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Vale Canada Limited fined $150,000 for workplace safety conviction in connection with death of T-3 scooptram operator Greg Leason – by John Barker (Soundings John Barker.com – October 1, 2014)

http://soundingsjohnbarker.wordpress.com/

Vale Canada Limited has been fined $150,000 in provincial court in Winnipeg and ordered to pay $37,500 in a victim surcharge after pleading guilty June 18 in a previously unreported decision to one count of failing to ensure the safety, health and welfare of all workers, contrary to The Workplace Safety and Health Act, in connection with the death of 51-year-old T-3 scooptram operator Greg Leason at Manitoba Operations in Thompson almost three years ago.

Vale was charged last Oct. 3. The Leason case marked the first time Vale, or its predecessor, Inco, had been charged by the province in connection with a mining fatality since mining began in Thompson,

The charge upon which Vale was convicted and nine other charges laid against Vale by Manitoba Labour and Immigration’s Workplace Safety and Health Branch, also under The Workplace Safety and Health Act, in connection with the the death of Leason, which were ordered stayed, all listed an offence date of Oct. 7, 2011, the date of the accident.

While stayed charges technically can be re-activated within one year of the day they are stayed by the prosecution, in practice they almost never are, unless the accused is charged with new offences during the one year period after the original charges have been stayed. When charges are withdrawn instead of stayed, the prosecution of those charges is finished immediately.

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End of the Iron Age – by James Wilson and Neil Hume (Financial Times – September 29, 2014)

http://www.ft.com/home/us

A collapse of ore prices throws miners’ strategies into doubt and threatens an industry shakeout

Iron is one of the most abundant elements on earth but pulling it out of the ground efficiently can be a daunting undertaking. Snaking through the low, green hills of southern Brazil is a 530km pipeline, the decisive link in Anglo American’s $8.2bn Minas-Rio project to extract iron ore in the Brazilian interior and ship it from a new Atlantic port. Way over its original $3.6bn budget and two years late, Minas-Rio is finally close to the point of “first ore on ship”.

For years, huge mining projects such as these have formed the backbone of global economic expansion. The world’s most important commodity after crude oil, iron ore has been devoured by Chinese steel mills, emerging as the raw material for an infrastructure-led growth spurt.

But Minas-Rio is about to deliver its first ore into a much less welcoming world. The price of iron ore has plunged more than 40 per cent this year, the worst performance across metals and bulk commodities in 2014. From an average price of $135 per tonne last year, the benchmark iron ore contract sank last week to less than $80 for the first time since the global financial crisis.

“The iron ore market is in the midst of a transition without precedent in recent commodity history,” says Macquarie, the Australian bank.

Behind the change is a big increase in iron ore exports – and not just the 26.5m tonnes that Minas-Rio will bring to market when fully operational in 2016.

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Brazilian giant Vale joins Fraser Range nickel rush – by Peter Ker (Sydney Morning Herald – September 30, 2014)

http://www.smh.com.au/

It’s the hottest exploration province in Australia, and now Brazilian mining giant Vale wants a piece of it. Vale’s Perth-based exploration unit is understood to have joined a long list of explorers in the Fraser Range region of Western Australia, in the hope of making a new major nickel discovery.

The region came to prominence after Sirius Resources hit the jackpot with the Nova nickel and copper discovery two years ago, and has since become one of the most active exploration regions in the nation. Most of the companies drilling in the region are tiny ASX-listed hopefuls, making the $US55 billion Brazilian quite the exception.

Vale is the world’s second biggest producer of nickel, behind only Norilsk Nickel of Russia, which decided to quit operating in Australia about 12 months ago.

Vale’s Australian office declined to comment on the strategy behind the move into the Fraser Range, but it is understood the claim area was acquired within the past month, and is located slightly off the main mineralisation trend, on the eastern edge of the range.

The company’s move into the Fraser Range is ironic, given Sirius’ first big nickel discovery in the region in 2012 was notable for the fact that it revealed a type of nickel mineralisation not previously seen in Australia.

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Vale, nickel giant, gets into the bee business in Sudbury, Ont. – by Markus Schwabe (CBC News Sudbury – September 26, 2014)

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

Bees help enhance the seeding of flowering plants, ‘which helps with the biodiversity of our city’

Mining company Vale is hoping honey bees will encourage its re-vegetation project in Sudbury. For decades, nickel producer Vale (formerly INCO) dumped tons of molten slag around its refinery in Copper Cliff. The by-product of the nickel-smelting process accumulated until black mountains were formed.

In 2006, Vale embarked on a $10 million re-vegetation project to grade the landscape, cap the slag with soil, then scatter the ground with clover, grass and wildflower seeds. Trees were also planted.

