International Media Resource Articles – Page 744

UPDATE 2-Minister quits deadlocked S.African platinum strike talks – by Zandi Shabalala (Reuters India – June 9, 2014)

June 9, 2014

http://in.reuters.com/

PRETORIA, June 9 (Reuters) – Wage talks between South Africa’s AMCU union and major platinum producers were deadlocked on Monday, prompting the mining minister to abandon his mediation role and dashing hopes for an end to a strike that is pushing the economy towards recession.

The five-month strike has halted mines that normally account for 40 percent of global platinum output and has hit wider economic output in Africa’s most advanced economy, driving it into contraction in the first quarter of this year.

The meeting on Monday was crucial as the government had said it would pull out of its mediation role if a deal was not struck then – and, after the talks ended at an impasse, it duly announced that the mining minister would no longer take part in negotiations.

“No agreement was reached today,” Joseph Mathunjwa, president of the Association of Mineworkers and Construction Union (AMCU), told reporters as he left the talks in Pretoria.

“AMCU made many concessions. We actually moved twice to make employers move closer to us,” he said, but added that the union did not compromise its demand for a 12,500 rand ($1,200) a month basic wage, which excludes allowances.

SA’s mining problem is one that runs deep – by Ray Hartley (Business Day Live- June 8, 2014)

June 9, 2014

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

THREE-and-a-half kilometres underground, no one can hear you scream, I tell myself as the drills hammer their way through solid rock. I am at the deepest point of Driefontein’s No 5 shaft, west of Johannesburg.

It is a work environment like no other. A rock-drill operator named Whitey is king. His kingdom is a jagged tunnel known as a panel, blasted out of the battleship-grey rock where the gold lies.

The panel’s low roof forces you into a crouch. The inclined floor is covered with loose rock, the detritus of previous advances into the earth. The rockface temperature approaches 60°C, and although mines are required to cool the stopes to about 28°C, humidity approaching 100% causes continuous and heavy perspiration. It is a cramped, claustrophobic space shared by stripped-down workers, rusted drilling machines and rock fragments.

Around Whitey, helmeted mineworkers toil in a strange, slow silence. Some spray-paint red dots on the rockface where holes must be drilled for blasting. Others attach air and water hoses to his rust-brown drilling machine, which has “AK47” as a nickname.

Earplugs seem a pathetic defence against the screaming, grinding and crunching of the drill bit as it fights its way into the rock, and water sprays from the stuttering machine.

Semiconductors: The Conflict Over Conflict-Free Minerals – by Ian King (Bloomberg News – June 05, 2014)

June 6, 2014

http://www.businessweek.com/

Like most advanced chips these days, Intel’s (INTC) contain tantalum, gold, tin, and tungsten—elements that can be mined on the cheap in war-torn parts of the Democratic Republic of Congo. Carolyn Duran’s job is to make sure the company doesn’t use so-called conflict minerals.

For the past five years, Duran, Intel’s supply-chain director, has paid for independent audits and led the company’s own audits of metal producers to determine if their ore comes from mines controlled by militias in the DRC, where a decades-long civil war has claimed millions of lives. It’s as tough as it sounds, she says: “Every single member of Intel’s conflict team has felt, at some point, that we’ve hit an insurmountable task.”

By June 2, U.S. companies with products that may contain conflict minerals were supposed to send reports to the Securities and Exchange Commission detailing their efforts to discover whether their metals originated in the DRC. The rule, designed to starve militias in the central African country of revenue by discouraging companies from dealing with them, dates to 2010’s Dodd-Frank Act.

In April a federal appellate court struck down the part of the rule that would have compelled companies to disclose the possible use of DRC-sourced conflict minerals on their websites. But businesses must still prove to the SEC that they’ve performed their due diligence, either by auditing their suppliers or hiring an accredited third party to do so. Besides Intel, Apple (AAPL) and Hewlett-Packard (HPQ), few companies put in the work before the deadline to trace their components from mine to factory.

Indonesia considers new restrictions on coal output, exports – by Fergus Jensen (Reuters India – June 6, 2014)

June 6, 2014

http://in.reuters.com/

JAKARTA, June 6 (Reuters) – Indonesia, the world’s top exporter of thermal coal, is considering new regulations to limit coal production and tighten controls on exports, government officials said on Friday, and could introduce the rules by early next month.

The country currently exports around 70 percent of its coal production, much of it to China and India, but the government says output must be capped as domestic demand for the power station fuel is expected to rise by 13 percent this year and next.

“Technically we are already restricting (coal production) through discussions on companies’ work plans and budgets, but formally we need a ministerial regulation on mines,” Coal Enterprise Director Edi Prasodjo told Reuters, referring to an output cap for producers his team is working to release soon.

