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RPT-UPDATE 2-Potash Corp withdraws $8.9 bln takeover bid for German peer K+S – by Greg Roumeliotis and Arno Schuetze (Reuters U.S. – October 5, 2015)

http://www.reuters.com/

NEW YORK/FRANKFURT, Oct 5 (Reuters) – Potash Corp of Saskatchewan said on Monday it had withdrawn its 7.9 billion euro ($8.9 bln) offer for German potash producer K+S , citing a decline in global commodity and equity markets and a lack of engagement by K+S management.

K+S shares dropped 24 percent after Potash announced its decision in a statement, wiping almost 1.5 billion euros off the company’s market value.

An acquisition of K+S would have given Potash Corp an opportunity to realize savings from selling potash within North America from its own Western Canada mines and from K+S’s Legacy mine, which is under construction in the region.

However, senior K+S executives dismissed the Canadian company’s 41-euro-per-share cash bid — which represented a 59 percent premium to the volume-weighted average of K+S’s share price during the prior 12 months — as too low and refused to negotiate.

Since Potash Corp made its offer to K+S privately at the end of May, shares of K+S peers have dropped by around 40 percent amid concerns over weakening demand from China, the world’s largest consumer of potash.

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Great Mines: Finland’s Kemi Chrome – by John Chadwick and Hugh Boden (International Mining – October 2015)

http://im-mining.com/

In September 2014 Kemi mine celebrated exactly 50 years since Outokumpu made the decision to begin chrome mining operations there in Kemi, Finland. Today it is one of the most efficient and environmentally friendly mines in the world. The deposit had been found five years earlier. Mining began in 1967, with large-scale mining operations and ferrochrome production beginning in 1968.

The chrome mine and ferrochrome works were the first steps in Outokumpu’s transition from state mining company to one of the world’s foremost stainless steel producers. Today the annual mill capacity is 2.7 Mt/y of ore (up from 1.3 Mt/y in 2010), producing lumpy ore and fine concentrate (all for internal use). The mine employs some 400 people including contractors, and the nearby ferrochrome works and stainless steel mill in Tornio employ some 1,900 (plus contractors).

CEO Mika Seitovirta: “Kemi is an essential part of the integrated production chain in the Tornio site. Chromium is what makes steel stainless, and our own chrome mine guarantees us competitive sourcing of chromium for the future. The Kemi chrome mine is a unique competitive advantage for us globally.” Outokumpu sees the competitive advantages of its ferrochrome operation as:

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Canadian firm fights gold mine ban by leftist Greek government – by Angeliki Koutantou (Reuters Canada – October 2, 2015)

http://ca.reuters.com/

ATHENS (Reuters) – A Canadian company appealed to Greece’s top court on Friday to overturn a ban on its plans to develop a gold mine in a forested area of northern Greece, in a case widely seen as a test of the leftist government’s approach to foreign investment.

Vancouver-based Eldorado’s venture to extract gold and other ores on the verdant Halkidiki peninsula is seen as one of the top investments in a country racked by a debt crisis since the end of 2009. The company has put in more than $600 million since 2012 and plans to invest another $1 billion in its quest for gold, copper and zinc at two other sites.

But a day before resigning to call a general election, Prime Minister Alexis Tsipras’ government revoked Eldorado’s permit for the Halkidiki mine in mid-August, citing environmental grounds, in a move that showed Greece remains a risky bet for investors.

Eldorado then suspended all its activities at the mine and made most of its 1,300 workers temporarily redundant.

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Coal threatens Poland’s image as European role-model – by Marcin Goettig (Reuters U.S. – October 1, 2015)

http://www.reuters.com/

WARSAW, Oct 1 (Reuters) – Coal mining has taken centre stage in the campaign for this month’s parliamentary election in Poland, an outsize political role that threatens the country’s hard-won economic growth and reputation in Europe.

Once a pillar of the communist-era economy, coal mines escaped the “shock therapy” that helped turn Poland into one of the European Union’s most resilient economies and a role-model for the rest of the bloc in investors’ eyes.

