International Media Resource Articles – Page 686

[Japan] Govt aims to commercialize seafloor mining in 2020s (The Japan News – February 22, 2015)

February 24, 2015

The Yomiuri Shimbun

The government is aiming to commercialize the mining of rich seafloor deposits around Japan of such mineral resources as copper in the 2020s, according to officials.

The nation has relied on imports to meet demand for mineral resources like copper, lead, gold and silver since many domestic mines were shut down by the end of the 1970s. Mining these resource-abundant seafloor deposits could help shake off Japan’s reputation as a nation with few resources.

At a press conference at the end of January, Tetsuro Urabe, a professor emeritus of the University of Tokyo, could hardly conceal his excitement. He was announcing the discovery of a deposit about 1,400 meters below the ocean surface off Okinawa Prefecture’s Kumejima island.

“The minerals there are of a quality I’ve never seen before,” Urabe said. “One could say this discovery is astonishing.”

The research was conducted by Japan Oil, Gas and Metals National Corporation (JOGMEC) using a remote-controlled vehicle, which retrieved six samples of ore with copper concentrations 15 to 30 times higher than those mined in South America.

Rio Tinto boss Sam Walsh: Glencore merger is ‘fantasy’ – by Matt Chambers (The Australian – February 25, 2015)

February 24, 2015

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

RIO Tinto managing director Sam Walsh says a merger with Ivan Glasenberg’s Glencore will never happen because it would not clear regulatory hurdles even if Glencore came up with an offer that provided value for Rio.

And the mining boss claims BHP Billiton’s planned South32 spin-off, which BHP chief Andrew Mackenzie describes as a “key differentiator”, is just portfolio management that Rio has already completed.

At a Chatham House event in London, Mr Walsh said the much-hyped prospect of Glencore making a bid for Rio when a six-month “put up or shut up” moratorium ends, and then somehow taking Rio over, was fantasy.

“Part of the reason is value but part of the reason is the anti-trust and people who collect tax and what have you, they’re simply not going to let it happen,” he said.

Mr Walsh added that BHP’s failed $US160 billion takeover of Rio in 2007 fell over primarily because anti-trust regulators would not let it happen.

BHP Billiton spin-off a bright spot in commodities gloom – by Sonali Paul (Reuters U.S. – February 23, 2014)

February 24, 2015

http://www.reuters.com/

MELBOURNE – (Reuters) – When global miner BHP Billiton reports its half-year results on Tuesday, the only parts of the company that are likely to report profit growth are some of the unloved assets it aims to spin off by June.

Commentators had dubbed the company BHP plans to hand to shareholders “DudCo” before it was christened South32, as the aluminum, manganese, nickel, some coal and silver businesses barely contributed to BHP’s earnings.

But now those businesses are looking rosier as prices for aluminum and manganese are improving in a world where prices for BHP’s four biggest products, iron ore, petroleum, copper and coal, have all collapsed to near six-year lows.

Despite the improvement, BHP wants to shed the smaller assets so it can focus on its four core commodities, and still believes that shareholders will gain more if South32 is freed to develop assets that were starved of capital amid an iron ore and coal boom.

The world’s biggest miner is expected to report a 34 percent slide in half-year underlying attributable profit to $5.1 billion, but within that, Deutsche Bank sees earnings from aluminum nearly tripling while manganese earnings are seen improving by around 45 percent.

Newmont to Consider Gold Deals Even as It Reduces Debt – by Liezel Hill (Bloomberg News – February 23, 2015)

February 24, 2015

http://www.bloomberg.com/

(Bloomberg) — Newmont Mining Corp., the largest U.S. gold producer, said it will consider acquisitions as well as the expansion of existing operations.

Like some of its biggest competitors, Newmont is focusing on its most efficient mines following a decline in the gold price. The company has sold about $1.4 billion of assets in the past two years and is building a mine in Suriname. Still, it won’t rule out buying low-cost and long-life mines in safe jurisdictions, Chief Executive Officer Gary Goldberg said.

“We’re always looking to improve our portfolio,” he said Monday in an interview in Hollywood, Florida, where he was attending the BMO Global Metals & Mining conference. “We’ve got a great organic pipeline but also it doesn’t hurt to just look around.”

While Goldberg declined to comment on specific assets Newmont would consider buying, he said the 50 percent of the Kalgoorlie Super Pit mine that Newmont doesn’t own would “fit in” with some of his acquisition criteria.

Barrick Gold Corp., the world’s largest gold miner, is the other Super Pit owner. That stake would be Barrick’s last remaining Australian asset if it offloads the Cowal mine, the sale of which was announced last week.

