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Africa Mining

SA mining’s uneasy truce with labour – by André Janse van Vuuren (Mineweb.com – November 27,2012)

http://www.mineweb.com/

While labour relations in the country have entered a period of relative calm, fears remain that the truce remains at risk.

JOHANNESBURG (MINEWEB) – Labour relations in South Africa have entered a period of relative calm in recent weeks, but the uneasy truce that exists between workers and their employers is at risk from a host of simmering tensions.

Normality has to a large extent returned to South Africa’s mining industry following the sector wide strikes which have shut the majority of the country’s biggest platinum and gold producing shafts for more than a month. Gold miners like AngloGold Ashanti and Gold Fields report the ramp-up process is largely going according to plan with no interruptions.

Similarly, the mass gatherings and often violent protests around the platinum mines of the North West province seem to have quietened down, while some mining bosses say they’re looking forward to a new era of multi-union relations.

But, some trouble spots remain. Kumba Iron Ore’s Sishen mine in the Northern Cape is, according to company spokesperson Gert Schoeman, still plagued by some no-shows and intimidation.

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Banro calm in face of turmoil in Democratic Republic of Congo – by Peter Koven (National Post – November 26, 2012)

The National Post is Canada’s second largest national paper.

Amid one of the the world’s most troubled regions, Simon Village maintains that it is business as usual for his company. All the same, he will admit to being a little alarmed by recent events near his operations in the Democratic Republic of Congo (DRC).

“If you remember, the M23 were just sitting in the bushes north of Goma. And then, all of a sudden, they were in Goma. It caught people by surprise,” the chief executive of gold miner Banro Corp. said in a phone interview from the DRC.

The Eastern Congo leapt into the news last week after the M23, a breakaway group of former soldiers, seized the city of Goma and promised to “liberate” the entire country.

The surprise move has de-stabilized the already-volatile border region near Rwanda, triggered fighting with the Congolese army, and displaced thousands. It is widely believed that the rebels are being backed by Rwanda, a country that has fuelled prior unrest in the Eastern Congo.

Goma is a city of one million people on the north end of Lake Kivu. Roughly 200 kilometres to the south, Toronto-based Banro continues to dig up gold at its Twangiza mine. Banro also has an operating office in Bukavu, a city on the south end of the lake that the rebels want to seize, according to reports.

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Goma’s fall leaves Congo afraid of score settling and all-out war [mineral resources] – by Geoffrey York (Globe and Mail – November 21, 2012)

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 — The rebel takeover of the key Congolese city of Goma has sparked fears for the future of one of Africa’s biggest and most war-torn countries.

In the short term, the victory by the M23 rebels could trigger a wave of reprisal attacks on civilians in the city of a million people. Thousands of displaced people, in the chaos of the rebel advance, are fleeing out of Goma or into the city from rural camps.

In the longer term, the rebel victory could destabilize and weaken the fragile government of the Democratic Republic of Congo, opening the door for a foreign carve-up of eastern Congo, a mineral-rich region that has attracted rebels and invaders for many years.

The Rwandan-backed rebels, commanded by indicted war-crimes fugitive Bosco Ntaganda (known as “the Terminator”), walked into Goma almost unopposed on Tuesday after the city was abandoned by Congo’s notoriously underpaid and unreliable army.

United Nations peacekeepers, who had deployed helicopters to strafe the rebels with cannons and rockets on Sunday in a futile attempt to slow their advance, appeared to give up and just stood by watching as the rebels took the city. French Foreign Minister Laurent Fabius said it was “absurd” that the 17,000-member UN force was unable to stop a few hundred rebels.

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Why DR Congo’s volcano city of Goma matters – by Theodore Trefon (BBC News Africa – November 20, 2012)

http://www.bbc.co.uk/news/

Theodore Trefon is senior researcher at the Royal Museum for Central Africa and author of the blog Congo Masquerade: The political culture of aid inefficiency and reform failure.

Goma lies at the foot of an active volcano in the Democratic Republic of Congo and on the border with Rwanda. It matters today because it testifies to the powerlessness of the Congolese government and the United Nations to stop fighting and tit-for-tat violence.

The border city also matters because it could be an indicator of the unravelling of the Rwandan president’s authority. In Rwanda, President Paul Kagame is under pressure from hardliners frustrated by the continued presence of opposition forces who have found sanctuary on the Congolese side of the border.

President Kagame is also increasingly seen as an embarrassment to touchy foreign partners. M23 rebels have now entered Goma; the governor of North Kivu has fled to Bukavu by boat and hundreds of thousands of people are fleeing the city helter-skelter without having anywhere to go.

War, rape and the illegal extraction of minerals – an old story – matter more and more.

