Australia/New Caledonia/Papua New Guinea Mining – Page 96

Biggest U.S. Iron Ore Producer Says Rio, BHP in ‘Imaginary World’ – by Jasmine Ng (Bloomberg News – November 4, 2015)

November 4, 2015

http://www.bloomberg.com/

The biggest iron ore producer in the U.S. says its larger rivals in Australia are hurting themselves as well as their competitors as they ramp-up production in an oversupplied market.

With iron ore slumping to less than $50 a metric ton, revenues at the biggest miners are shrinking faster than costs, according to the head of Cliffs Natural Resources Inc., who said the majors’ expectations that rivals will quit the market aren’t being fully realized.

“Prices below $50 are not comfortable to anyone, including the majors,” Chief Executive Officer Lourenco Goncalves said in a phone interview from the company’s headquarters in Cleveland, Ohio on Tuesday. “The cost-cutting is not even close to offset their loss in revenues. My entire point: the loss in revenue, totally avoidable. Self-imposed. Self-inflicted.”

BHP Billiton Ltd. spokeswoman Emily Perry said on Wednesday the company wouldn’t respond to Goncalves’s remarks, while Rio Tinto Group sent comments from Brendan Pearson, head of the Minerals Council of Australia, which represents miners.

BHP Billiton says no relief from weak iron ore prices – by Amanda Saunders (Australian Financial Review – November 3, 2015)

November 3, 2015November 3, 2015

http://www.afr.com/

A senior BHP Billiton executive says there is no light at the end of the tunnel for depressed iron ore prices, which will gradually deteriorate over the next few years before finding a new normal well below $US50 a tonne.

Alan Chirgwin, BHP’s vice president of marketing for iron ore, says the price will gradually fall over the next few years before finding a new normal at the highest breakeven of “a major producer in Australia or Brazil”.

That would likely be either Fortescue Metals Group or Brazil’s Vale, which are both racing to avoid the unwanted marginal producer status. Fortescue is sitting at about $US37 to $US38 on breakeven, while Vale is closer to to $US40 a tonne, and they are well behind the other two majors, Rio Tinto and BHP.

China coal testing regime ‘significant impost’ on free trade, BHP says – by Amanda Saunders (Australian Financial Review – November 1, 2015)

November 2, 2015

http://www.afr.com/

The world’s biggest exporter of metallurgical coal, BHP Billiton, says China’s import-coal quality testing regime is a “significant impost” on free trade and some rivals are being forced to sell rejected cargoes at “distressed” prices.

Shaun Verner, BHP’s vice-president of marketing for coal, told Fairfax Media the testing was hurting sentiment and making it “much more difficult” and slower to sell tonnes into China.

BHP has not had a cargo rejected, but Mr Verner said “our understanding is that where some cargoes have been rejected, and we have heard through the market that there have been a few, they have had to be reloaded and resold as distressed cargoes in other markets.

“If you take the general market situation, and price where it is, the risk of having a cargo rejected is not something that people are willing to bear.”

As downturn bites, Australia’s miners could turn to crowdfunding – by James Regan (Reuters U.S. – November 2, 2015)

November 2, 2015

http://www.reuters.com/

SYDNEY – Nov 2 A pair of former miners are hoping to launch a crowdfunding website in Australia for small mining companies struggling to raise capital via traditional outlets as lenders turn their back on the sector.

Crowdfunding in Australia to raise equity is prohibited under the nation’s Corporations Act. The founders of Mineral Intelligence Pty, however, are counting on this to change by the end of the year under pro-business initiatives being considered by lawmakers.

U.S. securities regulators approved new crowdfunding rules on Friday, allowing start-up companies to raise money for the first time from mom-and-pop investors over the internet.

Over the past three years, tens of thousands of jobs have gone in Australian mining, once the nation’s economic engine, while some executives have taken pay cuts or forsaken bonuses to support the bottom line in the absence of fresh capital.

Papua New Guinea is falling short of its potential – by Devesh Rasgotra (Global Risk Insights – November 1, 2015)

November 2, 2015

http://globalriskinsights.com/

Falling commodity prices alongside poor political governance have meant that Papa New Guinea, rich in natural resources, is seemingly not fulfilling its potential.

Papua New Guinea is one of the poorest and most isolated countries in the world. Yet it has experienced sustained economic growth in recent years. The country is rich in gold, oil, gas, copper, silver and timber.

The extraction of these natural resources accounts for 60% of its GDP whilst it’s other main economic sector, agriculture, employs up to 85% of the population.

The revenues from this commodity-based economy have not translated into strong economic development and improvements to living standards. Despite maintaining an average annual growth rate of 6.5% over the past 10 years, the country is blighted by corruption and poor fiscal management by the government.

