Republic of Mining

Six of the best: good news stories that lit up 2016 – by David McKay (MiningMX.com – December 22, 2016)

December 22, 2016

http://www.miningmx.com/

THERE was a good deal of trepidation in January 2016 as analysts and executives forecast another year of nail-biting austerity. And whilst it’s not yet beer and skittles for the world’s mining sector, there were some moments of cheery illumination of which the following is a rough sketch.

1. Ivan Glasenberg: The recovery of Glencore.

Glencore’s €10.5bn swoop for 19.5% of Russian oil company, Rosneft this month signalled a return to deal-making for the Swiss-based firm which also brought the curtain down on its self-help programme.

Some 18 months earlier short traders ran Glencore’s stock down 27% using fears about runaway debt for tinder. The response from Glencore was described in November by one analyst as ‘stunning’.

Anglo American’s future may lie outside South Africa – by Gavin du Venage (The National – December 21, 2016)

December 22, 2016

http://www.thenational.ae/

Anglo American, the corporation that helped turn South Africa into the world’s gem and gold supplier, may finally be ready to quit the country it helped shape for about a century.

Anglo, as it is mostly called, was once a cradle-to-grave employer that owned not just vast diamond, gold and other mineral assets, but a cross-section of South African industries spanning most sectors. At its height in the 1980s, Anglo owned food producers, packaging companies and others.

So pervasive was its influence that in the media sector, it owned shares in rival newspaper firms, the paper mills they depended on and even the very forests these fed on. It was, however, minerals that ran through Anglo’s corporate culture, and which were its main focus.

Idled Canadian iron ore mine charged with $30K fine over pollution – by Cecilia Jamasmie (Mining.com – December 21, 2016)

December 22, 2016

http://www.mining.com/

Wabush Mines, an iron ore operation in Canada’s western Labrador that has been shut since 2014, will have to pay a Cdn$30,000 (about $22K) fine for polluting the environment, a Newfoundland and Labrador provincial court has ruled.

The verdict follows the company’s guilty plea last week to offences including failing to perform acute-lethality sampling of effluent and failing to notify an inspector following a deposit out of the normal course of events.

In practical terms, that means Wabush Mines didn’t test the mine’s surroundings to determine whether there was any amount of waste being released that could harm rainbow trout. The company also failed to let an inspector know there was an unusual amount of deposit. All this happened in May 2015.

Lithium litmus test – by Staff (Mining Journal – December 22, 2016)

December 22, 2016

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

Australia’s lithium sector has swelled in line with market interest and 2017 could prove the litmus test for some 50 juniors which have entered the space this year.

Among the hopefuls, Blaze International Limited (AU:BLZ) made a foray into lithium in August, announcing it had the option to acquire the Marble Bar lithium project from Great Sandy Pty Ltd, an entity owned and controlled by well-known Pilbara prospector and miner Denis O’Meara.

O’Meara first identified mineralised pegmatites in the area in 1985 but little economic significance was placed on them at the time.

Norilsk Nickel’s Potanin says his company should be an environmental example – by Anna Kireeva (Bellona.org – December 21, 2016)

December 22, 2016

http://bellona.org/

MURMANSK –Vladimir Potanin, chairman of the giant and notoriously polluting Norilsk Nickel, has said his company’s biggest problem is environmental – and he knows how to fix it.

The company is looking stem sulfur dioxide emission that pollute Northwest Russia and Northern Norway by shutting down its nickel smelting facility in the Murmansk regional industrial town of Nikel.

In an interview to the business daily Vedomosti, Potanin said in order to transform Norilsk Nickel from a polluter into an example of ecological cleanliness, he’s willing to spend up to $14 million in a process that he says should take about seven years.

Year in Review: Mining: Transboundary concerns, Icy Cape prospect, Red Dog tax battle – by Staff (Alaska Journal of Commerce – December 2016)

December 22, 2016

http://www.alaskajournal.com/

Alaskans worried about the potential impact of upstream Canadian mines on Southeast Alaska fisheries officially got their voices heard by the State Department after years of asking for federal intervention.

An assistant secretary of state wrote in an October letter to the Alaska congressional delegation that the State Department is actively engaged with Canadian officials to protect the “transboundary” watersheds that bisect the U.S.-Canada border along Southeast Alaska.

