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Africa Mining

UPDATE 2-Congo bans exports of copper, cobalt concentrates – by Jonny Hogg (Reuters U.S. – April 17, 2013)

http://www.reuters.com/

KINSHASA, April 17 (Reuters) – The Democratic Republic of Congo has banned exports of copper and cobalt concentrates to encourage miners to process and refine the red metal within its borders, according to an order from the Mines Ministry.

The order, seen by Reuters on Wednesday, provides companies 90 days to clear stocks before the ban is enforced. It is dated April 5 and signed by Mines Minister Martin Kabwelulu.

Congo is not alone among emerging, resource-rich nations in discouraging exports of concentrates – the intermediate products that feed smelters and refiners – to focus on producing higher-value intermediate or finished products.

These, countries often argue, bring more revenue into state coffers and demand an increasingly skilled workforce. “Little by little, within the next three months, we need to no longer export concentrates,” Kabwelulu told Reuters by text message on Wednesday.

The ban is largely unlikely to affect major producers like Freeport McMoRan and commodities trader Glencore , which already process the bulk of their copper inside the country.

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In Nigeria, a gold rush is poisoning children – by Matteo Fagotto (Toronto Star – April 15, 2013)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

Processing gold without modern machinery is leading to “worst lead-poisoning epidemic in modern history.” More than 460 children have died.

BAGEGA, NIGERIA—Every day, a white-dressed figure wanders around the gold-mining site of Bagega, a village in northwestern Nigeria. Lean and middle-aged, perfectly dressed in traditional attire, his black-and-white leather shoes in stark contrast to the bare and dusty feet of the miners, he inspects every piece of gold extracted by the hundreds of men who work under him.

In a space as big as two soccer fields, scores of young men crush, grind and wash gold stones, sheltered from the scorching tropical sun by makeshift, wooden sheds. Some as young as 5, they work from eight in the morning until sundown, united by a common dream: to “hit the jackpot” and become as rich as the “white man,” Alhaji Adamou Tsiko, chairman of the Bagega Gold Miners Association.

Until five years ago, Bagega was just one of the many countryside villages dotting Zamfara, one of the northernmost and poorest states in Nigeria. With nothing more than a rural clinic, a school, a mosque and a few hundred mud houses, the village’s 8,000 inhabitants relied on subsistence farming to feed their children.

“Everyone knew there was gold in the region, but people didn’t care,” says Alhaji Jibril, the village chief, sitting in his “office,” a simple mat under a big tree in front of his house. Then, the economic crisis hit and the price of gold started climbing. In a matter of months, Bagega was at the centre of a new gold rush.

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Expansion of mining in Mozambique bringing benefits and concerns – by Keith Campbell (MiningWeekly.com – April 12, 2013)

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

Mineral production in Mozambique should generate revenues of nearly 20.8-billion meticais (some $680-million, or R6.24-billion) during this year, a technical team from the International Monetary Fund (IMF) has forecast.

Mozambique’s income from mineral production last year was nearly 14.3-billion meticais (about $470-million, or R4.3-billion), while, in 2011, it was just under 5.1-billion meticais (some $170-million, or R1.5-billion).

In gross domestic product (GDP) terms, the minerals sector accounted for 1.4% of the country’s GDP in 2011, rising to 3.4% in 2012 and predicted by the IMF to reach 4.3% this year. The ramping up of coal exports this year, the execution of major infrastructure projects and the elimination of transport bottlenecks – particularly an increase in the capacity of the railways linking the inland coal-producing Tete region to the coast – should increase the country’s economic growth rate to 8.4% for this year.

International ratings agency Fitch Ratings has noted Mozambique as one of the primary commodity-producing African countries that has gained in importance in recent years (others being Angola, Uganda and Zambia). The country is one of 20 African States whose sovereign debt is now rated by the inter- national agencies (in 1994, South Africa was the only African country to have its debt rated). Being rated encourages foreign investment.

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China Failed Mining Deals Top $45 Billion on Hanlong Bungle – by Helen Yuan and Elisabeth Behrmann (Bloomberg News – April 9, 2013)

http://www.bloomberg.com/

Sichuan Hanlong Group’s botched $1.2 billion bid for Australia’s Sundance Resources Ltd. (SDL) brings the value of China’s recent failed mining deals to $45 billion, a record that’s prompted stricter Chinese scrutiny of acquisitions.

Chinese companies attempted $107 billion worth of mining takeovers over the past five years, with about $45 billion, or 42 percent by value, of deals ending in failure. Of $562 billion of deals proposed globally in the same period, $180 billion, or 32 percent, didn’t proceed, according to data compiled by Bloomberg.

