International Media Resource Articles – Page 709

Iron Drops to Lowest Since 2009 as APEC Curbs Dent Demand – by Jasmine Ng (Bloomberg News – November 5, 2014)

November 5, 2014

http://www.bloomberg.com/

Iron ore declined to the lowest level in more than five years as China ordered some steel mills to reduce production, curbing demand in the world’s biggest user just as increased supplies exacerbate a global surplus.

Ore with 62 percent content delivered to Qingdao fell 2 percent to $76.46 a dry metric ton today, the lowest price since September 2009, according to data from Metal Bulletin Ltd. The drop extends two weeks of losses at the end of October.

The raw material lost 43 percent this year, underperforming all 22 members of the Bloomberg Commodity Index, as producers including BHP Billiton Ltd. expanded supplies and spurred the glut. Some mills in the largest buyer were ordered to suspend output before a summit of world leaders at the Asia Pacific Economic Cooperation forum in Beijing. A recovery in prices may take as long as 18 months, according to Anglo American Plc.

“Steel mills in north China should be working at a reduced rate due to the APEC meeting,” Christian Lelong, an analyst at Goldman Sachs Group Inc. in Sydney, said today before the price was released. “That should be playing a role” in iron ore’s drop, he said by e-mail.

Asia’s biggest economy will host the APEC gathering in the capital from Nov. 7-12, prompting authorities to order factory shutdowns to try to ensure clean air during the event.

CORRECTED-Gold, diamonds fuelling conflict in Central African Republic- U.N. panel – by Daniel Flynn (Reuters India – November 5, 2014)

November 5, 2014

http://in.reuters.com/

DAKAR, Nov 4 (Reuters) – Gold and diamond sales are being used to finance conflict in Central African Republic and United Nations peacekeepers should monitor mining sites to clamp down on illicit trade, a U.N. panel of experts said.

In a report, the panel also said the peacekeeping mission (MINUSCA) should deploy troops to the remote north of the country and use drones to monitor the rebel-controlled region to put an end to simmering violence there.

The mission, which launched in September, is operating at only two-thirds of its planned 12,000-strong capacity.

Central African Republic was plunged into chaos when northern, mostly Muslim Seleka rebels seized control of the majority Christian country in March 2013, prompting a vicious backlash by the largely Christian ‘anti-balaka’ militia.

The panel said that some 3,000 people had been killed between December 2013 – when the U.N. Security Council imposed an arms embargo – and August this year. The number of civilian deaths was falling, however, the panel said.

Vancouver and Calgary: A Tale of Two Cities – by Donald McInnes (Asian Pacific Post – November 4, 2014)

November 5, 2014

http://www.asianpacificpost.com/

Donald McInnes has an extensive background in mining and renewable energy ventures in BC and elsewhere. Based in Vancouver, he is a partner of Oxygen Capital Corporation.

Recently Canada 2020 hosted an event in Vancouver called “Cities as Nation Builders” featuring Mayors Robertson from Vancouver and Naheed Nenshi from Calgary. When I looked at the agenda I could not help consider the recent election advertisement of Mayor Robertson.

He demands on one hand that the Federal and Provincial governments help Vision Vancouver pay for and build a subway line to UBC and in the same breath says he must protect us from the Trans Mountain Pipeline.

Everyone in Canada knows that Alberta does not have a provincial sales tax, is near the top in spending more per capita on health care and education and spends more capita on infrastructure than every single other province. How do they do this? I take comfort that Calgarians know, love and celebrate that they are a service and supply centre for the oil patch which gives governments the ability to pay and provide.

By now most Vancouverites will have noticed the crane that was erected at the Seaspan Shipyard in North Vancouver. To me it’s a powerful symbol of economic prosperity and advancement for the province that come from natural resource development.

The Stealth Element: How Mercury Became a Global Environmental Problem – by Gustavo A. B. da Fonseca (Huffington Post – November 3, 2014)

November 5, 2014

http://www.huffingtonpost.ca/

Gustavo A. B. da Fonseca is Director of Programs, Global Environment Facility.

