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Metals supercycle remains intact, says Bay Street analyst Ray Goldie – by Peter Kennedy (Stockhouse.com – January 28, 2015)

http://www.stockhouse.com/

One of Canada’s most seasoned commodities analysts says the long term outlook is bright for key base metals, including nickel, copper and zinc.

Raymond Goldie, Vice-President, Commodity Economics with Salman Partners was in Vancouver Tuesday to talk about the “super cycle,” a term that was often used in the early part of this century when metal prices kept going up in a seemingly relentless fashion.

“We have been in a super cycle since 2004,’’ Goldie told the CFA Society of Vancouver during a lunchtime speech.

But even though the price of key metals has weakened in the past two years, it doesn’t mean the current supercycle is over. Rather it is caught in a “mid-cycle trough,” he said. “The rebound lies ahead.”

The veteran Bay Street analyst, who was widely known for his coverage of iconic Canadian mining companies like Falconbridge and Inco Ltd. before they were swallowed up in the globalization process, said the near term outlook is brightest for nickel.

He said supply is constrained by an Indonesian ban on exports of raw ore, which is affecting China’s ability to produce nickel pig iron, a low grade ferronickel invented in China as a cheap alternative to pure nickel for the production of stainless steel.

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CORRECTED-Weak rouble helps Russia’s Norilsk weather metals fall – CEO – by Polina Devitt (Reuters U.S. – January 23, 2015)

http://www.reuters.com/

NORILSK, Russia, Jan 23 (Reuters) – Falling metal prices are being more than offset by the rouble slide, allowing Russia’s Norilsk Nickel to maintain margins despite lower foreign currency earnings, its chief executive said.

CEO and co-owner Vladimir Potanin, Russia’s eighth richest man with a $12.6 billion fortune from the world’s largest nickel and palladium miner, said if metal prices remained at current levels, Norilsk’s 2015 foreign currency revenues would decline from a year earlier to $10 billion.

But he said lower metal prices would not affect the company’s earnings before interest, tax and depreciation (EBITDA) margin, which would exceed 40 percent this year. He did not provide data for 2014.

Many Russian companies have been hit by a downturn in the economy, suffering from weak oil prices and Western sanctions over the Ukraine crisis, but exporters are enjoying the 50 percent drop in the rouble since the beginning of last year.

Potanin said more important for his core business, based 300 km (186 miles) inside the Arctic Circle where it is dark for more than a month in winter, were prices for the company’s main metal products.

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Canadian ore carrier makes historic journey to China via Northwest Passage – by Richard Desgagnes and Andrew Godfrey (Canadian Mining Journal – January 2015)

http://www.canadianminingjournal.com/

Richard Desgagnes is a Senior Partner and Andrew Godfrey is an Associate with Norton Rose Fulbright.

Shipping history was recently made in Canada when Fednav’s MV Nunavik sailed from Deception Bay, Quebec to Bayuquan, China via Canada’s Northwest Passage.

The ship carried 24,000 tons of nickel concentrate and became the first commercial vessel to transit the Northwest Passage westward, unescorted, with an Arctic cargo and with Canadian expertise. In doing so the transit time was reduced by about 18 days (or about 5,800 miles) than had it been routed through the Panama Canal.

This and other developments are opening new frontiers of coastal mining transportation in Canada. Wherever a mining project is located, however, there are some key issues that have to be addressed when looking at maritime transportation.

FLAG CONSIDERATION: If the transportation needs are purely domestic (from one point in Canada to another), due to coasting trade restrictions, the vessel must be Canadian flagged and manned by Canadian seafarers. As such, manning costs are much higher compared to some other foreign flag operations. For carriage to a destination outside of Canada however, there is no restriction on the nationality of the vessel or the crew used on-board. All vessels are regulated by the standards of the IMO (International Maritime Organization).

