Archive | Africa Mining

HARRY OPPENHEIMER: 110 YEARS AGO, A LEGEND WAS BORN – by Iris Hortman (Israeli Diamond Industry – December 30, 2018)

Israeli Diamond Industry

More than anyone else, Oppenheimer is responsible for associating diamonds with romantic love

Harry Frederick Oppenheimer (1908-2000), born 110 years ago in South Africa, was one of the most prominent figures in the global diamond industry; more than anyone else, Oppenheimer is responsible for associating diamonds with romantic love, and the transformation of diamonds into a symbol of marriage.

Harry was the son of Sir Ernest Oppenheimer, founder of the multinational mining company Anglo American Corporation of South Africa, which took over De Beers after WWI. In 1929, Ernest Oppenheimer became Chairman of De Beers. Over the years his son took over, and under his leadership De Beers became a global leader in diamond mining.

Diamonds are Forever

More than anything else, Harry Oppenheimer is remembered for his contribution to the promotion and marketing of polished diamonds. In the mid-1930s, he persuaded his father and the company that they should advertise their polished stones – an innovative suggestion that was initially met with opposition. While some argued that advertising would degrade the image of diamonds, young Oppenheimer initiated a revolutionary marketing concept: Diamonds as a symbol of romantic love. Continue Reading →

Canadian miner Nevsun Resources has a tangled relationship with one of the world’s most repressive regimes – by Geoffrey York (Globe and Mail – December 29, 2018)

The road from Eritrea’s mountain capital to the Red Sea is narrow and dangerous. It descends steeply in switchbacks and hairpin turns, dotted with stone crosses that mark the deaths of drivers who failed to navigate the hazards: rock falls, steep cliffs, wandering goats, herds of camels, troops of baboons.

Now, the mountain road has a new menace: Hundreds of massive, Chinese-made trucks are thundering in a steady procession to the sea, carrying thousands of tonnes of zinc and copper concentrate from a Canadian-owned mine and roaring perilously close to shepherds and village children along the route.

The mine’s majority owner, Vancouver-based Nevsun Resources Ltd., has been warned by its own human-rights auditor – and by the United Nations children’s agency – about the potentially lethal risks of the truck traffic on the mountain road, especially to local children. Continue Reading →

The Congo’s increasing instability heightens critical minerals concern – by Greg Klein (Resource Clips – January 3, 2019)

This is the place that inspired the term “crimes against humanity.” As a timely new book points out, American writer George Washington Williams coined that phrase in 1890 after witnessing the cruel rapaciousness of Belgian King Leopold II’s rubber plantations in the country now known as the Democratic Republic of Congo.

After rubber, the land and its people were exploited for ivory, copper, uranium, diamonds, oil, ivory, timber, gold and—of increasing concern for Westerners remote from the humanitarian plight—cobalt, tin, tungsten and tantalum. Controversy over recent elections now threatens the DRC with even greater unrest, possibly full-scale war.

The country of 85 million people typically changes governments through coup, rebellion or sham elections. Outgoing president Joseph Kabila ruled unconstitutionally since December 2016, when his mandate ended. Continue Reading →

Barrick’s New CEO Says Gold Industry Shake-Up Is Just Starting – by Thomas Biesheuvel (Bloomberg News – January 2, 2019)

Barrick Gold Corp.’s new chief executive officer has a message for the gold industry: This is just the start of a big shake-up.

Barrick agreed to buy smaller rival Randgold Resources Ltd. in a $5.4 billion deal announced in September. As part of the agreement, Randgold’s CEO, Mark Bristow, became the chief executive of Barrick, the world’s biggest gold miner.

“Without a doubt, this industry needs transformation,” Bristow said in an interview from New York, where the combined company started trading Wednesday. “We believe we have started that. We’re going to end up with a blue-chip business and on the way we’re not going to be sitting on our hands should there be other opportunities.” Continue Reading →

Barrick’s new CEO defends head-office job cuts as Randgold acquisition closes – by Niall McGee (Globe and Mail – January 3, 2019)

Barrick Gold Corp.’s new chief executive officer defended the company’s decision to lay off more than half of the staff at its Toronto head office before Christmas, saying it was a necessary move in a difficult market.

Barrick issued layoff notices to about 95 people at its headquarters in December, bringing its headcount down to about 65 people, The Globe and Mail reported on Dec. 21. In an interview, CEO Mark Bristow said there are no plans to shut the office entirely, adding that a continuing staff is needed to carry out treasury services, human resources and accounting.

In another sign of Barrick’s diminished presence in the country, the gold miner announced a revamped board of directors on which only one of nine members is Canadian. Leaving the board are Anthony Munk, son of Barrick founder Peter Munk; Toronto-based mining consultant Graham Clow; and Robert Prichard, who is chair of Bank of Montreal. Continue Reading →

Supreme Court set to hear Nevsun Resources case on Eritrea human rights abuses – by Julius Melnitzer (Financial Post – December 27, 2018)

The future of the Canadian resource industry hangs in the balance as the Supreme Court of Canada prepares to hear a high-profile case accusing Canadian miner Nevsun Resources Ltd. of human rights abuses in Eritrea.