The collapse yesterday of the bid for Sundance, seeking to develop a $4.7 billion iron ore project in Africa, comes after a string of failed investments by Chinese companies, including the demise of a $19.5 billion investment in Rio Tinto Group in 2009. Regulators under China’s new leadership team of Xi Jinping and Li Keqiang have told state-owned companies that overseas takeovers will face a more stringent approval process.

“Chinese regulators are probably going to allow fewer deals to go through as they become more discerning,” Jonathan Li, a corporate partner at Clayton Utz, said in a phone interview from Melbourne. “The market will come to expect that when a deal involving a Chinese acquirer is announced, all the internal Chinese approvals will already have been obtained.”

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Congo’s mining heartland a volatile “powder keg” – lawmaker – by Jonny Hogg (Reuters U.K. – April 9, 2013)

http://uk.reuters.com/

KINSHASA – (Reuters) – Growing unrest in Democratic Republic of Congo’s copper-rich Katanga province risks scaring off investors and derailing its thriving mining sector, said the lawmaker heading an inquiry into a rebel attack on the provincial capital last month.

Katanga, in the country’s south, has been seen as insulated from the violent unrest that much of the rest of Congo. Billions of dollars have poured into the province to develop mining projects aiming to tap its underexploited mineral wealth.

However, security is steadily eroding as rebel groups, some of them seeking independence for Katanga, sweep down from the north of the province, massacring civilians and emptying villages.

“If nothing is done, Katanga is a powder keg and anything can happen,” Claudel Andre Lubaya, a legislator who is the rapporteur for the parliamentary commission for defence and security, said on Tuesday following a visit to Lubumbashi.

“Persistent insecurity could lead to investors pulling out. That’s why the government must not take only cosmetic measures.”

Last month’s raid saw around 300 fighters penetrate into the heart of Lubumbashi, Congo’s second city and the country’s principal mining hub, before they were stopped by the army’s elite Republican Guard.

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Gold – Full Movie (Mining Movie – 1974)

This information is from Wikipedia, the Free Encyclopedia: http://en.wikipedia.org/wiki/Main_Page

Gold is a 1974 thriller film starring Roger Moore and Susannah York and directed by Peter R. Hunt. It was based on the 1970 novel Gold Mine by Wilbur Smith. Moore plays Rod Slater, General Manager of a South African gold mine, who is instructed by his boss Steyner (Bradford Dillman) to break through an underground dike into what he is told is a rich seam of gold.

Meanwhile he falls in love with Steyner’s wife Terry, played by York. The film was only released as part of a double bill in the United States and is nowadays notable only as a period piece, being part of a propaganda effort to make Apartheid South Africa look ‘glamorous’ to European and American audiences.

Plot

The film begins with a tunnel collapse at the Sonderditch mine, in a scene that establishes the courage of Slater and his chief miner, ‘Big King’, and the bond of trust between them. This is contrasted with the contempt with which some other white managers treat the black miners.

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Sir Mark Moody-Stuart: “CEOs must listen and visibly engage” – Critical Resource – January 2013

Critical Resource specializes in political, sustainability and stakeholder risks facing natural resource investments. We advise senior executives and investors in some of the world’s largest companies. http://www.c-resource.com/

In a wide-ranging interview with Critical Resource, Sir Mark Moody-Stuart – former Chairman of Anglo American and Shell gives his top tips on managing stakeholder expectations, resource nationalism, and other social and political pressures facing resource firms.

CEOs should focus hard on engagement

CEOs need to be open and talk to people. They need to visibly engage and communicate both inside and outside the organisation. This is extremely important. First, CEOs have to listen and secondly, they need to be extremely clear. When a project opens, local people often hope to become wealthy and gain employment. It is important for companies to speak about the realities and explain what is really going to happen.

People need to be told early if they lack the education levels to fill jobs. Be clear about what jobs are likely to be available so as to ground expectations in reality. Companies then need to challenge themselves to raise education levels so that kids who are now eight can think about going to university when they are 18. They need to commit to creating a mechanism and to test progress towards that goal – consulting stakeholders on progress.

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Africa’s rise pays out dividends for democracy – by Pascal Fletcher (Reuters India – April 5, 2013)

http://in.reuters.com/

JOHANNESBURG – (Reuters) – Africa is rising not only on the growth charts of economists. The continent that was a byword for poverty, chaos and bloodshed only a few decades ago, providing a media feast of famines and wars, is slowly but steadily notching up gains on the democracy scorecard too.

Last month’s generally peaceful Kenyan presidential election – and the Supreme Court process that confirmed Uhuru Kenyatta’s narrow win – confounded pundits’ predictions that East Africa’s biggest economy would tumble back into the same inter-tribal violence which bloodied a 2007 vote.