POSCO may build Magnis Resources’ Tanzanian graphite project – by Sonali Paul (Reuters U.S. – October 27, 2015)

May 13, 2016October 27, 2015

http://www.reuters.com/

MELBOURNE – Oct 27 South Korea’s POSCO may build and help arrange financing for a graphite project in Tanzania being developed by Magnis Resources , as the Australian explorer races to start producing from the east African site by 2017.

Demand for graphite is expected to soar as it is a major ingredient in lithium-ion batteries for hybrid vehicles and wind and solar energy storage, with appetite for greener transport and energy booming.

Magnis said on Tuesday it had signed a memorandum of understanding that could see POSCO Engineering & Construction arrange debt from lenders it has ties with for the $210 million Nachu project, as well as coming up with a fixed-price bid by mid-2016 to build the mine and processing plant.

“The quality of the graphite at Nachu is the best in the world and with the huge demand in the battery market, we are excited to be involved with Magnis,” POSCO E&C mining plant business group director Peter Lim said in a statement put out by Magnis.

Prominent Australians ask world leaders to consider ban on new coalmines – by Lenore Taylor (The Guardian – October 26, 2015)

October 27, 2015

http://www.theguardian.com/

Wallaby David Pocock and author Richard Flanagan among 61 signatories to open letter calling for the future of coal to be on the agenda at Paris climate talks

Sixty-one prominent Australians, from Wallaby David Pocock to the Anglican bishop of Canberra George Browning, have signed an open letter calling on world leaders to discuss a ban on new coalmines and coalmine expansions at the United Nations climate change meeting in Paris in December.

The signatories are backing a call by the president of Kiribati, Anote Tong, and other leaders of Pacific Island nations in the recent Suva Declaration on climate change from the Pacific Island Development Forum.

The message from the signatories, who also include nobel laureate Professor Peter Doherty, former Australian of the year professor Fiona Stanley, author Richard Flanagan, former chair of the Australian Coal Association Ian Dunlop and former Reserve Bank governor and Climate Change Authority chair Bernie Fraser,

Camp Concern: Activists reunite for anti-uranium mining protest 40 years later inside Kakadu – by Emilia Terzon and Lisa Pellegrino (Australian Broadcasting Corporation – October 26, 2015)

October 26, 2015

http://www.abc.net.au/

As uranium mining near Kakadu faces an uncertain future, activists calling themselves Camp Concern have reunited inside the Northern Territory park to mark 40 years on from the launch of an anti-mining protest.

Camp Concern was an anti-uranium mining protest camp that started with five people on October 26, 1975, on land now encompassed by the World Heritage-listed Kakadu National Park.

The camp ended up witnessing hundreds of participants, before being disbanded after four years. The Ranger Uranium Mine was controversially completed in 1980.

Camp Concern founding member Hip Strider was among those who returned to the original protest site at the weekend. “We’re having a gathering to celebrate,” Mr Strider said.

Why Miners Keep Expanding, as Prices Collapse – by Paul Kiernan and Rhiannon Hoyle (Wall Street Journal – October 22, 2015)

October 23, 2015

http://www.wsj.com/

Weaker currencies help many firms cut costs, fueling new projects and adding to a global glut

RIO DE JANEIRO—Even as iron ore prices have collapsed, Brazilian giant Vale SA is building a $16 billion iron-ore operation that it touts as “the biggest project in our history and in international mining.” How? Because its costs are collapsing as well.

From South America to Australia, plunging currencies in mineral-rich nations are helping some companies expand their mines—and contributing to a glut of production that has saturated markets and driven prices down.

The cost of producing many commodities is “dropping like a stone,” said Goldman Sachs’s head of commodities research, Jeff Currie, who describes it as a “negative feedback” loop. The dynamic helps explain why commodity busts can be so long-lived.

The hope for recovery in commodities markets rests with the prospect that producers will run out of money or tire of losses and shut their facilities, bringing supply back into balance with weakened demand.

Commodities: Gina Rinehart is queen of Australia’s desert – by Jamie Smyth (Financial Times – October 21, 2015)

October 22, 2015

http://www.ft.com/

The ‘iron lady’ is opening an $11bn mine as rivals cut investment and her children vie for more control

It has taken two decades to develop, $11bn of investment to build and is at the centre of a bitter family feud. But Gina Rinehart, Australia’s richest person, is finally poised to achieve her ambition and that of her late father, Lang Hancock, to develop, own and operate an iron ore mine.

“This is the holy grail she has been aspiring to her whole life,” says Michael Yabsley, a former adviser, of the Roy Hill project that formally opens next month. “It’s Gina’s crowning glory.”

The first ore exports from Roy Hill, 1,100km from Perth, will be a landmark moment for Hancock Prospecting, a private company controlled by the 61-year-old heiress who has earned the nickname “iron lady” as much for her uncompromising personality as the commodity that built her family’s fortune.