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Coltan: Michael Nest – Book Review – by Stephen Williams (African Business – September 10, 2012)

http://africanbusinessmagazine.com/main-articles/ic-publications

Just one of many resources that the DR Congo has in abundance, coltan, has received an unprecedented amount of attention from Western-based NGOs. They accuse the world’s technology corporations of fuelling the bloody conflict in the eastern Congo region where this metal is found. More accurately termed columbite-tantalite, but universally known by its abbreviation ‘coltan’, author Michael Nest explodes many of the myths that have grown around this controversial metal.

Like any good researcher, Nest takes the time to crosscheck and corroborate the basic facts and figures. One of the first ‘facts’ that he debunks is the commonly cited figure of 80% as the DR Congo’s share of the world’s reserves, or even the world’s production of coltan.

The earliest article he could find that gave this figure was a story from Agence France-Presse that quoted the 80% as Africa’s total, which was then repeated in March and April 2001 respectively by the UK’s Guardian newspaper and New Scientist magazine. It was the BBC News website, in the same year, that first attributed the 80% tag to DR Congo itself.

Nest tells us that there is no shortage of coltan, and it is, in fact, found in many countries around the world. The author’s own research suggests an “informed estimate” that Central Africa has about 9% of the world’s total and the DR Congo has about 7-8% of global reserves. Nest also believes that for much of the 2000s, the DR Congo may have produced around 20% of the world’s total, but historically the largest producer has been Australia.

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As Coal Boosts Mozambique, the Rural Poor Are Left Behind – by Lydia Polgreen (New York Times – November 10, 2012)

http://www.nytimes.com/

CATEME, Mozambique — When Augusto Conselho Chachoka and his neighbors heard that the world’s biggest coal mine was to be built on their land, a tantalizing new future floated before them. Instead of scraping by as subsistence farmers, they would earn wages as miners, they thought. The mining company would build them sturdy new houses, it seemed. Finally, a slice of the wealth that has propelled Mozambique from its war-addled past to its newfound status as one of the world’s fastest-growing economies would be theirs.

Instead, they ended up being moved 25 miles away from the mine, living in crumbling, leaky houses, farming barren plots of land, far from any kind of jobs that the mine might create and farther than ever from Mozambique’s growth miracle.

“Development is coming, but the development is going to certain areas and certain people,” Mr. Chachoka said, taking a break from trying to coax enough food from his scraggly field to feed his six children.

Mozambique is one of the poorest nations in the world, broken by a brutal colonial legacy, a 16-year civil war and failed experiments with Marxist economic policy. But it is also one of the so-called African Lions: countries that are growing at well above 6 percent annually, even amid the global downturn.

Mozambique is poised for a long economic boom, driven by its vast deposits of coal and natural gas. Vale, the Brazilian mining company, is planning to invest $6 billion in its coal operation near here, and other coal giants like Rio Tinto will soon begin producing coal in the Tete region of northern Mozambique.

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Moving South Africa’s mining sector into the 21st century – Mamphela Ramphele -by Geoff Candy (Mineweb.com – November 17, 2012)

http://www.mineweb.com/

A crisis should never be wasted

GEOFF CANDY: Hello and welcome to this mineweb.com newsmaker podcast my name is Geoff Candy and joining me on the line is Dr. Mamphela Ramphele. She’s an author, academic, activist and self-described change agent. She’s been at the height of many of the issues South Africa has faced during its transition from apartheid to democracy. She’s helped found the black consciousness movement in the country and has had transformation very much in the site since the 1970s. She’s the founder of Letsema circle and more recently the Citizens Movement.

She served as the vice Chancellor of the University of Cape Town as well as the managing director of the World Bank. She’s also the chairwoman of Goldfields. Dr. Ramphele thank you for joining me. Now the last in the wave of strikes have affected the country’s mining sector since the tragic events at Marikan, ended yesterday but we’ve seen strikes flaring up in other sectors. One gets the sense that while the strikes have to an end for the moment this was only the opening salvo in a much bigger transformation. Would you agree with that?

DR. MAMPHELA RAMPHELE: I would absolutely agree that we are paying the price of having neglected to pay attention to the urgent need for restructuring or the transformation of our socio economic reality because we inherited in 1994 an economic system and a social system that persists to date.

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Correction: Given platinum’s problems, can Xstrata really justify a Lonmin takeover? – by Lawrence Williams (Mineweb.com – November 12, 2012)

http://www.mineweb.com/

Speculation that Xstrata will make another attempt to oust the Lonmin Board and take the company over remains rife in London, despite Lonmin’s rebuff of the Xstrata overtures. (Correction on Lonmin rights issue status)

LONDON (MINEWEB) – Despite an official rebuff by the Lonmin Board, Xstrata looks as though it may well be about to make a serious play to take over Lonmin and its South African platinum mines – although the timing could be better for the diversified miner with the Glencore merger vote coming up in just over a week’s time – just a day after Lonmin’s own proposed fundraising plan is due to be voted on.

