Asia Mining – Page 172 – Republic of Mining

Canadian miner rises above obstacles in Philippines – by Matthew Fisher (National Post – October 25, 2013)

October 25, 2013

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

Given environmental concerns and sensitivities about foreign ownership, mining these days can be an immensely complicated business anywhere. This has proven to be especially true for a Canadian company operating in the southern Philippines.

TVI Resource Development (Philippines) Inc. —a Filipino-Canadian venture affiliated with Calgary-based TVI Pacific Inc. — has weathered the fallout from a series of sinister emails that were sent to senior politicians, military officers and journalists.

The correspondence purported to show company officials were conspiring to assassinate a local leader and launch violent attacks on small-scale miners whose claim that they had pre-existing rights in the area where TVIRD is developing a gold and silver mine had been rejected by the government agency responsible for mining.

“To cut to the end of the story first, they established with 100% certainty that the charges were totally fabricated,” said John Ridsel, a Canadian who was TVIRD’s chief operating officer in the Philippines until mid-2011 and remains a consultant.

To prove the emails were fraudulent, TVIRD hired two cyber forensic firms. A separate inquiry was undertaken by the Philippine National Bureau of Investigations.

Indonesia mining at risk over export ban – by Ben Bland (Financial Times – October 22, 2013)

October 22, 2013

http://www.ft.com/home/us

Indonesia’s mining industry will collapse if the government moves ahead with a planned ban on the export of raw minerals, the country’s chamber of commerce has warned.

The southeast Asian nation, which is facing strong economic headwinds, is the biggest exporter of coal for power stations, nickel ore and tin, and a leading shipper of bauxite and copper. But on January 1 it is set to implement a law prohibiting the export of unprocessed metals as part of a drive to refine the ores and potentially generate higher margins.

Mining companies and independent economists are critical, arguing that at current depressed global prices for both raw and refined minerals, it is not a financially viable option in infrastructure- and energy-poor Indonesia, especially with no commitment to invest from the government.

The US Agency for International Development has argued that the push towards refining coupled with the ban would create few jobs and could lead to $6.3bn of lost economic benefits annually by prioritising spending on refineries with “poor commercial prospects” over investment in the country’s decrepit education, health and infrastructure systems.

Potential Indonesian nickel export ban bodes well for prices, poorly for pig iron – by Freya Berry (Mineweb.com – October 18, 2013)

October 18, 2013

http://www.mineweb.com/

While it is not certain the ban will go ahead unchanged, if it does, analysts say, it would be a game-changer for prices.

LONDON (REUTERS) – A potential ban on nickel ore exports by Indonesia next year and production cutbacks could lift the price of this year’s worst-performing base metal by more than 20 percent off multi-year lows, analysts said.

Indonesia, the world’s top exporter of nickel ore, has said it plans to bring in a ban on unprocessed ore exports from Jan. 1, 2014. Its ore is currently shipped to China to produce nickel pig iron, a cheap substitute for higher grade nickel in stainless steel.

It is not certain that the ban will go ahead unchanged, but if it does analysts said it would be a game-changer for prices. Benchmark nickel on the London Metal Exchange has fallen by around a fifth since January to four-year lows, weighed down by over-supply, and was trading at $13,963 a tonne at 1529 GMT on Thursday.

“It’s such an important swing factor for the market that you could see a decent rally in the nickel market if a ban is strictly enforced – at least 20 or 30 percent,” said Daniel Smith, head of metals research at Standard Chartered.

Shipments of Rio Tinto’s Mongolia copper stalled by China import snags (Globe and Mail – October 16, 2013)

October 16, 2013

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.

SYDNEY — Reuters – Global miner Rio Tinto Ltd. could be forced to amass a mountain of copper concentrate at its new $6-billion (U.S.) Oyu Tolgoi mine in Mongolia while Chinese buyers resolve a lengthy customs impasse with their government.

The Oyu Tolgoi concentrator continued to ramp up production in the third quarter and is now operating at maximum processing capacity of 100,000 tonnes of ore a day, said Toronto-listed Turquoise Hill Resources Ltd. of Vancouver, which runs Oyu Tolgoi and is 66 per cent owned by Rio Tinto.

