Northern Dynasty’s Last Stand – by Tommy Humphreys (CEO.ca – August 13, 2015)

http://ceo.ca/

Pebble’s new backers bet on EPA compromise and new JV partner for the world’s largest undeveloped copper-gold deposit

Two experienced mining financiers are making a $4.7 million bet that one of the world’s largest and most controversial minerals deposits is about to turn a major corner.

Frank Giustra and Gord Keep’s Cannon Point Resources (CNP.TSXv) is being acquired by Northern Dynasty Minerals (NDM.T) for a touch over its cash value (C$4.7 million). Pro forma, the deal would give Cannon Point about 8% of Northern Dynasty.

Northern Dynasty owns 100% of the Pebble Deposit in Alaska. The project saw over C$750 million of investment over the past decade and contains a jaw-dropping 107 million ounces of gold, 80 billion pounds of copper, 5 billion pounds of molybdenum, and over 500 million ounces of silver* and showed robust economics at $1050 gold and $2.50 copper in a February 2011 PEA.

Pebble is also vehemently opposed by the EPA, which began a process to veto the project in February 2014 and more recently has tried to impose development restrictions.

Read more

Glencore sells assets as downturn bites – by James Wilson (Financial Times – August 14, 2015)

http://www.ft.com/intl/

Glencore sold a trio of mining assets for $290m, extending its retreat from unwanted projects and continuing a trend among the largest resource companies to streamline their portfolios as the commodities downturn bites.

The UK-listed miner confirmed the sale of Tampakan, a copper project in the Philippines. It also revealed deals to sell Falcondo, a nickel producer in the Dominican Republic, and Sipilou, another nickel project in Ivory Coast.

Glencore inherited the assets as part of its takeover of Xstrata, completed in 2013, but has not significantly invested in them. For a project such as Tampakan, it could cost close to $6bn to build a mine.

Ivan Glasenberg, Glencore’s chief executive, has repeatedly said he dislikes the risks of “greenfield” mining developments, preferring to seek growth by expanding existing mines or via deals.

“Tampakan is one of those giant greenfield deposits . . . that’s been on the table for a long time, but struggling to obtain development approvals in the Philippines,” said analysts at Numis.

Read more

World’s Biggest Dam Needs Rain to Send Power to Zambia Mines – by Matthew Hill (Bloomberg News – August 14, 2015)

http://www.bloomberg.com/

Energy-use curbs by Zambia will keep its largest electricity plant at the world’s biggest dam, Lake Kariba, going until November, when seasonal rains may begin replenishing water levels at the hydropower station.

“If we don’t do anything right now, by October we’ll have nothing,” Jackson Sikamo, president at the Chamber of Mines, which represents mining companies in Africa’s second-biggest copper producer, said by phone Thursday. “If we do something right now, we’ll be able to run up to November and then the rains will come and we’ll be able to continue to operate at reduced levels.”

The Kariba North Bank generation facility has capacity to provide as much as 1,080 megawatts, nearly half of Zambia’s normal power production. Water levels at the reservoir had dropped to 40 percent by July 19, according to the Zambezi River Authority, half of where they were 12 months earlier. Neighboring Zimbabwe also relies on the dam for electricity.

Zambia in June started cutting power to customers other than mines by as much as 10 hours a day because of reduced generation at Kariba and the Kafue Gorge plants.

Read more

UPDATE 1-Brazil court orders Vale to halt Amazon nickel-mine operation (Reuters U.S. – August 14, 2015)

http://www.reuters.com/

Aug 14 (Reuters) – A Brazilian federal court on Friday ordered Vale SA to halt activity at its Onça Puma nickel mine in Brazil’s Amazon state of Pará until it can demonstrate what actions it has taken to compensate indigenous communities in the region.

Vale’s operations in Pará face regular legal and protest action by native Brazilian groups seeking better schools, health care and other public services.

Onça Puma, in Ourilândia do Norte, is part of a complex of mines operated by Vale in the state’s Carajas region. The mine produced 5,900 tonnes of finished nickel in the second quarter, or about 8.8 percent of Vale’s finished-nickel output.

The most common protest by indigenous groups has involved blocking Vale’s rail line between Carajas and the Atlantic Ocean.

The court also ordered Vale, the world’s second-largest nickel producer, to deposit 1 million reais ($287,000) for each indigenous village in the area until it establishes a compensation program for the communities.

Read more

RPT-COLUMN-Yuan devaluation more likely to boost than hurt China commodity imports – by Clyde Russell (Reuters U.K. – August 14, 2015)

http://uk.reuters.com/

LAUNCESTON, Australia, Aug 13 (Reuters) – The sudden depreciation of the yuan will have flow-on effects in commodity markets, but reducing China’s demand for imports is unlikely to be one of them.

