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International Media Resource Articles

Nickel Stockpiles at Record High as China Turns Exporter – by Agnieszka Troszkiewicz (Bloomberg News – August 6, 2014)

http://www.bloomberg.com/

Nickel inventories in warehouses monitored by the London Metal Exchange extended gains to a record after China, the biggest producer and consumer, shipped more metal out than it imported amid a financing scandal.

Stockpiles climbed to 317,874 metric tons, for a 21 percent increase this year, according to the LME data. Exports of refined nickel from China almost tripled in June to 16,737 tons, exceeding imports for the first time ever by 5,723 tons, customs data show. Nickel is used to make stainless steel.

“The recent build is probably attributable to the pick-up in refined nickel exports that came out of China,” Nicholas Snowdon, an analyst at Standard Chartered Plc in London, said by phone. “That is most likely related to some constraints on financing.”

Nickel has gained the most of the six main metals on the LME this year, rising as much as 56 percent after the largest miner Indonesia banned exports of unprocessed ore, a raw material used to make a lower-grade nickel substitute known as nickel-pig iron. Refined nickel production will exceed demand by 44,200 tons this year before turning into shortage of 97,100 tons in 2015, according to Morgan Stanley.

Prices have pared gains to 35 percent this year, to $18,730 a ton, on speculation that supplies are sufficient for now as stockpiles climbed to a record.

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Door still open for mega-merger between Newmont Mining and Barrick Gold – by Peter Ker (The Age-Business Day – August 7, 2014)

 http://www.theage.com.au/business

A $US35 billion ($37.6 billion) merger of global goldmining companies Newmont Mining and Barrick Gold may not be dead, after the chief executive of Newmont told an audience in Melbourne that he would not “close the door” on a future deal.
The two North American gold companies conducted merger talks earlier this year but the deal fell over in April amid reports they had disagreed over how to handle their respective Australian assets.

While neither company is listed in Australia, a merged entity would wholly own the nation’s biggest goldmine, Boddington, and the nation’s second-biggest goldmine, Kalgoorlie’s Super Pit, as well as other smaller assets.
When asked if he had shut the door on the proposed deal, Mr Goldberg indicated a revival of the deal was not impossible.

“I wouldn’t shut the door on it – we are focusing on running our business as effectively and efficiently as we can going forward and we will see what happens,” he said.

“Clearly we overlap and we work together, [the Super Pit] is an example, and we have a joint venture in Nevada and I wouldn’t close the door on it at all.” But he said he had not heard from Barrick since April.

During a presentation to the Melbourne Mining Club on Thursday, Mr Goldberg said the deal had failed because there were not enough “redundancies” between the two companies.

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Moon First—Mine the Asteroids Later – by Paul D. Spudis (Air Space Magazine – August 6, 2014)

http://www.airspacemag.com/

Let’s learn how to extract space resources closer to home.

The UK Daily Mail recently published a piece extolling the benefits of asteroid mining (before lightly tripping over some mundane, yet critical, technical details). The article leads with the headline: Single asteroid worth £60 trillion if it was mined – as much as world earns in a year. Should we chide them for such blatant sensationalism? Then again, is it blatant, or are they merely following an established pattern?

Asteroid mining is a field with lots of hype but little sober consideration. To redeem the technique of in situ resource utilization (ISRU) from the realm of ridicule and science fiction and make it a routine aspect of space mission architectures, we must honestly discuss the difficulties of extracting useful product from raw asteroid debris.

As with every Solar System body of interest and potential use, I am firmly convinced we will eventually mine asteroids. In truth, if we do not take up these formidable technical challenges, there is little hope for any permanent and extensive human presence in space. As long as we confine ourselves to launching everything we need for spaceflight from the bottom of the deepest gravity well in the inner Solar System, we will remain mass- and power-limited and thus, capability-limited.