The October letter was in response to a September request from Sens. Lisa Murkowski and Dan Sullivan and Rep. Don Young to Secretary of State John Kerry requesting the State Department to establish a formal way for Canadian officials to consult with U.S. federal and state agencies and Alaska Native tribes during Canada’s mine permitting process, similar to the domestic environmental impact statement process. It was the second such letter the delegation had sent to Kerry since May.

What Mining Giants From Barrick to Teck Are Watching For In 2017 – by Danielle Bochove (Bloomberg News – December 22, 2016)

December 22, 2016

https://www.bloomberg.com/

It’s been a turbulent year for miners, with metal prices starting near multi-year lows as executives drew from a common playbook: slashing spending, costs and debt. Then came Brexit and the U.S. election and gold and base metals diverged.

What does 2017 hold? Bloomberg asked the heads of some of the biggest producers including Barrick Gold Corp., Newmont Mining Corp. and Teck Resources Ltd. Opinions vary, but there’s broad agreement that gold faces near-term headwinds from the Fed; that industrial metals have bottomed out but the dizzying 2016 rally may falter; and that miners will begin to spend more, possibly on deals, while keeping an eye on balance sheets.

Barrick’s Kelvin Dushnisky: “If we see an opportunity to acquire something, to increase our margin, earnings, NAV, then we’ll consider it. But if it’s just a matter of adding to our production base, we’re not interested.”

No respite for shuttered iron ore miners as rally falls short – by Manolo Serapio Jr (Reuters U.S. – December 21, 2016)

December 22, 2016

http://www.reuters.com/

MANILA – While this year’s spectacular rebound in iron ore prices has been a godsend for the world’s biggest miners, it has not gone high enough for smaller, less-efficient producers that still have pits shuttered and equipment idle.

The price of the steelmaking material has nearly doubled in 2016 to above $80 a ton, a boon for miners such as Vale, BHP Billiton and Rio Tinto which extract the material at a cost of less than $20 per ton.

But smaller producers from China to Sweden still face hard times as their output costs can be as much as $100 a ton due to lower grades and fewer economies of scale. “Every mine I know remains shut down,” Pan Guocheng, chief executive of mining company China Hanking Holdings Ltd, told Reuters by phone.

Brides, Bureaucrats and Bargaining: Commodities in 2017 – by Liam Denning and Rani Molla (Bloomberg – December 21, 2016)

December 22, 2016

https://www.bloomberg.com/

Barring a Christmas nightmare, investors in commodities will enjoy a gift they haven’t received since 2010: a positive return. A 10 percent gain wouldn’t exactly make 2016 a leap year; the index is still only at roughly half the level where it ended 2010.

Still, a positive number is a positive number. Can it be repeated in 2017?For clues on that, look at where the underlying gains came from this year. The first thing to notice is that the rally has been broad-based.

While livestock and grains are lower this year, they represent less than 30 percent of the index overall — based on proposed weightings for 2017 — and have recovered somewhat in recent months. The second thing is that, of the four groups that are up, three really count: energy, industrial metals and precious metals (sorry, coffee and sugar, 7 percent is just a bit too small).

Illegal gold mining has supplanted cocaine trafficking as Latin America’s criminal endeavor of choice – by Marcello Rossi (Quartz.com – December 21, 2016)

December 22, 2016

http://qz.com/

For decades, the dominant image of organized crime in Latin America has been the drug cartel. But in recent years, for an increasing number of narcotrafficking groups—as well as right-wing paramilitary militias, and left-wing insurgents—illegal gold mining has become the real moneymaker.

Until the beginning of this decade, the nexus between wildcat illegal mining and criminal groups wasn’t considered an issue of state importance. The problem was first brought to public attention in 2011, when a report by the Colombian Security Service warned the government that 50% of the mines in the country were illegal and that armed groups dominated many of the mines.

As investigations and exposés followed, the public began to see that how extensive the illicit mining business was; now, it is believed to be worth more than drug trafficking.

Coal Traders See End of Price Rally as China Ramps Up Output – by Ladka Mortkowitz Bauerova (Bloomberg News – December 21, 2016)

December 22, 2016

https://www.bloomberg.com/

Coal’s recovery was one of the biggest surprises in commodities this year, but it’s all poised to end as output rises from China, producer of half the world’s supply.

After half a decade of declines, European prices rebounded more than 80 percent as China, also the world’s biggest consumer of the fuel, boosted imports. Benchmark month-ahead contracts will fall by more than 25 percent by the end of next year, according to the median in a Bloomberg survey of six analysts and traders.

