Twitter

Europe Mining

Cameco welcomes Greenland’s decision to lift uranium mining ban – by Jan Olsen (CTV News/The Associated Press – October 25, 2013)

http://www.ctvnews.ca/

COPENHAGEN, Denmark — Greenland’s parliament has agreed to remove a 25-year-old ban on uranium mining, paving the way for an industrial boom that the Arctic island hopes will help it gain independence from former colonial master Denmark.

Greenland, a semi-autonomous part of Denmark, wants to step up its mining of rare earths, valuable elements used in the production of smartphones, weapons systems and other modern technologies. But uranium is often found mixed into rare earths, so the ban was blocking key mining activity.

Cameco (TSX:CCO), one of the world’s largest uranium producers, welcomed the decision, adding that it would be open to setting up projects in Greenland.

“We are pleased to see that Greenland has opened the door to safe and responsible uranium mining,” said Rob Gereghty, a spokesman for the Saskatoon-based company.

“Currently, we are focusing our exploration efforts in Canada, Australia, Kazakhstan and the United States. As we look forward, the removal of this barrier will allow us to consider Greenland for potential uranium exploration projects.”

Read more

UPDATE 2-Mining slump weighs on Nordic suppliers Sandvik, Metso – by Niklas Pollard and Johannes Hellstrom (Reuters India – October 24, 2013)

http://in.reuters.com/

STOCKHOLM, Oct 24 (Reuters) – Swedish machinery and tool maker Sandvik said on Thursday a sharp fall in demand from a shrinking mining industry was showing signs of levelling out.

But the slump still hit its earnings, and led to a fall in orders at Finnish rival Metso, which also stepped up a programme of cost cuts.

The global mining industry is under pressure to reduce overheads as demand for raw materials levels off after a decade of strong growth, and sector heavyweights led by BHP Billiton and Rio Tinto have slashed capital spending by billions of dollars.

The cuts have translated into job losses and plunging order intakes for a cluster of Nordic suppliers.

Sandvik, which together with Swedish peer Atlas Copco supplies more than half the world’s underground mining gear, said the order intake in its mining business fell 17 percent year-on-year in the third quarter. The rate of decline eased from the second quarter, however.

Read more

Outokumpu asks EU to let it keep Italian steel plant: sources – by Silvia Antonioli and Maytaal Angel (Reuters India – October 22, 2013)

http://in.reuters.com/

LONDON, Oct 22 (Reuters) – Finnish stainless steel maker Outokumpu has asked the European Commission to let it keep the Italian steel plant the company agreed to sell to gain approval for its purchase of ThyssenKrupp’s Inoxum unit.

The Acciai Speciali Terni plant has been valued at more than 500 million euros ($677 million) by Outokumpu, but is now expected to sell for less than that due to weakness in the global steel market.

Two sources familiar with the matter told Reuters that Terni, one of Europe’s biggest and most modern plants, will lose 80-100 million euros this year, and that Outokumpu believes it is not anti-competitive to keep it under current conditions.

The Terni plant, about 100 km (62 miles) north of Rome, was valued by one analyst at up to $1 billion over a year ago. “They have been trying to convince the EU that they should keep Terni since the market situation has completely changed from last year – the sector got much worse,” an industry expert said.

Refraining from selling the plant could allow more flexibility in valuing it, the expert said, leading to a lower writedown in the company’s books.

Read more

Mining group Eramet plans more savings as nickel stays weak – by by Gus Trompiz (Reuters India – October 21, 2013)

http://in.reuters.com/

PARIS – Oct 21, 2013 (Reuters) – Eramet on Monday said it would step up cost saving measures to counter the effects of a depressed nickel market, which contributed to a five percent fall in the mining group’s third quarter sales.

Benchmark prices of nickel, mainly used in stainless steel, sank to a four-year low in July due to poor industrial demand and rising stocks, leaving a swathe of global production operating at a loss.

Eramet reported a 5 percent year-on-year fall in third-quarter sales to 754 million euros ($1.03 billion), which included a 23 percent decrease for its nickel division.

“The Group is stepping up its measures to decrease its costs and capital expenditure, adjust its productions to its markets and reduce its working capital requirements,” Eramet said in a statement, without giving details.

The company reiterated that current operating profit in the second half would be “significantly lower” than in the first half, when Eramet reported a 9 million euro loss.