In March, Prasodjo said Indonesia hoped coal production would remain at or below 421 million tonnes this year, but the government’s ability to restrict output has yet to be proven.

Many of Indonesia’s biggest coal mines, such as Bumi Resources and Toba Bara Sejahtera, are owned by politically connected figures, and with presidential elections fast approaching in July the government may face difficulties imposing new rules on the sector.

UPDATE 2-Board of Chile’s state-run Codelco removes CEO Keller (Reuters India – June 6, 2014)

June 6, 2014

http://in.reuters.com/

SANTIAGO, June 6 (Reuters) – Chilean state-run copper miner Codelco said it was removing Chief Executive Officer Thomas Keller to seek new leadership at a pivotal time for the company, but opponents said the decision was politically motivated.

Keller, a former retail executive, has earned plaudits for his efforts to overhaul old mines and cut costs at the world’s No. 1 copper producer, but his tough style triggered tensions with Codelco’s powerful unions and the new center-left government.

The board stressed the removal of Keller, seen as close to the right, was not politically motivated, while the conservative opposition decried what it said was meddling that could harm the miner in the midst of an ambitious investment plan.

“We asked Thomas Keller to tender his resignation as CEO as a result of the company’s move towards a new phase with new challenges that require new leadership,” new board head Oscar Landerretche told journalists after a more than five-hour meeting that ended early Friday morning.

The board voted 5-3, with one abstention, to remove Keller. “There were no arbitrary political motivations, though there were motivations surrounding the company’s politics, the politics of what Codelco should be in the future,” Landerretche said. ” … There was no single factor that formed board members’ opinion.”

BHP Billiton to follow China on its next growth journey – by Vicky Validakis (Australian Mining – June 6, 2014)

June 6, 2014

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

BHP Billiton will invest heavily in energy and food as it follows China on its transition from a construction-led economy to a consumption power-house.

Speaking to the media in Beijing where he wound up a 10-day tour of meeting BHP’s commodity customers in China, India, Japan and South Korea, BHP boss Andrew Mackenzie said while Chinese steel production would remain strong the company was also keen to meet the country’s other needs.

“We see a Chinese economy gradually shifting from construction to consumption,” he told reporters yesterday, adding “and so, will we transition.”

He said materials with high consumer demand included copper, energy and potash. “Copper is core. Coal is core. Oil and gas is core. Potash is core,” Mackenzie said.

“We’ve exited diamonds. We’ve exited arguably medium-sized ore bodies which don’t fit with our overall strategy to own the great ore bodies of uranium and copper and to some extent in oil and gas. And we reduced our exposure to liquefied natural gas.

Anglo Says Platinum Pay Fight Inevitable on Productivity – by Firat Kayakiran (Bloomberg News – June 6, 2014)

June 6, 2014

http://www.bloomberg.com/

Anglo American Plc (AAL)’s four-month battle with a labor union at its South African platinum mines was inevitable because the requests by workers are unsustainable, Chief Executive Officer Mark Cutifani said.

“It’s the fight we had to have,” Cutifani said yesterday in a speech in London. “What’s being asked, for us is unsustainable. And at the same time, the productivity in the platinum sector is one tenth the productivity in the Australian mining sector and we are paying one fifth of the wages.”

Anglo controls the world’s largest platinum producer, which has been disrupted by a strike in South Africa since January. The Association of Mineworkers and Construction Union has called more than 70,000 miners out, including employees at Anglo American Platinum Ltd. (AMS)

Union members are on strike over a demand for basic monthly pay excluding benefits for entry-level underground employees to be more than doubled to 12,500 rand ($1,168) by 2017. The producers have said increases of that order would cost too much.

Minister of Mineral Resources Ngoako Ramatlhodi is coordinating talks between the union and Anglo American Platinum, Lonmin Plc (LMI) and Impala Platinum Holdings Ltd. (IMP), which continue in the South African capital, Pretoria, for a third day today.

UPDATE 2-Newmont says declares force majeure at Indonesian copper mine – by Michael Taylor and Fergus Jensen (Reuters India – June 5, 2014)

June 5, 2014

http://in.reuters.com/

(Reuters) – Newmont Mining Corp said on Thursday it has notified the Indonesian government that it is invoking force majeure at its Batu Hijau copper mine and plans to put most of the mine’s employees on leave with reduced pay.

Newmont and fellow miner Freeport-McMoRan Copper & Gold Inc – accounting for 97 percent of Indonesia’s copper output – are in dispute with the government over an export tax imposed in January.

