Twitter

Nickel

Nickel price rise: too much too soon says new report – by Frik Els (Mining.com – May 5, 2014)

http://www.mining.com/

Indonesia surprised the mining world in January putting into effect an outright ban on nickel ore exports.

After a relatively subdued initial reaction on nickel markets – no-one thought the Asian nation would go through with the ban and when it did, the expectation was that the rules would be water down substantially – the price of the steelmaking raw material is now up 32% in 2014.

Indonesia accounted for around a fifth of global supply at an estimated 400,000 tonnes of contained metal so the potential was there for a big impact on the price.

But record inventories around the globe (hitting 285,000 tonnes in March), massive stockpiling by China’s nickel pig iron producers ahead of the ban, and years of growing mine supply (11% per year since 2009 to 2 million tonnes), kept the price near financial crisis levels by the end of January.

Traders only really entered panic mode when supply from the world’s largest producer Norilsk was also put in danger due to the possibility of sanctions against the Russian company over the crisis in Ukraine.

Read more

Proposed mine by wild Smith River roils Del Norte County folks – by Peter Fimrite (San Francisco Chronicle – May 3, 2014)

http://www.sfgate.com/

The clear, flowing Smith River is a life force in the northern corner of California, where the locals keep a sharp eye out for threats to the pristine water and thriving fish.

That would explain why the folk who live along the river in Del Norte County nearly jumped out of their britches when they learned about a proposed nickel mine along a major tributary of the Smith, the last major river without a dam left in the state.

A London mining company has applied to the U.S. Forest Service to begin exploratory drilling over thousands of acres of forest lands, including Baldface Creek, in Curry County, Ore., which flows into the Smith and helps maintain one of the most abundant natural salmon runs in California.

Steelhead trout, chinook and coho salmon spawn in both Baldface Creek and Smith, a National Wild and Scenic River that also provides Crescent City and the surrounding communities with drinking water.

“Locating a strip mine in the headwaters of the wild and scenic Smith River is like putting ice cubes made with toxic waste in your favorite drink,” said Grant Werschkull, the executive director of the Smith River Alliance, in Crescent City. “It’s completely outrageous.”

Read more

Sherritt Tops Armoyan With Putin’s Help: Corporate Canada – by Christopher Donville (Bloomberg News – May 1, 2014)

http://www.bloomberg.com/

Nickel and energy producer Sherritt International Corp. (S) is poised to fend off an attack by activist shareholder George Armoyan, helped by the soaring price of the industrial metal.

Nickel has risen 32 percent this year, propelling Sherritt to top performer among its Canadian base-metal peers, as Armoyan has sought to convince investors to replace three of the Toronto-based mining company’s nine directors with himself and two others.

“I think for George, the worst thing that could have happened was nickel prices went up,” David Taylor, the Toronto-based chief investment officer of Taylor Asset Management Inc., said by telephone last week. “He would have had a much better chance if this stock was still hovering around three bucks.”

Sherritt, which closed today at C$4.68 in Toronto, has advanced 26 percent this year on an Indonesian ban on nickel-ore exports. The threat of wider economic sanctions on Russia for President Vladimir Putin’s annexation of Crimea and skepticism of his efforts to defuse tensions in eastern Ukraine also lifted the price of the stainless-steel ingredient. Nickel generated 50 percent of Sherritt’s first-quarter sales, the company said yesterday in its earnings statement.

Read more

NEWS RELEASE: Duluth Metals Highlights Twin Metal’s Nickel Position with 4.7 Billion Measured and Indicated Pounds and 4.2 Billion Inferred Pounds

  • Duluth Metals has 60% ownership interest in Twin Metals Minnesota LLC which is currently close to completing a detailed pre-feasibility study on a very large copper-nickel-PGM project in NE Minnesota
  • Duluth Metals is well positioned to benefit from the current recovery in world nickel prices
  • Nickel currently contributes 30 percent to the base case NSR valuation of the Maturi Measured + Indicated Resource*
  • Realization of projected escalating spot nickel prices over the next two years may significantly increase the overall TMM nickel value and potential revenue ratio
  • January 2014 AMEC resource update highlights a contained nickel resource of 4.7 billion pounds Measured + Indicated and 4.2 billion pounds Inferred*
  • Duluth Metals has previously announced high grade nickel intersections in the southern portion of the Maturi Deposit **

TORONTO, May 1, 2014 /CNW/ – Duluth Metals Limited (“Duluth Metals”, “Company”) (TSX: DM) (TSX:DM.U) is pleased to announce that the Company is well positioned to take advantage of the rapidly recovering nickel market through their 60% ownership in Twin Metals Minnesota LLC (“Twin Metals”), which is currently in advanced pre-feasibility phase on a major polymetallic copper-nickel-platinum-palladium-gold project in NE Minnesota.

