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Nickel Laterites

Indonesia’s Nationalism – by Neil Chatterjee (Bloomberg News – October 19, 2015)

http://www.bloombergview.com/

Indonesia has been plundered since the Dutch collected nutmeg and cloves from the archipelago they called the East Indies 400 years ago. With treasures strung across 17,000 islands, it’s home to the world’s largest gold mine and exports the most power-station coal, palm oil and tin.

Indonesia’s identity was forged by a half-century of sometimes savage dictatorship that sold its riches overseas. Now the country wants to keep more of its wealth at home. The pull of protectionism has characterized the presidency of Joko Widodo, who came to power in October 2014 as the country’s second freely elected leader.

A rising tide of economic nationalism is threatening to undo the formula that for many years brought much-needed investment to the world’s fourth-most-populous nation and its 250 million people.

The Situation

Widodo, better known as Jokowi, represents a new generation of Indonesian politicians: a self-made furniture seller and can-do bureaucrat focused on cutting graft and red tape.

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Nickel to rise above $20,000/tonne by 2017 – Alto Capital (Mineweb.com – October 8, 2015)

http://www.mineweb.com/

A longer-term perspective supports price appreciation.

A bullish outlook that will see nickel climb out of its current price slump and double in value to in excess of US$20,000 a tonne before March 2017, has been forecast today by market observer, Alto Capital.

Addressing the Paydirt 2015 Australian Nickel Conference in Perth today, Alto Capital research analyst, Mr Carey Smith, said that while the sector was under substantial cost and price pain, nonetheless the trend factors and outlook were far more substantial than they appeared.

“The nickel market has been dismal due to a recipe of stockpiles are up, production is up and demand is down,” Mr Smith said.

“However, going forward, stockpiled Indonesian high grade laterite nickel in China has all been consumed, China Nickel Pig Iron (NPI) production is in decline, global nickel supply is decreasing with only Independence Group’s Nova Bollinger project on the horizon and most producers/miners are losing money – so they will minimise their operations and/or get out of the game,” he said.

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Nickel crisis rocks French islands in Pacific – by Claudine Wery (AFP/Yahoo.com – October 4, 2015)

https://en-maktoob.news.yahoo.com/

Plunging nickel prices and the market woes of world mining giants have shaken the French territory of New Caledonia, a tropical archipelago in the Pacific that is hostage to the metal’s fortunes.

Though best known for its stunning lagoon, pristine beaches and diverse wildlife, New Caledonia’s economy actually relies heavily on nickel, discovered here in the 19th century.

The price of nickel — essential to the manufacture of stainless steel — has plunged 35 percent so far this year to a six-and-a-half year low of less than $10,000 (9,000 euros) a tonne.

A slowdown in economic growth in China, the world’s biggest consumer of nickel, and stockpiles of the metal amounting to more than 450,000 tonnes, have depressed the market.

“We were already in a deteriorating situation when the crisis hit because every sector was in a slowdown. I think we are not far from zero economic growth,” Catherine Wehbe, director of the employers’ federation Medef in New Caledonia, told AFP.

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NEWS RELEASE: SNC-Lavalin exercises its option to sell its interest in Madagascar’s Ambatovy Nickel Project

MONTREAL, Sept. 30, 2015 /CNW Telbec/ – SNC-Lavalin (TSX: SNC) announced today that it has exercised its option to divest its five percent ownership interest and the balance of its loans in the Ambatovy Nickel Joint Venture Project, a laterite nickel mine operation and a hydrometallurgical processing plant in Madagascar, to Sumitomo Corporation, an existing partner, for a cash consideration of approximately CDN$600 million.

The Company was initially awarded an EPCM contract for the Ambatovy nickel and cobalt operation in 2007. The mine―the largest capital project in Madagascar’s history―has a capacity to annually produce 60,000 tonnes of refined nickel, 5,600 tonnes of refined cobalt and 210,000 tonnes of ammonium sulphate fertilizer for a minimum of 29 years. On September 21, 2015, the Ambatovy project achieved financial completion. Accordingly, SNC-Lavalin has chosen to exercise its put option and has received its proceeds.