Oyu Tolgoi was supposed to start shipping copper concentrate to China shortly after the mine opened in July. But instead has been forced to stockpile the material while buyers negotiate with Chinese customs officials over import approvals.

“Oyu Tolgoi’s customers are making good progress with Chinese customs officials to resolve matters with purchased concentrate at the border,” Turquoise Hill chief executive officer Kay Priestly said in a statement.

Northern China is running out of water, but the government’s remedies are potentially disastrous (The Economist – October 12, 2013)

October 16, 2013

http://www.economist.com/

BEIJING – CHINA endures choking smog, mass destruction of habitats and food poisoned with heavy metals. But ask an environmentalist what is the country’s biggest problem, and the answer is always the same. “Water is the worst,” says Wang Tao, of the Carnegie-Tsinghua Centre in Beijing, “because of its scarcity, and because of its pollution.” “Water,” agrees Pan Jiahua, of the Chinese Academy of Social Sciences. “People can’t survive in a desert.” Wang Shucheng, a former water minister, once said: “To fight for every drop of water or die: that is the challenge facing China.”

He was not exaggerating. A stock image of China is a fisherman and his cormorant on a placid lake. The reality is different. The country uses 600 billion cubic metres (21,200 billion cubic feet) of water a year, or about 400 cubic metres a person—one-quarter of what the average American uses and less than half the international definition of water stress.

The national average hides an even more alarming regional disparity. Four-fifths of China’s water is in the south, notably the Yangzi river basin. Half the people and two-thirds of the farmland are in the north, including the Yellow River basin. Beijing has the sort of water scarcity usually associated with Saudi Arabia: just 100 cubic metres per person a year. The water table under the capital has dropped by 300 metres (nearly 1,000 feet) since the 1970s.

CHINA, ZAMBIA, AND A CLASH IN A COAL MINE – by ALEXIS OKEOWO (New Yorker Magazine – October 10, 2013)

October 11, 2013

http://www.newyorker.com/

Alexis Okeowo received support for the reporting in this post from the Pulitzer Center on Crisis Reporting.

Twelve hundred Zambians gathered on a sunny morning in August of 2012 to protest at Collum Coal Mine, which is located in a rural southern province and, at the time, was owned by five Chinese brothers. They were angry about the working conditions in the mine: Collum had been cited several times by Zambia’s government for labor violations, and miners said that they felt unsafe working there. They were also upset about annual wage increases that they said amounted to only a single Zambian kwacha—the equivalent of twenty cents.

The miners learned that a Chinese foreman had brought outside workers to replace them during the protest, according to one of the protesting miners, twenty-eight-year-old Robert Mundike. Mundike and his co-workers confronted the foreman at one of the mine’s shafts and assaulted him. Then, according to Mundike, they beat up more Chinese workers, along with Zambian miners who were still working even though the protesters had told them not to.

The group—which included not only Collum miners but also their relatives and former workers who said they were owed wages—was becoming restless. They reached another mine shaft, near a cluster of houses where several Chinese supervisors lived. Five Chinese men ran from the settlement, past the coal-carrying conveyor belt and a rock crusher and into the mine, Danny Sikatari, who works as a mine foreman but who did not participate in the protest, told me.

China’s changing growth profile and the commodities that stand to benefit – by Geoff Candy (Mineweb.com – October 11, 2013)

October 11, 2013

http://www.mineweb.com/

According to Standard Bank, while it is not going to be a linear progression, the nature of Chinese growth is likely to moderate over the next five years.

GRONINGEN (MINEWEB) – Like any good relationship, it is hard to imagine one’s life without the other person while things are going well. Which is why, any mention of slowing growth in China was met by many in the commodities market with loud cries of “I can’t hear you” and hands clasped firmly over ears.

A case in point, it could be argued, is the massive expansion in iron ore production by the likes of Rio Tinto and BHP Billiton in the face of slowing demand from China, which is expected to result in at least four years of expanding gluts, according to data compiled by Bloomberg.

