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Africa Mining

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.

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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.

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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.

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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.

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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.

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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.

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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.

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[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.

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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.

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Miners step up safeguards in mineral-rich Africa amid Ebola crisis – by James Regan (Reuters India – September 5, 2014)

http://in.reuters.com/

SYDNEY, Sept 5 (Reuters) – Mining companies are beefing up protection against the spreading Ebola virus in West Africa while maintaining investment in new projects in a region with vast untapped mineral wealth.

Attempts to keep the deadly virus out of work sites range from turning away anyone who has come from countries where Ebola is present to installing infrared heat monitors to measure body temperatures of employees as they pass through mine gates.

Similar devices have been deployed in airports to identify carriers during outbreaks of Severe Acute Respiratory Syndrome (SARS), bird flu and swine flu.

In iron ore-rich Guinea, where the first deaths from Ebola were confirmed in March – the outbreak has since spread to Liberia, Sierra Leone, Nigeria, and Senegal – the government anticipates $50 billion of mining investments over the next decade, Minister for Mines Kerfalla Yansane said this week..

David Heymann, a professor of infectious disease epidemiology at the London School of Hygiene and Tropical Medicine, is calling on companies to consider installing sonar bat repellant technology at mine sites.

Some medical experts believe that bats and other animals are the natural hosts of the Ebola virus, which has led Guinea to ban consumption of bat soup, grilled bat and other such items.

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Smart governments encourage foreign investment – Glasenberg – by Martin Creamer (MiningWeekly.com – September 3, 2014)

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

JOHANNESBURG (miningweekly.com) – Smart governments encouraged foreign investment and ensured that they did not make it too difficult or impossible for companies to invest, Glencore CEO Ivan Glasenberg said on Wednesday.

Glencore – which employs 42 500 people at its South African operations, 20 300 of them in coal and 22 200 in alloys, and which last year paid $126-million in taxes and royalties and $490-million in wages – is one of the few mining majors that are continuing to invest in South Africa.

Replying to questions at a media briefing on the prospect of coal being declared strategic in South Africa, Glasenberg said that taking into consideration future growth requirements of Eskom, it was questionable whether the State power utility and South Africa would have sufficient funding to develop the number of coal mines required.

“It would be difficult. You need foreign investment coming in. So whether Eskom is going to make coal a strategic mineral or not, we will invest in this country if we believe that we can get the right returns for our shareholders.

“And what do we bring? We bring a load of money. We invest it in new mines, we employ a lot of people, we pay royalties and taxes and the government gets an ongoing, long-term benefit from us.

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Mineral beneficiation, industrialisation key to development – Finance Minister – by Martin Creamer (MiningWeekly.com – August 29, 2014)

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

JOHANNESBURG (miningweekly.com) – The key to the development of South Africa lay in mineral beneficiation and industrialisation in joint development with its regional neighbours, South Africa’s new Finance Minister Nhlanhla Nene told the Centre for Education In Economics and Finance (CEEF).

Speaking at a CEEF dinner in Johannesburg on Thursday evening, Nene said value addition, industrialisation and regional integration were linked to rapid, sustained economic growth in modern economic development, which was a critical reason why the South African government was placing greater emphasis on them.

Resource-endowed countries that had failed to move up the value chain had registered short bursts of growth, but never the kind of relentless growth that had persisted over decades and resulted in intergenerational wealth creation and the reduction of poverty, inequality and unemployment.

He suggested that South Africa’s vast $2.5-trillion nonenergy mineral endowment could be more adequately leveraged within South Africa’s Cabinet-approved beneficiation strategy, which targeted adding value to the country’s gold, platinum, diamonds, iron-ore, chromium, manganese, vanadium, nickel and titanium, energy coal and uranium endowments.

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Absolute change needed to mine Wits basin’s stranded 1.1bn gold ounces – by Martin Creamer (MiningWeekly.com – August 27, 2014)

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

CARLETONVILLE (miningweekly.com) – South Africa’s Witwatersrand basin contains another 1.3-billion ounces of gold, almost as much gold as has been mined there since 1886 – but miners can only get to another 200-million ounces of it using today’s mining methods.

If the industry does not come up with a new way of mining, more than a trillion dollars worth of gold will not be mined, because the 1.1-billion ounces in question are either below the cutoff for the current mining method, or they are at depths where there are no technical solutions to get to mine those ounces.

Moreover, safety has reached a plateau and unless significant change is made to what creates this plateau, death and injury in mines will continue, which is totally unacceptable.

There is thus an absolute need to change – and senior VP technology and projects Shaun Newberry is at the forefront of an AngloGold Ashanti move that could result in all three billion Wits basin ounces being mined and not merely 1.9-billion of them.

Individual technologies currently under investigation will make a significant impact on the current mining method, where reverse circulation drilling will ensure enhanced information and better planning.

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Deadly clashes continue at African Barrick gold mine – by Geoffrey York (Globe and Mail – August 27, 2014)

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.

JOHANNESBURG — Police have killed more villagers in clashes at a controversial Tanzanian gold mine owned by a Barrick Gold Corp. subsidiary, despite the company’s pledges to reduce the violence, researchers say.

The researchers, including a law firm and two civil society groups, say they’ve received reports that as many as 10 people have been killed this year as a result of “excessive force” by police and security guards at the North Mara mine, owned by African Barrick Gold, a subsidiary of Toronto-based Barrick.

A spokesman for African Barrick confirmed to The Globe and Mail that “fatalities” have occurred in clashes at the mine site this year, but declined to estimate how many. It is up to the Tanzanian police to release the information, he said.

Tanzanian police have repeatedly refused to give any details on fatalities at the site. Dozens of villagers have been killed by police at the mine in the past several years, according to frequent reports from civil society groups. The company occasionally confirms some of the deaths, including a clash in which police killed five people in 2011.

The deadly clashes occur when villagers walk into the mine site in search of waste rock, from which small bits of gold can be extracted. Hundreds or even thousands of “intruders,” as they are known locally, can be involved.

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Europe must do its bit to stop the trade in conflict minerals – by Ed Zwick (The Guardian – August 19, 2014)

http://www.theguardian.com/uk

We have to let our leaders know we do understand the link between products we buy and the suffering of others

Almost a decade ago, my film Blood Diamond told the story of the illicit diamond trade and its funding of the bloody civil war in Sierra Leone. The reaction was profound as consumers came to understand the sparkly ring they bought in their local jewellery store could have brutal implications elsewhere.

But this story was never just about diamonds. Throughout the world, the demand for all natural resources is soaring. Yet tragically, local populations – especially in poorer nations – rarely benefit. Instead, revenues continue to fund conflict rather than development. We have an opportunity to help change that.

Today, the sale of “conflict minerals” sourced from high-risk areas, such as parts of Colombia, the Democratic Republic of Congo and the Central African Republic, are funding armed groups that visit unimaginable suffering on helpless civilians. These minerals are then traded into global supply chains, where they end up in our mobile phones, laptops and automobiles.

Meanwhile, the EU is at risk of becoming a major trading hub for conflict minerals. It imports almost 25% of the global trade in tin, tantalum and tungsten. Despite this, there is no legislation requiring companies to source minerals responsibly.

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