“We are pleased to have been involved in building the Ambatovy operation with our joint venture partners these past seven years and helping this unique mining project achieve crucial key milestones over this time,” said Robert G. Card, President and Chief Executive Officer, SNC-Lavalin Group Inc. “With nickel being the country’s largest export, Ambatovy will continue to contribute to the country’s future growth and generate long-term economic and social benefits for the people of Madagascar.”

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World Biodiversity Hotspot Worth Much More than a Nickel – by Jim Yuskavitch (Earth Island Journal – September 23, 2015)

http://www.earthisland.org/

Trio of mining proposals threatens Klamath-Siskiyou region

If there were a place in the United States that possessed such biodiversity that it had been designated an “Area of Global Botanical Significance” by the International Union for the Conservation of Nature and also proposed as a UNESCO World Heritage Site and Biosphere Reserve, surely it would be protected from any industrial development that would compromise its ecological integrity. There is, in fact, such a place. But its most recent designation is “endangered” as the area faces threats from three proposed nickel strip mines at its heart.

Spanning the northern California-southwestern Oregon border and encompassing nearly 20,000 square miles, the Klamath-Siskiyou ecoregion includes a complex suite of geology, climate, terrain, and such a remarkable example of temperate climate biodiversity that in 1992 the IUCN recognized the region as an area of global botanical significance. The region is home to 3,500 plant species – 280 of which are rare or endemic. The streams that originate in the Klamath and Siskiyou mountains are among the most productive on the continent, the spawning grounds for wild Pacific salmon and steelhead.

And while the region has the most designated Wild and Scenic Rivers in the US, nearly a dozen wilderness areas, and the 62,000-acre Cascade-Siskiyou National Monument, it also contains the largest area of unprotected forest on the West Coast outside of Alaska.

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Sherritt moves to protect liquidity (Northern Miner – September 18, 2015)

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

Sherritt International’s (TSX: S) president and CEO David Pathe did not mince words when he said the firm must take action to protect its balance sheet in order to withstand lower commodity prices at a time when “more than 60% of global nickel production is underwater on a cash cost basis.”

After markets closed on Sept. 17 Sherritt suspended its 1¢ per share quarterly dividend, noting that at current spot prices of US$4.50 per lb., nickel is down 32% since the company last cut its dividend in the first quarter of 2014 from 4.3¢ per share to 1¢ per share.

A world leader in the mining and refining of nickel from lateritic ores and the largest independent energy producer in Cuba with oil and power operations across the island, Sherritt said prices for nickel and crude oil haven’t traded this low since 2009.

Sherritt also said it would cut capital expenditures in 2016 by as much as 25%-35%. Earlier this year the company trimmed its 2015 capex guidance by $15 million to $195 million.

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Indonesia to keep ban on nickel ore exports -govt officials – by Gayatri Suroyo and Bernadette Christina (Reuters U.K./Yahoo – September 1, 2015)

https://uk.finance.yahoo.com/

JAKARTA, Sept 1 (Reuters) – Indonesia will keep its export ban on nickel ore, contrary to recent media reports suggesting the country may relax curbs to prop up its slowing economy, senior government officials said.

Indonesia banned exports of unprocessed metal ores in early 2014 to force firms to develop smelters that would add value to the country’s resources and create jobs. But the curbs cost the country billions of dollars in lost revenue last year.

While there are signs the government is trying to bring more money back into resources, the Chief Economics Minister Darmin Nasution warned against speculation that the country would relax its nickel ore export ban.

Indonesia will seek consistency in its mining policies, he said on Tuesday, a view echoed by Mining Minister Sudirman Said.

“What we’re doing is looking for incentive to boost economic activities in nickel and bauxite business.

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[Philippines Nickel Laterite Mining] King Of Ore: Despite Nickel Asia’s Raids, Zamora Did Not Retreat (Forbes Magazine – August 26, 2015)

http://www.forbes.com/

Jose Anievas still remembers Oct. 3, 2011 quite vividly. Early in the morning that fateful Monday, the chief operating officer of [prisoners of war] was seized by New People’s Army (NPA) rebels who raided the company’s sprawling open-pit mining site in Claver, Surigao del Norte in Mindanao.

