International Media Resource Articles – Page 725

Glencore Mine in Doubt After Dominican Park Bill Passes – by Bill Faries (Bloomberg News – August 28, 2014)

August 28, 2014

http://www.bloomberg.com/

The future of Glencore Plc’s (GLEN) shuttered ferro-nickel mine in the Dominican Republic was cast into doubt after passage of legislation declaring the region surrounding the mine a national park.

The Senate approved a measure yesterday creating a protected area at Loma Miranda, home to the Falcondo mine. Glencore, led by billionaire Chief Executive Officer Ivan Glasenberg, called for “rationality” in decision-making on the mine’s future, the Baar, Switzerland-based company’s local unit said in a statement today.

The cost of permits to operate the mine will rise if the national park legislation is signed into law by President Danilo Medina. Affected landowners will be compensated, according to the bill. The mine, which Glencore acquired in 1956, contains 19.3 million tons of minerals.

“With operations at Loma Miranda, the Dominican economy would receive some $5.7 billion during the next 20 years,” according to the statement. “Where will those resources come from now?”

The Caribbean nation’s government has clashed with mining companies in recent years over royalties and environmental regulations. Dominican customs agents held up shipments from Barrick Gold Corp. (ABX)’s $4 billion Pueblo Viejo mine last year after Medina called the company’s concession “unacceptable.” Glencore temporarily shuttered the Falcondo mine last year due to low global nickel prices.

UPDATE 1-Australian state to sell around $2 bln in assets as mine boom ends – by James Regan (Reuters India – August 28, 2014)

August 28, 2014

http://in.reuters.com/

SYDNEY, Aug 28 (Reuters) – The state of Western Australia on Thursday said it planned to sell government-owned assets, including part of the Port Hedland shipping terminal, for an estimated A$1 billion to A$2 billion ($1.9 billion) as its resource-heavy economy adjusts to the collapse of a decade-long mining boom.

The move will precede other unspecified sales of land and assets that could fetch another A$4 billion to A$5 billion over the next two or three years, said state premier Colin Barnett.

Barnett, said his priority was to reduce debt and regain a triple-A credit rating for Western Australia. He once hailed the state as the economic engine for Australia, but it is now struggling to pay its bills.

“These are the first assets we will open up to the market. They have been identified as priority assets for sale,” Barnett said in a statement.

Moody’s this week downgraded Western Australia’s credit rating to Aa1 from Aaa. “The ratings downgrade reflects the state’s ongoing deficit position, the deterioration in its debt metrics, and a growing risk that this trend may not be reversed soon,” the ratings agency said.

Mining must strengthen community engagement, public confidence – Minister Rickford – by Dorothy Kosich (Mineweb.com – August 28, 2014)

August 28, 2014

http://www.mineweb.com/

Instead of debating whether Canada should develop its resources, Minister Greg Rickford advises the discussion should focus on responsible resource development.

RENO (MINEWEB) – While Ontario’s Ring of Fire holds great promise for the province’s north, Canadian Natural Resources Minister Greg Rickford stressed the importance of engaging with all communities in the region to work effectively with the province and the mining industry.

In a speech to 2014 Energy and Mine Ministers Meeting in Sudbury Tuesday, Rickford said, “I believe the Ring of Fire holds great promise for this region—a legacy resource development that will require substantial investment, new roads and essential infrastructure to ensure that our communities will have road access and electrification at a competitive value point for industry and communities in Northern Ontario to thrive.”

However, he observed, “To build local confidence, communities must trust what governments and industry say and what government and industries do. We must listen and address local concerns.”

“Building trust in public confidence comes from transparency,” said Rickford. “One of the reasons we’re pursuing initiatives like mandatory reporting for the extractive sector … is to get us to a point of some consensus.”

Glencore, Jinchuan frontrunners to buy BHP’s Nickel West – by Sivia Antonioli and Polly Yam (Reuters U.S. – August 27, 2014)

August 28, 2014

http://www.reuters.com/

LONDON/HONG KONG – (Reuters) – Commodities trader and miner Glencore (GLEN.L) and Chinese nickel producer Jinchuan Group are the frontrunners to buy BHP Billiton’s (BHP.AX)(BLT.L) Australian Nickel West division, two sources close to the situation said.

BHP, the world’s largest mining company, announced plans last week to spin off businesses worth an estimated $16 billion but said that Nickel West in western Australia would not be part of the demerged group.

Chief Executive Andrew Mackenzie has said the company was in talks with potential buyers for all or part of Nickel West.

Estimates of the value of Nickel West vary greatly, with some analysts and industry sources putting it at anything up to $1 billion and others tagging negative figures to an asset they say is burning cash. “It’s a race between Glencore and Jinchuan now,” the first source said.

