Iron Ore – Page 108 – Republic of Mining

UMD report underscores value of iron ore mining, potential for copper – by John Myers (Duluth News Tribune – February 7, 2013)

February 11, 2013

http://www.duluthnewstribune.com/

Iron ore mining in Minnesota has a $3.2 billion annual impact on the state’s economy, according to a new University of Minnesota Duluth study, but that’s only half the story if copper mining begins as expected.

The study, released Wednesday by UMD’s Labovitz School of Business and Economics, found that the existing iron ore industry — mining, processing and shipping taconite — pumped $3.2 billion into the state economy in 2010 and was responsible for 11,500 jobs.

But if the wave of new copper mines and expansion of traditional taconite mining planned in Northeastern Minnesota come to fruition, those numbers would more than double to $7.7 billion and 27,000 jobs, the study concluded.

Those numbers don’t include temporary construction jobs to build the projects like the proposed PolyMet open-pit copper mine near Hoyt Lakes, the massive underground Twin Metals mine proposed near Ely and the new Essar Steel taconite plant under construction in Nashwauk, among other projects on the books.

NEWS RELEASE: Northern Iron Pumps More Than 4 Billion Litres Of Water From The Griffith Pit

February 11, 2013

An estimated 4,025,000,000 litres or 1,065,000,000 gallons removed.
Water levels are down by approximately 5 metres or 16 feet 5 inches.
Vancouver, British Columbia, Canada – February 4, 2013.

Northern Iron Corp. (“Northern” or the “Company”) (TSX-V: NFE) (OTCQX- NHRIF) (FRANKFURT: N8I) today announced the completion of their winter dewatering program of the Griffith Mine which was halted on January 3rd, 2013 and will recommence during the spring thaw.

“Dewatering the pit will allow our drills to get onto the benches in the spring and complete the drill program over the summer,” said Basil Botha, President and CEO. “Our on-site crews have done a great job keeping everything running smoothly and management is delighted with the progress made.”

Northern is in the process of removing the first 25 metres of water from the flooded pit of the past producing Griffith Mine. To date the dewatering process has removed approximately 5 metres of water. This equates to 4,025,000,000 litres or 1,065,000,000 gallons of water removed since pumping started on October 22nd, 2012.

Throughout the dewatering operations, Northern staff implemented a water monitoring program designed to ensure there were no negative impacts on the receiving Bruce Lake.

Tribal leader says lawmakers have failed to discuss mining concerns – by Lee Bergquist (Milwaukee-Wisconsin Journal Sentinel – February 2, 2013)

February 4, 2013

http://www.jsonline.com/

The Bad River Band of Lake Superior Chippewa took legislators to task on Friday for their failure to reach out to tribal leaders and discuss a proposed iron ore mine in northwestern Wisconsin.

A letter from tribal chairman Mike Wiggins Jr. said that lawmakers have failed to engage in “government-to-government consultation” with the tribe. He said members of the Legislature have met “wealthier, nontribal communities in the north while making no effort to visit affected Native American communities.”

Wiggins reiterated his previous opposition to Republican-backed legislation that he says weakens protections for wetlands, navigable waters and groundwater.

Assembly and Senate committees will vote on the GOP bill on Wednesday. The proposed mine would be constructed in portions of Ashland and Iron counties in the Bad River watershed.

The tribe’s reservation is located downstream, and leaders have expressed concern that mining activity will degrade water quality and harm water resources, including wild rice beds.

Tribes operate their own government. In Bad River’s case, it has received approval from the U.S. Environmental Protection Agency to administer its water quality program and set standards. The EPA would enforce those standards.

Minnesota’s mining not an economic panacea – by Lee Bergquist (Milwaukee-Wisconsin Journal Sentinel – February 2, 2013)

February 4, 2013

http://www.jsonline.com/

Mining could be a huge economic boost for the state, say proponents of an iron ore mine in northwestern Wisconsin. But it hasn’t been a cure-all for the big iron ranges of Minnesota and Michigan.

The areas rank below average in median household income for their states, and their economies have often struggled despite dominating iron ore production in the United States. The ore, processed into taconite pellets, is a staple for making steel at Midwestern mills.

