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Potential Indonesian nickel export ban bodes well for prices, poorly for pig iron – by Freya Berry (Mineweb.com – October 18, 2013)

http://www.mineweb.com/

While it is not certain the ban will go ahead unchanged, if it does, analysts say, it would be a game-changer for prices.

LONDON (REUTERS) – A potential ban on nickel ore exports by Indonesia next year and production cutbacks could lift the price of this year’s worst-performing base metal by more than 20 percent off multi-year lows, analysts said.

Indonesia, the world’s top exporter of nickel ore, has said it plans to bring in a ban on unprocessed ore exports from Jan. 1, 2014. Its ore is currently shipped to China to produce nickel pig iron, a cheap substitute for higher grade nickel in stainless steel.

It is not certain that the ban will go ahead unchanged, but if it does analysts said it would be a game-changer for prices. Benchmark nickel on the London Metal Exchange has fallen by around a fifth since January to four-year lows, weighed down by over-supply, and was trading at $13,963 a tonne at 1529 GMT on Thursday.

“It’s such an important swing factor for the market that you could see a decent rally in the nickel market if a ban is strictly enforced – at least 20 or 30 percent,” said Daniel Smith, head of metals research at Standard Chartered.

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Sudbury [mining Vale Glencore] merger likely: Analysts – by Carol Mulligan (Sudbury Star – October 15, 2013)

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

Glencore Xstrata and Vale could and likely will one day merge their Sudbury operations. If and when that happens, it will be a marriage of convenience, not a “Rock Hudson- Doris Day romance,” says a nickel analyst.

It would be complicated to join the companies’ operations, but it may be necessary to compete against record-high production of nickel pig iron in China, says Terry Orstlan. He wasn’t surprised last week when Reuters broke the news Vale and Glencore Xstrata were in talks to explore combining their Sudbury operations.

Orstlan has been advising that for years. “Talks, that is exactly what they are, talks,” said Ortslan of TSO & Associates in Montreal. “Let’s have coffee and talk. Let’s have tea and talk. Let’s go out and talk,” he said. It would have made sense 30 years ago for the nickel giants to join forces, said Ortslan.

When Vale was owned by Inco and Glencore Xstrata by Falconbridge, their vastly differ-e nt cultures and powerful unions made a merger unthinkable.

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Mining legend [Robert Friedland] speaks to Sudbury students – by Staff (Sudbury Star – October 11, 2013)

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

Canadian mining companies have a responsibility to help people to make the goods they need to live in a smart and ethical way, one of the men who discovered Voisey’s Bay told a Sudbury audience this week.

Robert Friedland, chairman and founder of Ivanhoe Capital Corporation and executive chairman and founder of Ivanhoe Mines Ltd., delivered Laurentian University’s Goodman School of Mines’ inaugural lecture series on Wednesday.

Earlier in the day, he spoke to Laurentian students. “We’ll soon be sharing this planet with nine billion other inhabitants — most of whom, given a choice, would prefer to live in safety and comfort, drive cars, and have air conditioning and smartphones.” he said. “They also want clean air and clean water.

“In addition to its fundamental mission of finding and producing critical materials to support growing economies, the mining industry has a responsibility to present and future generations to develop and adhere to ethical and responsive practices, delivering effective management of the impacts of mining metals.”

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No plans to step down for Norilsk’s billionaire CEO – by Clara Ferreira-Marques and Douglas Busvine (Reuters U.S. – October 6, 2013)

http://www.reuters.com/

LONDON – (Reuters) – When he took the helm of Norilsk Nickel (GMKN.MM) last December as part of a deal that ended a long-running shareholder battle, Russian billionaire Vladimir Potanin hinted he saw himself in the job for roughly two years.

Almost a year on, Potanin is clearly relishing his role at the center of a major turnaround and indicates he has no plans to stand down as chief executive of the world’s largest producer of nickel and palladium. “I don’t like deadlines,” the 52-year-old Potanin told Reuters over tea in an upmarket London hotel late on Friday after a long day spent wooing investors.

His departure could be years away as he develops the Norilsk management into a world-class team, he said. “For a rich and reasonably successful guy, it is impossible not to enjoy your job, otherwise why would you spend so much time and effort doing it? I am a great fan of Norilsk and I like this kind of challenge.”