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Nickel miners shrug off sluggish prices – by Paul Garvey (The Australian – January 22, 2015)

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

NICKEL miners Western Areas and Panoramic Resources have shrugged off the sluggish nickel price with respective pieces of good news, with Western Areas flagging a big improvement in its guidance for 2015 and Pan­oramic surging on the back of a new discovery.

Western Areas said production costs at its high-grade Flying Fox and Spotted Quoll mines in Western Australia had fallen to their lowest in four years, clearing the way for the company to upgrade its guidance at its half-year result.

Each pound of nickel produced by Western Areas cost the company $2.23, compared with its guidance for the full year of between $2.70 and $2.80 a pound.

The lower production costs reflected higher nickel grades, a renegotiated contract with mining contractor Barminco, and optimisation efforts by the operations team.

Net cash at the company increased from $44.7 million to $53.7m, despite the falling nickel price and the payment of a dividend during the quarter. Western Areas executive director David Southam said the miner had outperformed during the December quarter.

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NEWS RELEASE: Antofagasta Investment Company Limited completes acquisition of Duluth

TORONTO, Jan. 21, 2015 /CNW/ – Duluth Metals Limited (“Duluth” or “Duluth Metals”) (TSX: DM) (TSX:DM.U) is pleased to announce that it has completed its previously announced proposed arrangement (the “Arrangement”) with Antofagasta Investment Company Limited (“Antofagasta”), a wholly-owned subsidiary of Antofagasta plc. Under the Arrangement, Antofagasta has acquired all of the outstanding common shares of Duluth (the “Duluth Shares”) (other than Duluth Shares held by Antofagasta and its affiliates) at a price of CDN$0.45 per Duluth Share in cash (the “Cash Consideration”).

The Duluth Shares are expected to be de-listed from the Toronto Stock Exchange as soon as practicable.

In order to receive the Cash Consideration in exchange for their Duluth Shares, registered shareholders must complete, sign, date and return the Letter of Transmittal that was mailed to each registered shareholder. The Letter of Transmittal is also available from Duluth’s depositary, Equity Financial Trust Company, by telephone at: (i) 1 (866) 393-4891 (North American Toll Free); or (ii) under Duluth’s issuer profile on SEDAR at www.sedar.com.

Shareholders whose Duluth Shares are registered in the name of a broker, investment dealer, bank, trust company, trustee or other intermediary or nominee should contact that intermediary or nominee for assistance in depositing their Duluth Shares and should follow the instructions of such intermediary or nominee in order to make their election and deposit their Duluth Shares.

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Eagle GM: Nickel a ‘good place’ – by Christie Bleck (The Mining Journal – January 20, 2015)

http://www.miningjournal.net/ [Michigan]

MARQUETTE – The business of producing nickel is in good shape, Michael Welch, general manager of Lundin Mining Corp.’s Eagle Mine, told the Economic Club of Marquette County Monday.

Welch was the guest speaker at the club’s monthly program at the Ramada Inn. He joined Eagle Mine in January 2014, coming from Xstrata’s Raglan operation, a large nickel mine in northern Quebec situated in subarctic conditions and facing challenges similar to Eagle.

Eagle Mine in Michigamme Township – a Lundin subsidiary – employs more than 400 people and is producing nickel, copper and small amounts of other metals over its expected duration of eight years.

“Short term, nickel has a very good supply-and-demand outlook,” said Welch, who noted 2015 will be a transition year as demand for nickel will outstrip supply. “Bottom line is, nickel’s going to be a good place to be.”

Laptops, cell phones – items used by just about everybody in the room, according to an impromptu poll by Welch – use nickel battery technology, he pointed out.

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Zinc and nickel price upside ‘imminent’: Clarus – by Peter Koven (National Post – January 20, 2015)

The National Post is Canada’s second largest national paper.

There has been a lot of bullish talk in the metals community about zinc and nickel over the past couple of years, as many insiders believe those commodities are poised for a rally. You can include Clarus Securities analyst Mike Bandrowski in that group.

