Republic of Mining

UPDATE 1-Rio Tinto set to decide on expansion of Mongolia copper mine – by James Regan (Reuters U.S. – November 26, 2015)

November 27, 2015

http://www.reuters.com/

SYDNEY, Nov 26 Rio Tinto is lining up project financing for a $4 billion expansion of its long-delayed Oyu Tolgoi copper mine in Mongolia and will make a final investment decision early next year, a senior executive said on Thursday.

The mine, which started producing from an open pit over two years ago, is the biggest single foreign investment in Mongolia, and resolution of disputes over its second phase in May revived hopes for a string of other stalled mining projects.

“At the end of the day, what we need is consistency and stability and we believe we have the right environment today,” Rio Tinto copper and coal chief executive Jean-Sebastien Jacques said at a Bloomberg News-sponsored forum.

Half of Gold Output May Not Be ‘Viable’ as Price Sags: Randgold – by Danielle Bochove (Bloomberg News – November 27, 2015)

November 27, 2015

http://www.bloomberg.com/

Half of the gold coming from mines may not be viable at current prices, underscoring the industry’s need for consolidation and output cuts, according to the best-performing producer of the metal in the past decade.

“The more we continue to produce unprofitable gold, the more pressure we put on the gold price,” said Randgold Resources Ltd. Chief Executive Officer Mark Bristow.

“In the medium term, it’s a very bullish outlook for the gold industry. The question is, how long are we going to supply it with unprofitable gold?”

Gold fell to a five-year low on Friday as a rising dollar and speculation that U.S. policy makers will boost interest rates next month curbed the appeal of bullion as a store of value.

Call for De Beers chief to step aside – by Allan Seccombe (Business Day Live – November 26, 2015)

November 27, 2015

http://www.bdlive.co.za/

A PROMINENT diamond industry player has called for De Beers CEO Philippe Mellier to step down and make way for someone who better understands the business.

Martin Rapaport, chairman of the Rapaport Group, has also demanded that De Beers and others drop prices for rough diamonds by up to 50% to save the ailing industry.

The global diamond sector has run into severe problems after years of poor decisions in financing the purchasing of rough diamonds by banks, pricing and production by mining companies, and the way the industry treated easy and abundant finance.

Taking specific aim at De Beers, Mr Rapaport, who analysts describe as highly regarded and influential in the polished segment, said the company, 85%-owned by Anglo American, was inflicting damage on the industry.

How Canadian chauvinism led to the decline of the TMX – by Terence Corcoran (National Post – (November 27, 2015)

November 27, 2015

The National Post is Canada’s second largest national paper.

It was the fullest expression of Canadian corporate nationalism. A convergence of the mightiest financial poobahs in the country: bank executives, public pension managers, regulators, politicians — all out to protect the vital organs of Canadian capitalism, the nation’s stock exchanges, from the foul clutches of a foreign company.

“We must ensure,” said Jim Prentice, then vice-chair of Canadian Imperial Bank of Commerce, “that the so-called ‘mind and management’ of Canadian finance do not migrate to London, or for that matter to New York or Hong Kong.”

That was in March 2011. More than four years have passed since Prentice, along with TD Bank CEO Ed Clark and others, joined forces to thwart a proposed merger of the TMX with the London Stock Exchange.

AUDIO: Musselwhite mine death highlights need for new mine safety regulations (CBC News Thunder Bay – November 27, 2015)

November 27, 2015

http://www.cbc.ca/news/canada/thunder-bay/

Ontario’s Chief Prevention Officer says changes are coming to regulations dealing with safety in underground mines.

A death this week at Goldcorp’s Musselwhite mine comes after a provincial review on mining safety, led by George Gritziotis. He told CBC News that, because of that review, regulations are now being proposed to mandate higher safety standards.

“The review was about being able to be very focused and targeted on what those high hazards and associated risks are that we need to go after right away.”

Pope: Blood diamonds fuel terrorism (News 24.com – November 27, 2015)

November 27, 2015

http://www.news24.com/

Nairobi – Pope Francis on Thursday urged global action against illegal trafficking of blood diamonds, ivory and other natural resources, saying it caused political instability and “terrorism”.

“Illegal trade in diamonds and precious stones, rare metals or those of great strategic value, wood, biological material and animal products, such as ivory trafficking and the related killing of elephants, fuels political instability, organised crime and terrorism,” he said in a speech in the Kenyan capital, Nairobi.

“We cannot be silent about forms of illegal trafficking which arise in situations of poverty,” he said, just two weeks before Nairobi hosts a key ministerial meeting of the World Trade Organisation.

BHP battered by UN’s claims of toxic tailings – by Barry Fitzgerald and Matt Chambers (The Australian – November 28, 2015)

November 27, 2015

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

If there was a saving grace to the tailings dam collapse at BHP Billiton’s half-owned Germano mine in the mountains of Brazil’s Minas Gerais state, it was that the iron ore waste which has since found its way to the Atlantic Ocean some 600km away was not toxic.

That was the accepted truth from BHP and Brazil’s Vale, BHP’s equal partner in the mine, and the mine’s operating company Samarco. After all, BHP managing director Andrew Mackenzie had seemed to say so, and he’s one of the great geoscientists of the modern era. Last year he became a fellow of the world’s premier scientific club, London’s Royal Society. Past fellows have included Albert Einstein, Charles Darwin and Isaac Newton.

So when Mackenzie said that the tailings material that hurtled down the valley floor after the tailings dam was breached on November 5 was “relatively inert’’, there was relief all around.