This year Vale contacted the services of a retired Vale employee, Wayne Tonelli, to raise honeybees on the property. “With all the wildflowers, it was thought to promote pollination and help the re-vegetation process,” the Vale superintendent of decommissioning and reclamation said.

Seven hives are now buzzing with more than 350,000 bees. The hives are situated in an old utility trailer owned by Vale, which allows for the bees to enter, but keeps predators likes bears out.

Dr. Jennifer Babin-Fenske of Earthcare Sudbury supports in the initiative.

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Thompson, Manitoba Vale Emission Agreement – by John Barker (Soundings John Barker.com – September 25, 2014)

http://soundingsjohnbarker.wordpress.com/

Agreement-in-principle reached with federal government on environmental sulphur dioxide (SO2) airbone emission standards that will allow Vale’s Manitoba Operations smelter to stay open until 2018, mayoral candidate Luke Robinson and USW Local 6166 president Murray Nychyporuk say

Vale has reached an agreement-in-principle with the federal government that will allow it to continue to operate its 53-year-old smelter in Thompson until sometime in 2018, say mayoral candidate Luke Robinson and USW Local 6166 president Murray Nychyporuk. Pending environmental sulphur dioxide (SO2) airborne emission standards that were due to come into effect in a few months, as applied to Vale’s Manitoba Operations, would have required its closure if Vale couldn’t meet the standards. The new standards would require a reduction in airborne emissions of approximately 88 per cent from current levels at the Thompson operation, Vale has said previously.

More than 30 per cent of Vale’s production employees in Thompson work in the smelter and refinery. Employees hired before Oct. 1, 2011, have the option to transfer to the mill or underground to the mines from surface operations when the smelter and refinery close under the company’s transition plan.

The announcement that the smelter and refinery would close was originally made on Nov. 17, 2010, with Vale saying at the time it was “phasing out of smelting and refining by 2015” in Thompson. Mining and milling operations are slated to continue.

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COLUMN-Will the Big 3 iron ore miners have enough time to win price war? – by Clyde Russell (Reuters India – September 24, 2014)

http://in.reuters.com/

LAUNCESTON, Australia, Sept 24 (Reuters) – The recent debate over iron ore has tended to be whether the three mining giants who dominate seaborne supply will win their massive bet that they can drive high-cost producers out of the market.

But a more relevant question is whether they will have the time to achieve their aims. The Anglo-Australian pair of Rio Tinto and BHP Billiton, as well as Brazil’s Vale have flooded the market with their low-cost iron ore, with supply from Western Australia ramping up dramatically in the past year.

This has led to a collapse in the Asian spot price .IO62-CNI=SI to a five-year low of $79.40 a tonne on Tuesday, down 41 percent from the end of last year and 58 percent from the record $191.90 a tonne reached in February 2011.

The main question for the big three is not whether they can drive higher-cost competitors to the wall, but how long their own investors will tolerate the lower earnings as a result of the weak iron ore price.

While the chief executives of the big three haven’t exactly said so in public, they are clearly hoping for a relatively short war and a quick victory, after which iron ore prices will once again rise and stabilise at a higher level. Again, that price level hasn’t been clearly spelt out, but I would imagine the big three have a number in mind somewhere above $90 a tonne, with $110 likely viewed as a ceiling.

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Iron Ore Rebound Seen by Morgan Stanley as Vale Sees $100 – by Jake Lloyd-Smith (Bloomberg News – September 15, 2014)

http://www.bloomberg.com/

Iron ore is heading for an end-of-year rally as some high-cost supplies are closed and steel demand picks up, according to Morgan Stanley, which said prices may first extend losses by a few more dollars before rebounding.

The steel-making raw material will drop into the $70s-a-ton range in the near term, then rally toward $90 a ton by the end of the year, analyst Joel Crane said in a report today. The commodity, which slumped to the lowest level in five years this month, last traded at less than $80 a ton in September 2009.

Iron ore fell into a bear market this year as the biggest producers including Rio Tinto Group expanded low-cost output, betting higher volumes would more than offset falling prices while less-competitive mines were forced to close. Morgan Stanley’s forecast for a rally in the final quarter follows a similar prediction last week from Vale SA, the world’s largest supplier, which said prices may be poised for a rebound.

“We are of the firm belief that an adequate proportion of supply from the top end of the cost curve will come out, flatten the curve and ultimately secure levels of cost support,” Crane wrote, referring to the potential loss of output from some of the highest-cost producers. The price should head back toward $90 a ton by year-end, said Crane.

Ore with 62 percent content at the Chinese port of Qingdao fell 36 percent to $85.58 a dry ton this year, according to data from Metal Bulletin Ltd. The commodity is heading for a third quarterly loss in the longest run of declines since 2009 amid forecasts for a surging global surplus.