Read more

Nickel bolsters Vale’s bottom line – by Jeb Blount (Reuters/Sudbury Star – May 1, 2014)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

Brazilian miner Vale SA said on Wednesday that first-quarter profit fell by nearly a fifth, a result in line with expectations, after the price of iron ore, its main product, fell sharply.

Net income fell 19% to $2.52 billion, compared with $3.11 billion in the same quarter of 2013, according to a securities filing. The result was near the $2.59 billion average estimate in a Reuters survey of 13 analysts and comes after a $6.54 billion fourth-quarter loss.

Vale Chief Executive Officer Murilo Ferreira has been working to slash costs and unload unprofitable businesses for more than a year as a slowdown in Chinese growth limits demand for iron ore and other metals. China, the world’s largest steel producer, is the biggest market for iron ore, the main ingredient in steel.

Vale is the world’s largest iron ore producer and a major miner of nickel, copper and fertilizers. In Sudbury, Vale is the city’s largest employer and runs mines, mills and a smelter. Nickel and copper are the main minerals produced in Sudbury.

Read more

COLUMN-Nickel options boom shows scale of bulls’ ambitions – by Andy Home (Reuters U.S. – May 1, 2014)

http://www.reuters.com/

The opinions expressed here are those of the author, a columnist for Reuters.

(Reuters) – Nickel is the only game in town right now among the base metals traded on the London Metal Exchange (LME).

LME three-month metal has edged back from the 15-month high of $18,715 per tonne reached on Monday but it is still up by over 30 percent since the start of the year. The next best performer among the LME pack is tin, trailing far behind with year-to-date gains of just 5 percent.

Nickel is trading a strong fundamental story with Indonesia’s ban on exports of nickel ore expected to turn the market from supply feast to supply famine in double-quick time. Extra spice comes in the form of possible sanctions against Russian producer Norilsk Nickel as geopolitical tensions around Ukraine ratchet up.

The company, which last year produced 285,000 tonnes of nickel, has not yet been targeted but the most recent sanctions include Sergei Chemezov, who sits on its board, suggesting the potential sanctions net is drawing closer.

Read more

UPDATE 1-Eramet sees another loss in H1 despite nickel recovery – by Andrew Callus and Gus Trompiz (Reuters India – April 29, 2014)

http://in.reuters.com/

PARIS, April 29 (Reuters) – French mining and metals group Eramet said on Tuesday it expected to make another operating loss in the first half of 2014 despite a recovery in nickel prices driven by an Indonesian ban on unprocessed mineral exports.

The group, whose nickel operations are based in the French Pacific territory of New Caledonia, has been pinning its hopes on Indonesia’s export embargo to curb global oversupply and bolster prices that sank to a four-year low in 2013.

Nickel prices had recovered significantly since March but still remained down 15 percent on year at “an abnormally low average level” of $6.64 a pound, it said.

“Eramet group turnover should pick up in Q2 2014, compared with Q1 2014,” it said in a first-quarter sales statement.  “Nonetheless, in view of the relative movement in nickel and manganese prices, current operating income for first-half 2014 should be approximately the same as in second-half 2013,” it said.

Eramet posted a current operating loss of 45 million euros for 2013, including losses in each half. Its nickel branch suffered a full-year loss of 222 million euros and the poor market conditions led Eramet to postpone its flagship nickel mining project in Indonesia.

Read more

COLUMN-Indonesia to make it even harder for foreign miners – by Clyde Russell (Reuters India – April 23, 2014)

http://in.reuters.com/

Clyde Russell is a Reuters columnist. The views expressed are his own.

LAUNCESTON, Australia, April 23 (Reuters) – Indonesia’s decision to start cancelling investment treaties with 62 countries has passed with little comment, but the move may have a greater impact than the recent banning of mineral ore exports.

Indonesia last month kick-started the process of terminating all of its bilateral treaties by notifying the Netherlands that its agreement to protect and promote investment would end in 2015, and signalling that the others would end as soon as possible.

The agreements, which are common between states, protect the rights of investors in each other’s country, and typically include clauses about fair treatment, no expropriation and guarantees that profits can be repatriated.

Most importantly for many investors in countries like Indonesia, with its patchy record on legal certainty, is the right of appeal to the Washington-based International Centre for Settlement of Investment Disputes (ICSID).

