International Media Resource Articles – Page 676

North Americans lead chase to buy AngloGold mine – by James Wilson (Financial Times – April 12, 2015)

April 14, 2015

http://www.ft.com/intl/companies/mining

North American gold producers are leading the chase to buy an AngloGold Ashanti mine in the US, underlining their desire to retreat to home turf and cut exposure to riskier jurisdictions.

A sale of the Cripple Creek mine in Colorado would be one of the largest of a US gold asset since the price of the precious metal declined sharply in 2013. It could raise up to $1bn to help the South African group cut its debt after a plan for a rights issue failed last year.

Newmont Mining of the US and Canada’s Kinross Gold are among a group of miners conducting second-round talks with AngloGold over a deal for part or all of Cripple Creek, according to people familiar with the sale process. Iamgold and Goldcorp, two other Canadian companies, have also shown interest.

A number of North American miners are expected to be keen to strengthen their holdings close to home to counterbalance riskier assets overseas. It would follow the example of Goldcorp, which only operates in the Americas and has become the world’s largest miner by market capitalisation.

Freeport Bets Copper’s No Oil With Growth to Grab Top Spot – by Matthew CrazeAgnieszka de Sousa (Bloomberg News – April 12, 2015)

April 14, 2015

http://www.bloomberg.com/

Freeport McMoRan Inc. is testing the nerve of the copper industry, and its own investors, with an expansion that has it poised to become the world’s biggest producer at a time of slowing China growth.

The Phoenix-based company will close the gap with current world No. 1 Codelco next year after expanding mines in Peru and the U.S. and as the Chilean state-owned company runs out of profitable ore at a mine in the Atacama Desert.

For those predicting a more precipitous demand slump as China shifts to a consumer-driven economy, Freeport’s growth makes little sense. But for the company — whose 76-year-old Chairman Jim Bob Moffett oversaw the discovery of the world’s biggest copper-gold operation in the jungles of Indonesia 27 years ago — the industry’s aging mines will struggle to keep up with even moderate global demand growth. It’s a view shared by Goldman Sachs Group Inc., Morgan Stanley and Macquarie Group Ltd., which predict shortages emerging beginning 2017.

“They are making the right bet,” said Christopher LaFemina, an analyst at Jefferies LLC, who recommends buying Freeport stock. “If you are going to be leveraged to a commodity price, this is the right one. If you compare to iron ore or coal, copper is better.”

As Freeport readies a $4.6 billion expansion at the Cerro Verde mine in Peru, Chief Executive Officer Richard Adkerson will join a debate on the supply side’s reaction to slowing demand at the industry’s annual get-together in Santiago this week.

Appalachian Communities Scraping By as Coal Taxes Drop – by Kris Maher (Wall Street Journal – April 10, 2015)

April 14, 2015

http://www.wsj.com/

Counties in West Virginia, elsewhere lay off employees and weigh consolidating schools amid dwindling revenues tied to coal mining

Just three years ago, Nicholas County in West Virginia had eight working mines and took in $1.2 million from coal-related tax revenue. Today, just one mine is still churning out coal. The county’s share of the state’s taxes on coal mining, partly based on local production and county population, plummeted to about $100,000 in 2014.

County officials recently responded by laying off 20 employees, including four police officers, meaning there won’t be any officers on duty after 4 p.m., the sheriff said. An additional 74 employees will take a 20% pay cut. A spokesman for the state police said more troopers will be assigned to patrol the county.

“For the first time that anybody alive can remember, we’re having to lay off some county employees,” said Ken Altizer, president of the Nicholas County Commission. “The biggest reason is the coal severance,” he said, referring to taxes on the amount of coal extracted, or “severed,” from the ground.

For decades, severance taxes paid by coal companies helped fill the coffers of coalfield communities throughout Central Appalachia—roughly encompassing southern West Virginia, eastern Kentucky and southern Virginia. The money helped pay for road and sewer projects, parks, libraries, Little Leagues and more.

Rumbles from the jungle as Bougainville mine stirs – by Rowan Callick (The Australian – April 13, 2015)

April 13, 2015

http://www.theaustralian.com.au/

Even the long-suffering Bougainville Copper board, which has witnessed cargo cults, wars, and the closure of its own vast mine, was puzzled when its share price soared 50 per cent a week ago.

For this sudden surge of confidence appeared, oddly, to have been triggered by troubling news for the company — the commencement of a new Mining Act passed by the Bougainville autonomous region’s parliament, which hands back control of all resources to landowners.

The future of the Bougainville mine, which still contains copper and gold worth about $50 billion, is tied up with its complex past, with the long geopolitical shadow cast by the 1989-2001 civil war on the island — and with cargo-cultist hopes held out by local leaders allied to eccentric foreigners constantly seeking to seize control of the resources from BCL.