Read more

Canadian miners should learn from Gabriel’s missteps – by Eric Reguly (Globe and Mail – October 19, 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.

ROME — After almost two decades of false starts and a running battle with some of the savviest environmental groups on the planet, it’s make-or-break time for Europe’s biggest and most politically sensitive gold project. In early November, the Romanian government will, like a Roman emperor at a gladiator fight, give the thumbs up or thumbs down to Gabriel Resources Ltd.’s $1.4-billion (U.S.) Rosia Montana mine in Dracula’s legendary homeland, Transylvania.

The vote could go either way, though the share price says the odds are against the Toronto-listed company. Gabriel’s stock collapsed early last month, falling from $1.47 (Canadian) to as low as 41 cents, when Romanian Prime Minister Victor Ponta said parliament would likely reject a draft mining law that would allow the project to go ahead. (It’s now at 93 cents.) Gabriel’s response was to threaten the government with a $4-billion (U.S.) lawsuit if the law were to die. That threat still stands. Rosia Montana’s future lies in the hands of lawmakers and lawyers, not engineers and financiers.

Gabriel says a lot about what’s right and what’s wrong with Canadian gold miners, which dominate the industry. About half of the top names are Canadian, among them Barrick, Goldcorp, Yamana, Kinross and Eldorado. They are big risk takers, superb at engineering and financing and occasionally capable of impressive value creation.

Read more

UPDATE 2-Outotec to cut up to 500 jobs as miners slash spending – by Ritsuko Ando (Reuters India – October 17, 2013)

http://in.reuters.com/

HELSINKI, Oct 17 (Reuters) – Finnish mining technology company Outotec lowered its full-year sales and profit margin forecasts and said it planned to cut up to 500 jobs as a sluggish global economy forces miners to rein in spending.

In a further sign of tough times for Finland’s industrial firms, its warning on Thursday came just after engineering company Metso said it faced a fall in sales and profit due to weakness in its pulp, paper and power unit.

Shares in Outotec, whose job cuts represent 10 percent of the workforce, slid 15 percent by 0930 GMT while Metso lost 6 percent.

Outotec said it was seeing delays in customer payments. One project, worth 30 million euros ($40.5 million) in its order backlog, was cancelled in September.

Mining companies have over the past year been pulling back on spending in the face of weaker prices as many boom-year projects turned sour, and many have scrapped or delayed plans.

Read more

No plans to step down for Norilsk’s billionaire CEO – by Clara Ferreira-Marques and Douglas Busvine (Reuters U.S. – October 6, 2013)

http://www.reuters.com/

LONDON – (Reuters) – When he took the helm of Norilsk Nickel (GMKN.MM) last December as part of a deal that ended a long-running shareholder battle, Russian billionaire Vladimir Potanin hinted he saw himself in the job for roughly two years.

Almost a year on, Potanin is clearly relishing his role at the center of a major turnaround and indicates he has no plans to stand down as chief executive of the world’s largest producer of nickel and palladium. “I don’t like deadlines,” the 52-year-old Potanin told Reuters over tea in an upmarket London hotel late on Friday after a long day spent wooing investors.

His departure could be years away as he develops the Norilsk management into a world-class team, he said. “For a rich and reasonably successful guy, it is impossible not to enjoy your job, otherwise why would you spend so much time and effort doing it? I am a great fan of Norilsk and I like this kind of challenge.”

Potanin, whose more than $14 billion fortune began in banking, has long been a major shareholder in Norilsk, securing stock at a bargain-basement price in the loans-for-shares privatizations that followed the collapse of the Soviet Union and spawned a new oligarch elite.

Read more

Farm and Food: Potash market isn’t for sissies – by Alan Guebert (Journal Star.com – October 5, 2013)

http://journalstar.com/ [Lincoln, Nebraska]

There are two reasons to keep up to speed on the fast pace of events in what would seem to be the very dull world of potash.

The first is that the key players in this once tightly controlled market continue to lose their grip on it. According to analysts, prices for this key fertilizer will continue to drop — to nearly $300 per ton, some say — through the end of 2013.

If they’re right, that’s more than $100 a ton less than a year ago and a gargantuan $600 to $700 per ton below the record price of five years ago.

