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Nickel

BHP eyes $3.9bn nickel float – by Barry Fitzgerald (The Australian – February 26, 2013)

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

BHP Billiton has cranked up the potential for a $US4 billion ($3.89bn) spin-off of its ailing nickel division by making a big high-grade nickel discovery near its Perseverance mine at Leinster, 375km north of Kalgoorlie in Western Australia.

Industry circles have been buzzing about the new find, which BHP has called Venus after the brightest planet visible to the naked eye. It follows last year’s big nickel-copper Nova discovery in WA by Mark Creasy’s Sirius, the brightest star.

BHP yesterday would not be drawn on the scale of the Venus find, saying that the prospect was still in its early stages of delineation and development, so no guidance on reserves could be given.

However, the company also said that at this early stage, Venus had the potential “to reshape the profitably and direction of the Nickel West business”.

“Venus’s key attributes — mainly its high nickel grades and proximity to existing mining infrastructure — give it clear potential to materially increase Nickel West’s mining inventory and reshape the profitably and direction of the Nickel West business,” BHP told The Australian.

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Rio Tinto delays [U.S. Eagle nickel mine] production because of falling market prices – by John Pepin (The Mining Journal – February 20, 2013)

http://www.miningjournal.net/

HUMBOLDT – Rio Tinto officials said Tuesday they plan to shift first production of nickel and copper at the company’s Eagle Mine and Humboldt Mill to the second half of 2014.

Rio Tinto spokesman Dan Blondeau said Tuesday an aggressive construction season had been planned for this year and production was initially slated for early to mid-2014, but the decision has now been made to “moderate” the pace of construction in response to “economic headwinds” and volatility in commodities markets.

“We’re not the only ones going through this tightened schedule, it’s across the industry,” Blondeau said. “Everyone is taking a more disciplined approach in where they’re spending their money and where they’re getting their capital.”

Construction at the mine is 80 percent complete, with the project overall – including the Humboldt Mill – about half done. “A lot of work this coming year was going to be at the mill,” Blondeau said. Any current construction work will be completed, but new construction will be rescheduled.

Blondeau said a primary objective will be to minimize any impacts of the new schedule to company staff. Even with the decreased construction efforts, Rio Tinto will continue to spend about $10 million each month on the mine and mill projects.

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The Duluth [nickel/copper/PGMs] monster – by John Chadwick (International Mining – February 2013)

http://www.im-mining.com/

John Chadwick looks at the Duluth Complex and in particular the leading positions of PolyMet and Duluth Metals. Duluth has described the complex as holding “one of the world’s largest undeveloped strategic metals deposits of it’s kind”

Duluth Metals massive potential in Minnesota was described in the December 2012 Leader. Let’s take a more detailed look at what is there. The industry has perhaps not yet realised the magnitude of the work being done and discoveries made by Duluth Metals here.

Duluth Metals’ strategy is to “systematically explore and develop copper-nickel-PGM deposits in the north of the US State of Minnesota.” With its partner Antofagasta (which holds 40%, with Duluth holding 60%) it is progressing Twin Metals Minnesota’s project through feasibility into production.

Twin Metals is focused on three deposits, Spruce Road, Maturi and Birch Lake (running northwest to southeast) in the northern part of the Duluth Intrusive Complex. These deposits are located in a zone of copper-nickel-PGM mineralisation occurring near the base of the complex at depths of 130 m to 1,300 m. Bechtel will deliver a very detailed prefeasibility study (enabling fairly quick progress to a BFS) in 2014. Bechtel Engineering was instructed to prepare the NI-43-101 PFS on the Twin Metals (formerly known as Nokomis) project based on the following parameters:

■ A vertically integrated mining complex

■ Large scale phased underground mine plan and development

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Norilsk Nickel: A mainstay in mining – by Will Daynes (Business Excellence – January 30, 2013)

 Business Excellence is a global on-line publication portal for businesses who have stories of excellence to tell: http://www.bus-ex.com/

Mining has been a part of life in the Norilsk area since the 1920s, during which time the seeds were sown for what would become a lucrative industry for the region and Russia as a whole over the course of the subsequent century. It was in 1935 that the government of the USSR created the Norilsk Combine and 1943 that Norilsk managed to produce an annual total of 4000 tonnes of refined nickel, before hitting its target figure of 10,000 tonnes just two years later in 1945.

In the aftermath of the fall of the Soviet Union a joint-stock company was created in 1993, taking the name RAO Norilsk Nickel. By 1997, the company had been sold to private enterprise Interros and had returned to profitability. In the years since, Norilsk has gone on to successfully acquire a host of mining and metallurgical assets across the world, thus transforming itself into a multinational organisation with operations in Russia, Finland, Australia, Botswana and South Africa.