“Despite our best efforts, we have not been able to export copper concentrate since January, and we still do not have an export permit,” Martiono Hadianto, CEO of Newmont’s Indonesian operations, said in a statement. “We are left with no option but to declare force majeure.”

A declaration of force majeure, which literally means “higher power”, allows certain terms of an otherwise legally binding contractual agreement to be ignored. Newmont’s move came after the Indonesian government launched a drive this week to force a breakthrough in the dispute, which has contributed to slower economic growth.

Both Freeport and Newmont have previously argued that they should be exempt from the tax, which kicks in at 25 percent and rises to 60 percent in the second half of 2016, before a total concentrate export ban in 2017.

Diversity back in vogue for miners as iron ore price tumbles – by STEPHEN EISENHAMMER, SONALI PAUL AND SILVIA ANTONIOLI (Reuters U.K. – June 5, 2014)

June 5, 2014

http://uk.reuters.com/

(Reuters) – After pouring billions of dollars into producing more iron ore to feed China’s construction boom, the world’s mega miners now face a self-induced price slump and are counting on other commodities to revive their allure to investors.

Base metals copper and nickel, oil and gas, as well as more offbeat commodities such as fertilizer potash, are increasingly important differentiators between the kings of iron – Vale , Rio Tinto and BHP Billiton – and could be welcome sources of growth this year as iron ore languishes near two-year lows.

BHP’s oil and gas portfolio and Vale’s nickel production have attracted positive attention. Glencore Chief Executive Ivan Glasenberg, meanwhile, has spoken of the advantage of smaller exposure to iron ore, saying it provided an “opportunity against our peers.”

Lack of diversity has not been an issue in recent years as Chinese demand for steel to build cities, railways and ports tripled iron ore prices from 2008 to 2011 – a windfall for the “big three” who produce 70 percent of the world’s seaborne iron ore.

But in May the price fell below the $100 mark for only the second time in four years, as production jumps just as Chinese demand growth appears to be slowing. Although many analysts see the price perking up again later this year, the fundamentals are worsening and the trend is downward.

North Korea Gold Taints U.S. Firms – by Joel Schectman (Wall Street Journal – June 4, 2014)

June 5, 2014

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

Country Was Source of Metal Used in Variety of Products

As companies scrambled to meet a deadline to report whether their suppliers used minerals from mines controlled by armed groups in the Congo region, they stumbled on something even more troubling: Many of their products may contain North Korean gold.

Dozens of companies disclosed over the past week that their suppliers used gold refined by North Korea’s central bank. These companies include Hewlett-Packard Co., Ralph Lauren Corp., International Business Machines Corp. IBM, Rockwell Automation Corp. and Williams-Sonoma Inc. IBM, for example, revealed the North Korean gold was used to make its memory-storage systems.

U.S. sanctions law bars importing materials from North Korea even if they come from deep within a supply chain and are in a completely different form by the time they reach the end user, sanctions experts said. “It’s a problem even if the raw materials are coming very indirectly through suppliers,” said Alexandra Lopez-Casero, an attorney at Nixon Peabody LLP who specializes in sanctions.

North Korea’s central bank provides currency for the regime and refines gold. Until 2006, the bank refined gold bars that were certified by the London Bullion Market Association, a gold marketplace, according to public records.

Ferro giants- the world’s biggest iron ore producers (Mining-Technology.com – May 29, 2014)

June 5, 2014

http://www.mining-technology.com/

The top ten iron ore producers account for over 90% of the world’s total iron ore output. Mining-technology.com profiles the ten biggest iron ore producing countries based on latest production and reserve data.

China

China, the largest producer, consumer and importer of iron ore, produced 1.3 billion tonne (bt) of iron ore in 2012, accounting for about 44% of the world’s output. The country’s crude ore reserves as of 2013 stood at 23bt containing 7.3bt of iron – the fourth largest in the world. China’s run-of-mine iron ore output is, however, of low quality, containing about 22% iron.

Over half of the nation’s domestic iron ore production comes from mines located in Hebei and Liaoning provinces while Beijing, Shanxi province and Inner Mongolia are the other iron ore producing regions. Ansteel Mining, a wholly-owned subsidiary of Anshan Iron and Steel Group (Ansteel Group), is the biggest iron ore producer in the country.

Australia

Australia produced 519 million tonnes (mt) of iron ore in 2012 accounting for about 18% of global iron ore output. The country’s estimated iron ore reserves of 35bt, containing 17bt of iron, makes it the world’s richest iron ore reserves holder.