Successive governments have shrunk the sector, but kept it in state hands, conscious of public support for the miners, whose predecessors lost lives opposing martial law in 1981 and helped overthrow communism.

The mines have lost more than $850 million since the start of 2014 as coal prices slipped to decade lows, and efforts to prop them up have brought Poland into conflict with the European Union on both competition and environmental grounds.

The bloc wants to cut carbon dioxide emissions by at least 80 percent by 2050, and the highly polluting Polish hard coal sector will come under further scrutiny with the approach of talks on a global climate deal in late November.

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Potash Corp.’s K+S Bid Helped by Commodity Slide, Analysts Say – by Scott Deveau and Jack Kaskey (Bloomberg News – September 24, 2015)

http://www.bloomberg.com/

Potash Corp. of Saskatchewan’s 7.85 billion-euro ($8.77 billion) proposal to acquire its largest European competitor is more attractive after price declines in the Canadian company’s namesake crop nutrient, according to two analysts.

Potash Corp.’s cash offer made in June was rejected by K+S AG of Germany as too low. Since then, spot prices for potash in the U.S. have dropped 12 percent and there have been forecasts for further declines on the export market. On Monday, Mosaic Co., the largest U.S. producer, said it was cutting output and blamed weaker demand.

Share prices of potash miners have fallen accordingly. K+S is down 9.3 percent this month and closed at 30.22 euros in Frankfurt on Wednesday. That makes Potash Corp.’s 41-euros-a-share bid attractive, said Nils-Peter Gehrmann, an analyst with Hauck & Aufhauser, and Jeffrey Stafford at Morningstar Equity Research.

“While we’re certain management believes EUR 41 per share undervalues K+S, we think the offer considerably overvalues the company,” Chicago-based Stafford said in a note Tuesday. He said his fair value estimate for K+S is 24 euros a share.

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Russian Billionaire’s Miner Sees Gold Pain as Buying Opportunity – by Danielle Bochove (Bloomberg News – September 22, 2015)

http://www.bloomberg.com/

Russian billionaire Alexey Mordashov’s gold mining company is positioning for a price recovery by buying more assets, defying an industry trend of cutbacks and closures.

Besides expanding existing mines in Russia, Nordgold NV is looking for early-stage projects that improve its reserve base, Chief Executive Officer Nikolai Zelenski said in an interview Monday from the Denver Gold Forum.

While the world’s biggest producers including Barrick Gold Corp. and Newmont Mining Corp. sell assets and cut spending in a bid to contain debt levels exposed by gold’s more than 40 percent plunge from a 2011 peak, Moscow-based Nordgold sees the downturn and the ensuing drop in valuations as a good time to buy.

“That’s why we’ve been making deals in the recent past and we plan to continue to do so in the future,” Zelenski said.

Nordgold is interested in the Sukhoi Log deposit, considered one of Russia’s largest fields with resources of about 1,953 tons of gold. The government plans to sell the licenses for the Siberian deposit next year.

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Aboriginal consultations lengthy but necessary step for mine development – by Jonathan Migneault (Sudbury Northern Life – September 21, 2015)

http://www.northernlife.ca/

KGHM makes progress with Victoria Mine

After many years of groundwork, KGHM’s Sudbury operations expect to submit a report to their parent company in Poland by the end of October to approve further development and production of the Victoria Mine, says the company’s local environment and community manager.

Ian Horne addressed the Canadian Institute of Mining Thursday about his years of experience negotiating agreements with local first nations regarding the mine’s development.

In 2010 the modernized Mining Act required mining companies operating in Ontario to consult with Aboriginal people before they could submit their mine closure plans to the Ministry of Northern Development and Mines.

The mine closure plan is a necessary part of any mining project.  “Once you get involved in something like Aboriginal consultation you realize the value and importance of it,” Horne said.

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KGHM to shut down McCreedy mine: Union – by Ben Leeson (Sudbury Star – September 21, 2015)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

In the face of weak commodity prices, KGHM International will shut down the McCreedy West Mine next month, the union representing representing workers there told the Sudbury Star on Sunday.