Nevada’s new mining mantra: Quality trumps quantity – by Marc Davis (BNW News)(Mineweb.com – February 24, 2015)

February 24, 2015

http://www.mineweb.com/

A far less glamorous species of ore has become the quarry of a few shrewd mining juniors – copper oxides.

Due to its wealth of prolific gold deposits, Nevada is fondly known as ‘elephant country’ to mining companies – big and small – that hope to hunt down their own epic discoveries. However, it’s a far less glamorous but nonetheless potentially very valuable species of ore that’s lately become the quarry of a few shrewd mining juniors – copper oxides. This strategy reflects the new reality in mining: Quality trumps quantity.

In other words, cash-strapped mining companies nowadays are quite happy to find modestly-sized, relatively high-grade deposits that can be commercialized at a fraction of the cost of huge ‘elephant-sized’ deposits. If these buried riches are near-surface – as is the case with some oxide deposits – the returns can be even more robust due to reduced pre-production expenditures.

Among Nevada’s new breed of ‘quality-oriented’ explorers is Discovery Harbour Resources (TSX.V: DHR). This mining junior recently drilled into what appears to be a near-surface copper oxide skarn deposit near the town of Lovelock in west central Nevada.

This is where an initial drill program has intersected as much as 74.2 feet (22.6 metres) averaging 1.2% copper at a fairly shallow depth at the 2BAR Project. Additionally, sweet spots as rich as 5.6 feet (1.7 metres) averaging 5.89% copper were also encountered within about 100 feet of the surface.

BHP’s iron ore outlook holds little cheer for small miners – by James Regan (Reuters India – February 24, 2015)

February 24, 2015

http://in.reuters.com/

SYDNEY, Feb 24 (Reuters) – Global miner BHP Billiton on Tuesday batted away suggestions of a turnaround in iron ore prices anytime soon – a bad omen for smaller producers struggling close to the break even point.

Chief Executive Andrew Mackenzie, releasing BHP’s half-year results, said iron ore demand in the all-important Chinese market was flat, although imports have increased by displacing higher-cost domestic supply.

But as supply costs have fallen, the price – around $62 a tonne – is now “more reflective of the medium-term fundamentals”, he said.

That’s a hefty enough price to keep BHP, the world’s third-biggest iron ore miner, and fellow mega-producers Vale and Rio Tinto in the black but is borderline for smaller rivals.

Atlas Iron, which plans output of about 14 million tonnes in fiscal 2015 against BHP’s 245 million tonnes, posted an underlying net loss of A$139 million ($108 million) for the half-year, against a A$61 million profit a year earlier.

Deep sea mining hopes hit by New Zealand decision – by Jamie Smyth (Financial Times – February 22, 2015)

February 25, 2015February 23, 2015

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

Sydney – A decision to block a deep sea mining venture off the New Zealand coast has cast a shadow over an emerging global industry that proponents say could revolutionise how minerals are extracted.

The sea floor is rich in copper, nickel, manganese, cobalt, zinc and a host of other minerals used in technology products. Improvements in undersea extraction technology have now put these within reach of miners.

New Zealand has lead the way in developing sea floor mining. But progress has now stalled following this month’s rejection by environmental regulators of a proposed project by Chatham Rock Phosphate off the coast of Canterbury, the second mine application refused within a year.

The decisions were welcomed by green groups, who fret that mining would damage vulnerable undersea ecosystems, which are relatively underexplored. But their delight is not shared by companies eyeing deep sea prospects.

“To say we are bitterly disappointed is an understatement,” said Chris Castle, Chatham Rock Phosphate’s managing director. “This will make it even harder, if not impossible for companies to attract capital for new projects in New Zealand.”

For almost 20 years deep sea mining has been flagged as a commercial opportunity. David Cameron, UK prime minister, claims it could be worth £40bn to the UK over a 30-year period.

Nearly 500 miners rescued from South African gold mine (Deutsche Welle – February 23, 2015)

February 23, 2015

http://www.dw.de/

All 486 miners trapped after a fire broke out in a South African gold mine over the weekend have been rescued. Some of the miners were trapped at a depth of nearly 3.5 kilometers.

The miners, who had been trapped by the fire, were rescued Sunday, according to officials from the Harmony Gold Mining Company.

“We are extremely grateful that all of our colleagues have been brought to surface, without injury,” said Harmony Gold spokeswoman Charmane Russell. “Fortunately in this instance, things went according to plan.”
The men were at work in the mine near Carletonville, southwest of Johannesburg, when a fire broke out at around 7:40 a.m. local time (0540 UTC). The miners were told to move to refuge bays within the mine.

