Court gives BHP, Vale until October 30 to settle $47 billion Samarco claim (Reuters U.S. – June 30, 2017)

https://www.reuters.com/

BHP Billiton (BHP.AX) (BLT.L) and Vale (VALE5.SA) have won a four-month extension from a Brazilian court to negotiate a settlement to a $47 billion claim stemming from the Samarco mine disaster in 2015, BHP said on Friday.

Brazilian federal prosecutors in May last year served the joint partners in the Samarco iron ore mine with a 155 billion Brazilian real ($47 billion) claim to pay for the social, environmental and economic costs of cleaning up the country’s worst environmental disaster.

“The Court has extended the final date for negotiation of a settlement until 30 October 2017,” BHP said in a statement. Nineteen people died and nearby towns were inundated with flood waters after a dam designed to hold back mine waste burst on Nov. 5, 2015.

Read more

Iron Ore Surges Into Bull Market as Mills Come Off the Sidelines – by Jasmine Ng (Bloomberg News – June 30, 2017)

https://www.bloomberg.com/

Iron ore’s bear market lasted all but three months. The raw material has rallied back into bull-market territory right at the end of the first half on a surge driven by mills in China boosting purchases to replenish inventories, with higher-grade ore in demand.

Ore with 62 percent content delivered to Qingdao rose 3.8 percent to $64.71 a dry metric ton on Thursday, the highest since May 4, according to Metal Bulletin Ltd. Prices have gained more than 20 percent from the year-low of $53.36 hit just two-and-a-half weeks ago, meeting the common bull-market definition. On Friday, the price rose 0.3 percent to $64.95.

“The pickup in physical tenders suggests a real tightness,” Daniel Gradwell, a senior economist at Australia & New Zealand Banking Group Ltd., said in a note. Earlier this week, the bank said trading activity had increased as buyers re-entered the spot market after a prolonged period on the sidelines.

Read more

Flower power: WA blocks iron ore projects – by Paul Garvey (The Australian – June 29, 2017)

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

Western Australia’s environment regulator has blocked two iron ore projects from development due to concerns about their impact on rare flowers and microscopic subterranean prawns that call the deposits home.

The WA Environmental Protection Authority yesterday announced that both the J5-Bungalbin East project owned by Mineral Resources, and the Blue Hills iron ore development of China’s Sinosteel should not go ahead due to their impact on flora and fauna.

The EPA’s decision leaves the fate of the projects in the hands of WA Environment Minister Stephen Dawson, who will have to make a final determination.

Read more

Iron Ore Gets a Break—But This Hedge Fund Says It’s Going Lower – by Jasmine Ng (Bloomberg News – June 29, 2017)

https://www.bloomberg.com/

Iron ore’s finally catching a break with a jump back into a bull market. But don’t bank on the recovery lasting through to the year-end, according to Academia Capital, a commodities and emerging markets-focused hedge fund, which warns that fundamentals will probably deteriorate.

“I expect iron ore prices to end the year lower, but that the market is vulnerable to a short-covering rally before we get there,” Ivan Szpakowski, chief investment officer at the fund, said in an email. “Iron ore supply and demand is likely to worsen in the second half.”

The raw material is closing out what’s been a bruising quarter on a very strong note, with spot prices climbing back into the $60s a metric ton and reaching the highest in eight weeks.

Read more

[Minnesota Iron Range] OUR VIEWS: ENOUGH ALREADY: IT ENDS IN VIRGINIA (Mesabi Daily News Editorial – June 28, 2017)

http://www.virginiamn.com/

Make no mistake about it, the Iron Range knows this is an attack on mining and
it will have no more of it. The region and its miners, laborers, businesses,
residents — everyone here — is committed to meeting and exceeding the standards
of the federal government’s environmental reviews. We are not here to destroy
the land we use everyday.

We have a deep pride in our history of mining. We helped the United States win
wars over dictators, the iron ore leaving here by train helps fuel the economy
of Duluth and Two Harbors. It builds safe, reliable infrastructure from U.S.-made
steel, and the minerals this region wants to mine will provide for the tech boom
in Silicon Valley. (Mesabi Daily News Editorial)

The Iron Range and its rich history of mining is in a fight for its future, and the deck is stacked against it.

There’s overreaching actions taken by a lame duck administration, there’s delays forced by lawsuit after lawsuit from deep-pocketed environmental groups, and there’s scare tactics to steer popular opinion against the region’s way of life. Enough is enough: It ends here. It started here, and the fight will end here.

The Iron Range is done being paraded around in the three-ring circus of hearings, resolutions and comment periods, which are really nothing more than putting the everyday Iron Ranger on trial by a jury of its uniformed peers.