Myles Sullivan, area co-ordinator for the United Steelworkers, said the company has informed members the mine will be placed under care and maintenance effective Oct. 1, affecting about 25 employees.

“In total, there’s about 40 of our members that are being laid off locally,” Sullivan said.

“It’s really hard. Things are tough in mining right now, with the price of nickel and copper and everything being low. We kind of hoped the (lower) dollar would help offset some of that and I’m sure it’s helping, but it’s still not enough.”

Based on seniority and qualifications, Sullivan said, some workers from McCreedy may have the opportunity to work at the nearby Morrison deposit. Attempts to contact a KGHM representative for comment on the weekend were not immediately successful.

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UK’s mining industry is revived – by Australians – by Jamie Nimmo (The Independent – September 17, 2015)

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

Wolf Minerals is today opening the first new mine in the UK for nearly half a century. Drakelands in Devon will be one of the world’s top five producers of tungsten – one metal whose price has not sunk because of a supply glut in recent years

Ask people about British mining and many are likely to imagine striking coal miners on picket lines, shouting anti-Thatcher slogans and clashing with police.

It is a measure of the industry’s inertia in this country that it this remains the lasting image a good 30 years on – for some, the scars have still not fully healed.

But Wolf Minerals, a little-known Australian company which is listed on London’s Alternative Investment Market, is preparing to inject life into the UK’s dormant mining industry.

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UPDATE 3-Potash Corp, K+S not actively discussing takeover -Potash CEO – by Rod Nickel (Reuters U.S. – September 16, 2015)

http://www.reuters.com/

(Reuters) – Potash Corp of Saskatchewan is not actively discussing its takeover proposal with Germany’s K+S, but remains interested in a combination of fertilizer producers that would aid North American potash sales and offer new access to Europe, Chief Executive Jochen Tilk said on Wednesday.

Potash Corp’s standing offer of 7.9 billion euros ($8.90 billion) or 41 euros per share is appealing to K+S shareholders, Tilk said at an investors’ conference in New York organized by Credit Suisse.

“It was attractive when we made it (in July). Marketing conditions have changed, we think it’s even more attractive now,” he said. “I will not put words in K+S shareholders’ mouths but I think most of them feel that is an appropriate offer in terms of premium.”

A K+S spokesman declined to comment. Shares of K+S dipped after Tilk’s comments and closed down 0.2 percent at 33.58 euros in Frankfurt. Potash shares were up 1.8 percent at $25.44 in New York and up 1.3 percent at C$33.51 in Toronto on Wednesday afternoon.

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A piece of mining history revived – the original Rio Tinto mine back in production – by Lawrie Williams (lawrieongold.com – September 10, 2015)

http://lawrieongold.com/

While the following article is not specifically on precious metals, but on the revival of one of the world’s oldest known mines, it has in its time produced silver and gold – indeed the Romans mined it primarily for its silver content – and the orebody still contains both precious metals.

While silver is still a byproduct, albeit a small one, the gold content is probably too low to be profitably extracted. Nevertheless as a piece of mining history – and a potentially decently profitable copper mining operation – even at current copper prices, readers may find it an interesting article.

In what has to be a mining engineer’s dream, the old Rio Tinto copper mine in Spain – which in its heyday was the foundation stone for the mega mining company which still bears its name – is being brought back to life. Indeed it is well on the way to becoming a major producer again – and the economics in comparison with low grade copper porphyries which provide the bulk of global copper production, are impressive.

The Rio Tinto mine in southwestern Spain has one of the world’s longest known mining histories with copper having been mined there even before Roman times, but it was in the late 19th Century, and the development of the operation into what at the time was one of the world’s largest copper mines as its first operation by the UK’s Rio Tinto company which made it into a mining classic – and as the world know Rio Tinto subsequently went on to become one of the world’s biggest diversified mining companies.

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Mining companies must be more efficient, says MD of consulting firm Hatch – by Charlotte Mathews (Business Day Live – September 2015)

http://www.bdlive.co.za/

HELSINKI — Financial cost cutting by mining companies is achieving short-term savings but in the long term it is hurting performance, MD of Hatch mining and mineral processing consulting firm Jan Kwak said on Tuesday.