Among the countries that have treaties with Indonesia are major foreign investors including China, India, Australia, Britain, Singapore and Russia. However, the United States and Japan are among nations that don’t have agreements.

Read more

[Norilsk Russia and Nickel Mining] Life behind closed doors in the Arctic is…..fun! – by Kate Baklitskaya (Siberian Times – April 22 2014)

http://siberiantimes.com/home/

Norilsk is home to the world biggest mining and metallurgy complex, and is shut off from the world in more ways than one.

From deep in Soviet times, it was ‘closed’ to outsiders, and currently remains exceptionally hard to visit for foreigners. It appears on lists of the top ten most polluted cities in the world, and yet has no road or rail connections to the ‘mainland’, as the rest of Russia is known here, and the sea port Dudinka, which is 100 km from Norilsk is closed for nine months a year. Yet, intriguingly, the 177,000 people living in Norilsk – which accounts for two per cent of Russia’s entire GDP – seem more contented than many others in Russia.

On a Saturday night, local photographer Nadezhda Rimskaya, 32, goes to OverTime bar to see the local rockabilly band. Nadezhda graduated from a college in St Petersburg but decided to return home and has been working here for the last four years. The concert finishes after midnight and the group of young people decide to go for a late dinner.

Luckily there are places where the kitchen remains open after midnight – for example Maxim pub. Indeed, Moscow-level restaurants and night clubs, bars and coffee shops, are increasing in Norilsk powered by the high demand, surprising as this may seem.

‘Norilsk misses just two things – oxygen and the internet’, says Nadezhda on her night out, referring to the general lack of oxygen in the air in the north and the absence of the high speed internet in the city. Everything else is fine here and in many ways much better than in many Russian cities. I’m honestly surprised when I hear people say that Norilsk is ‘horrible’. That’s just a misinformed stereotype.’

Read more

Indonesian ban on unprocessed ore exports may help Vale – (CBC News Sudbury – April 17, 2014)

http://www.cbc.ca/sudbury/

A new commodities report projects a boost in the price of nickel over the next three years — and that will have an impact on mining companies in Sudbury.

The projected price hike is connected to what’s happening overseas in Indonesia, where that country recently put a ban on exports of unprocessed ore—an effort to encourage foreign investment in domestic refining activity.

The country produces about 28 per cent of the world’s nickel, so its withdrawal from the global market marks a significant drop in supply. Recent nickel prices have reflected this new reality, as it reached a six-month high this week at $8.11/lb.

“I have revised upward my price forecast for 2015 to $9 a pound,” said Patricia Mohr, a commodities specialist with Scotiabank.  “We started this year at prices just a little above $6, so it does represent quite an improvement.”

Miner Vale has operations in Indonesia, but spokesperson Cory McPhee said the company won’t be affected by the ban. “We’re a company that actually produces a refined nickel product in Indonesia,” he said.

Read more

BHP Needs Rebound, Not Spinoffs, Amid Metal Slump: Real M&A – by Angus Whitley and Elisabeth Behrmann (Bloomberg News – April 17, 2014)

http://www.businessweek.com/

A spinoff of BHP Billiton Ltd.’s (BHP) least-loved assets may do little for shareholders of the world’s largest mining company.  BHP, which is wringing out costs after a decade-long mining boom ended, said this month it’s studying “structural options” to help narrow its focus to four commodities including iron ore. With mines aging and new oil and gas fields becoming harder to find, BHP’s return on invested capital has sunk to the lowest since 2003, according to data compiled by Bloomberg.

Separating the nickel, manganese and aluminum assets from BHP probably wouldn’t boost profit at either the new or old entity, said Sanford C. Bernstein Ltd. Profit margins for the unfavored business have evaporated at the bottom of the commodity cycle and CLSA Asia-Pacific Markets said a spun-off company may be valued at $7.5 billion, just 4 percent of Melbourne-based BHP’s market value.

“There’s a long history of the larger companies succumbing to the cyclical pressures,” John Robertson, director at EIM Capital Managers Pty in Melbourne, said by phone. “If you’re going to float off a large chunk of assets that currently have a low return on capital, unless somebody’s got a magic wand, it’s really not going to do much.”

In 2011, as China devoured everything from iron ore to copper to feed economic expansion, BHP’s return on invested capital was 35 percent, Bloomberg data show. The figure slumped to 10 percent two years later because of slower Chinese growth and costs that were still aligned with a resources boom.