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Vale’s Q2 nickel production plunges in Sudbury (Northern Miner – September 10, 2014)

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

Vale ’s (NYSE : VALE) companywide nickel production in the second quarter of 2014 was 61,600 tonnes, an 8.6% drop from the first quarter and 5.3% fall from the year-ago period. Vale says the decline mainly reflects the impact of four weeks of planned maintenance work carried out on the acid plant and furnaces in Sudbury, Ont. For the first half of 2014, Vale’s companywide nickel output was only off 0.7% to 129,200 tonnes.

Vale’s Sudbury operations produced 9,100 tonnes nickel in the second quarter, a decline of 48.4% from the first quarter and 49.2% from the second quarter of 2013. For the first half of 2014, Vale produced 26,800 tonnes nickel in Sudbury, off 23.6% from the 35,000 tonnes produced in the first half of 2013.

(Elsewhere in Canada in the second quarter, Vale produced 6,900 tonnes in Thompson, Man., or up 11% year-over-year; and 12,100 tonnes at Voisey’s Bay, Labrador, down -19.7%.)

The low point of the quarter came on April 6, when millwright Paul Rochette was killed at Sudbury’s Copper Cliff smelter complex. The United Steelworkers Local 6500 and Vale carried out a joint investigation into the fatality.

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Sudbury mine rescuers taking on the world in Poland – by Jonathan Migneault (Sudbury Northern Life – September 04, 2014)

http://www.northernlife.ca/

Vale, KGHM sending teams to International Mine Rescue Competition

For the first time, Vale will have a team compete in the International Mine Rescue Competition. Vale’s East Mines Rescue Team will fly to Poland Saturday to compete in the ninth International Mine Rescue Competition, which takes place in the city of Katowice.

“We’re just happy that we’re going and that they’re giving us that opportunity,” said Lorne Plouffe, the team’s captain. “It’s great to show off the Vale mine rescue teams to the rest of the world.”

In June, Plouffe and his team of seven experienced mine rescue professionals won the provincial championships. It was his third time winning that honour, but this year will be his first chance to compete on the world stage.

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Why the Vale-Glencore merger failed – by Carol Mulligan (Sudbury Star – September 4, 2014)

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

He can only speculate, but a Laurentian University economist offers several reasons why talks between mining giants Vale SA and Glencore to merge the companies’ Sudbury operations may have broken off.

Jean-Charles Cachon, an economist and a professor in Laurentian’s Faculty of Management, said internal restructuring at both firms, the rising price of nickel and copper, and the complexity of harmonizing the Sudbury operations might have put the brakes on merger talks.

Reuters news agency reported this week the companies had stopped talking about forming a partnership in Sudbury, although neither Vale nor Glencore would confirm that. Vale’s head of base metals, Peter Poppinga, did say in July there had been a “strategic break in bigger discussions” between the two companies.

Cachon, who has taught at Laurentian for decades, has followed the two mining companies in Sudbury through several ownerships.

He recalls the former Inco and Falconbridge, now Vale and Glencore, having a plan to merge in 2005. That plan had to be revised and amended when new harmonization talks began between the rebranded companies last year because some operations had closed and new ones had opened since that plan was developed.

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Iron ore giants eating little guys now, but cannibalism looms – by Clyde Russell (Reuters U.S. – September 3, 2014)

http://www.reuters.com/

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

LAUNCESTON, Australia – (Reuters) – There was maybe more than a touch of hubris in Rio Tinto boss Sam Walsh’s recent comment that it’s time for other iron ore producers to “really feel the consequences” of the current low price.

The chief executive of the world’s No.2 iron ore miner was speaking after his company’s first-half results last month, basically delivering the message that Rio Tinto is going to keep going full-steam ahead on its iron ore expansion plans.

Walsh, along with the bosses of top iron ore miner Vale and No.3 BHP Billiton, is betting that their low-cost, high volume model will force smaller competitors to the wall, leaving them the undisputed kings.

Perhaps he should have a word or two with the chief executives of coal miners, which, oddly enough, includes himself given Rio Tinto’s extensive coal assets.

When the price of both thermal and coking coal started to decline in mid-2011, the word from the industry was that this wasn’t too big a surprise, but no need to worry as Chinese demand will ensure prices don’t fall too far, and all the new capacity brought on and planned will be profitable.

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Glencore CEO Rebuffs Anglo American Bid Speculation – by Paul Burkhardt and Jesse Riseborough (Bloomberg News – September 3, 2014)

http://www.bloomberg.com/

Glencore Plc (GLEN) Chief Executive Officer Ivan Glasenberg rebuffed speculation about a possible takeover of Anglo American Plc (AAL), saying the world’s third-biggest miner is only interested in assets it already trades.