Essential, low-information density material – spaceflight’s “dumb mass” of propellant and consumables – should be obtained from sources in space, rather than long-hauled (at great cost) from Earth. Only complex, high-information density items not easily made in space should be brought up from Earth.

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Bottom reached for coal, iron ore? – by Oliver Probert (Australian Journal of Mining – August 07, 2014)

http://www.theajmonline.com.au/

An ANZ commodities expert says iron ore and coking coal prices may have reached their bottom, and he’s singing from the same hymnbook as at least one mining executive.

A report from Mark Pervan, global head of commodity strategy for ANZ, this week said that with the stabilisation of the overall macro environment, commodity markets are entering the second half of 2014 on a positive note.

While an increase in commodity prices is likely to occur, the report says, it will be a modest one, however.

“Overall, the backdrop looks accommodating for commodity markets in H2 2014,” Pervan’s report states. “But the upside looks limited over the next month or two until we see this supported by a pick-up in physical demand, which is expected later in the year.”

Commenting specifically on mined bulk commodities, Pervan wrote: “Supply-side issues remain, but the bottom appears to have passed for coking coal and iron ore. Seasonal drops in power demand will cap any thermal recovery.”

Pervan’s confidence in iron ore was echoed by Atlas Iron chief executive Ken Brinsden, who was referenced in a number of mainstream media outlets for his comments at the Diggers & Dealers conference in WA this week.

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UPDATE 2-China’s Ramu nickel mine in PNG restarts after attacks – embassy – by Sonali Paul, Melanie Burton and Polly Yam (Reuters India – August 7, 2014)

http://in.reuters.com/

Aug 7 (Reuters) – A Chinese-owned nickel mine in Papua New Guinea has resumed production three days after an attack by armed villagers forced work to halt, a Chinese embassy official in the South Pacific country said on Thursday.

The $2.1 billion mine, forecast to produce 22,000 tonnes of nickel in 2014, is operated by Ramu NiCo, which is majority owned and run by Metallurgical Corporation of China Ltd (MCC) .

Equipment including nine excavators, a fuel truck and a lighting vehicle were burned and five Chinese workers were injured in the attack on Monday, the embassy said, confirming earlier media reports.

“The embassy strongly condemns these brutal attacks and makes urgent request to the PNG Government to take immediate and effective measures to prevent the violence from recurring and ensure the safety of the personnel and properties, and to bring those attackers to justice to deter such criminal acts,” an embassy official said in an emailed response on Thursday.

“With the assistance of the police force, now the situation is under control and the mining production has been resumed.”

Mining and energy projects are the major source of income for Papua New Guinea, but outbreaks of violence sparked by landowner disputes and environmental concerns are not uncommon.

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Miners talk up big asset sales – by Paul Garvey (The Australian – August 7, 2014)

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

IT’S long been said that the juiciest stories out of Diggers & Dealers come not from the procession of speakers at the conference ­podium, but instead from the Hannan Street bars packed full of delegates each night (and often well into the next morning).

This year was no different. If the chatter doing the rounds in the bars of the Palace and Exchange hotels is anything to go by, we should be standing by for a flow of deals in the months ahead.

While Kalgoorlie’s infamous skimpies went about their business behind the bar — this year’s collection of scantily clad barmaids were apparently flown in from the Gold Coast specially for the event — much of the talk ­focused on the big asset sales said to be in the works.

The sales process around BHP Billiton’s Nickel West smelter, just down the road from the ­action in Kalgoorlie, was a subject of significant gossip.

Despite reports Glencore had walked away from the process, there was talk the Swiss giant was in fact still in the fray albeit frustrated by BHP’s approach to the sale. Private equity group Apollo Global Management is understood to have its offer for the assets knocked back, while China’s Jinchuan is still very much in the running.

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Shanduka Urges S. African Platinum Against Mechanizing – by Antony Sguazzin and Gordon Bell (Bloomberg News – August 6, 2014)

http://www.bloomberg.com/

Companies that buy operations put up for sale by Anglo American Platinum Ltd. (AMS) after a pay strike by South African mineworkers will need to coexist with labor unions rather than mechanize the operations, said the chief executive officer of Shanduka Group, which owns stakes in platinum mines.