Read more

CLIFFS SHOWS IT’S FOR REAL – by Jerry Burnes (Mesabi Daily News – June 28, 2017)

http://www.virginiamn.com/

Lourenco Goncalves isn’t one for the quiet retreat, but anyone within shouting distance of the Iron Range already knew that. The chairman, president and CEO of Cleveland-based Cliffs Natural Resources is a dying breed. As the alpha CEO becomes a thing of the past — replaced by the more unimposing figures crafted by Silicon Valley — Goncalves remains a thunderous presence atop one the Iron Range’s most successful companies.

So in April, when the CEO stood in front of local stakeholders in Chisholm and asked why it’s so hard to believe his message, the point should have resonated: Why is it so hard for the business community take him at his word? To him, the promises have been filled, the checks written, and yet, there’s work left to be done on the Iron Range.

For the past half-decade, investors, Wall Street and industry types cautiously eyed Cliffs as it teetered on the brink of bankruptcy and clawed its way back to solvency. That battle kept the company, Goncalves said, focused on the Cliffs’ core operations as it shed coal mines and exited the Canadian iron ore scene.

Read more

[Minnesota] MINING MAKE ITS MOVES D.C. – by Jerry Burnes (Mesabi Daily News – June 27, 2017)

http://www.virginiamn.com/

MOUNTAIN IRON/ELY — For most of the first half of 2017, the Iron Range has remained laser-focused on its goals in Washington, D.C.

Far from the now-bustling taconite mines and majestic scenery of northeastern Minnesota is where the real political fight to death is taking place. That might not be hyperbole either: What’s happening in Washington is — quite possibly — one of the most important issues the Iron Range has ever faced.

In December 2016, a little more than a month before it was phased out, the Obama administration took unparalleled steps on two actions that could stunt growth in the region. In one action, the administration denied leases to Twin Metals and its potential underground copper-nickel mine near Ely and the Boundary Waters Canoe Area Wilderness. In the second, it placed a two-year moratorium on mining for 234,000 acres of land in the Superior National Forest near the BWCAW, with the intent of studying industrial impacts on the watershed and consider a 20-year ban on those activities.

Read more

BHP mine investment ‘may restore trust’ – by Paul Garvey (The Australian – June 27, 2017)

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

BHP’s looming $US3.2 billion ($4.2bn) investment in the new South Flank iron ore mine will not only maintain the mining giant’s Pilbara output but could strengthen community trust that has come under strain in recent years, according to Mike Henry, BHP’s president of Australian ­operations.

BHP yesterday announced it had committed $US184 million to early construction works at South Flank deposit, which is expected to replace the 80 million tonne a year Yandi mine when it runs out of ore next decade.

The mining giant also revealed that the South Flank project was expected to cost between $US30 and $US40 a tonne of annual production capacity, which would make it the single biggest new mining project in Australia since the construction of Gina Rinehart’s Roy Hill mine.

Read more

Brazil’s Vale shareholders approve corporate reorganization (Reuters U.S. – June 27, 2017)

http://www.reuters.com/

Minority holders backed the extension for up to three and a half years of an agreement by controlling shareholders grouped under holding company Valepar SA to maintain control. The assembly also approved Vale’s takeover of Valepar and a subsequent merger of Vale’s two types of stock into a single common one.

Under terms of the share conversion, holders of Vale’s Class A preferred shares who join the share conversion voluntarily will receive 0.9342 of common stock.

To ensure completion of the plan, Vale would pay owners of Valepar a 10 percent premium for their shares, implying a 3 percent dilution for all shareholders. The former Valepar owners can sell the equivalent of up to 22 percent of Vale’s common shares after a six-month lockup period starting in August expires, provided they keep a 20 percent stake by November 2020.

Read more

Iron Seen in Low-$40s by Citi as Supply Grows, Demand Peaks – by Jasmine Ng (Bloomberg News – June 19, 2017)

https://www.bloomberg.com/

Iron ore may extend a slump into the low-$40s as supplies swell and demand reaches a short-term peak amid steel mill restarts and ramp-ups in China, according to Citigroup Inc., which cut its forecasts by as much as 20 percent over the next year.

The nadir in prices may occur in six to eight months, analysts including Tracy Liao wrote in a report received Monday. Iron ore is seen at $51 a metric ton in the third quarter compared with a previous estimate of $64, and at $48 in the final three months of the year, down from $60.

The raw material has sunk by more than a third since rising to almost $95 in February as global output increases, with miners such as Vale SA in Brazil and Australia’s Roy Hill Holdings Pty boosting capacity, and China’s efforts to curb financial leverage hurt demand.