In Wisconsin, many hope that a new iron ore mine in Ashland and Iron counties can rekindle the glory days, when cities such as Hurley buzzed with commerce and night life notoriety. “We’ve all dreamed for the past 50 years what would happen if a mining company came back to Hurley,” Gary Pelkola, owner of the Iron Nugget bar in Hurley, recently told a legislative committee in Madison.

“We now have a chance to make Wisconsin iron mining a dream come true.” If Gogebic Taconite gets the mining bill it wants from the Wisconsin Legislature, and receives regulatory approval, the company said it will spend $1.5 billion to construct an open pit mine that, in time, will stretch for four miles over an ore-rich ridge in the two counties. An adjoining factory would process the ore into pellets.

The mine, with 700 workers, would be a massive operation in an area of forests and a smattering of private properties. It would represent the biggest investment in decades – perhaps ever – for an area that is older, poorer and less educated than the state average.

Upper Peninsula pits offer perspective on Wisconsin mine proposal – by Lee Bergquist (Milwaukee-Wisconsin Journal Sentinel – November 5, 2011)

February 4, 2013

http://www.jsonline.com/

Please note the date: (Nov/2011)

Ishpeming, Mich. – The Empire Mine is big and deep, spanning a mile across and plunging 1,200 feet to its lowest point. Trucks that carry rock from the depths of the iron ore mine are the size of two-story houses and burn 1,000 gallons of diesel fuel a day.

The electric bill from this massive mining complex in the Upper Peninsula is bigger than the Milwaukee Brewers’ 2011 payroll. “It’s all about scale in the iron ore business,” observed Terry S. Reynolds, a historian at Michigan Tech and an expert on the state’s iron ore industry.

As Wisconsin debates a return to iron ore mining for the first time in nearly 30 years, the Empire and adjacent Tilden mines offer a window into how the industry operates today. The high-grade iron ore that drew immigrants to this region in the mid- to late 1800s played out long ago.

“There are probably still people who think we are out here with picks and shovels and mules and wooden carts,” said Dale Hemmila, the manager of corporate affairs in North America for Cliffs Natural Resources, based in Cleveland and the principal owner of the mine.

“But the fact of the matter is, this is a very, very sophisticated operation,” he said. Now, iron ore mines need to be enormous to justify the expense of excavating and processing mountains of low-grade rock.

Vale Brazil – Carajás Iron Ore Mine – by Will Daynes (Business Excellence – January 30, 2013)

January 31, 2013

Business Excellence is a global on-line publication portal for businesses who have stories of excellence to tell: http://www.bus-ex.com/

Simply ore-inspiring

The most widely used of all minerals, iron accounts for approximately 95 percent of the world’s metal production in terms of weight. As the world’s third largest iron ore producer and exporter, Brazil has long reaped the financial benefits provided by one of its largest export products.

The Carajás region of the country boasts some of the richest reserves and concentrations of iron ore anywhere on the planet, with the Carajás Mine, located in the state of Pará in Northern Brazil, holding the distinction of being the world’s largest iron ore mine. Fully owned by Vale, the mine holds up to 7.2 billion metric tonnes of iron ore in proven and probable reserves.

The Carajás Mineral Province was originally discovered entirely by accident when a US Steel helicopter was forced to land on a hill in the area to refuel in 1967, with the first iron ore mine called N4E Mine coming into operation in 1985. In the mine’s first year output reached one million metric tonnes of iron ore, which was processed at a semi-industrial plant. During the second year an industrial-scale processing plant was brought online and this resulted in production rising to 13.5 million metric tonnes of final product.

Mining operations in Carajás are open-pit, with 15-meter-high benches. The off-highway trucks that Vale uses, each capable of carrying loads of over 240 metric tonnes, unload ore at crushing facilities located inside the mines. After this, the material is transported on conveyor belts for further processing.

Vale Pledges to Deliver Growth After Losing Title to Rio Tinto – by Juan Pablo Spinetto (Bloomberg.com – January 29, 2013)

January 30, 2013

http://www.bloomberg.com/

Vale SA (VALE3) pledged to deliver on its growth projects after losing to Rio Tinto Group the title of the world’s second-largest mining company and failing to boost production of the steelmaking ingredient.

