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Iron Ore

‘Transformation’ is in the air at Vale – by Ian Ross (Northern Ontario Business – February 12, 2020)

https://www.northernontariobusiness.com/

Electric vehicle market, carbon neutral plans, environmental safeguards part of Sudbury miner’s current and future operations

The thrust of Dino Otranto’s presentation was on the transformational challenges ahead for base metal mining giant Vale to create a business that’s sustainable in the Sudbury basin for generations to come.

But the opening image he flashed to a Greater Sudbury Chamber of Commerce lunchtime crowd on Feb. 11 was of the Brumadinho tailings dam break at Vale’s Córrego do Feijão iron ore mine in Brazil on Jan. 25, 2019. It was the company’s second major dam breach in that country in four years.

The man-made environmental catastrophe at Brumadinho produced a toxic mudflow that swept away the company’s offices, and houses, farms and roads in a nearby village, and contaminated a major river system.

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Brazil’s Vale loses spot as world’s top iron ore producer to Rio Tinto – by Gram Slattery (Reuters U.S. – February 11, 2020)

https://www.reuters.com/

RIO DE JANEIRO (Reuters) – Brazil’s Vale SA on Tuesday posted a sharp output decline and $671 million in net additional provisions stemming from a deadly dam burst about a year ago, underlining the enduring effects of the incident on the iron ore giant.

In a statement, the company reported a 22.4% fall in fourth-quarter iron ore production from the same period last year and a 9.6% drop in quarterly terms. With that, Vale officially lost its position in 2019 as the world’s top iron ore producer to Rio Tinto.

In late January 2019, a Vale-owned tailings dam in the town of Brumadinho burst, killing some 270 people. The incident led to serious production stoppages, pledges by Vale to reconstruct or decommission many of its other dams and the firing of a number of executives.

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The Race Is On for Iron Ore Riches Buried Under an African Jungle – by Thomas Biesheuvel (Bloomberg News – February 4, 2020)

https://finance.yahoo.com/

(Bloomberg) — For years, the massive iron deposits under Guinea’s mountainous jungle were practically forgotten by the mining industry. Caught up in wrangles between owners and authorities in the West African nation, it seemed the super-rich ore might never be dug up.

That all changed last year, as investors from billionaire promoter Robert Friedland to legendary dealmaker Mick Davis converged on the country in a modern day resource rush. For the first time in years, projects like Simandou—Guinea’s crown jewel deposit—might finally be developed.

That would have huge implications for both Guinea, which is facing political upheaval as President Alpha Conde pushes for a third term, and the global iron ore industry. The new tons threaten to arrive just as steel demand is cooling, and the high-quality iron ore buried in Guinea will pile pressure on existing miners.

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Column: China’s commodities got smashed as expected. Now what? – by Clyde Russell (Reuters U.K. – February 3, 2020)

https://uk.reuters.com/

LAUNCESTON, Australia (Reuters) – It’s no surprise that commodity prices in China were hammered on Monday when the virus-hit country reopened its exchanges after a week-long Lunar New Year holiday. What will be more important is what happens on Tuesday.

It was a sea of red ink as domestic investors got to trade for the first time since Jan. 23, with Dalian Commodity Exchange (DCE) iron ore dropping the maximum allowed 8% to 606.5 yuan ($86.64) a tonne at the opening bell.

Iron ore wasn’t the only commodity smashed. Shanghai steel rebar futures reached their down limit of 8% as well, dropping to 3,233 yuan a tonne before recovering slightly in early afternoon trading to around 3,260 yuan.

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Fallout from coronavirus expected to have a ripple effect on coal, iron-ore – by Kim Cloete (MiningWeekly.com – January 31, 2020)

http://www.miningweekly.com/

CAPE TOWN (miningweekly.com) – The fallout from the coronavirus in China is expected to have a ripple effect on many sectors in the Chinese economy, slow down its economic growth and impact on its coal industry and imports.

Coal trader Noble Resources research head Rodrigo Echeverri says the impact has been severely disruptive. So far, more than 7 700 people have been infected by the virus, which has resulted in more than 170 deaths. Millions of people have been placed under quarantine and are unable to travel.