He published a detailed note on Tuesday that suggests zinc and nickel have “imminent” upside and will perform very strongly over the next two years as inventories disappear.

In the case of zinc, Mr. Bandrowski noted the market is already in deficit, and that deficit should get bigger following the closures of the Lisheen and Century mines this year. He said exchange inventories have fallen by more than half over the last two years and should be at “critical” levels later in 2015.

“We believe the lack of funding in zinc mine development and exploration has now caught up with the marketplace and zinc prices will respond in 2015,” he said in a note. “Despite the broad commodity sell-off, zinc has held up quite well, likely an indication of the favourable supply/demand fundamentals.”

Nickel has received more attention than zinc due to an Indonesian export ban on raw ore that was imposed a year ago, which removed about 25% to 30% of global nickel supply.

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Ex-Xstrata CEO Seeks Second Act With Vale’s Nickel Assets in Mind – by Firat Kayakiran, Dinesh Nair and Jesse Riseborough (Bloomberg News – January 14, 2015)

http://www.bloomberg.com/

Mick Davis, who built Xstrata Plc into one of the world’s biggest mining companies, is trying to do it again.

Davis, a 56-year-old South African, is considering a bid for the nickel business of Vale SA (VALE), the world’s top producer, according to people with knowledge of the situation. Davis’s investment vehicle X2 Resources values Vale’s nickel business at $5 billion to $7 billion, said two of the people, who asked not to be identified because the negotiations are private.

Through a decade of 40 mergers and expansions, the onetime cricket umpire Davis increased Xstrata’s market value more than 80 times to $50 billion, and became the world’s biggest exporter of power-station coal. After it agreed to be acquired in 2012 by its largest shareholder Glencore International Plc in a $30 billion deal, Davis was to lead the combined company. The power-sharing agreement collapsed when Glencore Chief Executive Officer Ivan Glasenberg demanded the title.

Davis’s X2 has since raised about $4.8 billion from equity investors and has been hunting for assets to buy from the world’s largest miners such as Vale, BHP Billiton Ltd. and Anglo American Plc.

“Mick Davis is a strong and a driven individual who has been very successful,” said Vince Gauci, who was managing director of M.I.M. Holdings Ltd. when Xstrata acquired the Australian metals and coal producer for $3 billion in 2003. “I’ve no doubt that he’s still got the fire in his belly to start again.”

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PRESS RELEASE: First Nickel Restructures the Lockerby Mine, Reducing Costs and Ensuring Continued Economic Viability

TORONTO, ONTARIO, Jan 12, 2015 (Marketwired via COMTEX) — First Nickel Inc. (“First Nickel”, “FNI” or the “Company”) (FNI) has announced that the Lockerby nickel/copper mine, located in the Sudbury basin in Ontario, is being restructured in order to reduce costs, increase exploration and extend mine life.

Background

The Lockerby Mine Project Technical Report dated August 2, 2012, available on SEDAR.com, envisaged mining from the 6,500-foot level to the 7,000-foot level. In 2013, the Company disclosed that, as a result of low nickel prices, ramp development below the 6800 level would be suspended. The Company has also said that if a decision was not made to restart ramp development, Lockerby would cease mining operations in 2015.

In December 2014, the Company concluded that, unless costs could be substantially reduced, developing the mine below the 6800 level would be uneconomic based on the current cost structure.

Thomas M. Boehlert, President & Chief Executive Officer, commented: “The employees at Lockerby have done a remarkable job in recent months to improve performance at the mine, with nickel production in the second half of 2014 improving significantly compared to the first half. However, the combination of persistently low nickel prices and our underlying cost structure has had a negative impact on our ability to generate the funds required to continue development of the mine.”

