Tanzanian growth accelerates on back of gold production – stats office – by Fumbuka Ng’wanakilala (Reuters India – September 11, 2014)

http://in.reuters.com/

(Reuters) – Tanzania’s growth accelerated in the first quarter of 2014 from a year earlier, on the back of a jump in gold production and power generation, the statistics office said on Thursday.

Gross domestic product (GDP) in Tanzania – one of the fastest growing economies in the region – expanded by 7.4 percent in the first quarter of 2014 compared to 7.1 percent a year ago, said the state-run National Bureau of Statistics.

“Mining and quarrying activities registered a growth of 8.7 percent in the first quarter of 2014 compared to a growth rate of 1.7 percent during the same period in 2013,” NBS director of economic statistics Morrice Oyuke told a news conference.

“This growth increase is attributed to an increase in gold production during the first quarter of 2014,” he added. Tanzania is Africa’s fourth-largest gold producer after South Africa, Ghana and Mali.

Big gas discoveries offshore – still several years away from major exports – have drawn in more investors, both in the energy industry and other sectors looking to find a foothold in a growing market.

The country aims to double its power production capacity to 3,000 megawatts by 2016 by investing in new gas and coal-fired turbines.

Read more

Mining CEOs call for global fight against Ebola – by Dorothy Kosich (MiningWeb.com – September 9, 2014)

http://www.mineweb.com/

Mining companies are joining forces, urging the global community to help fight Ebola in affected West African countries.

RENO (MINEWEB) – The Ebola outbreak in western African has prompted several mining companies, such as Vale, to suspend production and evacuate their expat staff as the epidemic has killed at least 2,100 people in five African countries.

However, other mining companies, such as Rio Tinto, Freeport-McMoRan, Newmont and Randgold Resources, have worked to battle the epidemic.

Combatting the spread of the virus requires West African governments to work closely with international agencies, health service provides and mining companies, which now have a duty to think above and beyond Ebola, said Rokaje Akinkugbe, head of energy and natural resources coverage at FBN Capital in Lagos, Nigeria.

“…Mining companies have a role to play because there will definitely be a greater pullback on mine sites as the disease impacts the workforce. And for a mining companies, its workforce is essential to long-term survival,” Akinkugbe told Think Advisor.com

Mining operations in Liberia, Guinea, Sierra Leone and Nigeria have provided financial backing and increased sanitation for their employees to help fight the disease. Six mining companies have been involved in the emerging infectious disease risk mitigation project funded by USAID, including Freeport McMoRan, MMG Limited, Mawson West and Tiger Resources.

Read more

[South African] Smelters need support to survive – by Mark Allix (Business Day Live – September 4, 2014)

http://www.bdlive.co.za/

SMELTERS and foundries need support if they are to survive. As a start, Eskom has to sort out its electricity supply problems, and government’s R4-trillion infrastructure plan needs to get under way soon.

Better still, the private sector should be encouraged to provide more traditionally sourced energy. BHP Billiton has turned off its Bayside aluminium smelter in KwaZulu-Natal. Smelting costs too much, even though the company has a hugely preferential electricity pricing agreement with Eskom.

Bayside, BHP Billiton’s Hillside aluminium smelter and the Mozal smelter near Maputo in Mozambique together used about 9% of South Africa’s total electricity output.

A chunk of state infrastructure funding is being spent on building new energy capacity — mainly the delayed Medupi and Kusile coal-fired power stations, but also the Ingula hydropower project in KwaZulu-Natal.

The manufacturing sector is under pressure from strikes, above-inflation wage and increases in administered price, as well as poor maintenance and development of infrastructure.

Read more

Energy constraints biggest threat to SA ferrochrome industry – by Leandi Kolver (MiningWeekly.com – September 4, 2014)

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

JOHANNESBURG (miningweekly.com) – The biggest challenge facing South Africa’s ferrochrome industry was no longer China, but local energy supply constraints, chrome producer Afarak executive chairperson Dr Alistair Ruiters said on Wednesday.

Speaking at the seventh South African Ferro-Alloys conference, convened by MetalBulletin Events, he said power supply would remain a problem for the foreseeable future.

Industrial users would likely face further electricity price increases, more blackouts and further buy-back requests, undermining the competitiveness of the local ferrochrome industry, he noted. South Africa was also at risk of losing market share, not only to China, but also to the rest of the world, as other countries, such as Finland, had seen a reduction in energy costs.

Ruiters highlighted the energy supply constraints as a significant concern, stating that the industry was becoming increasingly “debeneficiated” as it exported more raw ore instead of value-added products.

He pointed out that South Africa’s chrome ore exports to China had grown significantly from 100 000 t/y in 2004 to 6-million tons a year in 2013.

“South Africa today supplies more than 50% of China’s ore requirements,” he added.

Read more