Jinchuan is “very interested” in Nickel West and plans to ship about 30,000 tonnes of nickel concentrate to China if it takes over the business, said the China-based second industry source, who had been briefed about the plan but declined to be named because of the sensitive nature of the matter.

ANALYSIS-India’s coal crunch – a chance to revamp, reallocate and revive – by Krishna N Das and Abhishek Vishnoi (Reuters India – August 27, 2014)

August 28, 2014

http://in.reuters.com/

NEW DELHI/MUMBAI, Aug 27 (Reuters) – A court ruling this week that India’s decades-old method of granting coal mining concessions is illegal could herald much-needed reforms in a sector long dogged by the inability of state-run Coal India to raise output fast enough.

In declaring scores of coal block allocations made since 1993 unlawful and arbitrary, the Supreme Court has put investments worth billions of dollars at risk.

If it goes the next step and cancels the concessions after a further hearing due to start on Monday, India may have to import vast amounts of coal to keep the lights on.

In the long run, however, the decision could bring clearer rules to a sector that has failed to provide India with enough power because it has been so hamstrung by confusion and scandals over concessions allegedly handed to government cronies.

Coal India has a monopoly over coal that is mined for sale. The scandal, dubbed “Coalgate” by the media, concerns concessions sold to steel, cement and power firms to dig up coal for their own use.

The furore erupted after a federal auditor’s report in 2012 found that underpriced sales had cost the exchequer as much as $33 billion.

COLUMN-China may lose pole position as copper price driver – by Clyde Russell (Reuters U.S. – August 27, 2014)

August 28, 2014

http://www.reuters.com/

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

LAUNCESTON, Australia, Aug 27 (Reuters) – China has in recent years been viewed as the main driver of the global copper market, and while its influence remains strong, it’s possible that the rest of the world will take over in the short term.

Copper is currently one of the more divisive commodities among analysts, with opinions split over whether the industrial metal will continue its recent rally or lose ground over the rest of 2014.

The point is that considerable uncertainty exists over copper’s direction and much of that comes down to whatever view is held about the economic outlook for China, which consumes roughly 45 percent of the world’s copper.

While this is obviously a huge chunk of the market, it still means that the other 55 percent could exert a bigger influence, especially if its demand trend is changing.

London copper prices gained 3.4 percent between Aug. 14 and Tuesday’s close of $7,054 a tonne, although they are still down 4.2 percent since the start of the year.

The recent gains have largely been attributed to an improving outlook for growth in the United States and hopes that Europe may take steps to stimulate its struggling economies.

U.S. needs more domestic mining – by Courtney Young (Montana Standard – August 27, 2014)

August 27, 2014

http://mtstandard.com/

Courtney Young is the department head and Lewis S. Prater professor of Metallurgical & Materials Engineering at Montana Tech.

To get an idea of how dependent America is on imported minerals and metals for modern technology, I pointed out nearly a year ago how important rare-earth elements were to our country and noted that we were 100 percent dependent on imports with China controlling 96 percent of the world market. Now, let’s consider nickel and copper.

Only one U.S. mine produces nickel, a metal that is needed, for example, in the manufacture of stainless steel and batteries. One should not take for granted that the stainless steel is used for pipelines, surgical instruments, and food containers, and batteries are used to power many of our common items. We depend on imports from Russia and, as for good news, friendly countries like Canada and Australia.

To address this domestic supply issue, two companies (Polymet Mining and Twin Metals) are seeking to permit mines in northeast Minnesota where one of the world’s largest deposits exists. Their ores also contain platinum and palladium, two metals that are used to keep our air and land clean. If all goes according to plan, not only will our domestic supply of nickel increase, but so will these “green” precious metals. Their permit applications are moving through the regulatory process, and it’s expected one will begin operating next year. When that happens, U.S. manufacturers will become less vulnerable to supply disruptions and sudden jumps costs.

That will be a relief, because the United States is heavily dependent on foreign sources for many minerals used in defense production and consumer goods like computers, cell phones, and flat-screen TVs.

Gogebic’s formal request for iron ore mine to be delayed – by Lee Bergquist (Milwaukee – Wisconsin Journal Sentinel – August 26, 2014)

August 27, 2014

http://www.jsonline.com/

Company won’t finish all environmental fieldwork this year

Gogebic Taconite’s plans to submit an application to develop a $1.5 billion iron ore mine will be pushed back from the spring of 2015 until at least the fall of next year, the company says.

The company won’t finish all fieldwork this year and will be forced to conduct additional environmental work next year, according to Bob Seitz, a spokesman for the company.