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Minnesota couple who canoed from Boundary Waters to nation’s capital ponder next adventures – by Steve Karnowski (The Associated Press/Winnipeg Free Press – January 5, 2015)

 http://www.winnipegfreepress.com/

MINNEAPOLIS – Two experienced adventurers who paddled, portaged and sailed 2,000 miles from northern Minnesota to Washington, D.C., say they plan to keep up the fight in the new year to protect the Boundary Waters Canoe Area Wilderness from copper-nickel mining.

Amy and Dave Freeman set out Aug. 24 from Ely. They canoed 180 miles through the BWCA, then portaged to Lake Superior. They strapped their canoe to a sailboat for the next 600 miles to Lake Huron, then switched back to the canoe for the final 1,300 miles, travelling mostly by rivers and canals across parts of Canada and the eastern states. They reached the Potomac waterfront in Washington on Dec. 2 — 101 days after they set out.

The Freemans wanted to call attention to the threat they say copper-nickel mining poses to the Boundary Waters and to mark the 50th anniversary of the federal Wilderness Act, which protects pristine areas such as the BWCA. Their next plan is a bike ride across Minnesota in 2015 hauling another canoe to press their message.

But it won’t be the same signature-covered “petition canoe” they paddled to Washington. They gave that to the U.S. Forest Service, the agency that oversees the BWCA. Dave Freeman said the bike tour, which is being organized by the Ely-based group Save The Boundary Waters, will last about six weeks and a large group of people will participate for a week or two at a time.

“I think it’s going to be a lot of fun. We’re going to try and hit as many of the college campuses in Minnesota as possible,” he said.

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Good environment, good jobs: We can have both – by Frank Ongaro (Mesabi Daily News – December 20, 2014)

http://www.virginiamn.com/

Frank Ongaro is executive director of Mining Minnesota, which is a group working with local citizens, businesses and other organizations to bring growth and job creation to the state through responsible development of natural resources.

But this simply isn’t a fair or accurate portrayal of the issues at hand. We are all environmentalists and we all enjoy the beauty and serenity of Minnesota’s wilderness. Our state has a lot to offer outdoor enthusiasts, and with a population above 3.5 million, there are many people who call Minnesota home who have an interest in protecting the outdoors for future generations.

A majority of these 3.5 million individuals also need jobs — jobs that support their families and provide opportunities for future generations of Minnesotans. Thankfully, we can have both — the environment and mining have coexisted for more than 130 years and with modern technologies, will continue to do so as we expand the state’s rich mining tradition.

Mining copper, nickel, platinum and palladium from one of the world’s largest, untapped source of these strategic metals in Minnesota’s Duluth Complex will provide thousands of high-quality jobs in a range of sectors, as well as the metals we all need for the growing green economy. Wind turbines and solar equipment require copper. Electric cars and rechargeable batteries use nickel and copper. The autocatalysts in cars require platinum and palladium.

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Nickel Seen Extending Rally Into 2015 by CLSA on Ore Stocks Fall – by Alex Davis (Bloomberg News – December 12, 2014)

http://www.bloomberg.com/

Nickel, the best-performing base metal this year, may extend its rally into 2015 as China’s output of nickel pig iron will drop amid dwindling stockpiles of higher-quality raw material, according to CLSA Ltd.

China’s production of NPI, a lower-grade alternative to the refined metal, may fall to 300,000 metric tons in 2015 from 410,000 tons in 2014 and 485,000 tons in 2013, said Ian Roper, Singapore-based commodity strategist at CLSA. The country’s inventory of Indonesian laterite ore is now down about 61 percent from a peak in January, he estimates.

The refined metal, used in making stainless steel, surged to $21,625 a ton in May on the London Metal Exchange after Indonesia started an ore-export ban in January and then slipped into a bear market in September as the Philippines filled the supply gap. Prices are still up 18 percent this year, the most among the main six base metals on the LME. China is the largest producer and user of nickel.