“We were being lectured on how POWs [prisoners of war] should behave when we noticed thick smoke rising in the sky,” recalls Anievas, then the resident manager at Nickel Asia’s Taganito mine, the Philippines’ biggest nickel producer last year: About 200 NPA men and women descended on the mine and burned construction cranes, hauling trucks, barges and four buildings.

The rebels did a lot of damage–about $11 million worth of assets went up in smoke. But they failed to destroy the foundation and steel framework of the nickel refinery being built by Sumitomo and Mitsui & Co. in partnership with Nickel Asia.

The NPA members took hostages, including Anievas, an experienced mining engineer who was forced to march with the rebels deep into the forest. The hostages were used as human shields to keep away pursuing government troops. Their agony lasted almost ten hours. It was nightfall when they were released in a densely forested mountain ridge.

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Madagascar faces uphill struggle to revive bruised mining sector – by Drazen Jorgic and Lovasoa Rabary (Reuters U.S. – August 25, 2015)

http://www.reuters.com/

ANTANANARIVO, Aug 25 (Reuters) – When foreign mining firms and Western donors were pulling funds out of Madagascar following a coup in 2009, Austral Resources chief executive Scott Reid did the opposite and poured money in to the Indian Ocean island.

Yet far from being rewarded, the company’s $3.5 million investment in drilling and exploration of a high-grade mine has turned sour. Austral’s permit to extract zircon, used in ceramics, has expired and the project is far from production.

Sliding global commodities prices have hindered the Australian firm but to Reid the main frustration has been bureaucracy and government failure to renew its permit which languishes in the mining ministry with about 4,000 others.

With woeful air links hobbling tourism and power outages holding back its textiles industry, the former French colony’s economic recovery after years of political turmoil hinges on the revival of its mining sector.

But without permits, most miners are unable to raise cash on stock markets or get loans to keep their projects alive.

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Glencore sells assets as downturn bites – by James Wilson (Financial Times – August 14, 2015)

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

Glencore sold a trio of mining assets for $290m, extending its retreat from unwanted projects and continuing a trend among the largest resource companies to streamline their portfolios as the commodities downturn bites.

The UK-listed miner confirmed the sale of Tampakan, a copper project in the Philippines. It also revealed deals to sell Falcondo, a nickel producer in the Dominican Republic, and Sipilou, another nickel project in Ivory Coast.

Glencore inherited the assets as part of its takeover of Xstrata, completed in 2013, but has not significantly invested in them. For a project such as Tampakan, it could cost close to $6bn to build a mine.

Ivan Glasenberg, Glencore’s chief executive, has repeatedly said he dislikes the risks of “greenfield” mining developments, preferring to seek growth by expanding existing mines or via deals.

“Tampakan is one of those giant greenfield deposits . . . that’s been on the table for a long time, but struggling to obtain development approvals in the Philippines,” said analysts at Numis.

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UPDATE 1-Brazil court orders Vale to halt Amazon nickel-mine operation (Reuters U.S. – August 14, 2015)

http://www.reuters.com/

Aug 14 (Reuters) – A Brazilian federal court on Friday ordered Vale SA to halt activity at its Onça Puma nickel mine in Brazil’s Amazon state of Pará until it can demonstrate what actions it has taken to compensate indigenous communities in the region.

Vale’s operations in Pará face regular legal and protest action by native Brazilian groups seeking better schools, health care and other public services.

Onça Puma, in Ourilândia do Norte, is part of a complex of mines operated by Vale in the state’s Carajas region. The mine produced 5,900 tonnes of finished nickel in the second quarter, or about 8.8 percent of Vale’s finished-nickel output.

The most common protest by indigenous groups has involved blocking Vale’s rail line between Carajas and the Atlantic Ocean.

The court also ordered Vale, the world’s second-largest nickel producer, to deposit 1 million reais ($287,000) for each indigenous village in the area until it establishes a compensation program for the communities.