Potanin, whose more than $14 billion fortune began in banking, has long been a major shareholder in Norilsk, securing stock at a bargain-basement price in the loans-for-shares privatizations that followed the collapse of the Soviet Union and spawned a new oligarch elite.

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Rick Mills: Greenland Is the Final Frontier for Lower-Cost Mining – Interviewed by Kevin Michael Grace (The Metals Report – October 1, 2013)

http://www.streetwisereports.com/

Industrial minerals like copper and nickel are essential to global economic expansion. But everywhere you look, grades are getting lower, and costs are getting much, much higher. Is there a way out? Rick Mills says mining companies need to look to Greenland. In this interview with The Metals Report, the owner and host ofAhead of the Herd.com lauds the world’s largest island for its vast resources, its one-stop regulatory system and its year-round access to ocean transportation.

The Metals Report: You never really believed that there was anything resembling an economic recovery in the United States, correct?

Rick Mills: I don’t believe you can have an economic recovery with the type of jobs that have been created in the last few years. Wages have stagnated. The velocity of money, how many times it turns over in the economy, how many times it’s spent, is at a record low,

TMR: So the decision by the Federal Reserve to hold off on tapering quantitative easing didn’t surprise you?

RM: I’ve gone on record saying there would be no tapering this time around, but that doesn’t mean it isn’t coming—it certainly is. But it will likely be very gradual, and the Fed will start only when they feel the economic data support such a move. I firmly believe, however, that the Fed’s zero interest rate policy is here to stay, and this is very important for gold investors.

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Fickle nickel takes its toll on market darling Mirabela – by Sarah-Jane Tasker (The Australian – October 4, 2013)

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

MIRABELA Nickel once rode the commodities boom, hitting a share price peak of more than $7 in early 2008, but a perfect storm of low prices, debt, decreasing cash balances and a cancelled contract has seen the company join the ranks of the penny dreadfuls. Some 80 per cent has been wiped off the value of its share price in the last month alone — from an already low base.

This is a company that was valued by the market at about $800 million in 2008. Now? $14m. The price of a decent shack on Sydney’s waterfront.

Perth-based Mirabela this week became the latest high-profile casualty of a commodity that has been struggling more than most others.

Perth-based private equity firm Resource Capital Fund is Mirabela’s largest shareholder and is the hardest hit by the share price fall. The resources-focused fund stepped in to support the company last May, tipping in $20m at a share price of 40c, which at the time was at a 17.6 per cent premium to the junior’s share price. It also underwrote a $100m raising. The miner said at the time that the funds would strengthen its balance sheet.

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NEWS RELEASE: Norilsk Nickel Unveils New Strategy Focused on Tier I Assets and Higher Returns

October 04, 2013 09:05 AM Eastern Daylight Time

MOSCOW–(BUSINESS WIRE)--MMC Norilsk Nickel (hereinafter, Norilsk Nickel or the Company), the largest global nickel and palladium producer, today announced further details of its new strategy at MMC Norilsk Nickel’s “Unveiling New Strategy” event held in London.

Highlights

  • Capture full potential of MMC Norilsk Nickel’s unique resource base in Russia
  • Focus on Tier 1 assets to deliver sustainably high return on capital
  • Focus on capital discipline and introduction of return on investments as key metric for the organization
  • Increased focus of existing portfolio on copper and PGMs
  • Prioritize Polar Division Upstream assets, with a plan to:
    -Maximize high-margin production utilizing existing infrastructure
    -Develop the greenfield Skalisty mine, with a potential 2.4Mtpa ore capacity
    -Upgrade of the Talnakh infrastructure into a world class concentrator

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Two of Canada’s more isolated mines continue to impress: Raglan and Eleonore – by Russell Noble (Canadian Mining Journal – October 2013)

Russell Noble is the editor for the Canadian Mining Journal, Canada’s first mining publication.

Nunavik and Quebec’s Raglan Mine and Éléonore, operated by Glencore and Goldcorp respectively, are two of the larger and more successful mining operations in the country, but their locations are about as unfamiliar to most people as the northern landscapes where they are located.

In other words, most people don’t have a clue where they are on the map, let alone what the surroundings are like that far north. Both mines are indeed, remote and somewhat isolated, but when it comes to mineral deposits, Raglan Mine and Éléonore are at the forefront and envy of the mining community across the country.

In fact, the world is also keeping watch as Glencore and Goldcorp continue to move towards making their Canadian operations two of the more productive mines on the globe.