“It’s very disruptive in the places where supply chains and commodities are located.” Echeverri told delegates at the fifteenth annual Southern African Coal Conference this week.

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Murder charges in Vale dam collapse case complicate Brazilian probes – by Marta Nogueira (Reuters U.S. – January 27, 2020)

https://www.reuters.com/

RIO DE JANEIRO (Reuters) – The filing of murder charges against the former CEO of Brazilian miner Vale SA and 15 others for a 2019 dam collapse that killed more than 250 people was hailed by victims’ families as a major step in bringing those responsible to justice.

But the move by state prosecutors in Brazil’s Minas Gerais risks driving a wedge between their investigation and a parallel probe at the federal level, complicating the judicial process and potentially making convictions less likely, according to a lawyer with knowledge of the case and other legal experts.

Federal investigators are yet to identify the cause of the Jan. 25, 2019 collapse of a tailings dam at the Corrego do Feijao iron ore mine dam east of Brumadinho, which released a sea of mud that slammed into Vale’s offices and cut through a nearby community, killing 259 people and leaving 11 still missing. It was one of the world’s worst mining tragedies.

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Baffinland faces millions in liens over stalled expansion – by Beth Brown (CBC News North – January 27, 2020)

https://www.cbc.ca/news/canada/north/

Mary River contractors take legal precautions to get paid, mine calls claims for assets ‘ordinary’

Construction companies are taking steps to make sure they’ll get paid for work they did for Baffinland’s Mary River Mine. Last year, the mining company purchased work and machinery with the expectation that its application for a production increase would be approved by this year.

Some equipment it purchased includes a specially designed iron ore handling system made to unload rail cars, crush and screen iron ore, and load it onto ships. Part of that processing plant for the expansion was shipped to the mine site during the summer from Germany.

But the Mary River expansion is in a state of stalemate and, in November, Baffinland scaled back work and cut contracts related to the increase, shortly after necessary environmental hearings were adjourned unfinished.

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COLUMN-China virus outbreak a further risk to iron ore, steel outlook – by Clyde Russell (Reuters U.S. – January 23, 2020)

https://www.reuters.com/

LAUNCESTON, Australia, Jan 23 (Reuters) – The risk to commodity demand from the spread of a new flu-like virus in China has so far focused on crude oil and related products such as jet fuel, but the iron ore and steel markets will also be keeping a nervous watching brief.

The effective quarantining of Wuhan, a city of 11 million people where the new strain of coronavirus emerged, sounds like a major step to combat the virus which has so far killed 17 people and infected several hundred more.

That the move comes on the eve of the Lunar New Year holidays, which typically see millions of Chinese travel to visit family and friends, underlines the disease’s danger.

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Brazil charges ex-Vale CEO with homicide for dam disaster – by Marta Nogueira (Reuters U.S. – Janaury 21, 2020)

https://www.reuters.com/

RIO DE JANEIRO (Reuters) – Brazilian state prosecutors on Tuesday charged Fabio Schvartsman, the former chief executive of mining giant Vale SA, and 15 other people with homicide for a dam disaster last year that killed more than 250 people, according to the charging document seen by Reuters.

In addition to homicide charges, Vale and TUV SUD, the German company responsible for inspecting the dam, were charged with environmental crimes. Of the 16 individuals charged, 11 had worked for Vale and five for TUV SUD, prosecutors said.

The charges, which were presented nearly a year after the collapse of a Vale tailings dam in the state of Minas Gerais, represent a major step forward in Brazilian authorities’ attempt to hold individuals criminally responsible for the disaster.

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Pollution insurance costs to jump for U.S. tailings dams after Vale disaster – by Suzanne Barlyn (Reuters U.S. – January 21, 2020)

https://www.reuters.com/

The 2019 mining disaster in Brazil is expected to lead to a double-digit jump in costs to insure U.S. tailings dams that store mining waste against liability for environmental catastrophes.

Tailings dams, some of which tower dozens of meters high and stretch for several kilometers (miles), are the most common waste-disposal method for mining companies, whether they extract iron ore, gold or copper.

The deadly collapse last January of the dam at Vale SA’s Corrego do Feijao iron ore mine in Brumadinho rocked the mining industry and spurred calls for massive operational changes. At least 259 people were killed here in the incident.