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New Caledonia mining trucks protest over nickel export ban to China – by Cecile Lefort (Reuters U.S. – August 6, 2015)

http://www.reuters.com/

SYDNEY – Aug 7 Dozens of mining trucks on Friday took to the streets of Noumea, capital of the South Pacific island of New Caledonia, to protest the government’s ban on some nickel exports to China.

Last week, the heads of the national and local governments along with mining executives vetoed exports of nickel laterites to China because of New Caledonia’s longstanding supply agreements with Australia.

“The opening to China is against the mining strategy established in 2009 to maintain export volumes to traditional clients of New Caledonia,” Philippe Germain, president of New Caledonia said in a statement.

Germain also said exports to China were unpredictable and blamed the Asian giant for the substantial fall in nickel prices. Nickel prices hit a six-year low in July and are down 27 percent this year, largely on slowing demand.

The veto angered a large number of truckers who subcontract for mines such as Société Minière du Sud Pacifique SA (SMSP), Ballande Group and Gemini, saying the ban will force many of them to shut down in an already difficult environment with falling export volumes.

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Philippine nickel miners confident production won’t drop – by Anne Lu (International Business Times – August 06 2015)

http://www.ibtimes.com.au/

While the agricultural sector in the Philippines dread the looming El Niño phenomenon that could introduce widespread dryness across the country, the mining segment see it as a “blessing.”

“The impact of El Niño on our operations is going to be positive. The dry weather means our mines can continue to be productive in October or November when the season of heavy rains usually starts.” Nickel Asia Corporation CFO Emmanuel L. Samson told Business World.

During wet season, metal producers are forced to suspend field operations for safety and technical reasons, as it would be difficult to get ore underground when the earth is wet and damp. Typically, the rainy season stretches from October to the second quarter of the following year, a long period when most mining operations are recording average productivity levels.

Nickel Asia, which is also partly owned by Japan’s Sumitomo Metal Mining, has projected an ore export volume of more than 19 million wet metric tonnes (WMT) for 2015. The company produced only 17.9 million WMT last year.

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For Fortescue’s Andrew Forrest, it’s mine, all mine – by Jonathan Barrett (Australian Financial Review – July 31, 2015)

http://www.afr.com/

Billionaire mining magnate Andrew Forrest has relied on a series of controversial strategies to climb to the top of the resources pile.

It is not your ordinary after-school job.

It is the year 2000, and Daniel Kerr is under pressure from his mum to get part-time work. The 15-year-old schoolboy wouldn’t mind a few extra dollars given he needs a new set of wheels; he does, after all, have a habit of wearing out skateboards.

Kerr looks in the local paper, the Kalgoorlie Miner, and on the public noticeboard before he finds the perfect job. “Money for jam,” he thinks to himself.

An employer is looking for someone to go down to the local mines department once a week and hand-copy information that is lodged by explorers and miners. The job description might raise eyebrows for those living in major cities, but Kerr lives in the heart of Western Australia’s Goldfields region, where almost every job has a red-earth mineral tinge to it.

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Sherritt CEO sees brighter future in Cuba – by Lisa Wright (Toronto Star – July 29, 2015)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

The Toronto miner reports weak Q2 results amid severe downturn in nickel, oil

Toronto-based miner Sherritt International Corp. is taking a beating as nickel and oil prices plummet, but the chief executive sees a silver lining for his company as U.S. and Cuba relations continue to thaw.

David Pathe, who delivered weak second-quarter results Wednesday, said he visited the firm’s operations in the island nation last week as the U.S. reopened its embassy in Havana after 50 years under renewed diplomatic ties.

“There’s a tremendous amount of optimism in Cuba at the moment, and a lot more interest in Cuba internationally,” Pathe said in an interview. “We’ve been in Cuba for over 20 years and it’s a remarkably stable place to do business,” he said.

Sherritt produces approximately two-thirds of Cuba’s oil and also owns a 50 per cent interest in the Moa nickel and cobalt joint venture with the Cuban government, which includes mining, processing and refining operations.

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