Read more

Minnesota officials tried to avoid another mining failure – by Don Davis (Duluth News Tribune – June 19, 2017)

http://www.duluthnewstribune.com/

ST. PAUL — Minnesota leaders hope a lease they are offering to a new mining company will reverse a decade of frustrating failure in one area they felt held lots of promise.

Officials who feel they were burned by Essar Steel Minnesota, which did not fulfill state taconite mining requirements, then declared bankruptcy, on Monday, June 19, folded what they hope are iron-clad guarantees into a new mineral lease. They hope the new mining company will produce taconite and turn it into an in-demand iron product where Essar Steel failed for years.

Also Monday, it appeared the White House is on the cusp of a major decision about whether to impose new restrictions on steel imports, a choice that has divided President Donald Trump’s administration while sparking global fears about a burgeoning trade war. Steel imports have been blamed for recent years’ economic woes on northeast Minnesota’s Iron Range, where taconite is told to produce steel elsewhere.

Read more

Update: Judge approves Essar bankruptcy settlement – by John Myers (Duluth News Tribune – June 13, 2017)

http://www.duluthnewstribune.com/

Chippewa Capital Partners has reached an agreement with Gov. Mark Dayton over mineral leases at the former Essar Steel Minnesota project in Nashwauk, removing one of the last obstacles to a bankruptcy settlement approved this morning in Delaware.

The agreement allows Chippewa — a joint venture of London steel and energy conglomerate GFG Alliance and Roanoke, Va., billionaire Tom Clarke — to take over the bankrupt, half-built taconite iron ore mine and processing center, restart construction and start mining and processing ore by 2020.

India-based Essar pumped $1.8 billion into the Nashwauk project over seven years but then walked away in late 2015, out of cash and more than $1 billion in debt, filing for bankruptcy last July.

Read more

U.S. company signs collective agreement to restart Wabush Mines – by Andrew Topf (Mining.com – June 13, 2017)

http://www.mining.com/

Miners at the closed-down Wabush Mines in Labrador could be back on the job thanks to the recent signing of a collective agreement with the union. Five hundred people were thrown out of work in 2014 when Cliffs Natural Resources (NYSE:CLF) shut the gates on the operation in Western Labrador.

Last week however the United Steelworkers Union had good news to share, telling its members it signed a five-year collective agreement with Tacora Resources, an American company without a functioning website, for the Scully Mine operation.

Part of Wabush Mines, Scully Mine began operating in 1965, with iron concentrate railed to a pelletizing facility in Pointe Noire, Quebec, for shipment to Europe and throughout North America. Before it closed in 2014, a victim of low iron ore prices, Wabush Mines was Canada’s third largest iron ore operation, with an annual capacity of 6 million tonnes. The site since then has been tied up in regulatory proceedings.

Read more

Iron ore market can absorb supply loss from BHP fire: traders – by James Regan (Reuters U.S. – June 1, 2017)

https://www.reuters.com/

SYDNEY – A well-supplied global iron ore market will easily absorb lost production due to a fire at BHP’s big Mt Whaleback iron ore mine in Australia, traders in the commodity said on Thursday.

A fire earlier on Thursday broke out at the mine, the largest of seven operated by BHP in the Pilbara iron ore belt of Western Australia state. BHP said all staff were safe but that operations had been suspended as an investigation got underway.

Images in local media showed fire and smoke billowing out of the processing facilities at the mine. “All personnel at site have been accounted for and we are working to ensure the site is safe,” a company spokeswoman said.

Read more

Vedanta, Vale Lead Base-Metals Mining Drop as Iron Ore Plunges – by Mark Burton and Susanne Walker Barton (Bloomberg News – May 31, 2017)

https://www.bloombergquint.com/

(Bloomberg) — Vedanta Resources Plc and Vale SA led declines in industrial-mining companies as Chinese investors returning from a public holiday drove iron ore to a seven-month low. Nickel traded near its lowest in a year after Indonesia’s largest producer started shipping ore to China.

An index of 18 producers tracked by Bloomberg Intelligence headed for a third straight loss, with Vedanta dropping 5.7 percent and Rio de Janeiro-based Vale sliding 5 percent. Earlier, a 6.5 percent slump took iron ore to 424.5 yuan ($62.3) a metric ton on the Dalian Commodity Exchange amid signs of ample supply. The September contract finished May down 19 percent, in the longest run of monthly declines since November 2015.

“The fundamentals in iron ore are relatively weak but the selloff is more to do with speculative traders’ positions,” Xiao Fu, an analyst at Bank of China International Global Commodities, said by email. “The bears are winning at the moment.”

Read more