At the heart of the hearing, set for Jan. 23, is whether customary international law (CIL) — a fairly undefined and shifting body of law that has, to date, only been applied to sovereign states — will now apply to Canadian companies. Traditionally, Canadian courts have been loath to deal with violations of international law that have occurred abroad.

The Nevsun case could change that — an unappealing outcome for Canadian multinationals, especially resource-extraction companies who must often enter into arrangements with foreign governments regarding their exploration and development initiatives. Continue Reading →

Grand Theft Cobalt: Rotterdam – by Kit Chellel and Mark Burton (Bloomberg News – December 27, 2018)

Thieves are pulling off audacious metal heists at Europe’s largest port. They’re even stealing from the Cobalt Jesus.

A group of bankers, brokers, and journalists was huddled outside a dingy warehouse along the Nieuwe Maas River in Rotterdam on a gray morning last January. All around was the industrial sprawl of Europe’s largest port, a landscape of cranes and colorful shipping containers stacked up like Lego bricks, reversing trucks and squalling gulls.

The building was run by Vollers Group GmbH, a logistics specialist based in Germany. One of its managers, Martijn Wijbrandi, led his visitors inside to get high-viz jackets and a safety briefing. We’ve never had a problem with theft, Wijbrandi said, but it pays to be careful.

He pointed out the alarm system, secured by a PIN code. On the warehouse floor, everyone filed past piles of magnesium bricks and bags of coffee to an area walled off by steel sheets that rose almost to the ceiling. A security camera was aimed at the padlocked sliding door. Continue Reading →

Barrick’s no-premium Randgold deal expected to spur more mining M&A in 2019 – by Niall McGee (Globe and Mail – January 1, 2019)

Junior mining companies struggled once again to raise capital in 2018 with
the lowest level of equity issuance in the North American metals and mining
sector in 13 years. To fill the void, many have turned to more expensive
methods of raising capital, including royalty agreements and streaming deals.

Barrick Gold Corp.’s “no-premium” US$6-billion acquisition of Randgold Resources Ltd. is expected to trigger more deal making in the struggling Canadian gold sector in 2019.

During the great commodities boom of the mid-2000s, Barrick and others unveiled splashy multibillion-dollar-premium takeovers only eventually to take massive writedowns. But in September, Barrick broke away from the old model by announcing it will pay merely the market price for Randgold. The deal was warmly greeted by shareholders on both sides as a sensible solution in a difficult market.

“M&A has slowly been re-entering investor consciousness, and we suspect this trend will gain momentum in 2019, especially since there have now been a few successful transactions,” BMO Nesbitt Burns Inc. analyst Andrew Kaip wrote in a note to clients, including the Barrick-Randgold deal as an example. Continue Reading →

Breakingviews – China will outdo U.S. in scramble for Africa – by Ed Cropley (Reuters U.S. – December 28, 2018)

LONDON (Reuters Breakingviews) – China and the United States’ global Cold War has an increasingly important theatre: Africa. On different metrics Uncle Sam and the Middle Kingdom can claim to be the continent’s biggest player. In 2019, China will pull ahead.

The United States has $57 billion of FDI stock, United Nations data shows, narrowly ahead of Britain and France. But China had cumulative investment worth $40 billion in 2016, against just $16 billion in 2011.

In trade terms it has been Africa’s main partner for a decade. Its sum of exports and imports in 2017 was $170 billion, over three times America’s. Washington has noticed. In mid-2018, as Donald Trump launched his trade war, the U.S. president recognised China’s threat by doubling development finance to $60 billion – a far cry from Trump’s previous dismissal of unspecified African countries as “shitholes”. Continue Reading →

‘We definitely need more assets in Canada,’ Barrick’s new CEO says – by Nicole Gibillini(Bloomberg News – January 3, 2019)

Barrick Gold Corp. () needs more assets in Canada, the gold miner’s new chief executive officer said Wednesday, on the company’s first day of trading since its recent acquisition of Randgold Resources Ltd.

“Barrick is back,” 59-year-old Mark Bristow told BNN Bloomberg in an interview from the New York Stock Exchange. “We should be proud of being team players in the Barrick family, and one of the things that I really am focused on is we definitely need more assets in Canada. ”

Barrick currently operates just one mine in the country – Hemlo Mines – east of Thunder Bay, Ont. “Don’t get too hung up right now on us only having Hemlo,” Bristow added. “We’re definitely focused on growing this business and you’re correct if you’re recognizing that we’re underweight in our investments in Canada.” Continue Reading →

Three days of violence that emptied an Angolan town of Congolese – by Stephen Eisenhammer and Giulia Paravicini (Reuters U.S. – October 25, 2018)

LUCAPA, Angola (Reuters) – Residents of Kapende, a Congolese neighborhood in the Angolan town of Lucapa, scrawled messages on their homes to keep the looters away, but it did not work.