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Vale’s biggest problem won’t be easy to fix – by Vinícius Andrade and Sabrina Valle (Australian Financial Review/Bloomberg – Janaury 17, 2020)

https://www.afr.com/

São Paulo | In the weeks and months after Vale’s deadly dam disaster, some of Brazil’s biggest investors snatched up shares in a bet they’d bounce back and then keep rising.

A year later, the gamble paid off, but with a caveat: The stock rebounded, but Vale’s reputation hasn’t — and that’s the problem. Vale still trades at a discount of at least 20pc to peers BHP and Rio Tinto, based on enterprise-value-to-expected-Ebitda ratio.

While the world’s largest iron ore producer, like all miners, has struggled with plenty of environmental issues in the past, there’s no denying that a company’s green credentials suddenly matter now more than ever.

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Nunavut review board seeks comments on Baffinland production extension (Nunatsiaq News – January 14, 2020)

https://nunatsiaq.com/

The Nunavut Impact Review Board is accepting comments on Baffinland Iron Mines Corp.’s request to extend its production limit at its Mary River mine.

The board issued a call for comments from interested parties on Jan. 8. Comments will be accepted until Feb. 3. Baffinland requested this extension, to continue mining up to six million tonnes of iron ore per year through 2020, on Dec. 16.

This follows a production cap increase granted in 2018, up from the 4.2-million-tonne cap set in the project certificate amendment that allowed trucked shipping to Milne Inlet under the company’s “early revenue phase.” That two-year production cap expired on Dec. 31, 2019.

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Exclusive: Brazil prosecutor aims to charge Vale within days over mining waste dam disaster – by Marta Nogueira and Christian Plumb (Reuters U.S. – January 8, 2020)

https://www.reuters.com/

BELO HORIZONTE, Brazil (Reuters) – A Brazilian state prosecutor expects to bring criminal charges “in the next few days” against miner Vale (VALE3.SA) over a mining waste dam collapse that killed at least 259 people, even as the prosecutor’s federal counterpart continues to investigate the case.

Andressa de Oliveira Lanchotti, coordinator for the task force of state prosecutors investigating the disaster, told Reuters they expect to indict 15 to 20 people, including executives from Vale and employees from German inspection firm TÜV SÜD – as well as the companies themselves.

“What we can take away from the investigations is there were several factors pointing to risk – the risk was not unknown,” Lanchotti said, disputing Vale’s contention that it had no way of knowing that the dam that unleashed an avalanche of mining waste on the Brazilian town of Brumadinho in January 2019 posed a danger.

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Dalian iron ore futures hit over 5-month closing high on restocking demand (Reuters U.S. – January 7, 2020)

https://www.reuters.com/

BEIJING (Reuters) – Iron ore futures in China surged to their highest close in over five months on Wednesday, on hopes of strong restocking demand from mills ahead of local holidays.

The most active May contract for iron ore futures on the Dalian Commodity Exchange jumped as much as 2.85% to 685 yuan ($98.69) per ton in morning trade, before settling up 2.1% at 680 yuan, the highest close since Aug. 2.

“Steel mills in south and east China are restocking actively before the upcoming Spring Festival holiday… but inventories at northern mills are still at relatively low level,” Tianfeng Futures wrote in a note.

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Vale report blames water level for Brazil mining waste dam disaster – by Christian Plumb and Luciano Costa (Reuters U.K. – December 12, 2019)

https://uk.reuters.com/

SAO PAULO (Reuters) – The deadly collapse of a Vale SA’s mining waste dam in Brazil was partially triggered by “a persistently high water level” that caused the structure to lose strength and stability, according to a report by a panel of experts appointed by the company’s lawyers.

The report, released by Vale on Thursday, said there was no warning the dam was unstable, and no seismic activity or explosions in the area were recorded before it burst in late January. The dam collapse unleashed an avalanche of mining waste on the Brazilian town of Brumadinho, killing at least 155 people.

The report examined technical factors leading to the disaster rather than issues of liability. It came less than four years after another dam collapse at a joint venture between Vale and BHP Group in the same region, an accident that experts also blamed on water weakening the solid materials composing the dam so that they behave more like a liquid – a phenomenon known as liquefaction.

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