That’s also not to say, and this is an important distinction, that growth in China has stopped, rather it is moderating. Overall growth is expected to slow over the course of the next few years but it is still going to be at a healthy rate. Indeed, it should also be noted that the base on which this, albeit slower, growth is now placed, and thus the quantum of commodities required in any given year, is vastly higher than it once was.

Asean nations continue to develop mining industry – by Henry J. Schumacher (Business Mirror – October 9, 2013)

October 11, 2013

http://www.businessmirror.com.ph/index.php/en/ [Philippines]

ASSOCIATION of Southeast Asian Nations (Asean) member-states are mineral rich, and mining is playing an increasingly important role in the region’s economic growth (hopefully also in the Philippines). In Indonesia, Southeast Asia’s largest economy, mining accounts for 12 percent of gross domestic product.

Even as global demand has eased, Asia’s locomotive economies continue to drive Asean’s fast-developing mining sector, especially China, which consumes more than 40 percent of the world’s output of industrial ores.

The most rapid growth in both Indonesia and other Asean states has been seen in the extraction of industrial minerals—such as copper, nickel, tin and, more recently, gold. The region’s status as an area of world mineral importance, with immense, still to be exploited, deposits of an almost limitless range of ores, is a focus for the world’s biggest developers.

The Philippines is considered to be the fifth most mineralized country in the world, with its gold resources ranking as the third largest. The country also has the fourth-largest copper resources and fifth-largest nickel deposits. However, only a relatively small amount of territory has been mined.

Myanmar’s resources star dims after mine reform delay – by Melanie Burton (Reuters India – October 4, 2013)

October 4, 2013

http://in.reuters.com/

SINGAPORE, Oct 4 (Reuters) – A year ago Myanmar was the hot new destination for resources investors looking to make a fast buck in a country opening up to the outside world, but a new mining law is still not passed, the hot-money crowd has filed out and reality has set in. Yet while funding options may have slimmed, opportunity is still knocking, industry participants at a conference in Singapore said this week.

“A year ago everyone was going to Myanmar. You couldn’t get on a flight there because every flight was booked,” said Edward Rochette, chief executive of Canadian explorer East Asia Minerals Corporation, which has applied for an exploration permit in the country.

“Investors were thinking: ‘It’s wide open, it’s the Wild West, we’ll just sign and be done’. Unfortunately, it’s going to take time,” he added.

Explorers have banged up against processing times for prospecting permits stretching out several years while commodity prices have fizzled and debt and equity funding markets have dried up. The country has to fight harder to attract capital.

Tracing the Chinese gold rush – by Jan Skoyles (Mineweb.com – October 1, 2013)

October 4, 2013

http://www.mineweb.com/

According to Jan Skoyles, 2013 will be remembered by the gold market as the year of China, but the Asian giant’s domination, while quick hasn’t happened overnight.

LONDON (THE REAL ASSET COMPANY) – The year 2013 in the gold investment market will be remembered as the year of China, so we’ve produced a stunning infographic detailing China’s great golden rise to power.

In just a few months the world’s largest country will overtake India as the biggest consumer of gold and its gold market continues to break records.

A country that already mines over 400 tonnes of gold a year, China still demands more physical gold no matter the price. Between January and July this year the Shanghai Gold Exchange delivered more than 1,333 tonnes to gold investors.

In the last 100 years China’s gold mine productivity has climbed from just 4 tons of gold in 1949 to an expected 440 tons this year, none of which is exported. Hong Kong imports have been over 600 tonnes this year alone, but still more gold is demanded.

Appetite for Destruction – by Damien Ma and William Adams (Foreign Policy Magazine – October 1, 2013)

October 3, 2013

http://www.foreignpolicy.com/

Why feeding China’s 1.3 billion people could leave the rest of the world hungry.

On Aug. 20, the Australian mining giant BHP Billiton announced that it will pump nearly $3 billion into developing a deposit of Canadian potash, a mineral used in the manufacture of fertilizer destined for farms fields across the world. And in late September, Chinese pork producer Shuanghui officially purchased Smithfield Foods in the largest Chinese acquisition ever made in the United States. The companies’ investments are both decisions that speak to a vote of confidence in global food consumption growth over the next decade — and nowhere will bellies be filling up faster than in China.