Read more

Scotiabank raises nickel price outlook in light of Indonesian export ban – by Craig Wong (Canadian Press/CTV News – April 14, 2014)

http://www.ctvnews.ca/

OTTAWA — Scotiabank is raising its outlook for the price of nickel — a key component in stainless steel — following an Indonesian export ban on unprocessed ore that took effect earlier this year. Nickel prices have been rising following the Indonesian ban that was enacted in an attempt to encourage foreign investment in ore processing in the country.

“While the export ban was announced more than four years ago with an unchanged starting date of January 2014, few market observers, including ourselves, believed that Indonesia would have the resolve to stick with this agenda,” Scotiabank said in a report Monday.

“However, after three months and no signs of the ban being eased or watered down, the nickel market has begun to panic, with prices moving up sharply.”

The bank said it now expects nickel to average US$7.66 per pound this year, up from earlier expectations for US$6.75. Scotiabank also raised its outlook for 2015 to US$9 from US$7 for 2016 to US$10 from US$7.50. The price of nickel was US$6.82 per pound last year.

Read more

COLUMN-BHP’s “unloved” assets may be better long-term bet – by Clyde Russell (Reuters U.K. – April 14, 2014)

http://uk.reuters.com/

LAUNCESTON, Australia, April 14 (Reuters) – “Unloved” was a word that popped up several times in relation to BHP Billiton’s mooted plans to spin-off its non-core aluminium, nickel and manganese businesses.

It’s worth looking at the language used to describe and frame corporate plans as this is more often revealing that the bland statements companies tend to issue.

BHP Billiton didn’t use the word “unloved” itself, that was the description applied by news outlets, among them Reuters, the Sydney Morning Herald and the Wall Street Journal.

What BHP Chief Executive Andrew Mackenzie did say was the world’s largest mining company was looking at a range of options in the “next phase of simplification,” but would only pursue those that enhanced shareholder value.

BHP has identified four key pillars of its business – iron ore, copper, coal and petroleum – with potash a potential fifth. This leaves the so-called unloved assets as aluminium, alumina, bauxite, nickel and manganese.

Read more

NEWS RELEASE: Royal Nickel Gains Exposure to the Drill-Ready Aer-Kidd Ni-Cu-PGE Project in Sudbury Basin

rr-royal nickel final 500Reminder: RNC will host a conference call/webcast today at 11:00 a.m. (Eastern time) to provide a nickel market update and discuss recent RNC news (access information below)

TORONTO, April 14, 2014 /CNW/ – Royal Nickel Corporation (“RNC”) (TSX: RNX) is pleased to announce it has gained exposure to the highly prospective Aer-Kidd nickel-copper-platinum group metals project in Sudbury through the acquisition of a 25% interest in Sudbury Platinum Corporation (“SPC”) for a consideration of CDN$1.5 million.

SPC, a private subsidiary of Transition Metals Corp., holds an option to earn up to 70% of the Aer-Kidd property.

“Opportunities to participate in compelling Sudbury area sulphide exploration plays such as Aer-Kidd are rare and I am pleased that RNC will gain exposure to the upside potential of this promising project. I am very enthusiastic about Aer-Kidd’s untested potential at depth given its location on the Worthington offset dyke between known high grade Ni-Cu-PGE resources at the Totten mine (Vale) and the Victoria project (KGHM),” said Mark Selby, interim President and CEO of Royal Nickel Corporation.

Read more

BHP polishes up nickel unit as demerger talk swirls – by James Regan (Reuters India – April 11, 2014)

http://in.reuters.com/

SYDNEY, April 11 (Reuters) – Breakthroughs in the way BHP Billiton processes nickel ores could help the world’s biggest miner find a buyer for its ailing Nickel West division in Australia.

Nickel West is among businesses that also include aluminium and manganese which BHP has grouped into a single division set aside in 2012 for underperforming assets deemed non-core to its portfolio. BHP has said it is actively studying the “next phase of simplification” of the company but declined to comment on media reports that senior executives favoured a demerger.

Chief Executive Andrew Mackenzie has said BHP will focus on its large iron ore, copper, coal and petroleum businesses, while selling off smaller, less profitable operations. Macquarie Bank last month in a research note put a value of $4.6 billion on the nickel assets.

Improvements in the way BHP mines nickel together with better market dynamics and exploration successes could save Nickel West from closure.

A programme at Nickel West to extract full value from ore that would otherwise be uneconomic to treat due to high contents of talc is opening up more of BHP’s rich Mount Keith and Yakabindie deposits in Western Australia for mining, enhancing the potential appeal to outside investors.

Read more