I spent many fond moments as a child letting captive mercury droplets swirl from the palm of my hand to another as I waited for my father, a dentist, to finish working on his last patient of the day.

The element that goes by the symbol Hg in the periodic table of elements (from the Greek word hydrargyrum, or “liquid silver”) is still widely employed in fillings of dental cavities in the form of an amalgam with a blend of other metals. It has also found a breath of uses in the modern world including medicine, industrial manufacturing of chlorine, plastics, compact florescent lights and gold production.

It took a major calamity to wake society up to the health hazards brought about by the carefree use and handling of mercury. In 1956, at a remote fishing village of Japan, where a chemical plant was, for decades, dumping loads of mercury into the Minamata bay, the large-scale poisoning of people and animals was bought to the attention of the wider public.

Mercury bioaccumulates in the environment through the ingestion of food and water. Over time, the element then concentrates in individual organisms then through the contamination of their immediate environment. Described as the Minamata disease, this form of severe mercury poisoning is a debilitating neurological syndrome caused by the consumption of marine organisms heavily contaminated with mercury.

Antarctic mining ban to be indefinite – by Cole Latimer (Australian Mining – November 3, 2014)

November 4, 2014

http://www.miningaustralia.com.au/home

A symposium on polar law has heard that mining will indefinitely be banned in the Antarctic region. The event, held in Hobart, saw the former head of the Australian Antarctic Division claim that the Antarctic Treaty – which bans mining in the region – will not be revised later this century, according to the ABC.

It comes as polar ice both in the Arctic and Antarctic regions begins to recede, opening up new regions for resources companies. While the Antarctic appears barren on the surface, below it stores an abundance of highly sought resources, including coal, iron ore, manganese, copper, lead, uranium and billions of barrels of oil reserves.

The resources are plentiful but they have been largely untouched as a result of an international peacekeeping agreement – the Antarctic Treaty System (ATS).

Established in 1961, the Treaty includes 12 original signatories, consisting of Australia, New Zealand, Japan, Argentina, Belgium, Chile, France, Norway, South Africa, Russia, the United Kingdom, and the United States, plus 28 other states that have ‘consultative party’ status, which allows them to vote on decisions concerning Antarctic administration.

Australia claims the majority of Antarctica, with the Australian Antarctic Territory covering 42 per cent of the continent. In 1991, nations of the Treaty agreed to ban the exploitation of minerals by signing a comprehensive Protocol on Environmental Protection (the Madrid Protocol).

Russia’s Dependence on the West – by Grzegorz Kaliszuk (New Eastern Europe – November 3, 2014)

November 4, 2014

http://www.neweasterneurope.eu/

The conflict in eastern Ukraine, which has been lasting for nearly ten months, has had direct implications on the Russian economy. Foreign investments, as the best tool to integrate the world’s economies, are more and more often bypassing Russia. According to the Central Bank of Russia, the country is going to lose 90 billion US dollars of foreign investments as a result of the war.

The energy industry, which is the core of the Russian economy, is very close to the heart of the Kremlin. As a place where hundreds of different minerals are exploited every day, we generally associate the Russian energy industry with oil and natural gas. However, besides “black gold” and “blue fuel”, Russia’s coal mining is also a very significant part of its energy business. One-third of the world’s coal supplies are located in Russia, primarily in Siberia.

In 2012, the Russian Federation endorsed a long-term coal development programme. Its main aim is to increase Russia’s annual coal production to 430 million tonnes. The first step to success is its large coal reserve. The second are the specialised technologies which are usually purchased from other countries. The current level of exhaustion in the mining infrastructure shows an immediate upgrade is needed in up to 60 per cent of production sites (in 139 open-pit mines and in 93 underground mines).