“Our employees have been trained for this,” Russell said. Rescue teams were called in to contain the fire and then moved from level to level to locate the trapped miners.

South African President Jacob Zuma told his fellow citizens to keep the trapped miners in their thoughts during the rescue operation. “I urge all South Africans to keep the miners in their thoughts and prayers during this difficult period,” Zuma said.

COLUMN-Iron ore can’t go back to the future to annual pricing – by Clyde Russell (Reuters U.S. – February 23, 2015)

February 23, 2015

http://www.reuters.com/

LAUNCESTON, Australia, Feb 23 (Reuters) – Iron ore should go back to the future and reinstate annual contract pricing, according a former executive of top miner Rio Tinto. He’s wrong.

Mal Randall, who spent more than 25 years at Rio Tinto and also helped set up an Australian iron ore miner, said the move to iron ore spot pricing from 2010 onwards was a disaster, the Australian Financial Review reported on Monday.

Up to a few years ago, iron ore had been priced through annual talks between steelmakers and their largely Australian suppliers. This changed, largely at the behest of former BHP Billiton chief executive Marius Kloppers, who wanted to take advantage of a shortage of supply to generate higher returns for his iron ore mines.

“It was orchestrated and brought in by a guy that has no responsibility now, Kloppers who used to run BHP,” the newspaper quoted Randall as saying. “It’s great to make these changes and then he’s gone.”

Randall, who now chairs mineral sands company MZI Resources, is correct insofar as the spot market pricing is no longer working in the favour of the big miners.

BHP Chief to Shed Light On Mining-Spinoff Plan – by Rhiannon Hoyle (Wall Street Journal – February 22, 2015)

February 23, 2015

http://www.wsj.com/

Coming Earnings Release Is Also Expected to Highlight Challenges Facing Company

BHP Billiton Ltd. ’s diversification across commodities from aluminum to oil earned it darling status in an industry where many of its rivals were shackled to the fortunes of a single commodity. This week, though, investors expect CEO Andrew Mackenzie to shed more light on his proposal to tack away from that strategy as BHP completes plans for one of the largest spinoffs in mining history.

The release of BHP’s fiscal first-half earnings after the U.S. market closes on Monday will also highlight the challenges facing the Anglo-Australian miner as it carves off better-performing assets such as nickel pits to focus on four commodities including iron ore and oil, the prices of which halved in value last year.

As the slide in some resources markets deepens, investors and analysts have questioned whether the timing is right any longer for a roughly $15 billion demerger that would leave BHP with four units, all of which are forecast to report an on-year decline in first-half earnings.

The miner had long championed the benefits of digging up a variety of commodities, as they often don’t rise and fall in tandem. “The diversification of our portfolio of commodities, geographies and currencies is a key strategy for reducing volatility,” the miner repeated in recent annual reports.

PRECIOUS-Gold turns down as Greek accord is drafted, 4th weekly drop – by Marcy Nicholson and Clara Denina (Reuters U.K. – February 20, 2015)

February 20, 2015

http://uk.reuters.com/

NEW YORK/LONDON, Feb 20 (Reuters) – Gold turned lower in choppy dealings on Friday, flirting with a seven-week low after the euro zone discussed extending the Greek bailout by just four months, while prices headed for their fourth straight weekly drop.

A draft text on extending Greece’s bailout from its international creditors proposes prolonging the program by four months rather than a previously suggested six, officials from Greece and other euro zone states said on Friday.

Spot gold turned down 0.7 percent at $1,198.55 an ounce by 2:49 p.m. EST (1949 GMT). The metal has lost 2.5 percent so far this week, dipping to its lowest in six weeks at $1,197.56 on Wednesday, when hopes for a successful resolution to Greece’s debt talks boosted investor appetite for risk.

U.S. gold futures for April delivery settled down $2.70 an ounce at $1,204.90 on the day. “Overall, gold is lower as the market grows increasingly optimistic about a positive resolution, hence less need for a safe haven investment,” said Tai Wong, director of base and precious metals trading for BMO Capital Markets in New York.

The euro traded near session highs against the U.S. dollar after the Greek bailout was drafted.

Cliffs to return to core business – by John Pepin (Mining Journal – February 19, 2015)

February 20, 2015

http://www.miningjournal.net/

MARQUETTE – The top executive for Cliffs Natural Resources said Wednesday the mining company continues to pursue a “rock solid” revitalization strategy of shutting down and selling off its diverse assets elsewhere, reducing debt, and focusing on iron ore production in the Upper Great Lakes region.