Today, MMC Norilsk Nickel is the world’s largest producer of nickel and palladium, and one of the leading global producers of platinum and copper. In addition, it also produces various by-products such as cobalt, chromium, rhodium, silver, gold, iridium, ruthenium, selenium, tellurium and sulphur. “Our production assets,” explains director of foreign assets, Roman Panov, “are located in five countries, Russia, Finland, Australia, Botswana and South Africa, across which we mine over 30 million tonnes of ore and produce almost 300,000 tonnes of nickel. The latter figure represents a fifth of the world’s total nickel production.”

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Excerpt from “The History of Mining: The events, technology and people involved in the industry that forged the modern world” – by Michael Coulson

To order a copy of The History of Mining please click here: http://www.harriman-house.com/products/books/23161/business/Michael-Coulson/The-History-of-Mining/

THE AUSTRALIAN NICKEL BOOM

The Australian mining boom of the late 1960s was given the generic title of the nickel boom, although it can be argued that nickel was, in economic terms, a relatively minor part of a period of exploration and new discoveries that saw the genesis of the giant iron ore industry in the northern part of Western Australia and the discovery of uranium in the Northern Territories.

In terms of nickel there were three major events – the discovery of nickel by Western Mining at Kambalda in Western Australia in 1966, the sensational but ultimately disappointing Poseidon discovery at Windarra to the north of Kambalda in 1969, and in 1971 the Selection Trust group’s Agnew nickel discovery, which was further north still.

A FINANCIAL EVENT

Although Australia had spawned a number of mining booms in its past, the 1960s boom at times was as much a financial event as a mining event. As far as stock market activity was concerned, the surge of interest in Australian mining shares followed an extended worldwide boom in industrial, technology and financial shares, and was symptomatic of an era when confidence was high and investors, buoyed by profits elsewhere, were in the mood for speculation.

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Vale cut not ‘fatal’ to city’s economy – by Harold Carmichael (Sudbury Star – January 12, 2013)

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

Vale’s decision to cut in half the proposed $2 billion it would spend on a massive pollution-reduction project at the Copper Cliff Smelter site will affect local mining supply and service companies, but it’s not a fatal blow, says Dick DeStefano.

DeStefano, executive director of the Sudbury Area Mining Supply and Service Association, said local companies had about a 25% of Vale’s Clean Atmospheric Emissions Reduction project, which will now cost $1-billion. The members reaction, he said, is the work will be made up somewhere else.

“I haven’t heard one complaint because they made a business decision,” said DeStefano. “No one has called me up saying ‘I am losing a pile of money.’ Our guys are saying ‘let’s move on. There are other markets in other places. If we don’t see it here, there are others. We have to live with it.’”

DeStefano said the good news Thursday is the increased push to develop the Victor-Capre Mine and the Copper Cliff Mine brownfield site, which he said, could lead to $500 million-plus of investment at each site, more than making up for the lost $1 billion from Clean AER.

While he accepts that the Clean AER announcement was a business decision, DeStefano said the Copper Cliff Smelter could run into problems down the road when it operates with just one furnace.

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Applications flood in to Vale for long-term jobs – by Ashley Fitzpatrick (St. John’s Telegram – January 9, 2013)

http://www.thetelegram.com/

Vale is looking to fill long-term jobs for the operation of its new nickel-processing plant in Long Harbour. Coming out of construction over the next nine months, the mining company expects to have first nickel from the plant in the fourth quarter of this year.

There are an estimated 500 long-term jobs for the operation of the plant and about 350 people are expected to be hired by the end of the year.

The jobs include about 300 “technician” positions, advertised throughout the fall of 2012. “We’ve had quite a significant response,” said Bob Carter, a spokesman for Vale in Newfoundland and Labrador, in a recent interview with The Telegram.

Carter said the call for applications for the jobs has led to upwards of a couple thousand submissions, the vast majority being people from this province. The applications are being assessed and a first round of offers, though not the last, will be going out before the end of the month.

Carter said some of the applications submitted mistook the positions as construction jobs, rather than maintenance and the oversight of plant processes.

However, even after sorting out inappropriate submissions, he said, there is real competition for the plant jobs. Interviews and testing are meant to give recruiters a better sense of who is best suited to the positions.

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Vale cuts don’t concern SAMSSA director – by Heidi Ulrichsen (Sudbury Northern Life – January 11, 2013)

http://www.northernlife.ca/

‘Other places besides Vale’ to do business

Local mining supply and service companies won’t be majorly impacted by Vale’s decision to downscale its Clean AER project and move to one furnace at its Copper Cliff Smelter, said Dick DeStefano.