For three decades, resource-intensive manufacturing fueled China’s spectacular economic rise. By 2012, the country was consuming nearly half of the world’s coal and producing 46 percent of its steel, 43 percent of its aluminum, and about 60 percent of its cement. The Chinese economy has slowed in 2013 in part because of the government’s recognition that such a resource-intensive growth model has become unsustainable.

As a result, Beijing is trying to rebalance away from exports and investments and toward domestic consumption. Companies like BHP Billiton are betting that China’s rebalancing will spur rapid growth in demand for food and the inputs needed to produce it.

Wanted by the taxman: Indonesia’s $5 billion of lost coal – by Fergus Jensen (Reuters U.S. – October 1, 2013)

October 3, 2013

http://www.reuters.com/

JAKARTA – (Reuters) – Indonesia may be the world’s top exporter of thermal coal, but that masks an embarrassing fact for a government scrambling to raise revenue – more than $5 billion worth of the fuel is mined illegally and goes untaxed each year.

Export and consumption data shows Indonesia produces around 12-15 percent more coal annually than the ministry of energy and mineral resources reports. That’s enough to supply Taiwan, the world’s fifth-largest coal importer, for a year.

The $460 million of lost tax revenue that industry officials estimate this represents would provide Jakarta, which is considering roughly doubling royalties paid by coal producers, with some of the funds it needs to redress its budget deficit.

The gap between recorded and actual output has also attracted the attention of Indonesia’s top anti-graft agency the Corruption Eradication Commission (KPK).

A combination of export data from the Bureau of Statistics, using customs information, and consumption data from state electricity utility Perusahaan Listrik Negara PLNEG.UL, shows Indonesia’s total coal output at 451.9 million tons in 2012.

The Myth of Indonesia’s Resource Nationalism – by John Kurtz and James Van Zorge (Wall Street Journal – October 1, 2013)

October 2, 2013

http://online.wsj.com/home-page

Jakarta’s new mining and oil regulations are really about rent-seeking and corruption.

Mr. Kurtz is head of Asia-Pacific for A.T. Kearney, where Mr. Van Zorge is a senior fellow.

Jakarta – Lately, the Indonesian government has unleashed an array of policies that are keeping mining and oil executives awake at night across this vast and geologically rich archipelago. The unpopular new regulations, aimed at reforming the mining and oil industries, are promoted in the name of “national interest.” Yet left uncorrected, they will inevitably lead to a dramatic decline of output in Indonesia’s extractive industries, damaging foreign investment and economic growth.

Particularly hard-hit will be some of Indonesia’s less-developed regions such as Kalimantan and Papua, where oil and mining play major economic roles. “Equating the government to the Emperor Nero and the local mining industry to ancient Rome,” said Bill Sullivan, leading legal consultant for the mining industry in Indonesia, “It is as if Nero is choosing to complacently fiddle while Rome burns.”

Why exactly this fiddling persists—especially since large investors have already cut back from planned capital outlays—is open to debate.

What China’s massive urbanization drive means for Canada’s economy – by John Shmuel (National Post – October 2, 2013)

October 2, 2013

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

China’s premier, Li Keqiang, announced earlier this year upon taking office that he
wants to modernize China’s economy. Part of that will involve facilitating the movement
of 400 million rural Chinese to the country’s cities over the next decade. A lot of
expectation is pinned on this mass urbanization. (John Shmuel – National Post)

There’s an ambitious plan underway in China , one that will represent one of the largest migrations of humans in history. China’s premier, Li Keqiang, announced earlier this year upon taking office that he wants to modernize China’s economy. Part of that will involve facilitating the movement of 400 million rural Chinese to the country’s cities over the next decade.

A lot of expectation is pinned on this mass urbanization. Officials in the country hope it will transform China’s economy, the world’s second largest, into one that resembles those of the developed world, instead of the credit-focused, export-driven economy that China is today.

It’s also a transformation that, if successful, will hugely benefit Canada’s economy and companies.