The Kenyan ballot, following a line of hotly-contested but broadly smooth elections last year in Senegal, Sierra Leone and Ghana, has bolstered what many see as a spreading embrace of multi-party democracy in Africa.

Combined with better economic management by many governments and a fast-growing population of young workers and consumers, this improving political maturity will underpin expected GDP growth for Sub-Saharan Africa of five percent or more this year.

“If you peel back ‘Africa Rising’, it is not just growth rates,” said John Stremlau, Vice President for Peace Programs at the Atlanta-based Carter Center and a veteran observer of African elections, including the most recent Kenyan one.

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Minerals beneficiation a key ‘pillar’ of SA’s reindustrialisation push – by Terence Creamer (MiningWeekly.com – April 4, 2013)

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

Trade and Industry Minister Dr Rob Davies has described minerals beneficiation as the “first pillar” on which South Africa’s reindustrialisation should be built and has reported that his department is working with the Department of Mineral Resources (DMR) and others to integrate beneficiation-supporting regulatory instruments into the amended Mineral and Petroleum Resources Development Act (MPRDA).

Speaking at the launch of the fifth iteration of South Africa’s Industrial Policy Action Plan (Ipap), Davies said the aim was to ensure that more value was added to domestic mineral products ahead of export, so as to extract greater economic value and employment from the country’s remaining mineral resources, estimated to be worth $2.5-trillion.

But he also saw the potential to create access to industrial minerals as South Africa’s “new long-term competitive advantage” for a domestic manufacturing sector that no longer benefited from access to the world’s cheapest electricity.

“By access to industrial minerals, we don’t mean that you can buy it at the London Metal Exchange price, or at an import-parity price. We mean that it must be available in the form that is required for downstream manufacturing and also at a price which is competitive,” he explained.

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Cutifani says to initially focus on [Anglo American] value creation – by Idéle Esterhuizen (MiningWeekly.com – April 3, 2013)

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

JOHANNESBURG (miningweekly.com) – Diversified miner Anglo American’s new CEO Mark Cutifani has indicated that his initial focus would be to find ways to improve value creation within the company.

“I will look to start with the value proposition for being a major diversified [company]. I will look at the portfolio, the commodities we are in – do they make sense? Are they the right commodities for the future? The assets – are they competitive?…Should we be doing things differently to realise value?” he said during a video interview on his first day as CEO of the mining group.

Cutifani, who has mined on six continents in 25 countries and in 20 commodities and who succeeded Cynthia Carroll, indicated that he would be scrutinising the company’s balance sheet to determine whether it had the capacity to realise value and whether it was adequately operationally flexible.

A process of determining whether the right people were in the right positions to do the required work would also be undertaken.
Further, Cutifani said he would be looking into the company’s structures and systems, as the mining sector was lagging behind others in this regard.

“I would like to put those pieces together in that first three or four months…getting the major themes out there and understanding what we have to attack to really create value in the long term.

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Banro Leading Miners in Worst Drop Since 1990 – by Eric Lam & Christopher Donville (Bloomberg.com – April 2, 2013)

http://www.bloomberg.com/

Canada’s raw-materials stocks are forecast to extend their longest losing streak in more than 20 years, as companies such as Banro Corp. (BAA) and Teck Resources Ltd. (TCK/B) struggle with falling metals prices and concern China’s growth will slow.

The Standard & Poor’s/TSX Materials Index of 60 stocks posted its fifth monthly drop in March, the longest string of declines since April 1990. The index has plunged 18 percent over that period, led by a 62 percent slump in gold miner Banro. Teck, the country’s largest diversified miner, has tumbled 22 percent this year.

Producers of raw materials from copper to coal and gold have slid amid concerns China is settling into a slower growth path, mining companies face escalating costs and gold’s status as a safe haven is diminishing as the U.S. economy gains momentum.

“China’s economy is growing, just not fast enough, and it’s hard to see a lot of upside for mining and materials companies,” John Stephenson, a fund manager with First Asset Management, said April 1 by phone from Toronto. Stephenson helps manage C$2.8 billion ($2.8 billion), including Teck shares.

Growth in China, Canada’s second-biggest trading partner, grew at an average quarterly pace of 8.5 percent from 2011 to 2012, down from 9.4 percent in the previous eight quarters. Growth fell to a three-year low of 7.4 percent in September, before rebounding to 7.9 percent in the fourth quarter of 2012.