The Russian coal industry is also a chance for the Polish economy. Until the end of the 1960s, Poland imported coal-mining technologies from Russia – now the boot is on the other foot and the Russian market is dominated by companies like Becker Mining Systems (Germany), Sandvik Mining Construction (Finland) and the export alliance of Czech Mining Technology.

Volatile gold prices may worsen N.A. miners’ ratings – by Dorothy Kosich (Mineweb.com – November 3, 2014)

November 4, 2014

http://www.mineweb.com/

S&P warns that if gold prices average about $1,100/oz in 2015, several N.A. gold producers may have their credit ratings downgraded.

RENO (MINEWEB) – While most Standard & Poor’s-rated North American gold producers are anticipated to maintain relatively stable credit profiles at $1,200/oz gold through 2015; if gold prices settle modestly below $1,200/oz, Allied Nevada Gold, Barrick Gold, Iamgold, Kinross Gold and Newmont Gold “are particularly vulnerable”.

“Specifically, we estimate that thse companies would breach the adjusted debt-to-EBITDA ratio, funds from operations (FFO)-to-debt ratio, or liquidity thresholds previously highlighted in the downside scenarios in our most recent research reports on each issuer,” said S&P in the new RatingsDirect report entitled: Will Falling Prices Tarnish North American Gold Producers Credit Quality?

Currently, S&P rates both Barrick and Newmont at ‘BBB’ with a “Negative” outlook, Kinross at a ‘BBB-’ with a “Stable” outlook, Iamgold with a ‘BB+’ with a “Watch Negative” outlook, and Allied Nevada at a ‘CCC+’ with a “Negative” outlook.

In an interview with Mineweb Friday, S&P primary credit analyst Jarrett Bilous observed, “We have a relatively stable gold price at $1,200 through 2015-16, and that incorporates our expectation for relatively modest US inflation below 2% through 2016.

Germany’s Turn Against Coal Risks More Reliance on Russia – by Stefan Nicola, Tino Andresen and Brian Parkin (Bloomberg News – November 3, 2014)

November 4, 2014

http://www.bloomberg.com/

Germany is turning against coal as a fuel for generating electricity, a move that will boost the nation’s reliance on natural gas from Russia.

Alarmed that curtailing nuclear power has prompted utilities to burn the most coal in six years, Chancellor Angela Merkel’s government is working on a plan to reinforce Germany’s commitment to reduce fossil-fuel emissions. The Economy Ministry on Oct. 31 published a paper laying the groundwork for the most strict steps yet to limit coal in Europe.

The shift, if implemented, would force Germany to tap Russia for additional supplies, to import power from neighbors and to further subsidize renewables such as solar and wind. That would swell the country’s 100 billion-euro ($126 billion) annual fuel import bill and may raise the cost of electricity paid by consumers, already the second-highest in the European Union.

It would also run counter to efforts by the U.S. and EU to isolate Russia economically.

“The importance of gas, and with that the dependence on Russia, will increase,” said Guido Hoymann, an analyst at B. Metzler Seel Sohn & Co. KGaA. Cross-border exchanges of electricity also would rise, helping the nuclear plants just outside Germany’s border, he said.

Chinese unmoved by gold price drop, see it cheaper still – by A. Ananthalakshmi (Reuters U.S. – November 3, 2014)

November 4, 2014

http://www.reuters.com/

SINGAPORE – Nov 3 (Reuters) – Even with gold prices dropping to near 4-year lows, buyers in China – the world’s leading market – aren’t tempted, suggesting prices have further to fall.

When gold prices are in a slump, Chinese buyers, eyeing a bargain, traditionally move in and stop the rot. But that doesn’t seem to be happening this time around. The current market decline has seen the price of gold lose more than a third of its value in two years, to around $1,173 an ounce.

Unusually, prices on the Shanghai Gold Exchange, the world’s biggest platform for physical trade, are at a discount of around $1 an ounce to the global benchmark, slipping from premiums of $1-$2 an ounce last week. Since all physical gold trade in China goes through the exchange, it is seen as a reliable barometer of Chinese demand.