Vale is “confident” it can deliver on its expansion plans and that will eventually be reflected in its share price, Chief Financial Officer Luciano Siani told investors yesterday at an event in Rio de Janeiro, where the company is based. Doubts may still remain among investors about Vale’s capacity to fulfill its promises, he said.

“Why Rio Tinto has today a higher market value than Vale if its iron-ore production is much lower? Because Rio Tinto has delivered iron-ore growth and we haven’t,” Siani, 42, said. “Vale has an incredible latent value and its management is absolutely committed to deliver and reveal that value.”

Vale, the world’s largest iron-ore producer, in October was surpassed by London-based Rio Tinto, which is currently valued $5.6 billion more than its rival, according to data compiled by Bloomberg. The Brazilian company is cutting investments, seeking partners and writing off nickel and aluminum assets after shares slumped to the lowest in almost three years in September amid weaker demand from China and Europe.

UPDATE 2-Vale sees iron ore at $110-$180/Tonne – CFO – by Jeb Blount and Leila Coimbra

January 30, 2013

http://www.reuters.com/

RIO DE JANEIRO, Jan 29 (Reuters) – Emerging-market demand for iron ore, which accounts for 90 percent of the profit at Brazilian miner Vale, will keep prices between $110 and $180 per tonne over the long term, Chief Financial Officer Luciano Siani said Tuesday.

Vale has struggled with falling iron ore prices , which touched three-year lows in September of 2012 and forced it and other big miners to reassess the costs of holding on to unprofitable operations.

Earlier on Tuesday, miner Anglo American announced it would take a $4 billion writedown on its Minas Rio iron ore project in Brazil.

Mining giant Rio Tinto ousted its chief executive, Tom Albanese, on Jan. 17 after it took $14 billion in impairments tied to its underperforming Mozambican coal and Canadian aluminum operations.

Analysts say Vale has had its share of problem investments ranging from its Rio Colorado potash project in Argentina to its massive Simandou iron ore project in Guinea. When asked about those projects, Siani said Vale was “not afraid to write off non-performing assets.”

He said during a meeting of institutional investors in Rio de Janeiro that the company plans to reduce its 50 percent stake in the CSP steel mill project in the northeastern city of Pecem, in which South Korea’s Dungkuk holds 30 percent and Posco the remaining 20 percent.

UPDATE 3-Anglo American’s $4 bln hit clears decks for new CEO – by Sarah Young and Brenda Goh (Reuters.com – January 29, 2013)

January 29, 2013

http://www.reuters.com/

LONDON, Jan 29 (Reuters) – Anglo American took a $4 billion hit to its Minas Rio project on Tuesday, clearing the decks for new boss Mark Cutifani and indicating that the delayed Brazilian operation will eventually get off the ground.

Minas Rio, which is now costing Anglo more than three times its original estimates, has been seen as Anglo’s most significant failure of recent years and is partly responsible for costing outgoing chief executive Cynthia Carroll her job.

The writedown to the valuation of the huge iron ore project and a jump in the bill for its development to $8.8 billion, alongside a planned overhaul for the company’s troubled platinum business, are as near to a clean slate as new CEO Cutifani is going to get.

Shares in Anglo American gained 2.2 percent to 19.14 pounds ($30.06), topping Britain’s blue-chip leader board in midday trading after the announcement of the impairment charge. “The Minas Rio impairments give the incoming CEO a clean slate, creating a degree of positive sentiment,” Bernstein analyst Paul Gait said.

“The greater detail and clarity on the progress of Minas Rio can only increase the confidence around the executability and delivery of the project.”