Anglo American Platinum, the Johannesburg-based unit of Anglo known as Amplats, said last month that it will sacrifice its status as the world’s biggest producer of the precious metal by seeking buyers for four mines and possibly stakes in two joint ventures after first-half profit fell 88 percent because of a five-month strike. The company employed almost 50,000 people at the end of last year, according to data compiled by Bloomberg.

South African mines are labor-intensive, a legacy of the apartheid system that ended in 1994. The whites-only government based its economy on using cheap black labor to mine the world’s biggest gold and platinum deposits. To end the strike, Amplats, Impala Platinum Holdings Ltd. and Lonmin Plc were forced to agree to above-inflation pay increases that they said they couldn’t afford. Impala has said it may mechanize a future development to reduce its labor costs.

“Going the mechanized route is an aggressive approach,” Phuti Mahanyele, the CEO of Shanduka, said in an interview at the U.S.-Africa Business Forum in Washington yesterday. “We have to find ways to work with labor.”

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UPDATE 2-Glencore courts Guinea’s iron ore treasures- document – by Silvia Antonioli and Alexandra Reza (Reuters India – July 6, 2014)

http://in.reuters.com/

LONDON, Aug 5 (Reuters) – Miner and commodity trader Glencore has expressed interest in iron deposits in Guinea, a presentation obtained by Reuters shows, although the company said it had not pitched for a stake in Simandou, the country’s largest deposit.

Glencore is the latest mining major looking to invest in iron ore assets in Guinea. Most interest is focused on Simandou, one of the world’s biggest deposits.

Any potential investors in Simandou are treading carefully, however. Israeli-owned BSG Resources, which was stripped of its license to develop part of Simandou following a Guinean corruption investigation, is seeking arbitration and has threatened to sue companies that invest in its former license area.

Three sources close to the government said London-listed Glencore had indicated its interest in investing in Simandou, in a meeting with government officials in Conakry in June.

A copy of a power point presentation, which the sources said a Glencore representative delivered at the meeting, includes a reference to Glencore having the financial and technical ability to develop big projects in the region and “the willingness to proceed very quickly together with the government to the exploitation phase of iron ore projects”.

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Boardroom coup likely to see Cliffs on the selling block – by Peter Kerr (Sydney Morning Herald – August 5, 2014)

http://www.smh.com.au/

The miner at the centre of a $US2.65 billion ($2.84 billion) boardroom coup has conceded it will probably fall under the control of an activist hedge fund intent on breaking up its structure and selling its assets.

In a transition that is expected to put the fifth biggest iron ore export business in Australia on the selling block, Cliffs Natural Resources said overnight that hedge fund Casablanca Capital was expected to control six seats on the company’s 11-member board.

”The election of individual director candidates is not yet complete,” Cliffs said in a filing to market regulators in the US. ”However, based on the preliminary voting results, all six of the Casablanca Nominees and five of the Board Nominees have been elected for a term that will expire on the date of the 2015 annual meeting of shareholders.”

The comments support claims by Casablanca immediately after last week’s annual meeting of Cliffs’ shareholders, when the hedge fund claimed to have won control of the miner after a long campaign seeking higher dividends and asset sales.

Cliffs owns coal and iron ore assets across several locations in the US, Canada and Australia, including an iron ore export business in Western Australia.

That business, known as the Koolyanobbing operations, is profitable and exports about 11 million tonnes of iron ore a year through the port of Esperance.

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15,000 Oregonians sign petition opposing nickel project – by Dorothy Kosich (Mineweb.com – August 6, 2014)

http://www.mineweb.com/

More than 15,000 Oregonians have signed a petition advocating the withdrawal of lands, located in SW Oregon watersheds, from mining and exploration.

