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Copper Supply Glut Seen Tripling as Prices Sink 10%: Commodities – by Nicholas Larkin, Agnieszka Troszkiewicz & Maria Kolesnikova (Bloomberg News – October 14, 2013)

http://www.bloomberg.com/

The worldwide glut of copper supply is poised to almost triple in 2014, driving prices to the lowest in at least three years at a time when the International Monetary Fund says economic growth will be weaker than forecast.

The surplus will reach a 13-year high of 272,000 metric tons, according to data from Barclays Plc and the International Copper Study Group in Lisbon. Codelco and Freeport-McMoRan (FCX) Copper & Gold Inc., the biggest producers, are among those scheduled to add supply next year. The metal will drop as low as $6,450 a ton in 2014, or 10 percent less than last week’s close, the median of 22 analyst estimates compiled by Bloomberg shows.

New mines or expansions to existing pits from Mongolia to Indonesia to Chile will boost output as producers respond to prices that more than tripled in the past decade. Shortages occurred in seven of the past 10 years as the Chinese economy expanded almost sixfold. Mining companies are finally catching up just as growth in China, the world’s second-largest economy and consumer of two in every five tons, is projected to be the lowest in almost a quarter century.

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Norilsk Hires Barclays for International Assets Sale: Sources – by Gillian Tan (Wall Street Journal – October 14, 2013)

http://online.wsj.com/home-page

SYDNEY–Russia’s OAO Norilsk Nickel (GMKN.RS), the world’s largest nickel and palladium producer, has hired Barclays PLC (BARC.LN) to sell the majority of its international assets, including mines in South Africa and Botswana, people familiar with the matter said.

The U.K. bank has sent out information to prospective buyers for assets including Norilsk’s 50% stake in the Nkomati joint venture in South Africa. African Rainbow Minerals (ARI.JO) owns the remaining interest and has the right to match any offer for the stake, one of the people said.

The company’s 85% stake in Tati Nickel, which it co-owns with the Botswana government, is also for sale. Both assets were acquired when Norilsk outbid Xstrata PLC to acquire Canada’s LionOre Mining International Ltd. for 6.3 billion Canadian dollars (US$6.1 billion) in 2007.

Another asset on the block is the Norilsk Nickel Harjavalta refinery in Finland, which produces 50,000 metric tons of nickel a year, according to its website.

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Canadian Agri-Business Linked to Moroccan Conflict Mineral – by Mitchell Anderson (TheTyee.ca – October 14, 2013)

http://www.thetyee.ca/

Agrium’s import of phosphate from occupied Western Sahara raises serious legal, ethical questions. Steaming towards Vancouver is a freighter holding almost $10 million of phosphate rock from Western Sahara — a region that has been militarily occupied by Morocco since 1975.

When the load arrives around Oct. 24 at Neptune Bulk Terminals in North Vancouver, it could be the first import of conflict minerals coming directly into Canada since the apartheid era in South Africa.

Plight of the Saharawi people

Calgary-based Agrium is the owner of the 60,000 tonnes of phosphate rock aboard the freighter Ultra Bellambi and has entered into an agreement with Moroccan state-owned company OCP to import one million tonnes each year until 2020. Agrium confirmed to The Tyee that at least some of this material is being sourced from Western Sahara.

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Risk of ‘irreversible damage’ seen in Ring of Fire – by Wendy Parker (In Support of Mining.com – October 11, 2013)

http://insupportofmining.wordpress.com/

Ontario is “risking irreversible damage to wildlife and wilderness” by rushing to develop mines, roads and power lines in its fragile far north. That’s the warning from Gord Miller, the province’s environmental commissioner, who has singled out the stalled Ring of Fire project for special attention in his annual report to the provincial legislature.

In a Thursday release highlighting his Ring of Fire concerns, Miller says Ontario’s “long-held rule” has been to establish planning controls before projects can be built.

In the case of far northern mineral activity, however, “infrastructure such as highways and transmission corridors are already on the drawing board” and “there’s been little analysis or public debate of their effect on the environment or their benefits for First Nations.”

Miller maintains there is still time “to get things right” in the far northern region by ensuring that land-use plans, jointly created by First Nations and the Ontario government, are in place before development proceeds.

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Friedland talks up platinum, the creation of a ‘Platinum Valley’ in Limpopo – by Henry Lazenby (MiningWeekly.com – October 11, 2013)

http://www.miningweekly.com/page/americas-home

TORONTO (miningweekly.com) – Outpsoken financier and mining guru Robert Friedland is poised to make history in South Africa, as he envisions the creation of a ‘Platinum Valley’ in the platinum-rich Limpopo province that would be synonymous to hydrogen fuel cell manufacturing, as California’s Silicon Valley is to technology.

Addressing the Canada-Southern Africa Chamber of Business on Thursday evening, Friedland said the rise of megacities around the globe would drive metals demand up, not only for growing infrastructure, but also in achieving cleaner air, especially within the automobile industry.

Friedland, who also is the executive chairperson of Africa-focused project developer Ivanhoe Mines, formerly known as Ivanplats, said the rise of the hydrogen fuel cell-powered car is about to change the global platinum landscape forever.