World gold prices are at their lowest since 2010 and slid $25 an ounce on Friday as the U.S. dollar strengthened, but Chinese buyers still aren’t biting, predicting prices have further to drop.

There is little sign of increased demand, dealers at importing banks in China and traders told Reuters on Monday, recalling how China led a rush to buy jewellery and gold bars and coins when prices slumped about $200 an ounce in two days last year.

In the U.S., a Turning Point in the Flow of Oil – by Clifford Krauss (New York Times – October 7, 2014)

November 4, 2014

http://www.nytimes.com/

HOUSTON — The Singapore-flagged tanker BW Zambesi set sail with little fanfare from the port of Galveston, Tex., on July 30, loaded with crude oil destined for South Korea. But though it left inauspiciously, the ship’s launch was another critical turning point in what has been a half-decade of tectonic change for the American oil industry.

The 400,000 barrels the tanker carried represented the first unrestricted export of American oil to a country outside of North America in nearly four decades. The Obama administration insisted there was no change in energy trade policy, perhaps concerned about the reaction from environmentalists and liberal members of Congress with midterm elections coming.

But many energy experts viewed the launch as the curtain raiser for the United States’ inevitable emergence as a major world oil exporter, an improbable return to a status that helped make the country a great power in the first half of the 20th century.

“The export shipment symbolizes a new era in U.S. energy and U.S. energy relations with the rest of the world,” said Daniel Yergin, the energy historian. “Economically, it means that money that was flowing out of the United States into sovereign wealth funds and treasuries around the world will now stay in the U.S. and be invested in the U.S., creating jobs. It doesn’t change everything, but it certainly provides a new dimension to U.S. influence in the world.”

Tycoon [Mick Davis] has eye on Anglo assets – by Danny Fortson (The Australian – November 3, 2014)

November 3, 2014

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

MINING tycoon Mick Davis has entered the fray again, tabling a multi-billion dollar offer for a big chunk of Anglo American’s empire.

The bid, thought to have been made in recent weeks, is the latest attempt by the former boss of mining giant Xstrata to launch his new vehicle, X2 Resources.

Mr Davis, who sold Xstrata last year to Glencore for $US27 billion, has raised $US4.8bn ($5.5bn) from a handful of investors to set up a diversified mining giant.

The Anglo bid marks the second time he has tried to prise away assets from one of the world’s top miners to form the heart of his new venture. BHP Billiton rejected a similar bid and has instead decided to spin off aluminium, coal, nickel and manganese operations into a new $US12bn listed company.

The 56-year-old South African is not the only suitor knocking on Anglo’s door. It is understood that Warburg Pincus, the private equity giant who this year hired Peter Kukielski, Arcelor Mittal’s former mining chief, had also made an approach for some of the giant’s assets.

Mark Cutifani, who took over as Anglo’s chief executive 18 months ago with a mandate to slash costs, sell assets and knock the company into shape after years of underperformance, has already announced plans to sell a big part of its historic platinum mining operation in South Africa and launched an auction for copper mines in Chile.

Australia coal mining marks challenge for U.N. green push – by James Regan (Reuters U.S. – November 3, 2014)

November 3, 2014

http://www.reuters.com/

SYDNEY, Nov 3 (Reuters) – U.N. calls to curb greenhouse gas emissions by ending most electricity generation using coal will face some tough challenges, with coal mining going through a growth spurt in countries such as Australia.

The U.N on Sunday released a report saying governments could keep climate change in check at manageable costs but would have to cut greenhouse gas emissions to zero by 2100 to limit risks of irreversible damage.

Although coal is blamed for contributing to climate change and causing large amounts of harmful pollution, it remains by far the most important fuel for power generation at a global share of around 40 percent.

Australian production of thermal coal is forecast to rise by 8 percent over the next two years to 270 million tonnes, according to government figures, confirming the nation as the world’s second’s biggest-exporter after Indonesia.