Xstrata is a logical saviour for Lonmin, although the latter doesn’t seem to think so. It owns 24.6% of Lonmin already, has platinum, chrome and ferrochrome operations in the Bushveld Complex area – where 90% of the world’s platinum reserves are thought to lie and which accounts for 70% of annual global production – but is not a major platinum miner and could view picking up the remainder of Lonmin at a relatively cheap price as an attractive long term play.

It is sitting on a huge loss on its existing holding, but nevertheless probably sees Lonmin’s platinum reserves, resources and operations as a great long term asset, particularly at Lonmin’s current hugely depressed share price. But, perhaps importantly if it doesn’t take up its rights, a large proportion of the the Lonmin fundraising could remain with the underwriters – even though the rights issue price has been set at a substantial discount to make it more attractive to existing shareholders.

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Vale’s former boss Agnelli eyes Guinea potential again – by Clara Ferreira-Marques (UK Reuters – November 7, 2012)

http://uk.reuters.com/

Nov 7 (Reuters) – A mining venture co-founded by the former boss of Vale, Roger Agnelli, is among suitors eyeing BHP Billiton’s slice of the Mount Nimba iron ore deposit in Guinea, sources familiar with the matter said.

Other suitors for BHP’s share of the joint venture that holds the Nimba mining concession include the world’s largest steelmaker ArcelorMittal, which has a mine just over the border in Liberia, the sources said.

A dealmaker by background, Agnelli is staging a return to West Africa with billionaire banker Andre Esteves. Two years ago, Agnelli led Brazilian miner Vale’s push into Guinea, controversially taking a stake in iron ore assets that included blocks of the Simandou deposit confiscated by the government from rival Rio Tinto.

Agnelli, 53, was ousted from Vale last year after a decade at the helm. Analysts said his plans for a multinational Vale, did not chime with the Brazilian government’s own, more nationalistic view.

He is returning to mining and Guinea through B&A Mineracao, a partnership between his venture AGN Participacoes and Esteves’ investment bank BTG Pactual Group, just after Vale’s new bosses shelved their major commitment in the country.

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Vale partner says Guinea seeks to seize iron ore rights – by Richard Valdmanis, Clara Ferreira-Marques, and Saliou Samb (Reuters Canada – November 3, 2012)

http://ca.reuters.com/

DAKAR/LONDON (Reuters) – The mining arm of Israeli billionaire Beny Steinmetz’s business empire has accused the government of Guinea of seeking to “illegally seize” its assets through a probe into how it won rights to mine part of a major iron ore deposit.

Privately owned BSG Resources, which has been working in the West African country with Brazilian mining major Vale (VALE5.SA: Quote), confirmed it had received a letter from a government commission alleging improper behavior and graft in its winning of rights to develop blocks in the Simandou region.

The Financial Times reported on Saturday that a government committee backed by philanthropist George Soros had launched a corruption probe into the award process for the blocks in 2008 and sent the letter to BSG including a range of charges.

The blocks were stripped from Anglo-Australian miner Rio Tinto (RIO.AX: Quote) and the licenses passed to BSGR in 2008, under a previous administration. Simandou, in Guinea’s hilly and forested southeast, is estimated to hold what could be the world’s largest unexploited iron ore reserves.

“This is the fifth and most clumsy attempt by an already discredited Government of Guinea in an ongoing campaign to illegally seize BSGR’s assets,” BSGR said in a statement.

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Warnings of more job losses in strike-hit SA mining industry – by Natasha Odendaal (MiningWeekly.com – November 2, 2012)

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

JOHANNESBURG – South Africa’s largest platinum mining companies this week warned of potential job losses, while 400 workers were sacked at a chrome mine and at least one mining contractor confirmed that it would retrench 860 workers.

The warning of potential job losses in a country with a 25.5% unemployment rate comes as the latest Statistics South Africa Quarterly Labour Force Survey revealed a loss of 8 000 jobs in the mining industry during the three months ended September.

Considering that many of the mining companies hit by industrial action only started dismissals in the past month, it was likely that the full impact of the dismissals related to the wildcat strikes would only be seen in the fourth-quarter report.

There was also potential for more job losses arising from possible downsizing at several platinum operations.

Gold and platinum mining companies in recent weeks threatened mass dismissals, offered moderate wage increases and promised once-off bonuses, many in the range of R2 000, to coax workers back to work.