He said he had it on good authority that Japan-based automaker Toyota will launch the world’s first commercially available hydrogen fuel cell-powered cars in November, which, according to him, would be a game changer for South Africa.

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Ontario drives manufacturers away with overpriced electricity – by Barrie McKenna (Globe and Mail – October 14, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

“Ontario is probably the worst electricity market in the world,” said Pierre-Olivier
Pineau, an associate professor and electricity market expert at the University of
Montreal’s HEC business school. (Globe and Mail – October 14, 2013)

OTTAWA — The laws of economics suggest that when supply goes up, prices fall. Not so in Ontario’s increasingly twisted electricity market. Here, heavily discounted surplus power is routinely sold to neighbouring utilities in Quebec and various U.S. states, while customers at home face a steady diet of higher rates.

Ontario had net exports of more than 1,000 megawatts of electricity last year, or enough to power a million homes. Occasionally, Ontario Power Authority even pays Hydro-Québec to take electricity off its hands – power the Quebec utility can then resell in New England at a profit.

Al Yousef, process improvement manager at plastic packaging maker Par-Pak Ltd. of Brampton, Ont., is appalled by this bitter irony. The company pays 12 to 14 cents per kilowatt hour for electricity at its three Toronto-area plants – four or five times the price charged to Ontario’s neighbours in the wholesale market.

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Ontario MNR gets failing grade – Thunder Bay Chronicle-Journal (October 11, 2013)

Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

WHEN Ontario’s Liberal government considered the mounting budget deficit and how to keep it from further damaging the province’s economy and its regions, it called in an expert. Respected former banker Don Drummond was asked to provide a detailed analysis of government spending and recommendations on how to save money.

The Drummond report became Ontario’s budgetary blueprint going forward, as they say. Now the other shoe has dropped.
Not many Ontario citizens disagreed with the general nature of this independent advice. No department was spared at least a detailed examination and most were ordered to provide minor and not-so-minor scenarios to reduce spending.

Education escaped the knife and some arbitrated contract settlements excepted a general wage freeze. But for the most part tough love was felt government-wide. Ontario would pretty much cut spending across the board and thus responsibly recover from the recession that took such a toll, south to north.

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Duplicitous Dalton, Inc. – by Rex Murphy (National Post – October 12, 2013)

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

The Auditor-General of Ontario has released her report on the provincial Liberal government’s brazenly political decision to cancel two gas-fired power plants. Her estimate of the ultimate cost: about $1.1-billion, potentially reaching $1.5-billion.

This obscenity of mismanagement and prevarication came out of Duplicitous Dalton, Inc., a.k.a. the McGuinty government, an administration we now know was, politically, so venal as to toss perhaps as much as a billion and a half taxpayer dollars into the devouring — but politically favourable — wind.

D.D., Inc. even had the brass to insist, originally, that the cost to cancel just the Oakville, Ont., plant was only $40-million. The Auditor-General this week, after a cautionary distribution of Gravol tablets to the assembled press, offered a more altitudinous range of $675-million to $810-million — 15 to 20 times as much! And from the very beginning of the noxious affair, to any question the Liberal response was delay, obfuscate, stone-wall, delete emails, deny said deletions, miraculously locate the not-so-deleted emails, and, of course, insult and hector any and all critics.

Let there be no more “used car salesmen” jokes about political leaders. Used car salesmen are pillars of candour and conscience compared to this lot.

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Canadian miners caught in the middle – by Jason Fekete (Vancouver Sun – October 11, 2013)

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

Spying allegations latest issue facing companies working in Latin America

Allegations of Canada spying on Brazil’s mines and energy ministry could prove the latest political and economic headache for Canadian extractive companies already encountering problems operating in Latin America.

Federal government documents obtained by Postmedia News under access to information laws show Canadian companies – trying to improve a bruised reputation – face increasing political uncertainty and challenges earning “social licence” in Latin American countries such as Brazil, Chile and Mexico, even before the latest spying allegations.

The Canadian government is being accused at home and abroad of industrial espionage, following allegations the supersecret Communications Security Establishment Canada targeted the metadata of emails and phone calls to and from the Brazilian ministry of mines and energy.

Questions are also mounting about what specific information Canadian security agencies and federal officials have been sharing with Canadian energy companies during secret meetings.

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Legislation to protect Chile’s glaciers and water supplies worries important mining industry – by Associated Press (Washington Post – October 09, 2013)

http://www.washingtonpost.com/

SANTIAGO, Chile — Just how to define a glacier is at the heart of a Chilean congressional battle that could determine the future of mining in the world’s largest copper-producing country.

The revival of legislation to ban mining in glacial areas is spawning debate among miners, farmers and environmentalists about how to protect both vital water supplies and Chile’s mining industry. If the bill passes, mining experts fear it could shutter multibillion-dollar mining projects and slow investment.

The key will be in the fine print of whether the final bill defines glaciers as including frozen areas around them, too, and whether the protections would apply retroactively to mines already operating next to glaciers.