Starting at the farthest point north at the Raglan Mine, which is located in Nunavik approximately 1800 km northwest of Montreal or, about the same as Cuba is to the south, is near Deception Bay on the Hudson Straight and is linked by all-weather roads to an airstrip at Donaldson.

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Royal Nickel has high hopes for Dumont mine – by Robert Gibbens (Montreal Gazette – October 1, 2013)

http://www.montrealgazette.com/index.html

MONTREAL — Resource companies keep an eagle eye on the economic cycle and Royal Nickel Corp. believes its $1.2 billion U.S. Dumont nickel mine in northwestern Quebec will start up in 2016 as metal prices swing higher.

Base metals, including nickel — the key ingredient in stainless steel — mirror the economic cycle, with their price charts giving early warning of bad news to come.

This year they’ve been in the dumps, with nickel among the most volatile. Analysts blame overcapacity stemming from slower Chinese growth, the European debt crisis and North America’s tepid recovery from the 2008-09 recession.

But Royal, led by a team of former Inco (now owned by Brazil’s Vale SA) executives, has begun negotiating partnerships, offtake agreements and debt and equity financing for its Dumont open-pit nickel mine and mill near Amos, in the Abitibi region. It could rival Vale’s big Voisey’s Bay (60,000 tonnes a year) mine in Labrador when it hits full stride in 2020.

“We’ve been planning this for more than three years and we see a low-cost operation providing more than 500 permanent jobs, a mine life of at least 33 years and able to survive any future global economic cycles,” Tyler Mitchelson, Royal’s CEO, said in an interview.

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PRESS RELEASE: Nickel An Essential Material To Address Sustainability Challenges

BRUSSELS, Belgium – 25 September 2013 – The Nickel Institute has today released a new report ‘Nickel in Tomorrow’s World: Tackling Global Challenges’ which highlights how nickel contributes to technologies for a more sustainable society and economy, one which meets the needs of a growing global population.

Nickel’s versatility and robustness mean that it is an ideal material to provide solutions for energy, transport, food and clean water as well as meeting other key sustainability challenges.

Nickel metal is tough, malleable and highly-resistant to corrosion. Nickel containing materials such as stainless steel have a long lifespan and require less maintenance than many alternative materials. Nickel is light and can reduce the overall weight of products, reducing the energy required for their production and operation. In addition, nickel retains its value at end-of-life, making it well-suited for recycling and reducing the wastestream.

Tim Aiken, Nickel Institute President said, “Some of society’s greatest challenges include reducing energy consumption and assuring access to safe food, clean water and advanced healthcare for citizens. The Nickel Institute’s latest publication is part of our ongoing commitment to educate and inform our stakeholders on the essential role nickel plays in industrial applications to address these grand challenges.”

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Inuit employment in Nunavik mines still weak – by Sarah Rogers (Nunatsiaq-on-line.ca – September 27, 2013)

http://www.nunatsiaqonline.ca/

Only 175 Inuit work at the Raglan nickel mine

Nunavik Inuit still make up only 13 per cent of the work force at the region’s only fully operational mine. At the Raglan nickel mine complex, in operation since 1998, only 175 of 1,292 workers are Inuit — well under the 20 per cent initially targeted for the region.

And those numbers haven’t changed much since 2012. “The data for Xstrata mine site is very similar to last year,” said Margaret Gauvin, director of the Kativik Regional Government’s sustainable employment department, during a regional meeting earlier this morning.

“Contract companies have a harder time getting Inuit workers, and that brings the percentage down.” A number of companies like Katinniq Transport, Iglu Construction and Nunavik Construction are contracted to work at the Xstrata site. But increasing Inuit employment in the mining sector remains a priority for the KRG, which wants to encourage students to stay in school or return to school in areas related to mining, Gauvin said.

More than $10 million over the next two years is targeted at mine training in Nunavik — to respond to a growing number of mining projects in development and to address fears among Nunavimmiut that they are being left out of the process.

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Norilsk Sees Nickel Surplus Shrinking Next Year on Idled Plants – by Yuliya Fedorinova & Marina Sysoyeva (Bloomberg News – September 27, 2013)

http://www.bloomberg.com/

OAO GMK Norilsk Nickel, the world’s largest producer of the metal, urged producers to start idling unprofitable operations to fight a surplus that has damped prices and caused losses.