The ASX issued a “speeding ticket”, asking the company to explain the April 2 share price leap. BCL replied that it couldn’t. The price had slid back down to 28c by Friday.

The directors of the company, which is 53.58 per cent owned by Rio Tinto, 19.06 per cent by the Papua New Guinea government, and 27.36 per cent by other shareholders, are trying to juggle an enormous range of unknowns and variables, without even the compensating benefits of having a mine to run.

New reckoning for copper miners now running in the red – by Josephine Mason (Reuters U.S. – April 12, 2015)

April 13, 2015

http://www.reuters.com/

(Reuters) – Nearly a quarter of the world’s major copper mines are running in the red, even after producers including Codelco and BHP Billiton engage in their deepest cost-cutting in years, according to a Reuters analysis.

A 17-percent slump since last July has pushed copper futures on the London Metals Exchange to under $6,000 a tonne, the lowest since 2009, is the first major test of producers’ margins since the global economic crisis, forcing a new reckoning after five years of relatively consistent profitability.

Codelco, the Chilean state miner that produces about 8 percent of the world’s copper, will review the cost reduction plan at its Salvador mine as it prepares to restart operations there after torrential rains shuttered the complex in March, said a source close to the state-run miner.

The company has an ambitious target to slash total costs by as much as $1 billion this year. Salvador produced copper at a cost of some $11,439 per tonne in the fourth quarter last year, the highest out of 91 mines analyzed by Thomson Reuters unit GFMS as part of its Copper Mine Economics database.

The mines account for more than two-thirds of global output, and almost a quarter of them had production costs late last year above current prices.

THE BIG READ: Nicolau tears into Carroll – by Chris Barron (Business Day Live – April 12, 2015)

April 13, 2015

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

FORMER Anglo Platinum CEO Neville Nicolau says he might have been able to save the world’s biggest platinum miner from last year’s crippling five-month strike if he had not been given the cold shoulder by Cynthia Carroll.

At the time of their disagreement, the US-born Carroll was CEO of Anglo American, which owns 78% of Anglo Platinum, and chairwoman of Amplats. Nicolau, who was CEO of Amplats from 2008 to July 2012, said in an interview that he took a “very significant” proposal to the Amplats board about how it could survive falling platinum prices and looming labour strife — but the board was not interested.

“Cynthia Carroll disagreed completely with what I wanted to do with the company,” he says.

Nicolau’s frank admissions mark the first time that the boardroom unhappiness about Carroll’s leadership style has spilt out. Carroll left the group in November 2012, shortly after Nicolau, under intense pressure from shareholders.

“There were certain actions which I needed to take. Amcu [the Association of Mineworkers and Construction Union] was on its way in and there was a better way to manage that. The metal price was on its way down and there was a better way to manage that. There were opportunities to consolidate the platinum sector.”

Former Xstrata boss Mick Davis’ Canada links set mining rumour mill turning – by James Thomson (Australian Financial Review – April 13, 2015)

April 13, 2015

http://www.afr.com/

They seek him here, they seek him there, those miners seek him everywhere! Mining industry chief Mick Davis might not exactly have a secret identity like the Scarlet Pimpernel, but he seems to share a few common traits with the legendary literary figure right at the moment.

The former Xstrata boss now heads up X2 Resources and has raised about $7.2 billion to buy unloved, undervalued and unwanted mining assets and companies.

It’s such a huge amount of money and such a huge brief that, like the Scarlet Pimpernel, he seems to be everywhere at once. His exploits are talked about in hushed tones by unnamed sources and no one is exactly sure where he might strike first.

Will it be a raid on BHP Billiton’s South32, before or after it is spun off? Does he have his eyes on assets within Rio Tinto or Anglo American’s giant portfolios? Could he swoop in Australia, Canada, London or South Africa?

On the weekend there was a sighting of the Mining Pimpernel in Canada, with a Bloomberg report saying unnamed sources had linked Davis with three Canadian mining companies.

Can Indonesia’s 50 Cent-an-Hour Workers Mimic China’s Success? – by Chris Brummitt (Bloomberg News – April 9, 2015)

April 13, 2015

http://www.bloomberg.com/

As the sun lowers into the Java Sea, Asep Saefullah and his friends sit by a pond among the rice fields near his village in Indonesia, chatting, smoking clove cigarettes and fishing.

Not for much longer. Work has begun on an industrial park with a power station and water treatment plant that will create as many as 190,000 jobs. It’s part of a grander plan to turn this stretch of coastline on the island of Java into an export city, with a container port and a highway to the capital, Jakarta.