Mining spinoff jobs threatened in downturn – by John Myers (Duluth News Tribune – November 25, 2015)

November 27, 2015

http://www.duluthnewstribune.com/

Three years ago, Mitch Robertson showed a reporter around his booming steel fabrication business in Virginia, with sparks flying and machines clanking and business as brisk as it had ever been.

In late 2012, the price of iron ore was over $130 per ton. U.S. steelmakers were pumping out finished product for new oil pipelines, trucks and refrigerators. And Minnesota’s iron mining industry was shiping iron ore as fast as the stuff could be processed.

TriTec, Robertson’s company, was booming as it helped keep the mining industry moving with repairs on heavy equipment and specially designed equipment for taconite plants — such as rock-proof fuel tanks for mining trucks.

Nickel’s hiatus may be brief without output cuts, stronger demand – by Pratima Desai (Reuters U.S. – November 27, 2015)

November 27, 2015

http://www.reuters.com/

LONDON, Nov 27 Nickel’s spectacular fall since the middle of last year may have come to a halt, but without significant, enduring output cuts and stronger demand from China’s stainless steel mills the reprieve could be brief.

Benchmark nickel on the London Metal Exchange fell to $8,145 a tonne earlier this week, less than half the level seen in May last year and its lowest since the middle of 2003.

Funds reversing their bets on lower prices on the expectation that Chinese producers may cut output since then pushed prices back up to near $9,000 a tonne.

President says Zambia will not take over struggling copper mines – by Chris Mfula (Reuters U.S. – November 26, 2015)

November 27, 2015

http://www.reuters.com/

LUSAKA – Zambia will not take over mining firms that have shed jobs after a sharp fall in copper prices, President Edgar Lungu said on Thursday, backtracking from an earlier warning that the state would run the mines.

Lungu also said the economy would grow at a slower pace than previously estimated due to the struggling copper industry, but outlined austerity measures to cope with the decline in revenue.

Copper accounts for 70 percent of Zambia’s export earnings, which have been further eroded by a power crisis that forced production to be cut.

BHP sees coal price getting worse before it gets better – by Mark Ludlow (Australian Financial Review – November 25, 2015)

November 27, 2015

http://www.afr.com/

A senior BHP Billiton executive has warned the market for Australian resources will get a lot worse before it gets better, saying it would be “dangerous” to invest in a new mine based on the assumption coal prices will recover.

As big miners continue to cut costs following a plunge in international coal prices, BHP Billiton Mitsubishi Alliance asset president Rag Udd painted a bleak picture of the resources sector in Australia.

“I think it’s dangerous to try and align a business around prices improving in metallurgical coal. I personally think it will get worse before it gets better,” Mr Udd told a Queensland Resources Council forum in Brisbane on Wednesday.

China’s Nickel Smelters Agree 20% Production Cut for 2016 (Bloomberg News – November 27, 2015)

November 27, 2015

http://www.bloomberg.com/

Nickel smelters in China, the largest producer, plan to cut output next year by at least 20 percent in a bid to shore up prices after the metal plunged to its lowest in 12 years.

Eight producers, including the largest refined metal supplier Jinchuan Group Co. and nickel pig iron maker Tsingshan Holding Group Co., also agreed to cut output next month by 15,000 metric tons, according to a statement circulated by the group on Wechat.

The smelters didn’t say how much of China’s total supply the 20 percent reduction would account for, but their statement suggests cuts of about 120,000 tons next year, according to Celia Wang, general manager at Tianjin Zhongwei Group Co.’s investment department.

Rio Tinto launches $2.6b bauxite push in Queensland – by Peter Kerr (Sydney Morning Herald – November 27, 2015)

November 27, 2015

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

Rio Tinto will spend $US1.9 billion ($2.6 billion) growing its exposure to the increasingly lucrative bauxite trade after announcing a redesigned expansion of a massive project in Queensland on Friday afternoon.

Known as the South of Embley project, the expansion has been expected for three successive years, but had so far been deferred by the Rio board.

Rio Tinto chief executive Sam Walsh told Fairfax Media on Friday that the project would have been difficult to approve if it were still in the scope put before the board in 2013, and praised his team for redesigning the project, which has been renamed “Amrun” in a mark of respect to the local indigenous people.

US staking its rights in space – by Kip Keen (Mineweb.com – November 27, 2015)

November 27, 2015

http://www.mineweb.com/

President Obama signs law giving US citizens rights to resources in space.

US President Barack Obama signed off on a lofty law concerning private rights to resources in space this week. It’s ignited the aspirations of the space exploration crowd in the US – a few of which have designs on mining in space.

Indeed, Obama inspired some first class hyperbole. Planetary Resources, a would-be asteroid explorer, went so far as to peg the law as the “single greatest recognition of property rights in history”.

Well, well. It’s unfortunate the space exploration class chose such climatic words for a moment that is indeed quite interesting if not quite so sexy.

Chinese rail engineering firm scopes out Ring of Fire proposal – by Ian Ross (Northern Ontario Business – November 26, 2015)

November 26, 2015

http://www.northernontariobusiness.com/

No sense getting into the chromite business without having China on your radar, according to KWG Resources.

With more than half of the world’s ferrochrome is being consumed by the People’s Republic, Moe Lavigne, vice-president of exploration and development for the Toronto junior miner, said it’s a no-brainer that his exploration firm would strike a deal with a Chinese railroad engineering outfit to investigate the economics of a Ring of Fire railroad.

KWG announced on Nov. 24 a three-year agreement with China Railway First Survey and Design Institute to conduct, what amounts to, a pre-feasibility study of KWG’s long-standing plans for an ore-haul railway from northwestern Ontario to the James Bay region to haul out chromite for processing.