Is iron ore headed for US$40 per tonne? – by Cole Latimer (Australian Mining – October 22, 2015)

October 22, 2015

http://www.australianmining.com.au/

Pundits are predicting a massive decline and a new low for iron ore.

Vice president for Citigroup’s China commodities research group, Ivan Szpakowski, has pointed to a new recent low for the metal of US$40 per tonne next year, according to the Sydney Morning Herald.

it comes as the price of iron ore hits its lowest point since late July, and the benchmark 62% Fe import price at the port of Tianjin fell to the US$52.50, although it is yet to reach the seven year low seen in early July of US$44.59.

According to Szpakowski, the slowdown in Chinese demand coupled with oncoming oversupply thanks to record production rates from Vale and BHP is likely to drive down the price below US$50 per tonne by the end of this year, and to US$40 per tonne or lower by the end of the March quarter next year.

Mining town Kambalda looks to 50th anniversary despite nickel turmoil – by Sam Tomlin (Australian Broadcasting Corporation – October 21, 2015)

October 21, 2015

http://www.abc.net.au/

Amid the toughest downturn the nickel town has ever seen, Kambalda residents say it is only a matter of time before the tide turns.

With an unprecedented slump in the nickel price leading to more than 100 job losses over the past 18 months, and the future of much of its infrastructure called into question, the mining town in Western Australia has faced a recent crisis of confidence.

But as the community looks at ways to celebrate the 50th anniversary of the area’s first nickel mines, locals say the town has plenty of life left in it.

And with the nickel industry starting to show some long-term optimism amid the gloom, they say the turnaround they have been hoping for is not too far away.

While mining has always been a fixture of the landscape, modern Kambalda had its genesis in a chance discovery by two prospectors in 1954.

BHP First-Quarter Iron Ore Output Jumps 7% to Meet Estimates – by David Stringer (Bloomberg News – October 21, 2015)

October 21, 2015

http://www.bloomberg.com/

BHP Billiton Ltd., the world’s biggest mining company, said first-quarter iron ore output rose 7 percent, joining rivals Vale SA and Rio Tinto Group in reporting increased supply amid falling prices and a global glut.

Production was 61.3 million metric tons in the three months ended Sept. 30, Melbourne-based BHP said Wednesday in a statement. That compares with 57.1 million tons in the same period a year earlier and with a median of 61.9 million tons of three analysts surveyed by Bloomberg.

Benchmark iron ore prices have fallen more than 70 percent from a 2011 peak amid slowing economic growth in China and as the largest suppliers raise output to boost savings and squeeze out higher-cost rivals. BHP reported a 4 percent drop in petroleum output and flagged a 6 percent decline in the unit’s capital spending this fiscal year.

“The iron ore result is as expected and is a good result, though we’d expected petroleum to be higher,” said David Lennox, a resource analyst at Fat Prophets in Sydney.

El Nino halts Papua New Guinea gold mine-Barrick – by James Regan (Reuters U.S. – October 19, 2015)

October 20, 2015

http://www.reuters.com/

Oct 19 Operations at the Porgera gold mine in Papua New Guinea have been suspended due to drought conditions, part owner Barrick Gold said on Monday, the latest mine in the Asia-Pacific to be disrupted by El Nino-induced dry weather.

Production had been halted due to low levels of water in the mine’s reservoir, used in processing the raw ore, operator Barrick (Niugini) Ltd said in a statement to Reuters.

“Some water-intensive production activities at the mine have been temporarily suspended during this extended dry season, and we are using this opportunity to bring forward some scheduled maintenance activities,” it said.

“The very unusual extended dry conditions that we have seen in recent months have meant that our supplies of production water have run very low, and we have made the decision to shut down our milling and processing plants for the time being to conserve our water supplies.”

2 Australian mines are now operating with an all-driverless fleet of trucks – by Matthew Yglesias (Vox Business and Finance – October 19, 2015)

October 20, 2015

http://www.vox.com/

The first big commercial deployment of driverless car technology is coming not in the streets of Silicon Valley but in the arid and sparsely populated Pilbara region of Australia. That’s where the large mining conglomerate Rio Tinto has rolled out fleets of all-driverless trucks at two iron ore mines, according to a report by Jamie Smyth at the Financial Times.

Rio Tinto tells Smyth that the driverless transition has improved performance by 12 percent, mainly by “eliminating required breaks, absenteeism and shift changes.”

GPS guides the trucks and allows them to deliver iron ore 24/7, 365 days a year, without the kinds of breaks and handover periods that human drivers would need. The GPS navigation system is backstopped by a team of human operators working remotely from Perth, hundreds of miles away.

Not only does this reduce the total number of humans who are needed to run the trucking operation, but it eliminates the need to employ those humans in the remote and desolate mining country.