The executive director of the Sudbury Area Mining Supply and Service Association (SAMSSA) said his members were only winning about 25 per cent of the Clean AER contracts anyway. A website dedicated to Clean AER contracts hadn’t posted any new jobs up for grabs for the last three months, DeStefano said.

But with Clean AER’s scope being cut from $2 billion to $1 billion, he said he’ll never know how many contracts his members could have won. “There will be no tenders put out, and you won’t know,” he said. So far, DeStefano hasn’t received any phone calls from members who are losing contracts because of the cuts.

Companies that specialize in servicing the smelter may be hurt by the company’s decision to shut down one of its furnaces, but again, he said he doesn’t see a large overall impact on his membership.

DeStefano estimates other Vale projects, such as the Victor Capre Mine and the Copper Cliff Deep project, will be worth about $2 billion anyway, and will provide many contract opportunities for local companies.

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Vale scales back [in Sudbury] – by Laura Stricker (Sudbury Star – January 11, 2013)

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

Vale announced Thursday it will slash spending on a massive pollution-reduction project in Sudbury, as it moves from a two-furnace to one-furnace operation at its Copper Cliff smelter.

“A move to a single furnace is years away, but preparation for this move will mean changes to the Clean AER Project in the immediate future,” Vale said in a statement. “The outcome of this move to a single furnace, combined with adjustments to the Clean AER Project, will be reductions in annual (sulphur dioxide) emissions more than 50% greater than contemplated in the original Clean AER plan, at approximately half the capital investment.”

The changes will see the cost of the Clean AER project reduced from $2 billion to $1 billion. The company’s operating costs will also be reduced, but by how much remains to be seen, said Angie Robson, Vale’s manager of corporate affairs.

“Vale has moved from what was once a growth strategy to really focus on generating value rather than production volume and also ensuring that each of our operations are self-sufficient and able to stand on our own two feet,” Robson said.

“Changes in our asset footprint, such as the commissioning of the Long Harbour project in Newfoundland, and decisions to optimize and redistribute some of the flow of our raw materials, have created conditions for moving from a two-furnace operation to a single-furnace operation for our smelter … We see it as the next logical step in our evolution here in Sudbury.”

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Union, company [KGHM] working together – by Carol Mulligan (Sudbury Star – January 11, 2013)

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

A joint team of three people each from KGHM and United Steelworkers Local 2020 is working to reduce the number of union members who will be laid off when Podolsky Mine ceases production March 29.

Poland-based KGHM posted a notice Wednesday at the mine, as required under the Employment Standards Act, that 70 hourly rated positions would be cut when the mine closes.

That doesn’t mean 70 union jobs will be lost, said Wess Dowsett, area co-ordinator and staff representative for USW.

Six jobs were saved Thursday when the committee met for the first time. It decided to retain at least half a dozen employees for a year and keep the mine located north of Capreol on care and maintenance.

“There is always the possibility the closure will be delayed again or it may reopen in the near future,” said Dowsett, so the company will maintain the mine so it can reopen in short order if need be.

The fact KGHM is putting Podolsky on care and maintenance gives the union hope it may return to production in the future.

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Vale Statement About Sudbury Clean AER Project – (January 10, 2013)

In the face of volatile market conditions and operating cost challenges affecting the broader mining sector, work began last year to reinvent the business model for Base Metals through a comprehensive review of all projects and operations. A wide range of opportunities are being explored to drive value in the business.

Changes in our asset footprint, such as the commissioning of our Long Harbour project in Newfoundland, together with decisions to optimize and redistribute the flow of raw materials, have made the move from a two-furnace operation to a single-furnace operation at our Copper Cliff Smelter the next logical step for the business. The current and future mine plans in Ontario do not support a two-furnace operation.

A move to a single furnace is years away, but preparation for this move will mean changes to the Clean AER Project in the immediate future. The outcome of this move to a single furnace, combined with adjustments to the Clean AER Project, will be reductions in annual SO2 emissions more than 50% greater than contemplated in the original Clean AER plan at approximately half the capital investment. This represents a significant investment of $1B in our Ontario operations while reducing sustaining capital requirements by $1B over the next two years.

We do expect that over the next several years there will be fewer jobs in the smelter complex with a change to a single furnace – but given the lead time we will look for ways to minimize any impacts.