“If it passes as a law with tough conditions, it could harm not only the operation of current projects but also future projects,” said Juan Carlos Guajardo, head of the Chilean mining think tank CESCO. “Depending on the conditions, the scenarios would make mining activity very difficult in high mountain areas.”

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Ontario jobs driven to Quebec – by John R. Hunt (North Bay Nugget – October 12, 2013)

http://www.nugget.ca/

This has been a very badly kept secret. Ontario has been losing thousands of man-hours of work and natural resources worth thousands and probably millions of dollars. Highway 11 is being pounded daily by a flotilla of trucks and in both Latchford and Temagami there have been concerns about pedestrian and traffic safety.

It is known that the trucks are carrying mine concentrates from Sudbury to be refined in Noranda, Que.

There appears to have been a total news blackout. One might have expected the unions to be howling and protesting. But little or nothing has hit the headlines. Perhaps everyone is scared of the big mining companies.

All this may change Thursday evening when the Latchford town council will consider resolutions directed to Ontario government departments. They will point out that Hwy. 11 is the town’s Main Street. The heavy traffic is wearing down the recently renovated pavement and that the trucks often appear to be traveling in convoys of eight to nine vehicles which makes life very difficult for pedestrians and automobile drivers.

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Water Insecurity a Key Threat to the Development of Global Mining – by Lauren Power (Future Directions International – October 9, 2013)

http://www.futuredirections.org.au/

Pressure for platinum miners in South Africa to halve their water consumption is symptomatic of a growing global risk to resource development posed by water shortages and conflict over water supplies available for mines.

Background

The South African Government recently requested that platinum miners in the country’s North West province cut their water use by half, in response to a drought that is threatening water supplies in the region. Throughout the world, mining activities are being challenged by water issues involving the availability of supplies for operational use, community conflict over available resources and the environmental consequences of water contamination.

Water issues are creating threefold operational, regulatory and reputational risk for miners, who are increasingly identifying water shortages as a top ranking issue in risk analysis. The availability of water is a considerable factor, affecting both growth and productivity; shortages in supply could prove a threat to new developments in some areas.

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Water shortage threatens mining – by Lucky Biyase (Business Day – October 13, 2013)

http://www.bdlive.co.za/ [South Africa]

TROUBLED mining companies in the Rustenburg platinum belt are facing another crisis — drought.

This may add to problems besetting companies trapped in the middle of rivalry between the National Union of Mineworkers and the Association of Mineworkers and Construction Union.

The water affairs department and North West’s provincial government have both warned of a drought in the mineral-rich province.

South Africa supplies nearly 60% of the world’s platinum and rhodium and 30% of palladium. The department has warned mining companies, among them Glencore, Anglo American and Lonmin, to restrict water use.

Lonmin’s executive vice-president for process and sustainability, Natascha Viljoen, said: “We are working with the Madibeng local municipality to explore opportunities to re-use water. Our current external source of water is Rand Water and the Buffelspoort canal scheme, and the rest is internal.”

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Age of the water wars – by Brahma Chellaney (Globe and Mail – October 9, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

In an increasingly parched world, shared water resources are becoming an instrument of power, fostering competition within and between nations. The struggle is escalating political tensions and exacerbating effects on ecosystems. This week’s Budapest World Water Summit is the latest initiative to search for ways to mitigate the pressing challenges.

Consider some sobering facts: Bottled water at the grocery store is more expensive than crude oil on the spot market. More people own or use a cellphone than have access to sanitation services.

Unclean water is the greatest killer on the globe, yet a fifth of humankind still lacks easy access to potable water. More than half of the global population lives under water stress – a figure projected to increase to two-thirds during the next decade.

Access to natural resources has been a key factor, historically, in war and peace. Water, however, is very different from other natural resources. A person cannot live without water.

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CHINA, ZAMBIA, AND A CLASH IN A COAL MINE – by ALEXIS OKEOWO (New Yorker Magazine – October 10, 2013)

http://www.newyorker.com/

Alexis Okeowo received support for the reporting in this post from the Pulitzer Center on Crisis Reporting.

Twelve hundred Zambians gathered on a sunny morning in August of 2012 to protest at Collum Coal Mine, which is located in a rural southern province and, at the time, was owned by five Chinese brothers. They were angry about the working conditions in the mine: Collum had been cited several times by Zambia’s government for labor violations, and miners said that they felt unsafe working there. They were also upset about annual wage increases that they said amounted to only a single Zambian kwacha—the equivalent of twenty cents.

The miners learned that a Chinese foreman had brought outside workers to replace them during the protest, according to one of the protesting miners, twenty-eight-year-old Robert Mundike. Mundike and his co-workers confronted the foreman at one of the mine’s shafts and assaulted him. Then, according to Mundike, they beat up more Chinese workers, along with Zambian miners who were still working even though the protesters had told them not to.

The group—which included not only Collum miners but also their relatives and former workers who said they were owed wages—was becoming restless. They reached another mine shaft, near a cluster of houses where several Chinese supervisors lived. Five Chinese men ran from the settlement, past the coal-carrying conveyor belt and a rock crusher and into the mine, Danny Sikatari, who works as a mine foreman but who did not participate in the protest, told me.

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