By fiscal 2018/19, production will reach 290 million tonnes, says the Australian Bureau of Resource and Energy Economics, the government’s forecaster.

Australian growth is expected to continue as companies including Rio Tinto , BHP Billiton and Glencore earmark capital to dig and acquire new mines.

BHP Billiton Rejects Mining Industry’s Bigger-Is-Better Mantra – by Alexis Flynn and Andrew Peaple (Wall Street Journal – October 31, 2014)

November 3, 2014

http://online.wsj.com/home-page

CEO Mackenzie Is About to Realize His Goal for a More Focused Company

LONDON— BHP Billiton is the world’s largest mining company by market value, with operations in 25 countries. So what’s one of the first things its chief executive advised his board when he joined six years ago?

Break it up. Now Andrew Mackenzie is about to get his way. The Anglo-Australian miner disclosed plans this summer to spin off unwanted assets in areas such as aluminum and manganese to shareholders. The business could be valued $18 billion as a stand-alone operation, analysts say.

Mr. Mackenzie said the spinoff, expected to be completed next year, shows that BHP isn’t about getting bigger. Once a company decides to focus on large assets, “there is a lot of simplification,” the 57-year-old said in an interview.

The slimmed down BHP will pursue four main areas: coal, copper, iron ore and oil and gas. It also may expand into potash, a mineral mainly used as fertilizer. Mr. Mackenzie, a former academic and energy executive, plans to focus the remaining company’s efforts on just 12 major assets world-wide, down from 30 before the split.

The breakup is something more companies—especially in natural resources—are doing to hone their business and make earnings more predictable.

Illegal mining forces Harmony to halt mine – by David McKay (MiningMX.com – October 31, 2014)

November 3, 2014

http://www.miningmx.com/

[miningmx.com] – HARMONY Gold is to shut its Kusasalethu mine on the west Rand for two weeks and send employees on leave in a bid to combat the threat to safety posed by illegal mining on its premises.

The action, aimed primarily at protecting employees at the mine which has suffered three underground fires this month, also has the affect of denting Harmony’s chances of clawing itself back to profitability.

Harmony said on October 14 that gold production in the first quarter of its 2015 financial year would be about 6% higher. It booked a full-year R1.27bn net loss (2013: – R2.35bn) in August amid falling gold recovery grades.

An underground fire broke out at Kusasalethu on October 30, and although all employees were evacuated safely, Harmony CEO, Graham Briggs, said the risk of another fire harming employees was too great a risk to bear.

“The risk of yet another underground fire is a risk that we are not prepared to take and therefore we are reverting to this temporary mine closure”, said Briggs. During the closure of the mine, Harmony would attempt to remove the illegal miners.

BHP offers little hope of revisiting giant copper mine expansion – by James Regan (Reuters U.K. – October 31, 2014)

November 3, 2014

http://uk.reuters.com/

SYDNEY – (Reuters) – Expansion by BHP Billiton’s giant Olympic Dam mine in Australia, once considered among its prized growth assets, is off the agenda due to low metals prices and productivity inefficiencies, the company said on Friday.

BHP shelved plans for a multi-billion-dollar expansion of the copper, gold and uranium mine in 2012 after a year-long study, citing a need to reign in spending as the Australian mining boom started to fade.

Since then business leaders and politicians, including Australian Prime Minister Tony Abbott, have implored BHP to reconsider its decision, hoping to alleviate job losses caused by the exit of car manufacturing in Australia.

But BHP has stood firm and on Friday reiterated its mothballing of expansion plans for Olympic Dam.

“Our immediate challenge is how we self-fund the required investment by being prudent and creative with our capital and engaging our workforce to not only reduce costs but also accelerate the initiatives that will reduce our costs,” Darryl Cuzzubbo, Olympic Dam assetpresident, said in a business speech emailed to Reuters.