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Project Focus: Ring of Fire – by John Chadwick (International Mining – January 2013)

http://www.im-mining.com/

There is a very exciting new mining camp developing in Canada, John Chadwick reports

According to the Ontario Government, “The Ring of Fire is one of the most promising mineral development opportunities in
Ontario in almost a century. Located in Ontario’s Far North, current estimates suggest the multigenerational potential of chromite production,as well as significant production of nickel, copper and platinum.”

The projects will open up economic opportunities in an extremely remote and undeveloped area, an 80 km by 100 km swath of
muskeg, especially for local First Nations communities. Any new infrastructure (community, social, etc.) will further benefitlocal communities. The region will require significant investment in mine and processing infrastructure, the construction and operation of transportation infrastructure and the provision of energy. Rail and all-weather road options are currently being assessed for the transportation corridor.

The exploration and prospecting involves some 16,400 claim units, covering an area of 2,630 km2, with 21 companies currently holding claims in the Ring of Fire belt. The area of most intense exploration is about 20 km long running northeast from Noront’s Eagle 2 prospect to Spider-KWG’s McFauld’s #2. Discoveries include chromite, nickel, copper, zinc, gold and kimberlite.

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[KGHM Sudbury] Podolsky Mine closing – by Star Staff (Sudbury Star – January 10, 2013)

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

KGHM International Ltd. has begun issuing layoffs to about 70 people who work at Podolsky Mine located north of Capreol.

A company official said Wednesday the mine will close by the end of the first quarter of 2013. The company had originally planned to close the mine by the end of 2012. She said layoffs shouldn’t come as a surprise, since KGHM International Ltd. announced in November plans to shutter the mine.

“There is nothing left to mine,” she said. KGHM International and Steelworkers Local 2020 will now meet to discuss how the layoffs should be implemented.

Quadra FNX — which merged with Polish company KGHM Polska Mied S.A. in 2012 and now operates as a subsidiary, KGHM International Ltd. — began commercial production at Podolsky Mine of copper, nickel, gold, platinum and palladium in 2008.

In November, the company said despite exploration work, it could find no reserves at Podolsky. President and CEO Paul Blythe said then the company decided to focus on its more promising projects.

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Cuba closes oldest nickel processing plant – by Marc Frank (U.S. Reuters.com – December 28, 2012)

http://www.reuters.com/

HAVANA, Dec 28 (Reuters) – Cuba has closed the oldest of three nickel plants in the country, a local Communist Party leader said, a looming event that had become the talk of the mountain town of Nicaro, in eastern Holguin, where it is located.

Nickel is Cuba’s most important export and one of its top foreign exchange earners after technical services and tourism.

“This plant’s productive role is completed and now it will dedicate its efforts to services,” Jorge Cuevas Ramos, First Secretary of the Holguin Communist Party, said in an interview with the provincial television station on Thursday evening.

A local radio report earlier in the week had also indicated the plant was closed. “After the closing of the René Ramos Latourt plant, its director said only the mineral transportation system would be maintained so it is ready to be transferred to Moa or for a foreign company that might be interested in investing in the area,” the report said.

The Cuban nickel industry is cloaked in secrecy. National media and officials have yet to mention the plant’s closure after operating for around 70 years.

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Vale Is Staring At A Q4 Loss On Impairments And Additional Tax Charges – by Trefis Team (December 27, 2012)

http://www.trefis.com/?from=link

Vale (NYSE:VALE) seems all but certain to report a loss in the fourth quarter of the ongoing financial year. The company has suffered two major setbacks in the last few days. Firstly, it announced that it will book a $4.2 billion fourth-quarter pretax charge after lowering the valuation of a nickel mine and its stake in aluminum producer Norsk Hydro ASA. Also, last week the company announced tax losses of nearly $483 million relating to cases in Brazil and Switzerland. Of this, $451 million will be booked in the balance sheet for Q4 and the rest of the amount will be adjusted in the next financial year. [1]

These two setbacks are only recent additions to a long list. Tumbling iron ore prices on a weak demand outlook, failure to begin docking Valemax ships in China due to permission issues, and the shelving of the Simandou project in Guinea due to an uncertain and adverse operating environment are some issues which have been highlighted frequently in the past. The company has been forced to contract its capital expenditure plans for next year and announce sale of non-core assets in order to reduce costs and improve efficiency. However, any gains due to these are certain to be negated due to the latest charges as far as earnings are concerned. [2]

What Is The Reason For A Writedown In The Nickel Business?

Vale will take a $2.85 billion pretax writedown on its Brazilian nickel project Onca Puma. The problems in its nickel business have been festering for some time.

As reported in its third quarter earnings results, lackluster performance of the nickel segment has been one of the largest drags on profit. Vale has been trying to diversify away from iron ore and hopes that nickel would reduce its dependence on iron ore.

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