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RPT-BHP freezes its mining projects in Gabon -sources (Reuters India – April 2, 2013)

http://in.reuters.com/

(Reuters) – Top global miner BHP Billiton is freezing all its projects in Gabon, mining ministry sources said on Friday, dashing government hopes for sizeable investments in manganese and iron ore production.

A spokesman for BHP could not immediately be reached for comment.

The company holds licences in the Central African country for the mining of manganese at Mounana, 650 km east of the capital Libreville, and at Okondja, 150 km further to the north.

Government officials had also said BHP signed a contract a year ago for the Belinga iron ore mine, in northeast Gabon, edging out China’s Comibel. BHP has declined to comment on this.

“We respect the decision by BHP to freeze its activities in Gabon,” said a senior official at the mining ministry who asked not to be identified. “At the same time this is a blow to the country, which hoped to become the world’s largest exporter of manganese.”

Gabon is the world’s second-largest producer of the mineral, an ingredient in making steel, after South Africa. France’s Eramet has been mining manganese at Moanda in southeast Gabon for some 50 years through its Comilog subsidiary.

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Africa’s ‘Pilbara’ needs champion – Investec – by Marin Creamer (MiningWeekly.com – March 27, 2013)

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

JOHANNESBURG (miningweekly.com) – The Cameroon-Congo-Gabon region, often likened to Australia’s iron-ore-rich Pilbara, needs a champion in the mould of Fortescue founder Andrew Forrest to assemble companies, governments, financiers and end-users in a region that could give the iron-ore top-three a run for their money.

Investec Securities analysts Hunter Hillcoat and Marc Elliott speculate whether the possible increased involvement of Glencore could be the start, given the significant expanse of iron-ore mineralisation, including the potential for meaningful direct shipping ore (DSO) volumes.

It offers one of the few opportunities globally for a substantial iron-ore production base outside of that controlled by the top three – Vale, BHP Billiton and Rio Tinto – yet it remains a long way from production.

Last year, Equatorial Resources CEO John Welborn urged junior iron-ore producers in Gabon, Cameroon and the Republic of Congo (ROC) to work together to ensure that export markets could access the region’s minerals, with the Metal Bulletin’s ‘Steel First’ reporting his view that iron-ore exploration companies Sundance Resources, Core Mining and the government of Gabon needed to consolidate to maximise the potential of the rich craton.

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Russia, South Africa Seek to Create OPEC-Style Platinum Bloc – by Ilya Arkhipov & Franz Wild (Bloomberg.com – March 27, 2013)

http://www.bloomberg.com/

Russia and South Africa, countries that hold about 80 percent of platinum group metal reserves, plan to set up an OPEC-type trading bloc to coordinate exports.

“It can be called an OPEC,” Russian Natural Resources Minister Sergey Donskoy said late yesterday in an interview in Durban. “Our goal is to coordinate our actions accordingly to expand the markets. The price depends on the structure of the market, and we will form the structure of the market.”

South Africa mines about 70 percent of the world’s platinum and Russia 40 percent of its palladium, a metal from the same group used to cut car pollution, Johnson Matthey Plc (JMAT) said in a 2012 report. Other nations would be able to join the group. The U.S., Zimbabwe and Canada are among producers of the metals. The Organization of Petroleum Exporting Countries is an oil cartel.

Platinum and palladium prices rose following yesterday’s comments by Donskoy. South Africa and Russia signed only a “framework” accord, he said, with details yet to be decided.

“We are now forming working groups to work out joint actions on this market,” Donskoy said. “There will be a meeting in the summer to discuss mechanisms in detail.”

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Congo Reassures Copper Miners Rattled by Attack in Katanga – by Michael J. Kavanagh (Bloomberg.com – March 27, 2013)

http://www.bloomberg.com/

Democratic Republic of Congo’s mines minister reassured investors after separatists attacked the capital of mineral-rich Katanga province, raising concern among analysts that the region faces increased conflict.

At least 35 people died when 250 Kata Katanga militants battled soldiers and police in Lubumbashi on March 23 before surrendering to the United Nations. The government introduced a curfew and some businesses and schools closed early on March 25 in the city, home to the offices of some of the biggest mining companies operating in Congo.

“I’m personally reassuring miners that these events are temporary and will be completely put to a halt,” Mines Minister Martin Kabwelulu said by mobile-phone message on March 25. “A psychosis will reign for several days, but that will pass as well.”

After years of conflict and instability, Congo’s mining industry has flourished since 2009, with copper production doubling to about 600,000 metric tons last year, most of it coming from Katanga in the southeast. The Central African country was the eighth-largest producer of the metal in 2012, accounting for 3.4 percent of world output, according to the U.S. Geological Survey. It also produces half of the world’s cobalt, used in rechargeable batteries.

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