In short, go long potash; it’s the best time in years to buy it and apply it. The second reason to pay attention to the potash market is that, in truth, you can’t take your eyes off of what quickly is turning into a Russian version of an American soap opera.

Nine weeks ago the Russian-Belarusian potash cartel, a rocky twosome composed of Russia’s Uralkali and Belarus’ Belaruskali, parted company when the Russians simply called their marriage off.

Read more

Rick Mills: Greenland Is the Final Frontier for Lower-Cost Mining – Interviewed by Kevin Michael Grace (The Metals Report – October 1, 2013)

http://www.streetwisereports.com/

Industrial minerals like copper and nickel are essential to global economic expansion. But everywhere you look, grades are getting lower, and costs are getting much, much higher. Is there a way out? Rick Mills says mining companies need to look to Greenland. In this interview with The Metals Report, the owner and host ofAhead of the Herd.com lauds the world’s largest island for its vast resources, its one-stop regulatory system and its year-round access to ocean transportation.

The Metals Report: You never really believed that there was anything resembling an economic recovery in the United States, correct?

Rick Mills: I don’t believe you can have an economic recovery with the type of jobs that have been created in the last few years. Wages have stagnated. The velocity of money, how many times it turns over in the economy, how many times it’s spent, is at a record low,

TMR: So the decision by the Federal Reserve to hold off on tapering quantitative easing didn’t surprise you?

RM: I’ve gone on record saying there would be no tapering this time around, but that doesn’t mean it isn’t coming—it certainly is. But it will likely be very gradual, and the Fed will start only when they feel the economic data support such a move. I firmly believe, however, that the Fed’s zero interest rate policy is here to stay, and this is very important for gold investors.

Read more

NEWS RELEASE: Norilsk Nickel Unveils New Strategy Focused on Tier I Assets and Higher Returns

October 04, 2013 09:05 AM Eastern Daylight Time

MOSCOW–(BUSINESS WIRE)--MMC Norilsk Nickel (hereinafter, Norilsk Nickel or the Company), the largest global nickel and palladium producer, today announced further details of its new strategy at MMC Norilsk Nickel’s “Unveiling New Strategy” event held in London.

Highlights

  • Capture full potential of MMC Norilsk Nickel’s unique resource base in Russia
  • Focus on Tier 1 assets to deliver sustainably high return on capital
  • Focus on capital discipline and introduction of return on investments as key metric for the organization
  • Increased focus of existing portfolio on copper and PGMs
  • Prioritize Polar Division Upstream assets, with a plan to:
    -Maximize high-margin production utilizing existing infrastructure
    -Develop the greenfield Skalisty mine, with a potential 2.4Mtpa ore capacity
    -Upgrade of the Talnakh infrastructure into a world class concentrator

    Read more

Steel firm Outokumpu should help itself: Finland’s state fund – by Jussi Rosendahl (Reuters U.S. – September 30, 2013)

http://www.reuters.com/

HELSINKI – (Reuters) – Steel company Outokumpu (OUT1V.HE) should try to solve its own problems even though its heavy debts have raised the prospect it might need more money from shareholders at some stage, the head of Finland’s state investment fund Solidium said.

While Finland is often listed among the most innovative economies and remains triple-A rated, government funding is still badly needed in the country of 5.4 million people which has a limited pool of private capital. Kari Jarvinen, Solidium’s managing director, told the Reuters Nordic Investment Summit that the fund was making its long-term investment decisions independent of political pressure to help out troubled Finnish companies.

“It is better that the company tries to sort out its problems by itself. The company already had a 1 billion (euros) rights issue only one-and-a-half years ago,” Jarvinen said when asked about Outokumpu’s finances. “It is paramount that these companies find ways to be profitable in the future.”

Solidium holds stakes worth in total 7.7 billion euros in 11 Finnish listed companies including paper maker Stora Enso (STERV.HE) and investment and insurance group Sampo (SAMAS.HE).

Read more

PRESS RELEASE: Outokumpu introduces new industrial plan in Europe to improve financial performance

October 1, 2013

Outokumpu announced today plans for further structural changes in its European operations aimed at improving its financial performance and efficiency, and ultimately returning the company to profitability.

While Outokumpu has already implemented significant cost savings as a result of the merger between Outokumpu and Inoxum at the end of 2012, the company’s cost structure continues to be unsustainably high in the current market environment.