The delay comes after the company and supporters said state regulators needed to be more time-conscious of big capital-intensive projects, and they pushed lawmakers to make changes in state law to speed up the review for the massive mine.

“We were kind of hellbent for leather to get past the research phase this year, but we realize that we are not going to be able get that done,” Seitz said.

Southern Wisconsin may still be in the grips of summer, but leaves are beginning to change in the far north. That’s prompting Gogebic to wrap up some fieldwork already.

On a hillside along Highway 77, the company wants to transform forestland into a mine and processing plant that would produce taconite to make steel. Preliminary core samples show significant deposits of iron ore.

Birch Lake mining venture showcases its El Dorado — and stock price tumbles – by Ron Meador (Minnesota Post – August 26, 2014)

August 27, 2014

http://www.minnpost.com/

Last week we all got our first look at official projections of how the Twin Metals Minnesota copper/nickel mine at the edge of the Boundary Waters might proceed, and the numbers were frankly impressive:

$2.8 billion in capital investments to get TMM’s mines and processing facilities started, and another $2.6 billion in capital outlays over the first 10 years of operation.
A payback period on those expenditures of not quite six and a half years, thanks to a combination of favorably low production costs and a revenue stream estimated to flow at more than $12 billion in that first decade.
Metals production, over the 30 years that this phase might run, of 5.8 billion pounds of copper, 1.2 billion pounds of nickel, 1.5 million ounces of platinum, 4 million ounces of palladium, 1 million ounces of gold, and 25.2 million ounces of silver.

All in all, “one of the most compelling greenfield copper-nickel development projects in the world,” poised to be “one of the world’s great 21st century mines” — fortuitously situated to take advantage of low production costs, a ready work force with mining experience to fill an anticipated 850 jobs, and access to Great Lakes shipping. All in “a state that supports the mining industry.”

Those are the words of Kelly Osborne, CEO of Duluth Metals, the Canadian company that owns a majority of Twin Metals Minnesota, and you might think they would be music to investors’ ears.

Peru to become world’s second-largest copper producer – by Andres Schipani (Financial Times – August 26, 2014)

August 26, 2014

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

Lima – Peru is set to become the world’s second-largest copper miner, behind neighbouring Chile, thanks to a $20bn pipeline of Chinese mining projects, according to senior officials in Lima.

Last month’s $7bn acquisition of Glencore’s Las Bambas copper project in Peru by China Minmetals’ MMG subsidiary has reinforced the links between the two countries, as Beijing seeks to secure more resources to drive economic growth.

MMG’s Las Bambas deal means Chinese backers are now behind one-third of all Peru’s new mining investments by value, estimated by the country at $61bn.

While US companies – including Newmont Mining and Freeport-McMoRan – have been among the biggest investors in Peruvian mining, Chinese projects in the country are now worth more than those from the US and Canada combined.

Eleodoro Mayorga, Peru’s energy and mining minister, said: “We have excellent relations with the Chinese; China has evolved as a partner. There is more openness, not only at a financial level, [but] also at trade and social responsibility levels.

“It is not the closed, traditional, governmental China, but transnational companies playing the market game,” he said in an interview with the Financial Times.

Cliffs CEO: Non-Core Assets For Sale ‘at Right Price’ – by John W. Miller (Wall Street Journal – August 26, 2014)

August 26, 2014

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

Company Prefers to Sell Assets Rather Than Separate Into Two Firms

Cliffs Natural Resources Inc. CLF +1.19% ‘s new chief executive wants to sell less-profitable mining assets at the right price rather than separate into two firms.

“I’ve made it clear, I don’t support splitting up the company,” said Lourenco Goncalves, a steel industry executive recently installed as chairman and chief executive following a boardroom coup orchestrated by hedge fund Casablanca Capital LLC.

One option floated by the fund had been to divide Cleveland-based Cliffs, the U.S.’s largest iron-ore miner, and refocus the company around its most profitable business segment: five iron-ore mines in Minnesota and Michigan. Anglo-Australian miner BHP Billiton BHP.AU -0.08% and Canton, Ohio’s steel and steel parts maker Timken Co. TKR +0.40% recently carried out similar restructurings.

Iron ore is the main ingredient in the making of steel, and Cliffs’s U.S. mines have benefited from the resurgence of the Detroit auto industry, drill-pipe demand for natural-gas wells and a geographical advantage over iron-ore superpowers Brazil and Australia.

Other Cliffs assets, such as coal mines in the U.S., iron-ore assets in Australia and Canada and a suspended chromite project in Canada, have been less profitable. Cliffs, one of the worst performers on the S&P 500 index in the past two years, has been hurt by declining iron-ore prices, which have fallen 20% in the past year, mostly because of oversupply. Cliffs reported a $1.9 million loss in the second quarter, compared with a $133.1 million profit a year earlier. Revenue dropped 26%.