In an interview on the sidelines of the Global Cleantech Summit in Finland on Tuesday, Mr Kwak, whose global company (which operates in Africa as Hatch Goba) specialises in strategic consulting and research, project management and operational support for mining, energy and infrastructure companies, said mining companies should rather be making savings through solutions that deliver sustained output using fewer resources.

The three-day Global Cleantech Summit, which is organised by the Finnish government, brings together about 800 delegates from around the world to discuss issues relevant to “green” technology development, financing and marketing.

Mining companies, squeezed by falling commodities prices, have intensified cost-saving programmes in the past two years, including retrenchments and cutting back on new capital investments. Anglo American has said it will cut about one-third of its global workforce, including through disposals of assets.

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PRESS RELEASE: OUTOTEC’S DEWATERING TECHNOLOGY CENTER INAUGURATED IN LAPPEENRANTA, FINLAND

SEPTEMBER 8, 2015 – Outotec’s Dewatering Technology Center inaugurated in Lappeenranta, Finland

Outotec has established a Dewatering Technology Center in Lappeenranta, Finland, to further strengthen its position as a leader in dewatering solutions. The center, inaugurated today, is dedicated to developing new products, processes and services for solid-liquid separation and raw material reuse for the entire life cycle of processing plants.

Outotec’s customers are constantly looking for more efficient processes in mineral slurry dewatering, process water reuse and by-product handling in metals and chemical processing as well as in industrial water treatment. Outotec has comprehensive offering for dewatering and strong process understanding in systems integration of relevant unit operations. With the new Dewatering Technology Center, Outotec can simulate and optimize customer processes to integrate them with Outotec technology to capture new levels of efficiency throughout the life cycle of a plant.

“In line with our mission ‘sustainable use of Earth’s natural resources’, we continuously develop new resource-efficient equipment, processes and services for our customers. With the recent acquisition of Kovit Engineering and Outotec’s expansion into tailings management solutions, the new dewatering technology center brings world-class knowledge in the study of tailings dewatering and treatment.

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Billionaire’s 20-Year-Old Son May Lead $5 Billion Polyus Bid – by Yuliya Fedorinova (Bloomberg News – September 1, 2015)

http://www.bloomberg.com/

Suleiman Kerimov’s son, a university student in Moscow, may lead a $5.4 billion bid to take Russia’s largest gold producer Polyus Gold International Ltd. private.

Wandle Holdings Ltd. and its Sacturino Ltd. unit, controlled by the billionaire’s son Said Kerimov, are considering an offer to buy the shares of the gold miner they don’t already own for $2.97 each, Sacturino said in a statement late Wednesday. The family already owns about 40 percent of the company, so a fully subscribed offer would value the deal at $5.4 billion, according to Bloomberg calculations.

Polyus shares rose as much as 6.9 percent and were up 3.7 percent at 196.50 pence ($3) as of 12:24 p.m. in London. The stock has climbed 8.3 percent this year, the third-best performer on the 10-company Bloomberg Europe 500 Metals and Mining Index, which dropped 26 percent over the same period.

Kerimov senior, 49, Russia’s 18th richest man with an estimated fortune of $4.9 billion, is a member of the Federation Council, the nation’s upper chamber of the parliament.

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Nazi ‘gold train’: Poland to bring in army to help in hunt – by Agence France-Presse (The Guardian – September 2, 2015)

http://www.theguardian.com/

Defence ministry says it will send technical equipment to region of lower Silesia to establish whether train exists

Poland will deploy the military to look for an alleged Nazi “gold train” that sparked global fascination after two anonymous treasure hunters claimed they had pinpointed where it is buried.

“The defence minister decided to send technical equipment to search the area in order to determine whether a train actually exists,” a defence ministry spokesman, Jacek Sonta, said on Tuesday.

“The army is acting at the request of the governor of the region concerned.”

On Monday Tomasz Smolarz, the governor of the south-western region of lower Silesia, said it was “impossible to claim that such a find actually exists at the location indicated based on the documents that have been submitted”.

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