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Major facilitation still needed to create business case for mineral beneficiation [ferrochrome facilities] – by Nomvelo Buthelezi (MiningWeekly.com – October 26, 2012)

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

JOHANNESBURG (miningweekly.com) – According to research by American banking group Citigroup, South Africa is the world’s richest country in terms of its mineral reserves, which are worth about $2.5-billion. This leaves the country with significant potential to capitalise on the mineral reserves through mining and beneficiation – or does it?

Although it may seem that beneficiation is the clear route to take to further enhance the potential that South Africa holds with its extensive mineral wealth, there are major demands that must still be met before entrepreneurs will so much as utter the word ‘beneficiation’.

Firstly, there must be a business case for beneficiation; trying to force-feed it is utter folly. Where there are sound business cases, there is then the need for entrepreneurs to step up to the plate, which they will only do if South Africa’s political environment improves.

From government’s side, there has to be adequate electricity capacity and that elec- tricity has to be affordable. The next need is for the availability of the required skills, regrettably within a South African education and training environment that is currently poor. Also required are high-level marketing capability and logistics capacity.

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Striking South African miners killed at Canadian coal mine: reports – by Geoffrey York (Globe and Mail – November 1, 2012)

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 — Two striking miners have been killed by security guards at a Toronto-based company’s coal mine in South Africa, local reports say.

The deaths, confirmed by the company Thursday, are the latest in a year of sporadic violence that has killed more than 60 people at mines across South Africa, including 34 who were killed by police at the Marikana platinum mine in August.

In the clash on Wednesday, about 100 striking workers tried to storm a locked mine-explosives armoury at a coal mine owned by Toronto-based Forbes & Manhattan Coal, but were dispersed by security guards, police said.

“It is further alleged that the security officers chased some of the workers into an informal settlement near the mine and shots were fired, injuring two men,” police spokesman Colonel Jay Naicker said in a statement.

He said the two men died from their injuries in hospital, and police are investigating two counts of murder. The company confirmed Thursday that two of its employees were killed in the clash.

The company said it has suspended operations at its Magdalena and Aviemore underground coal mines in South Africa, where strikes have been continuing since Oct. 17.

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Centamin’s licence for flagship Sukari mine revoked by Egyptian court – by Peter Koven (National Post – October 31, 2012)

The National Post is Canada’s second largest national paper.

TORONTO – More than 18 months after the revolution, political risk remains a serious concern for companies doing business in Egypt.

Investors in Toronto-listed gold miner Centamin PLC learned this fact first-hand Tuesday, after an administrative court in Egypt ruled the company’s concession on its flagship Sukari mine should be revoked. There was no written judgment to go with the decision and Centamin was unable to get details.

The stock traded briefly in London, and was down 35% Tuesday morning before being suspended. It was halted in Toronto and never opened for trading.

The ruling was made as part of an ongoing case that originates with an Egyptian lawyer named Hamdy El Fakharany. He argues that the licence for Sukari should be revoked because of irregularities with the contract, which dates back to 1994, and because it does not generate enough revenue for Egyptians.

Centamin claims the Sukari concession agreement is valid and that this court has no jurisdiction to overturn it. The company is continuing operations at Sukari as if nothing happened, and analysts believe this issue can be settled at Egypt’s Supreme Court.

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Cynthia Carroll’s Anglo American legacy – by Geoff Candy (Mineweb.com – October 29, 2012)

 http://www.mineweb.com/

The numbers only really tell one side of the story.

GRONINGEN (MINEWEB) – When Cynthia Carroll, a coal geologist by training and, formerly, of Canada’s Alcan, took the reins at Anglo American in March 2007, then Chairman Mark Moody-Stuart cited her “clear leadership and communication skills, her highly relevant hands-on operational experience and her record of working with governments and other key stakeholders,” as important attributes.

This is the legacy Carroll leaves behind her by the numbers: In its 2006 financial year, Anglo American’s produced $5.5 billion in underlying earnings, a 46% increase over 2005. Operating profit jumped 54% to 9.8 billion and net debt fell 33% to 3.3 billion. The group also recorded the deaths of 44 employees and contractors. In 2011, the group reported a group operating profit of $11.1 billion and underlying earnings of $6.1 billion. It spent $5.8 billion in capex and reduced net debt to $1.4 billion down from $7.4 billion in 2010. The group also reported 17 deaths.

In between those numbers, however, lies a much broader story. Firstly, as my colleague Dorothy Kosich wrote a year after Carroll’s appointment was announced, “Carroll shattered the glass ceiling of international mining as the first female CEO to head a mega-mining company, specifically with deep South African roots. In an industry, which barely allowed women to work underground a couple of decades ago, Carroll’s appointment is a substantive indicator of change in mindset among international miners…Carroll also hails from Canada’s Alcan, where as president of the Primary Metals Group, she had to convince a sceptical public that smelting aluminium could actually evolve into a sustainable, environmentally clean activity.

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