UPDATE 1-Newmont withdraws mining arbitration case against Indonesia – minister – by Michael Taylor and Yayat Supriatna (Reuters India – August 26, 2014)

August 26, 2014

http://in.reuters.com/

Aug 26 (Reuters) – Newmont Mining Corp has withdrawn its international arbitration filing against the Indonesian government, the industry minister said on Tuesday, in a possible sign of a breakthrough over its seven-month dispute that halted exports.

Newmont’s Indonesian CEO Martiono Hadianto said the mining giant had reached a “constructive solution” over new mining rules, and expects to resume production at its copper mine soon. He declined to give additional details and a company spokesman could not be immediately reached.

U.S.-based Newmont, which declared force majeure at its Batu Hijau copper mine in June and then filed for arbitration in July, is in dispute with the Indonesian government over an export tax imposed in January that the U.S.-based miner says conflicts with its mining contract.

“I heard Newmont’s lawyer has withdrawn the case a few days ago,” Indonesia’s Industry Minister Mohamad Hidayat told Reuters, adding that investment board chief Mahendra Siregar had confirmed the news.

Indonesia’s Chief Economics Minister Chairul Tanjung is expected to make an announcement on Newmont’s arbitration on Wednesday, said Susyanto, the director of the law bureau for the mines ministry.

UN agency to study organized crime’s role in illegal gold mining – by Dorothy Kosich (Mineweb.com – August 26, 2014)

August 26, 2014

http://www.mineweb.com/

“These criminals are stealing the minerals of the country”, says Capt. Paul Ramaloko of the South African police force investigative unit, Hawks.

RENO (MINEWEB) – The United Nations Interregional Crime and Justice Research Institute (UNICRI) is reportedly launching a global study in September examining the role organized crime allegedly plays in the production and distribution of precious metals such as gold, according to the Wall Street Journal.

Although Mineweb could not find a reference to the new study on the UNICRI website, the organization’s magazine, Freedom From Fear, has an article on illicit trafficking in precious metals in its latest issue.

The agency claims that illicit trafficking of precious metals has become the focus of organized criminal groups “in producing countries such as South Africa, Africa, Russia, the USA, South America and China”.

“Unfortunately, law enforcement in general has not recognized the emerging pattern of this global crime yielding high returns on the black market that funds other types of organized crime and terrorism and has thus not accorded it the same priority as they have other series crimes,” said F3 magazine in an article by South African Peter H. Bishop.

China steel output growth doesn’t gel with coking coal – by Clyde Russell (Reuters U.S. – August 25, 2014)

August 25, 2014

http://www.reuters.com/

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

LAUNCESTON, Australia – Aug 25 (Reuters) – Something doesn’t quite add up with China’s rising steel production, but falling coal output and imports so far this year.

China’s raw steel output was 480.76 million tonnes in the first seven months of 2014, up 2.7 percent from the same period a year earlier, according to data from the National Bureau of Statistics.

However, imports of metallurgical, or coking, coal used to make steel were down 12.6 percent to 36.01 million tonnes in the first seven months of the year, according to customs data.

Given that imports only meet roughly 10 percent of China’s coking coal needs, it’s essential to look at domestic coal output.

Total coal production in China in the first seven months of the year was 2.163 billion tonnes, a decline of 1.45 percent on the same period in 2013, with July’s output down 1.63 percent from the same month last year, according to data from the China Coal Transport and Distribution Association.

What isn’t clear is the breakdown of thermal to coking coal within those broader production figures.

BHP Billiton set to expand Pilbara iron ore operations – by Matt Chambers (The Australian – August 25, 2014)

August 25, 2014

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

BHP Billiton chief executive Andrew Mackenzie says iron ore prices are unlikely to climb back above $US100 a tonne but the company is readying to spend an extra $US3.25 billion ($3.5bn) to bring more ore on to the market in a bigger-than-expected expansion of its West Australian mines.

As iron ore prices last week slid to about $US90 a tonne and approached five-year lows, Mr Mackenzie said he was not counting on a price floor forming.

At the same time, in a declaration largely lost amid BHP’s plans for a $US14bn spin-out of non-core assets, the world’s biggest miner says it is looking to expand its Pilbara iron ore mines and ports to annual capacity of 290 million tonnes a year.

This is up from a previous target to grow to 270 million tonnes and at a forecast capital cost that is dramatically lower than guidance given to analysts a year ago.

“We would say it is quite unlikely that we would see prices north of $US100 a tonne, so our forecasts are obviously based on something below that,” Mr Mackenzie told British media when asked if there might be a price floor around current price levels.