Mining giants – the top ten richest mining companies (Mining-Technology.com – March 27, 2014)

June 5, 2014

http://www.mining-technology.com/

Glencore Xtrata, followed by BHP Billiton, Rio Tinto and Vale recorded the biggest revenue from mining operations in 2013. Mining-technology.com profiles the world’s ten biggest mining companies based on revenue earned in calendar year 2013.

Glencore Xtrata

Glencore Xstrata, created through the merger of the world’s biggest commodities trader Glencore and the diversified mining company Xtrata in May 2013, is the world’s biggest mining company. The mining and trading conglomerate headquartered in Switzerland reported revenues exceeding $200bn from industrial and marketing activities in its metals and minerals, and coal and oil segments in 2013.

The company’s mining operations encompass over 150 mining and metallurgical sites around the world. Revenue from the metals and minerals business including copper, nickel, zinc/lead, alloys, alumina/aluminium and iron ore was over $64bn in 2013. Glencore Xstrata also produced 138.1 million tonnes of coal in 2013 recording industrial revenues exceeding $10bn.

The Zanaga iron ore mine in Republic of Congo, the Collahuasi copper mine in Chile, the Antamina copper-zinc mine in Peru, and the Correjon coal mine in Colombia are among the major mining operations in which Glencore Xtrata holds significant interests.

China Swaps Gusto for Rigor as It Learns From Africa – by Franz Wild (Bloomberg News – June 3, 2014)

June 4, 2014

http://www.bloomberg.com/

China’s gung-ho foray into Africa is waning. As trade with the continent surpasses an annual $160 billion, its companies are avoiding risk by taking smaller stakes in projects close to making money.

Cowed by capricious commodity prices, political instability and a string of lost investments, Chinese financiers aren’t as gutsy as when state-owned giants used their heaps of cash to propel the nation’s “Go Out” drive and whip up business abroad 15 years ago.

“There was a lot of enthusiasm and momentum,” said Clement Kwong, whose Beijing-based Long March Capital Ltd. clubbed together with other investors last year to take over a South African gold company. “That momentum is definitely reined in by a new level of risk aversion and caution.”

China surpassed the U.S. as Africa’s largest trading partner in 2009. Trade volumes soared 11-fold in the decade through 2013, according to data from the Geneva-based International Trade Centre. The quest for profit now trumps the wider aim of creating a Chinese footprint abroad.

Smaller private companies are taking the lead from the state-owned giants that prepared the ground. After many African leaders doubled back on the initial fervor for China, the new players are less conspicuous and score quicker returns.

Indonesian minister spearheads drive to restart copper exports – by Wilda Asmarin and Michael Taylor(Reuters India – June 4, 2014)

June 4, 2014

http://in.reuters.com/

JAKARTA – (Reuters) – Indonesia’s chief economics minister is spearheading a series of high-level government and industry meetings on Wednesday, aiming to broker a deal with foreign miners to restart copper concentrate exports that were halted nearly five months ago over a controversial tax.

Billionaire businessman Chairul Tanjung, who was appointed to the role last month, has made restarting copper exports a top priority amid a widening trade deficit, a slowdown in first-quarter economic growth and the prospect of job layoffs at mines.

Tanjung was due to attend a cabinet meeting on Wednesday morning to thrash out a new tax deal that could potentially be put before miners, including Freeport-McMoran Copper & Gold Inc and Newmont Mining Corp.

“After the cabinet meeting I will receive a report from the negotiating team at the coordinating economic ministry,” Tanjung said on Wednesday, speaking ahead of the cabinet meeting in the capital Jakarta. “Let’s see the result. If the results are finalized, I will officially receive the Freeport and Vale CEOs,” he said.

COLUMN-Asian coal miners, traders face up to grim realities – by Clyde Russell (Reuters India – June 4, 2014)

June 4, 2014

http://in.reuters.com/

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

NUSA DUA, Indonesia, June 4 (Reuters) – “There is no skin left on my teeth to hang on with,” was the lament of a coal trader, expressing a sentiment echoed time and again at the industry’s largest gathering in Asia.

Normally coal miners, traders and shippers are a fairly optimistic bunch, their good humour likely shaped by a tough industry that is increasingly unloved across the world despite being essential to keeping the lights on.

But the mood at the Coaltrans Asia conference in the Indonesian resort island of Bali this week was subdued, and the question on everybody’s lips was how much lower can coal prices go.

At a roundtable session, a well-known analyst talking about the outlook for prices was mobbed, while an expert on valuing coal mines cut a lonely figure, underscoring that nobody is currently interested in investing in coal production.

The price of coal at Australia’s Newcastle Port , an Asian benchmark, fell to $73.89 a tonne in the week to May 30, down 14.3 percent so far this year and close to the 4-1/2 year low hit in March.