“Nickel should be back up above $17,600 by the middle of next year because the Indonesian ore in China will all have been consumed by the second quarter,” Roper said in a Dec. 9 interview. “It’s justified for it to go back to $17,600 to incentivize nickel pig iron running purely with Filipino ore, because that involves a 30 percent higher processing cost.”

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Vietnam’s emerging nickel-sulphide district – by Frik Els (Mining.com – December 9, 2014)

http://www.mining.com/

Nickel investors have been on a wild ride in 2014. Indonesia, supplying more than a fifth of global exports, surprised the mining world in January by putting into effect an outright ban on nickel ore exports.

Initially record warehouse inventories, massive stockpiling by Chinese nickel pig iron producers and growing mine supply kept a lid on the price which was languishing at near five-year lows below $14,000 a tonne at the start of the year.

The Asian nation, against expectations, stuck to its guns and the ban, in combination with fears that tensions with Russia could affect supply from top miner Norilsk, eventually sent the price above $20,000 in May.

But as LME stocks continued to rise and the Philippines – the only other source in the region of high-grade laterite ore required by China and responsible for 9% of global mine supply – took up some of Indonesia’s slack, supply worries subsided and the price tanked again, nearly wiping out all 2014’s gains.

Prices are now back above $16,500 on the back of dwindling stockpiles in China and expectations of robust demand from steelmakers in the US, China and the EU.

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TVI affiliate looking to build Philippines’ third nickel plant (Reuters U.S. – December 10, 2014)

http://www.reuters.com/

MANILA – Dec 10 (Reuters) – A Philippine miner partly owned by Canada’s TVI Pacific Inc is looking to build what could be the Southeast Asian country’s third nickel processing plant ahead of a possible ban on exports of unprocessed ore, a Manila-based spokesman said.

TVI Resource Development Phils. Inc. (TVIRD), which in October began shipping ore to China from its newly developed Agata mine in Surigao province in southern Philippines, expects a feasibility study on the plant to be completed this month.

“The company’s direct shipping ore operations will pave the way for the opportunity to list on the Philippine Stock Exchange as well as the establishment of a nickel processing plant over the medium term,” Corporate Communications Director Kaycee Crisostomo told Reuters.

If the plant is proven feasible, TVIRD plans to build and commission it by 2016 at a cost of $150 million to $200 million. It is a looking at a technology cheaper than the most commonly used one called high pressure acid leach, or HPAL.

Nickel Asia Corp, the Philippines’ biggest nickel miner, and main shareholder Sumitomo Metal Mining Co Ltd own and operate the country’s two existing processing plants, including the $1.7 billion Taganito HPAL facility commissioned about a year ago.

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[NEWS RELEASE] North American Nickel (NAN): A good summer in Greenland (BE Mining.com – December 9, 2014)

http://www.bus-ex.com/

Though it’s barely six months since we last reported on progress at NAN’s 3,601 square kilometre property, which encapsulates the nickel-rich Greenland norite belt (GNB) and where the company was embarking on an ambitious drilling programme, the results and the indication of future discoveries has been so encouraging that it is quite difficult to know where to start.

As NAN’s President and interim CEO Dr Mark Fedikow told us not that long ago: “This year we have said we will drill a minimum of 4,700 metres of core but that could be increased to as much as 10,000 metres if no unforeseen difficulties are encountered.” With their efficient technical and drill team firing on all cylinders a total of 8,773 metres was drilled in 2014.

That is impressive, as were the results obtained with high grade nickel, copper and PGM mineralisation, but there remain many more exploration targets identified and more geophysical surveying required. This summer’s work focused mainly on the Imiak Hill complex, which includes Imiak Hill, Mikissoq (previously referred to as Imiak North) and Spotty Hill, three mineralised zones within 1.6 kilometres of one another, and Fossilik, another large area of norite.

“We went into our 2014 drill programme with the game plan of getting onto the ground as early as possible, and we managed to get in and start ground geophysical surveys in April,” says Fedikow.

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