“Occupied”, “do not enter”, “home of an Angolan”: The writing remains visible on the wrecked houses belonging to Congolese who have gone home as Angola has clamped down on illegal diamond mines and the migrants who worked them.

The destruction in Kapende, where no house remains occupied or intact, marked the culmination of three days of violence in Lucapa, a sprawling mining town in the northeast surrounded by some of the world’s richest diamond fields. About 300,000 Congolese have fled Angola in the last few weeks, many of them in response to the violence in Lucapa at the beginning of October. Continue Reading →

How this African election could spell trouble for Tesla – by Aleks Vickovich (Your Money – December 20, 2018)

Your Money

Supply of precious metals hinge on peace in this troubled country.

Few rags to riches stories exemplify the troubles of Africa like the rise of Joseph Kabila. Born in a small village in what was then Zaire in 1971, a military career led him ultimately to the presidency of the Democratic Republic of the Congo and (in what is unfortunately unlikely to be a coincidence) vast personal wealth.

Like far too many sub-Saharan leaders, Kabila’s reign has become synonymous with conflict and corruption. Researchers at New York University have estimated that the First Family has financial interests in companies, especially miners, worth hundreds of millions of dollars.

Meanwhile the average salary in the DRC is $394 USD per annum, and many Congolese citizens live in unsafe and unhealthy conditions, and some in full-blown warzones. This weekend, the people of the so-called Democratic republic have an opportunity to exercise that democracy and put an end to the Kabila regime. At least in theory. Continue Reading →

Katanga Mining, CEO and former insiders to pay $34.4-million in OSC settlement over misleading disclosures – by Niall McGee (Globe and Mail – December 19, 2018)

Katanga Mining Ltd., its chief executive and six former insiders admitted they broke Canadian securities laws and have agreed to pay $34.4-million in penalties in a settlement with regulators that centred on “materially misleading” financial disclosures.

The Ontario Securities Commission fined Katanga CEO Johnny Blizzard $400,000 on Tuesday and banned him from serving as an officer or director with a Canadian-listed company for two years. Mr. Blizzard, who has been CEO since February, 2015, has agreed to step down from the company within 30 days.

The OSC levied the largest individual fine on Aristotelis Mistakidis, who will pay $2.45-million and is subject to an officer and director ban for four years. Mr. Mistakidis was a director with Katanga until late last year and is the outgoing head of Glencore PLC’s copper unit. Continue Reading →

The Quest for a Moral Diamond – by Monte Reel (Bloomberg News – December 18, 2018)

The Peace Diamond, and the miner who found it, are at the center of a new push to redeem African diamond mining.

From a pickup truck heading out of Freetown, Sierra Leone’s recent history is legible in the images that scroll beyond the passenger-side window. A hand-painted sign reading “Amputee Lodge” points to a structure serving victims brutalized by an 11-year civil war that ended in 2002. Next comes a billboard that says “Report Bribery,” a plea to resist the corruption blamed for siphoning away international relief funds and obstructing postwar recovery.

A faded canvas banner—“Only You Can Stop Ebola”—is a tattered relic from a 2014 outbreak that killed thousands. As we ascend the hills on the city’s periphery, a glance in the rearview mirror reveals a thick brown stripe running down the face of a distant slope: the scar from a 2017 mudslide that devoured the homes of at least 3,000 people, killing more than 1,100 of them.

For a break from all this misfortune and calamity, stop looking out the window and focus on the man in the passenger seat of the truck. His name is Emmanuel Momoh, and by general consensus, he’s the luckiest man in Sierra Leone. Until last year, Momoh, 44, wasn’t much different from anyone else in a country where more than 60 percent of the population lives on less than $1.25 per day. Continue Reading →

Katanga Mining’s financial penalties in OSC settlement to top $20 million: sources – by Barbara Shecter (Financial Post – December 18, 2018)

Katanga Mining Ltd., a subsidiary of Anglo-Swiss commodities and mining conglomerate Glencore PLC, is expected to settle serious allegations — including making misleading statements and failing to disclose risks associated with its operations in the Democratic Republic of Congo — at a hearing Dec. 18 in front of Canada’s largest capital markets regulator.

The combined financial penalties in the proposed settlement are understood to exceed $20 million, and a number of individuals are also expected to settle, including a key long-serving executive of the parent company who sat on Katanga’s board, sources say.

The Ontario Securities Commission had been investigating Katanga for months, including whether the firm, whose shares are traded on the Toronto Stock Exchange, adequately disclosed risks pertaining to international bribery, government payment and anti-corruption laws. Commission staff disclosed their allegations resulting from the probe in a 33-page document made public on Monday. Continue Reading →