“With Anglo, we don’t trade diamonds, if that gives you a good idea, and we don’t trade platinum,” Glasenberg told reporters in Johannesburg today. “We will only look at assets which we trade, which we market,” he said in response to a separate question.

Glencore, the world’s biggest exporter of power-station coal, completed the $29 billion all-share takeover of Xstrata last year to add coal, copper and nickel mines. Anglo American, the largest platinum producer, also controls copper, coal, iron ore, nickel and diamond mines and has a market value of about $36 billion. CEO Mark Cutifani is open to takeover offers, the Wall Street Journal reported yesterday, citing an interview with the Australian.

“Cutifani said someone’s going to take him over, he’s happy,” Glasenberg quipped. A Glencore bid for Anglo American is increasingly possible next year as the stock widens its outperformance over its smaller rival, Jefferies LLC analyst Chris LaFemina wrote in a report today.

“This outperformance, combined with Glencore’s completion of the full integration of the Xstrata acquisition and a strong strategic rationale for Glencore to acquire Anglo, should make Anglo a compelling target for Glencore some time next year,” LaFemina said.

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Vale, Glencore break off talks over Canada nickel deal: sources – by Silvia Antonioli (Reuters U.S. – September 2, 2014)

http://www.reuters.com/

LONDON – (Reuters) – Vale (VALE5.SA) and Glencore (GLEN.L) have broken off talks over combining their nickel assets in Canada in a deal that could have produced over $1 billion in annual cost savings, sources close to the matter said.

The discussions over linking the two companies’ neighboring nickel mining and processing facilities in the Sudbury basin in southeast Canada broke down partly due to disagreement over how to share the costs and savings and to worries about government and labor union reaction to potential job cuts and shutdowns, the sources said.

At the same time, a recovery in nickel prices has made cost rationalization less urgent, they added.

“Both sides more or less agreed on what the optimum structure of a combined Sudbury business would look like, but to enable that to be created, very difficult decisions needed to be taken, and the appetite or the ability to take those decisions was not there,” a source with knowledge of the situation said.

Glencore and Vale declined to comment. One of the sources said differences in corporate culture — with Swiss-based trader and mine operator Glencore more willing to take risk and Brazilian miner Vale more conservative — also played a role.

A combination of the nickel assets in Canada had already been attempted by their previous owners, Inco and Falconbridge, which in the mid-2000s came close to an agreement before they were acquired by Vale and Xstrata.

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Diversified mining giants becoming less so – by Lawrence Williams (Mineweb.com – August 19, 2014)

http://www.mineweb.com/

Confirmation that BHP Billiton is planning to demerge what it considers its non-core assets into a new company continues the trend for the world’s biggest miners to simplify their structures.

LONDON (MINEWEB) – The big post 2008 fallout in the global mining sector has been a major influence on corporate policy since. It has already seen the culling of the chief executives who had the misfortune to be in place as metal prices slumped and profits collapsed. They had previously been exhorted by their institutional shareholders to go for growth almost at any cost.

But once it became apparent that some of the huge capital programmes involved were actually having a negative impact on the bottom line, helped by the fact that the concentration on growth had led to management’s eyes being taken off controlling costs at existing operations, then institutional pressures changed and heads started to roll. CEOs became an endangered species

Now it looks as though there is something of a different tack coming into play. For the single commodity players – e.g. those in the precious metals sector there has also been a move to demerge, or just sell what are considered to be non-core assets – those that had appeared to be taking up too much management time and effort, but without complementary returns. A typical example of this has been Barrick Gold’s floating off of African Barrick which now at least seems to be turning itself around, but still probably falls short of its parent’s return requirements. Others have been divesting of so-called non-core projects piecemeal.

But while the gold miners were relatively quick to act – the big diversified miners perhaps took a little more time over their moves to do likewise.

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New Caledonia cancels vast Eramet, Vale nickel project – by AFP (August 8, 2014)

http://www.afp.com/en

New Caledonia on Friday cancelled a deal with Brazilian mining giant Vale and France’s Eramet to allow the exploration of one of the last major untapped nickel deposits in the world.

President of the southern province, Philippe Michel, said the agreement signed in April was illegal on five different counts, “each of which is enough to cancel the allocation of the resources”.

New Caledonia, off northeastern Australia, has a quarter of the world’s deposits of nickel, a key ingredient for manufacturing stainless steel.

The French overseas territory has been reviewing its mineral laws after a change of leadership and a surge in nickel prices, which have jumped a third this year after top miner Indonesia banned ore exports.

New Caledonia President Cynthia Ligeard told AFP that she “did not want to react at the moment” on the decision. Eramet also declined to comment.

The government estimates the Pernod and Prony deposits in question are estimated to hold between four million and seven million tonnes, but Michel said the amount had been understated in the deal with the miners.

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