Just as Chinese policy limiting mining days kick-started the rally, a gradual boost in domestic output during autumn will accelerate a slide, according to analysts. Once seasonal winter demand in the northern hemisphere is over, China will need less imports at the same time as abundant output by other producers will keep a lid on prices from Australia to Antwerp.

Tech companies pledge to keep kids out of the cobalt mines that power your smartphone – by Peter Whoriskey and Todd C. FRankel (Toronto Star – December 22, 2016)

December 22, 2016

https://www.thestar.com/

WASHINGTON POST – Separate groups of the world’s leading technology companies are launching two initiatives to curb “the worst forms of child labour” and other abusive practices in the supply chain for cobalt, a key ingredient in lithium-ion batteries that power smartphones, laptops and electric cars.

About 60 per cent of the world’s cobalt originates in the Congo, where hand-dug mines rife with dangers attract legions of poorly-equipped, “artisanal” miners who work for as little as $2 a day

Apple, HP, Samsung SDI, and Sony have joined an effort, known as the Responsible Cobalt Initiative. It is being led by a Chinese business group, the Chinese Chamber of Commerce for Metals, Minerals & Chemicals, and supported by the Organisation for Economic Cooperation and Development (OECD), according to the group.

Beware of desperate politicians seeking ‘environmental legacies’ – by Kevin Libin (Financial Post – December 22, 2016)

December 22, 2016

http://business.financialpost.com/

Here’s to wishing all Canada’s provincial and federal leaders much success, prosperity and terrific polling numbers for 2017. Let us hope they all sail comfortably through the new year on high approval numbers from their voters. Because as Canadians — and now Americans — are learning, there is little more dangerous than a political leader with nothing to lose.

On Tuesday, after eight years of stifling U.S. economic growth, Barack Obama announced yet another round of rules to restrict oil and gas, this time ordering vast expanses of the Arctic and Atlantic seaboard “indefinitely off limits” to new offshore oil and gas exploration.

The reasoning was supposedly “the important, irreplaceable values of … Arctic waters for Indigenous, Alaska Native and local communities’ subsistence and cultures, wildlife and wildlife habitat, and scientific research (and) the vulnerability of these ecosystems to an oil spill,” according to a White House statement.

Faced with soaring energy bills, Ontario businesses demand ‘love’ from Queen’s Park – by Chris Selley (National Post – December 21, 2016)

December 22, 2016

http://news.nationalpost.com/

TORONTO — The Ontario Liberals’ electricity price nightmare has plenty of human faces: middle-class parents, gainfully employed, struggling to pay for an essential utility. The opposition attack ads in 2018 will practically write themselves: Ontarians have endured a more-than-70-per-cent rate hike over a decade, driven mostly by production costs that were the direct result of Liberal decisions.

Through 2014, auditor general Bonnie Lysyk found last year, the system extracted $37 billion extra from Ontarians’ pockets. The nightmare might soon have a more recognizable corporate face. A group of small-to-medium-sized businesses calling itself the Coalition of Concerned Manufacturers of Ontario invited reporters on a tour of Leland Industries’ fasteners plant in Scarborough on Tuesday.

There were the good-paying blue-collar jobs. And here was a group of employers saying Ontario’s electric bills, and its forthcoming cap-and-trade system, were pushing them toward the brink.

Rio Tinto gets little Christmas miracle as bitter rival Beny Steinmetz detained – by James Thomson (Australian Financial Review – December 20, 2016)

December 21, 2016

http://www.afr.com/

It must have seemed like Christmas would never come in the Rio Tinto bunker. The promise of a new, urbane chief executive in Jean-Sebastien Jacques, the tailwind of rising commodity prices and progress on some genuinely exciting growth projects have been completely drowned out by the scandal over allegations of improper payments made five year ago around the controversial iron ore Simandou iron ore project in Guinea.

But it seems the Big Guy in red dropped a little early gift down the Rio chimney on Monday night after news emerged that Rio’s bitter rival, Beny Steinmetz, was detained in his native Israel on suspicion of bribing government officials in Guinea

Barely a week has passed since Steinmetz threatened to take legal action against Rio over the email scandal, writing an incendiary letter to Jacques and Rio chairman Jan de Plessis, and sending it on to the world’s media.