NEWS RELEASE: Cliffs Natural Resources Inc. Expects to Include Non-cash Impairment Charges within Its Fourth-quarter Results

January 25, 2013

http://www.cliffsnaturalresources.com/EN/Pages/default.aspx

January 24, 2013

· Fourth-quarter 2012 Results Expected to Include $1.4 Billion of Non-cash Impairment Charges and $542 Million of Non-cash Tax Valuation Allowances
· Financial Results for Fourth-quarter and Full-year 2012 to be Released After U.S.-Market Close on Feb.13 and Conference Call on Feb. 14

CLEVELAND, Jan. 24, 2013 /PRNewswire/ — Cliffs Natural Resources Inc. (NYSE: CLF) (Paris: CLF) today announced that as a result of its goodwill impairment test conducted in the fourth quarter of 2012, the Company has determined that approximately $1 billion of goodwill related to Cliffs’ 2011 acquisition of Consolidated Thompson Iron Mines Limited is impaired. The goodwill impairment charge will be recorded as a non-cash expense for the year ended Dec. 31, 2012. The impairment is primarily driven by the project’s anticipated lower long-term volumes and higher capital and operating costs. The previously announced delay of the Phase II expansion of the Bloom Lake mine also contributed to the impairment. Cliffs also indicated it expects to incur $100 – $150 million of other charges related to its Eastern Canadian Iron Ore business segment.

(Logo: http://photos.prnewswire.com/prnh/20101104/CLIFFSLOGO)

Additionally, as previously disclosed, Cliffs’ Board of Directors recently authorized the sale of the Company’s 30% interest in Amapa. Based on the pending terms of the sale, Cliffs expects to record a non-cash pretax impairment expense of $365 million within its fourth-quarter results.

Australian Iron Ore Rush – by James Coffman – (The Motley Fool – January 25, 2013)

January 25, 2013

http://beta.fool.com/

The race is on! The iron rush, in the Pilbara iron district of Western Australia, is in full force. Forget about watching the World Series, a horse race, or Monday night football. This race to increase iron ore production keeps me on the edge of my seat. The stakes are high and the profit potential is great.

There are three main players. We have two very large and very diversified companies; namely Rio Tinto (NYSE: RIO) at the number one spot, BHP Billiton (NYSE: BHP) at the number two spot and the underdog nipping at their heals, namely Fortescue Metals Group (NASDAQOTH: FSUMF). All of the players are exposed to the rise and fall of iron ore prices as a result of the vagaries of the big Chinese steel mills and the Chinese economy. RIO and BHP have diversified mineral plays across the globe, but tend to get the largest piece of their profit pie from iron operations.

Both of the big boys have problems from other operations eating up their cash flow: RIO with its $14 billion dollar mistake in Mozambique and BHP’s inability to act in a forward looking direction. In contrast, Fortescue is a pure iron play and well situated to cash in on the current and future iron needs of China, though it sees much larger swings in its share price with changes in iron prices than its competitors.

Fortescue is motivated and determined in their pace of development. They will see the greatest rise in stock value over the next couple of years. FSUMF has just gotten out of the gate and they are the young purebred challenging the old guard resting on their laurels.

Fat profit margins make iron ore the apple of miners’ eyes – by James Regan (Reuters.com – January 24, 2013)

January 24, 2013

http://www.reuters.com/

SYDNEY – Jan 24 (Reuters) – Australian miners like to say iron ore is the new gold. How about the new iPhone?

Iron ore, needed to make steel, long ago replaced gold as the most profitable mineral to mine in the Australian outback. And while sales of iPhones have become a disappointment for Apple Inc, mega-mining companies such as BHP Billiton are projecting strong growth in iron ore sales for decades to come – at margins even an Apple or smartphone rival Samsung Electronics would drool over.

BHP and rivals Rio Tinto and Fortescue Metals are seeing profit margins often exceeding 100 percent on sales of hundreds of millions of tonnes of ore. Apple Inc earned gross margins of 49 to 58 percent on its U.S. iPhone sales between April 2010 and the end of March 2012, according to court filings obtained by Reuters.

Apple on Thursday missed Wall Street’s revenue forecast for the third straight quarter as iPhone sales came in below expectations, although earnings topped forecasts.

Production costs under $40 a tonne mean margins at Rio Tinto and BHP are comfortably above any of their other businesses with iron ore selling for nearly $150 a tonne, explaining why they continue to invest to expand their operations in Western Australia’s vast Pilbara iron ore belt.