This is Indonesia’s shot at recreating the success of Shenzhen, the marshy village in southern China that became the heart of that nation’s industrial expansion in the late 1990s. Now China is too expensive for many factories, and industries that poured money into cities from Shenzhen to Shanghai for two decades are looking for somewhere with lower costs and lots of cheap workers.

“The great China boom was really bad for the Southeast Asia economies,” said Tim Condon, the Singapore-based head of Asia research at ING Groep NV. “With the China slowdown, all that moves in reverse. Southeast Asia’s manufacturing sector is the big winner, as it was in the early 90s.”

Analysis: Booming economy can’t help iron ore, steel – by John Myers (Duluth News Tribune – April 5, 2015)

April 13, 2015

http://www.duluthnewstribune.com/

When Minnesota Lt. Gov. Tina Smith met with some of the hundreds of Iron Range Steelworkers who received layoff notices last week, she said the stress was evident on their faces.

“The older ones, who have been through this cycle before, really had this look of fatigue, like ‘here we go again,’ ” Smith told the News Tribune. “With some of the younger ones, there was more fear. We’re telling them we’re going to bring everything we can to help them. But mostly there’s just so much uncertainty. No one knows how long this is going to last.”

Those in attendance were among nearly 1,200 taconite industry workers who will be out of a job by June. Minnesota’s Iron Range and its mining industry are facing the most layoffs they’ve seen since 2009 thanks to an industry-crippling international trade problem that seems to be getting worse.

The prices of both finished steel and its main raw material, iron ore, are in a free fall thanks to a huge global oversupply. Similar Iron Range downturns in the early 1980s, in 2000-01 and again in 2009 all came as part of national and even global recessions.

Japan Bets on Nuclear, and Coal, for Future Power – by Keith Johnson (Foreign Policy – April 8, 2015)

April 13, 2015

https://foreignpolicy.com/

Four years after Fukushima, Tokyo is angling to get nuclear reactors back online. But dirty old coal will be doing the real heavy lifting.

Japan has a new blueprint for its energy future, one that opens the door for a controversial return of nuclear power four years after the Fukushima accident took the country’s reactors offline. But even more noteworthy is that Japan now appears set to embrace a dominant role for dirty coal in the country’s energy mix for decades to come.

The plan, presented Tuesday, April 7, to Prime Minister Shinzo Abe and expected to be finalized this spring, highlights the difficult choices that developing and even developed countries must make — just months before a landmark climate conference in Paris — between cheap but dirty energy and more expensive, if cleaner alternatives. Japan’s struggles are complicated further by the political fallout of Fukushima, which forced the evacuation of hundreds of thousands of people and has left a residue of radioactive soil and water.

Abe’s blueprint envisions stable, round-the-clock power sources such as nuclear, coal, and hydroelectric growing from about 40 percent of the electricity mix today to 60 percent in 2030. The rest of Japan’s electricity would come from natural gas and renewable energy like wind and solar power, complemented by increasingly aggressive efforts to boost energy efficiency.

While there are no hard-and-fast targets yet for nuclear power in the new plan, officials say it would represent about 20 percent of the total — slightly more than the 15 percent that Abe had sought, but much less than the 30 percent of Japan’s electricity in the years before Fukushima.

The Last Coal Miners of Spain – by Nathaniel Rich (New York Times – April 10, 2015)

April 10, 2015

http://www.nytimes.com/

oal is on the way out in Europe, and it is dying a slow and ugly death. Its decline has been hastened by competition from the renewable-energy industry, cheaper imported coal from Russia and the United States and new air-quality regulations passed by the European Union. The death throes have been especially violent in Spain, where the national coal-mining industry was created by royal order in 1621 to exploit the coal basin at Villanueva del Rio y Minas in Seville.

In 1990, 167 coal mines employed about 40,000 workers. Today there are roughly 40 active mines, employing fewer than 4,000 miners. The struggling industry has long been supported by state subsidies, but under a recent E.U. agreement, all subsidies must expire by 2018.

When the government issued heavy reductions to the subsidies in 2012, miners responded by holding strikes and sit-ins and by blockading roads, highways and railroad lines. Thousands of them marched to Madrid, some walking 250 miles. When they arrived on the night of July 11, 2012, they were joined by more than 10,000 additional protesters, many of whom saw the miners’ fate as a symbol of economic parsimony taken too far.

They fired at the police with slingshots, catapults and rocket launchers. Clashes with the police followed, and the press carried images of women and children with bloodied heads. Spain’s prime minister, Mariano Rajoy, declined to hold talks with the miners. The following day, he announced new austerity measures.

Canadian Regulators Find Fault With Smaller Mining Companies’ Disclosures – by Alistair MacDonald (Wall Street Journal – April 10, 2015)

April 10, 2015

http://www.wsj.com/

CSA report underscores investors’ chronic complaints of poor reporting standards

Canadian securities regulators said Thursday that a review of publicly traded mining companies revealed often misleading and incomplete disclosures, underscoring investors’ chronic complaints of poor reporting standards among smaller companies.