RENO (MINEWEB) – More than 15,000 petition signatures, in favor of a mineral withdrawal for public lands in southwest Oregon watersheds, were delivered Tuesday to the U.S. Forest Service and the Bureau of Land Management to be presented to the U.S. Secretaries of Interior and Agriculture.

The named “critical” watersheds include the North Fork Smith River, Baldface Creek, Rough & Ready Creek, and Hunter Creek.

“These signatures build upon the request of a broad coalition of local and national conservation groups to withdraw these public lands from mining in response to proposals for nickel strip mining in the area,” said a news release published Tuesday by Washington, D.C.-based environmental NGO, Earthworks.

The petition not only calls for the immediate withdrawal of the Rough & Ready and Baldface Creek watersheds from mining under the Mining Law of 1872; it also urges the enactment of legislation “to protect them from destructive nickel strip mining and permanently preserve their unique natural values”.

Minerals withdrawals from the 1872 Mining Law of up to 20 years can be issued by the Secretary of Interior under the Federal Land Policy and Management Act (FLPMA).

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Gold Industry Takeovers Climb to Highest in Three Years – by David Stringer (Bloomberg News – August 4, 2014)

http://www.bloomberg.com/

There’s no sign of a let up in gold industry takeovers as a surge in acquisitions by producers, led by Agnico Eagle Mines Ltd. (AEM) and Yamana Gold Inc. (YRI), has pushed deals to a three-year high.

Mid-sized and small producers are seizing on assets discarded by larger competitors as they trim portfolios to focus on their most profitable operations after gold last year notched up the biggest annual drop in more than three decades.

“The hunters have feasted for the last six months,” said Raleigh Finlayson, managing director of Saracen Mineral Holdings Ltd. (SAR), which in May completed a deal to buy OAO GMK Norilsk Nickel’s mothballed Thunderbox operations in Australia. “There are projects still out there and the field might have opened up for those that are left, so that’s an opportunity for some.”

Finlayson is among mining executives gathering this week in Kalgoorlie, the Western Australian town 595 kilometers (370 miles) east of Perth, for the annual Diggers & Dealers conference through Aug. 6. Former Bank of England governor Mervyn King addressed the forum ahead of presentations by executives from Fortescue Metals Group Ltd., AngloGold Ashanti Ltd. and Gold Fields Ltd. in coming days.

Deals worth about $14 billion have been announced or completed so far this year, according to data compiled by Bloomberg, the highest annual total in three years and led by Agnico Eagle and Yamana’s $3.44 billion acquisition of Osisko Mining Corp., the industry’s biggest deal since 2010.

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Guinea’s Simandou iron ore trove: huge potential for the hugely patient – by Saliou Samb (Reuters India – August 5, 2014)

http://in.reuters.com/

BEYLA, Guinea, Aug 5 (Reuters) – In a remote, southeastern corner of Guinea, the mist-shrouded Simandou mountain range rises above the lush forest. Buried under its green slopes lies some of the planet’s finest iron ore, a treasure long coveted by the world’s mining giants.

But any profit, for Guinea or the firms, will remain locked in the russet ground until an export outlet to the coast is cleared, a task that will involve building 650 kilometres (400 miles) of railway, 35 bridges, and 24 km of tunnels.

Coupled with the need for a new port to load the ore onto ships, the initial price tag would be around $20 billion, making it Africa’s biggest mining project ever, to be carried out in one of the continent’s most unstable and rundown nations.

“The logistical challenge is such that the whole project remains on hold until the infrastructure can be put in place to get the ore out,” said Madani Dia, a Guinean mining analyst.

Lack of adequate infrastructure – ports, roads and railways – to expand the trade and export of Africa’s mineral riches is one of the biggest brakes on the continent’s faster growth.

Global firms including Rio Tinto and Brazil’s Vale have for years been eying Simandou, and most recently miner and commodity trader Glencore has expressed interest in Guinea’s iron ore, a presentation obtained by Reuters shows.