Is the iron ore rally overdone? – Northern Miner Editorial (January 10, 2013)

January 24, 2013

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry.

Spot prices for iron ore fines delivered to China touched a three-year low in September 2012 of US$87 per tonne before rebounding to US$119 per tonne in December and to the US$158-US$160 per-tonne level of recent days. The question is, where will prices for the metal move from here?

John Goldsmith, deputy head of equities at investment management firm MontruscoBolton in Toronto, says they have nowhere to go but down. “Iron ore has had an absolutely phenomenal rally but I think it’s time to take money off the table,” he says. “The rally has been long in the tooth.”

In Goldsmith’s view, GDP growth in China over the next three years will average about 6%, down from the 7.8% the country clocked last year and the 9.2% of 2011. That estimate, he explains, is a function of the average 7% GDP growth rate set out in China’s last five-year plan in 2010. And a growth rate of 6%, he says, will have an impact on iron ore demand and prices, given that the economic juggernaut produces nearly 50% of the world’s steel and makes up more than 60% of global demand for seaborne iron ore.

“People are realizing that China will not grow to the moon, it will not have GDP growth north of 8% for the next ten years, and people that think that are dreaming,” he continues. “The risk for the iron ore trade right now is that there is a slowdown in infrastructure spending in China and it will have an impact on steel consumption usage and that will cascade down to the iron ore price.”

Fallen mining CEOs scapegoats rather than villains – by Lawrence Williams (Mineweb.com – January 22, 2013)

January 22, 2013

http://www.mineweb.com/

The idea of a board of directors is one of collective responsibility for major decisions, but it is those unfortunate to be at the head of a company at the wrong time who carry the can.

LONDON (MINEWEB) – Among the spate of CEO changes we have already noted, many observers had remarked that Rio Tinto’s CEO, Tom Albanese had effectively been fired as a consequence of the huge write-down of the company’s investment in major aluminium producer Alcan, coupled with the smaller write down of its Mozambique coal assets acquired from the takeover of Riversdale coal last year.

The Riversdale acquisition was obviously down to an extent to Albanese, but a company CEO has to rely on his management executives and board for pursuing, and approval of, major decisions of this type.

It’s not just a case of the CEO pushing through an investment of the type without receiving plenty of advice first. In this case the acquisition appears to have been pushed through on the advice of a technical team led by Doug Ritchie who lost his job at the same time as Albanese.

Now, under normal circumstances, Albanese might have survived the Riversdale debacle on its own but one suspects that the Rio Board, faced with deciding to take the Alcan and Riversdale write downs at the same time, also decided that a high profile head would have to roll –

Company Returns Assured by Government in [Brazil] Rail Expansion – by Christiana Sciaudone – (Bloomberg.com – January 11, 2013)

January 21, 2013

http://www.bloomberg.com/

Brazil’s $45 billion railroad expansion is targeting ALL America Latina Logistica SA (ALLL3) and Vale SA (VALE)’s duopoly by guaranteeing returns for companies that create train lines and transport cargo.

Highway operator TPI-Triunfo Participacoes & Investimentos (TPIS3) SA and logistics group JSL SA (JSLG3) have said they may take part in the April auction for the rights to operate lines or handle cargo on 10,000 kilometers (6,200 miles) of new railways. The government says the nation’s biggest rail expansion since the 1930s will lure 91 billion reais ($45 billion) of investments.

President Dilma Rousseff, seeking to stimulate the economy and upgrade infrastructure after a decade without investment, will auction off ports, airports and roads to ease bottlenecks in Brazil, the world’s largest exporter of iron ore, orange juice and sugar. The government ran the 28,000 kilometers of railways until it privatized the lines in 2007. ALL and Vale now control 84 percent of the network.

“There is a lot of space for this sector to grow,” Roger Oey, an analyst at Bes Securities, said by telephone from Sao Paulo. “If there is any uncertainty, the government will try to diminish this for the projects to be successful, especially in the beginning.”

As part of the plan announced Aug. 15, the government vowed to sign contracts for all of the new capacity, Transportation Minister Paulo Sergio Passos said. Companies will either operate the rail lines or transport cargo, but not both. Additional terms will be released in March.