The Canadian Securities Administrators, an umbrella group for Canada’s provincial regulators, said it reviewed presentations to investors made on the websites of 130 mining companies, and it asked 49 of them to correct disclosures that didn’t comply with regulations.

“Overall, our review found that mining issuers’ website disclosure needs improvement. Incomplete information and overly promotional language are key areas of concern,” said Louis Morisset, the group’s chairman and president and chief executive of the Autorité des marches financiers, Quebec’s securities regulator.

The CSA cited a number of areas in which the companies need to improve disclosures. Those include a need to provide cautionary statements on the limitations of their exploration targets and preliminary economic assessments, in which mining companies give early estimates on the size of their deposits and likely costs to develop them.

[South Africa] Mine strikes, outages will add to misery – by Ntsakisi Maswanganyi (Business Day Live – April 10, 2015)

April 10, 2015

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

MINING production rose sharply while manufacturing fell in February compared with a year ago, according to Statistics SA data released on Thursday.

The trend has been attributed to low base effects. The two sectors make up a large share of gross domestic product and the latest data suggest economic growth got off to a slow start this year.

The Manufacturing Circle, which represents the majority of producers in SA, said the figures were concerning. Electricity outages and looming strikes in the public sector and gold mines would add more misery in coming months, Manufacturing Circle executive director Coenraad Bezuidenhout said.

A public servants’ strike would hit manufacturers through lower demand for products, Mr Bezuidenhout said. “And a strike at gold mining would be even more concerning because they supply to manufacturers,” he said.

Wage negotiations between unions representing about 1.3-million public servants and the government are subject to conciliation, while pay talks in the gold and coal sectors are expected to start next month.

Ex-Xstrata CEO Davis Said to Close In on Canada-Based Miners – by Thomas Biesheuvel and Firat Kayakiran (Bloomberg News – April 10, 2015)

April 10, 2015

http://www.bloomberg.com/

Mick Davis is considering buying a Toronto-listed mining company as the former Xstrata Plc chief executive officer eyes fresh targets for his $5.6 billion war chest, according to two people familiar with his plans.

A deal in Canada could be a prelude to the bigger acquisition he’s been seeking for some time, the people said, who asked not to be identified because the deliberations are private. Davis’s X2 Resources is weighing an eventual bid for South32 Ltd., the miner being spun off next month by BHP Billiton Ltd. that’s been the subject of takeover speculation, they said.

In the meantime, X2 is looking at Canadian companies with copper, coal or nickel mines and is pursuing assets with a value of $500 million to $2.5 billion, said the people. Davis may conclude a deal within six months, the people said.

Hudbay Minerals Inc., Capstone Mining Corp. and Imperial Metals Corp. are among companies that X2 is studying as takeover candidates, according to the people. All three stocks advance in Toronto trading, Hudbay climbing 0.7 percent, Capstone 4.7 percent and Imperial Metals 0.9 percent.

X2, based in London, declined to comment. The switch to smaller mining companies and assets signals a change of tack from X2. The fund has been hunting for assets from the world’s largest miners such as BHP, Anglo American Plc and Vale SA, but has been unable to reach a deal, 18 months after the fund was started.

Iron-Ore’s Collapse Claims Major Australian Casualty – by Rhiannon Hoyle (Wall Street Journal – April 10, 2015)

April 10, 2015

http://www.wsj.com/

Mid-sized miner Atlas Iron floored by iron-ore prices’ fall to lowest levels in a decade

SYDNEY—The sharp fall in iron-ore prices claimed a major casualty in Australia when Atlas Iron Ltd. said it would shutter all its mines and halt exports to Asia.

Atlas was worth nearly 4 billion Australian dollars (US$3.1 billion) as recently as 2011 but has been losing money rapidly as iron-ore prices fell 30% since the start of this year to a decade-low. That raised concerns about its ability to repay debts if it continued digging up ore.

The Perth-based company joins a raft of small- and mid-sized iron-ore producers squeezed by the rapid decline in spot prices. Australian steelmaker Arrium Ltd. has been forced to shutter one of its two iron-ore mines here, while Cliffs Natural Resources Inc. recently suspended a mine in Canada. Cliffs has been restructuring its U.S. business to focus on domestic iron-ore sales rather than competing in the seaborne market.

Even major producers such as Rio Tinto PLC have been slashing costs and jobs as they grapple with the deepening market downturn.

Fortescue Metals Group Ltd., the world’s fourth-largest iron-ore exporter, was last month forced to scrap a planned debt sale because it couldn’t agree on terms with investors amid a sour outlook for the commodity.