Consecutive quarters of losses should push companies to cut output, which may narrow the nickel surplus 30 percent to 70,000 metric tons in 2014 from 100,000 tons this year, according to Anton Berlin, marketing director at ZAO NormetImpex, a unit of Norilsk Nickel.

Nickel, used in stainless steel, tumbled into a bear market in May and is set for a third yearly loss, as demand waned and China increased output of a substitute derived from lower-grade ores. Additions to Chinese nickel pig iron capacity outstrip closures, creating a third consecutive annual surplus in 2013, according to a Deutsche Bank AG report in August.

“Unfortunately, we don’t see significant changes on the nickel market yet compared with what we had at the start of the year,” Berlin said in an interview Sept. 25. “From 35 to 40 percent of producers are still loss-making and the gap between supply and demand remains high.” Nickel traded at about $13,887 a ton on the London Metal Exchange by 10:35 a.m. local time, down 19 percent this year, making it the worst performing industrial metal.

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Innovators work to diversify the U.P. economy – by Kathleen Lavey (Detroit Free Press – September 22, 2013)

http://www.freep.com/

Gannett Michigan – Seven hundred feet below the surface of the earth, John Mason drives a truck through the heart of Eagle Mine, the tires crunching on irregular pieces of rock at the bottom of the tunnel.

He points to a section of the rock that’s a slightly different color than the rest. It gleams a little in the artificial light from the lamp on his hard hat.

“There,” Mason says, “is the ore body. Right there.” Four percent copper. Five percent nickel. An estimated 550 million pounds of usable metal in a mine near Marquette.

That’s no match for the purity of the copper hewn from the U.P.’s ancient rock formations during its 19th- and 20th- Century mining boom. But these days, getting it out is worth an investment of more than $1 billion and an effort that will keep a crew of up to 220 miners busy for at least eight years.

The new mine, scheduled to begin extracting ore late next year, is the next chapter in the Upper Peninsula’s long history of making a living from natural resources.

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Vale’s Manitoba Operations has reached 95 per cent of cost savings goal, Lovro Paulic says – by John Barker (Thompson Citizen – September 18, 2013)

The Thompson Citizen, which was established in June 1960, covers the City of Thompson and Nickel Belt Region of Northern Manitoba. The city has a population of about 13,500 residents while the regional population is more than 40,000. editor@thompsoncitizen.net

But smelter and refinery “base case” is still to close sometime in 2015

Vale, which is trying to find $100 million in cost savings at its Manitoba Operations in Thompson, has achieved 95 per cent of that goal over the last year – a cost savings of $95 million with $5 million still to go, vice-president Lovro Paulic told the Thompson Chamber of Commerce Sept. 11.

Paulic said $60 million was saved last year and $35 million has been saved so far this year. Ninety per cent of the money was saved between September 2012 and last April, while anther five per cent has been saved since then. That leaves another five per cent to go to reach the $100 million target.

The result of the collective cost-savings effort across the operation was a reprieve for Birchtree Mine from being mothballed again for a second time. Birchtree Mine, which was discovered for its nickel deposit in 1963 and opened in 1968, was previously on care and maintenance for nearly 12 years from 1977 to 1989, although regardless if it is mothballed or not, the current life of mine plan anticipates closure at some point in the next 10 years in any event.

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Lundin Sees Growth in Rio’s Michigan Cast-Off: Corporate Canada – by Gerrit De Vynck (Bloomberg News – September 18, 2013)

http://www.businessweek.com/

Lundin Mining Corp., the best performer among Canadian base-metal companies, is betting that a cast-off from the world’s second-biggest miner will help double output.

Lundin agreed to buy the Eagle nickel and copper mine from Rio Tinto Group for $315 million in June and plans to bring it into production by the end of next year, Chief Executive Officer Paul Conibear said. Eagle is the company’s first new mine after emerging from two aborted takeovers in 2011. Conibear said he wants to boost companywide annual output to about 500,000 metric tons within five years.

“We’re back to basics to re-grow our company,” he said Sept. 13 in a telephone interview. “We’re looking at trying to increase our cash flow through producing facilities.”

Lundin plans to expand while mining companies including Rio and BHP Billiton Ltd. (BHP), the world’s largest, sell assets and reduce spending amid lower prices. Copper has slumped 11 percent this year, nickel dropped 19 percent and zinc is down 11 percent on the London Metal Exchange after growth slowed in China, the world’s largest consumer of metals.

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