Stainless steel market has remained challenging during 2013, mainly driven by the continued economic weakness in Europe and the global overcapacity in the industry. Outokumpu has continued to be heavily loss making in 2013, with a net debt of 3.0 billion euros at the end of June 2013. Industry overcapacity and imports from Asia continue to put pressure on prices and profitability and there are no signs of a material improvement in the market environment. For example, in Europe alone, there are more than 1,500,000 tonnes of overcapacity in cold rolled production. In addition, as previously stated, the Terni remedy requirement by the European Commission resulted in lower synergy potential than originally planned.

Therefore, Outokumpu is now introducing a new industrial plan and efficiency measures for its operations in Europe. Specifically, the planned changes include:

Read more

Norilsk Sees Nickel Surplus Shrinking Next Year on Idled Plants – by Yuliya Fedorinova & Marina Sysoyeva (Bloomberg News – September 27, 2013)

http://www.bloomberg.com/

OAO GMK Norilsk Nickel, the world’s largest producer of the metal, urged producers to start idling unprofitable operations to fight a surplus that has damped prices and caused losses.

Consecutive quarters of losses should push companies to cut output, which may narrow the nickel surplus 30 percent to 70,000 metric tons in 2014 from 100,000 tons this year, according to Anton Berlin, marketing director at ZAO NormetImpex, a unit of Norilsk Nickel.

Nickel, used in stainless steel, tumbled into a bear market in May and is set for a third yearly loss, as demand waned and China increased output of a substitute derived from lower-grade ores. Additions to Chinese nickel pig iron capacity outstrip closures, creating a third consecutive annual surplus in 2013, according to a Deutsche Bank AG report in August.

“Unfortunately, we don’t see significant changes on the nickel market yet compared with what we had at the start of the year,” Berlin said in an interview Sept. 25. “From 35 to 40 percent of producers are still loss-making and the gap between supply and demand remains high.” Nickel traded at about $13,887 a ton on the London Metal Exchange by 10:35 a.m. local time, down 19 percent this year, making it the worst performing industrial metal.

Read more

REUTERS SUMMIT/-Polish entrepreneurs come of age with global acquisitions – by Christian Lowe and Marcin Goclowski (Reuters India – September 27, 2013)

http://in.reuters.com/

WARSAW, Sept 27 (Reuters) – Polish companies are buying into foreign markets long dominated by Western multinationals, driven by growth at home and a hunger to prove they are no longer Europe’s poor relations.

Twenty-four years after Communist rule ended in Poland, its companies now have the scale, knowledge and self-belief to expand abroad, chief executives and government officials said at a Reuters Eastern Europe Investment Summit this week.

“We are building our economic power as a country,” said Zbigniew Jagiello, chief executive of PKO BP, Poland’s biggest bank. “I hope that … before 2025 we’ll see a Polish company which will be a multinational, known worldwide.”

Two or three years ago Polish firms had almost no significant presence abroad. Executives from Canadian firm Quadra FNX recalled that when Polish copper miner KGHM approached them about a takeover, they had never heard of the Polish firm and doubted they were serious. Since then, there has been a run of foreign acquisitions, and there are more on the way.

Read more

South Africa, Sweden to bolster mining relations – by Chantelle Kotze (MiningWeekly.com – September 26, 2013)

http://www.miningweekly.com/page/americas-home

JOHANNESBURG (miningweekly.com) – While there are differences between the mining industries in South Africa and Sweden, mining forms the backbone of both countries’ economies and, therefore, knowledge-sharing in this field can be of great importance in terms of developing a better understanding of safety, skills and sustainability challenges in their respective mining environments.

This was highlighted by Ambassador of Sweden to South Africa Anders Hagelberg, at the Safety, Skills and Sustainability in Mining conference, in Johannesburg, on Thursday. The conference focused on how the efforts to improve safety, develop skills, facilitate longevity and sustainability, as well as increase profitability and efficiency in the mining sector.

It aimed to foster profitable and sustainable business, lower accident rates, better occupational health, lower environmental impact, positive social impact and technology, leadership and methodology sharing between the two countries.

The conference also marked the establishment of the Swedish–Southern African Mining Initiative, which aims to create a platform for knowledge sharing and networking between Swedish and South African mining role-players.

Read more