“We are back to basics,” said Lourenco Goncalves, Cliffs’ chairman, president and chief executive officer. “We are back to our business, to our real business, the business that made Cliffs a big company, the business that made Cliffs a powerhouse in the United States and abroad and that is producing iron ore in Michigan and Minnesota and that’s it. That’s our business.”

From coal to chromite, from Australia to Canada and the southeastern United States, under previous board management, Cliffs diversified and expanded.

“Everything else was done through a strategy that was not the best one for the company – that was not the best one for the community that the company serves,” he said. “Lots of money was spent and wasted in bad investments we’re correcting all that.”

Goncalves said Cliffs’ now realizes those “mistakes of the past.”

EDITORIAL: Investors balk at unpredictable law (Business Day Live – February 20, 2015)

February 20, 2015

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

THE government is inclined to dismiss warnings that its policy choices could discourage foreign investment as either exaggerated or without foundation. But that stance is starting to appear decidedly shaky as investors break their silence to object to opaque lawmaking, and international data on foreign direct investment flows point to a loss of interest in SA as an investment destination.

Anglo American CEO Mark Cutifani recently objected to the government’s decision to reopen debate over minerals pricing, saying this reversal had created mistrust and put SA’s credibility at risk internationally. Meanwhile, private equity firms polled by Bloomberg say returns from South African investments have been shrinking for a decade, making West and sub-Saharan Africa more attractive due to their ability to offer a higher internal rate of return.

Yet despite paying lip service to the need for foreign investment and the importance of policy predictability and business confidence, the government continues to promote and promulgate laws that do the opposite. The draft Expropriation Bill that is now before Parliament, for example, is intended to form the foundation for the pending Protection and Promotion of Investment Bill, which replaces bilateral investment treaties, and the Regulation of Land Holdings Bill, which will ban foreigners from buying agricultural land and limit the size of existing farms to 12,000ha.

Yet it is silent on how it will interact with the Property Valuation Act that was promulgated last year, which provides for the establishment of an office of the valuer-general whose job it will be to value property earmarked for expropriation. This law was intended to overcome the land reform logjam, which the government blames on the failure of the “willing buyer, willing seller” principle.

Indonesia to allow mine contract extension earlier than 2 yrs out – by Wilda Asmarini (Reuters India – February 20, 2015)

February 20, 2015

http://in.reuters.com/

JAKARTA – Feb 20 (Reuters) – Indonesia will start allowing miners to renew contracts earlier than two years before expiry, the mines minister said on Friday, a move that would favour Freeport-McMoran Inc and its expansion plans at one of the world’s largest copper mines.

Southeast Asia’s largest economy is currently in talks with miners over their plans to develop domestic smelting and processing facilities, and earlier this week indicated that it could also ease a planned 2017 export ban on copper and other mineral concentrates.

The government’s willingness to show more flexibility comes after U.S.-based Freeport pushed ahead with expansion plans at Indonesia’s sole copper smelter at Gresik and gave its support to a government-backed industrial zone in Papua.

“The government regulation for extension proposals that regulates a minimum of two years before a contract expires will be revised,” Sudirman Said, Indonesia’s energy and mineral resources minister, told reporters.

Said did not say how early mining companies would be able to propose extensions but noted that oil and gas concession holders can propose renewals up to 10 years before a contract expires.

Potash Price War Looms With Belarus Seeking Share: Commodities – by Yuliya Fedorinova (Bloomberg News – February 19, 2015)

February 20, 2015

http://www.bloomberg.com/

(Bloomberg) — The potash industry, which provides the potassium used to grow bigger fruits and vegetables worldwide, is facing a global price war as Belarus seeks to strengthen its share of the $20 billion market. The Eastern European country, which supplied 20 percent of global exports last year, is running mines at almost full capacity to gain a foothold in the U.S. and in China, at a time when the Asian nation is in talks with other providers of the plant nutrient, analysts and competitors say.

The moves come a year-and-a-half after the once-staid market was thrown into chaos when Russia’s PAO Uralkali unexpectedly terminated its relationship with Belarus’s state-owned producer Belaruskali. That venture used to control 40 percent of exports, helping to maintain stable prices.

“The real price war has already started,” said Oleg Petropavlovskiy, an analyst at BCS Financial Group in Moscow. “Belarus is offering lower prices in some regions, while running close to full capacity. It’s the key threat now for the global potash market and will not abate any time soon.”

Potash, used by farmers as an important fertilizer for their plants, is mined deep underground, in areas where water from ancient seas dried up and disappeared, leaving behind potassium salts. Total demand for the nutrient reached a record high of about 62 million tons last year as farmers in Brazil, China and North America increased consumption.