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COLUMN-Coking coal prices set for modest gains, thermal still marooned – by Clyde Russell (Reuters U.K. – July 5, 2014)

http://uk.reuters.com/

Clyde Russell is a Reuters columnist. The views expressed are his own.

LAUNCESTON, Australia, Aug 5 (Reuters) – Prices for thermal and coking coal appear poised to diverge, with the power-plant fuel remaining mired in the doldrums and the steel-making ingredient posting modest gains.

The halving of thermal coal prices since early 2011 has grabbed the most attention in the beleaguered industry, but coking coal has actually performed worse, dropping by almost two-thirds since its post-2008 recession peak in mid-2011.

The 2011 high was reached after severe flooding in Queensland state, the main coking coal producer in top exporter Australia.

Both types of coal have been plagued by oversupply, which has swamped the modest increases in demand in top importers China and India.

The problem for thermal coal has been supply hasn’t significantly been cut despite weak prices. Producers in the top two exporters Indonesia and Australia have been instead trying to cut costs and increase volumes in order to boost revenues.

Australian producers have another problem, the so-called “take-or-pay” contracts that commit them to paying for transport costs whether they actually ship coal or not.

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UPDATE 2-Brazil’s Vale profit falls; prices undermine record output – by Stephen Eisenhammer (Reuters India – July 31, 2014)

http://in.reuters.com/

(Reuters) – Brazilian miner Vale SA posted a sharp decline in profit from the previous quarter as lower iron ore prices undermined record production of the steel-making ingredient.

Vale, the world’s largest producer of iron ore, reported second-quarter net income of $1.43 billion, down 43 percent on the previous quarter and below the average analyst estimate of $1.89 billion in a Reuters survey.

“It was a very challenging environment where the price of our most important product has dropped by 15 percent,” Chief Financial Officer Luciano Siani said in a video accompanying results.

Net income was more than three times higher than the year-ago quarter, when a one-time foreign exchange charge slashed profit to $424 million. Prices for iron ore .IO62-CNI=SI have dropped by nearly 30 percent this year, hitting a 22-month low in June.

Iron ore production rose 12.6 percent to 79.45 million tonnes from a year earlier, as better weather conditions combined with ramp-ups at its two main mine sites in Brazil.

Mega miners Vale and Australia’s Rio Tinto Ltd and BHP Billiton Ltd are ramping up output and slashing costs in an attempt to increase market share.

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The 800 Pound Gorilla in the room for rare earth sustainability in North America – thorium – by Alessandro Bruno (Investorintel.com – August 3, 2014)

http://investorintel.com/

The West must deal with thorium content limits before it can hope to become rare-earths independent…

James Kennedy works closely with the Thorium Energy Alliance to promote US legislation for the commercial development of thorium energy systems and rare earths. And when he asked me to review a video where he presents a paper entitled “Creating a Multinational Platform, Thorium, Energy and Rare Earth Value Chain – a Global Imbalance in the Rare Earth Market” – it occurred to me that Tracy’s frequently referenced ‘800 lb. gorilla’ in the proverbial rare earth room was overdue for discussion: thorium.

Kennedy’s essential argument is that the rare earth imbalance is largely the result of regulations with unintended consequences: “Rare earths and thorium have become linked at the mineralogical and geopolitical level.” In other words, thorium should be considered as a rare earth mineral.

There is, in fact, a close relationship between thorium and rare earths; they often come together. In fact, monazite, was first mined to produce thorium and rather than rare earths. In the 19th century, thorium was used to make gas mantles. Later, with the development of technology that required rare earths to function, monazite started to be mined for elements other than thorium. Meanwhile, monazite itself is a by-product.

It is separates easily, through gravity and at almost no cost, in the mining of titanium or zirconium, such that the monazite can be said to be produced practically free of charge. The United States was the leading supplier of monazite – which was in the main source of rare earths – in the first decades of the rare earths industry (the post WW2 period).

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