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Asia Mining

Indonesia limits foreign ownership of mines – by Reza Thaher and Neil Chatterjee (Globe and Mail – March 7, 2012)

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.

JAKARTA— Reuters –Indonesia will take more of the profits from its vast mineral resources by limiting foreign ownership of mines in a move likely to scare off new investment in the world’s top exporter of thermal coal and tin.
 
Under new rules announced on the mining ministry’s website, Southeast Asia’s largest economy will require foreign companies to sell down stakes in mines and increase domestic ownership to at least 51 per cent by the 10th year of production.

The move is part of a global trend of increased resource nationalization that is pushing up the costs of mining for international companies and giving governments in emerging market countries more cash and clout.
 
Indonesia may have a fresh stamp of approval from ratings agencies as an investment grade nation, but the unexpected regulation underlines continuing policy uncertainties that have long been a major risk for investors hoping to tap some of the world’s richest deposits of coal, gold and copper.

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Deals Underscore Chinese Interest in Canada’s Mineral Riches – by Marilyn Scales

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Not so long ago, say 10 years, the Chinese were thought of as a poor, insular nation, mysterious and of a peculiar political stripe. Now we must lay aside those notions and recognize that China is an economic powerhouse. Whatever remains of “communism” in that country is proving to have very capitalistic talents. Hence, the many foreign investments made in the last two years while the rest of the world suffered economic meltdown.

Here are a few of the investments made by Chinese investors outside that country in the past two years:   
 
-Aluminum Corp. of China (Chinalco) attempted to invest US$19.5 billion in Rio Tinto
-China Minmetals made a A$2.6 billion bid for Australian miner Oz MineralsChina Mining United Fund bought into Canadian juniors including

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The Chinese are coming! The Chinese are coming! – by Marilyn Scales

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Readers are advised to get out their chopsticks and start practising because the Chinese are coming to Canada. In two separate deals since the beginning of this year, Jilin Jien Nickel Industry has shelled out cash to gain a toehold in potential new nickel producers.

In April, Jien agreed to advance $30 million to Edmonton’s Liberty Mines. Liberty has suspended work at its Redstone nickel mine, but it is hoping to reopen the McWatters nickel-copper mine and make a development decision on the Hart nickel-copper-PGE project. These projects are all near Timmins, ON, and all have measured and/or indicated resources.

For its investment, Jien has received 51% of the issued and outstanding Liberty common shares. The Chinese partner also holds close to 187 million convertible and redeemable preferred shares. If all the preferred shares are converted, Jien will hold 76.8% of Liberty. Jien will also appoint four of the seven Liberty directors.

Separately, Jien has become a joint venture partner with Vancouver’s Goldbrook Ventures on Goldbrook’s Raglan Belt property in northern Quebec.

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Arming Private Security in the Philippines – by Marilyn Scales

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Halloween is fast approaching, and I am filled with scary thoughts. I can imagine little ghosts and goblins shrieking for treats. I can imagine costumed superheroes playing gruesome tricks. But the truly frightening thing that I came across this week is the decision made by the Philippine government to allow mining companies to arm their private security forces.

According to reports from GMANews.TV, mining companies in the Philippines will be allowed to established civilian auxiliary armed groups (CAGs) as an adjunct to the local military. CAG members will carry only low-calibre guns, but that is little consolation to anyone who has ever been on the receiving end of a bullet.

Philippine Defence Secretary Gilberto C. Teodoro reportedly said that miners will be allowed to have a many armed men “as necessary depending on the threat level and the terrain” as along as each company signs an agreement with the Armed Forces.

I find this proposal frightening for several reasons.

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