The yuan has lost around 3.5 percent of its value against the U.S. dollar in domestic trade since the People’s Bank of China this week took steps to devalue its currency, in a move widely interpreted as aimed at boosting the competitiveness of the struggling export sector.

The depreciation was more steep in international markets, where the yuan lost about 4.8 percent of its value as investors feared China was starting a sustained depreciation, which may lead to a global currency war.

Commodity prices, and the currencies of major natural resource exports such as Australia, also took a hit along with the yuan on the view that a weaker Chinese currency will dampen demand for imports.

Brent crude lost as much as 3.6 percent on Aug. 11, the day of the Chinese devaluation, although by the close on Wednesday at $49.66 a barrel, the decline had tempered to just 1.5 percent.

Read more

South Africa faces mining strike double whammy – by Sungula Nkabinde (Mineweb.com – August 14, 2015)

http://www.mineweb.com

Disputes have been declared in both coal and the gold sector negotiations. Strikes will happen if no resolution is found.

South Africa should brace itself for strikes in the gold and coal mining sectors. The latter is arguably more important to the country given our current electricity situation, but it would be disastrous to have two sector-wide strikes running concurrently within the mining industry.

The gold wage negotiations have come to naught after the Associated Union of Mineworkers and Construction (AMCU) and the National Union of Mineworkers (NUM) rejected the gold producers’ final offer and, as a result, the producers have taken the offer off the table and deferred back to what they refer to as their initial ‘firm’ offer. On Thursday, after the final opportunity for voluntary mediation, the NUM has declared a dispute.

“The final offer that was on the table was an extremely generous offer and represented increases ranging from 9% to 18%, which is more than you would find anywhere else,” said Memory Johnstone, who spoke on behalf of the gold producers.

What is on the table now is an increase ranging from 7% to 13%, but a key difference between the two was that the former was a cash payout that was not linked to benefits (i.e. overtime, pension fund contributions), while the latter would be.

Read more

K+S says it’s open to Potash Corp. takeover, despite its rejection of U$8.6-billion bid – by Peter Koven (National Post – August 14, 2015)

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

The chief financial officer of K+S AG said his firm is not opposed in principle to a merger with Potash Corp. of Saskatchewan Inc., despite its total rejection of the US$8.6-billion takeover proposal.

“Don’t get me wrong: We aren’t at all blocking a potential transaction,” chief financial officer Burkhard Lohr said on an earnings conference call on Thursday.

Potash Corp. is offering 41 euros a share, and K+S says that this is far too low. But the German firm also claims a takeover could be bad for its home country, as Potash Corp. could shutter domestic production.

If German politicians end up supporting that argument, Potash Corp.’s proposal may get effectively blocked. While there is no known mechanism for the government to block the bid, it would be difficult to do such a big transaction without at least some political support.

K+S argues that it is only logical for Potash Corp. to close its European mines. The potash market is oversupplied, and Potash Corp.’s Saskatchewan output is lower-cost than what K+S has in Europe.

Read more

Explosion in China disrupts oil, iron ore shipments at world’s 10th largest port in Tianjin – by Erika Kinetz (Associated Press/Global News – August 13, 2015)

http://globalnews.ca/news/

SHANGHAI – Explosions that sent huge fireballs through China’s Tianjin port have disrupted the flow of cars, oil, iron ore and other items through the world’s 10th largest port.

The blast sent shipping containers tumbling into one another, leaving them in bent, charred piles. Rows of new cars, lined up on vast lots for distribution across China, were reduced to blackened carcasses.

Ships carrying oil and “hazardous products” were barred from the port Thursday, the Tianjin Maritime Safety Administration said on its official microblog. It also said vessels were not allowed to enter the central port zone, which is near the blast site.

Tianjin is the 10th largest port in the world by container volume, according to the World Shipping Council, moving more containers than the ports of Rotterdam, Hamburg and Los Angeles. It handles vast quantities of metal ore, coal, steel, cars and crude oil.

Australian mining giant BHP Billiton said the blast had disrupted iron ore shipments and port operations, but had not damaged any iron ore at the port. “We are working with our customers to minimize any potential impact,” it said in a statement Thursday.

Read more

Nuclear Revival Sparks Cameco Rally as Uranium Demand Is Growing – by Christopher Donville (Bloomberg News – August 13, 2015)

http://www.bloomberg.com/

Cameco Corp., the world’s second-largest producer of uranium, is emerging as a rare bright spot among Canada’s largest mining companies on signs nuclear power is shaking off its post-Fukushima slump.

Shares of Cameco have climbed 12 percent in Toronto in the past month. By comparison, Teck Resources Ltd., the world’s second-largest exporter of seaborne metallurgical coal, fell 16 percent and Barrick Gold Corp., No. 1 for bullion production, slid 18 percent.

A U.S. plan to cut carbon emissions from power plants may support new reactors and the restart of a Kyushu Electric Power Co. plant this week is highlighting a drive to get more atomic stations online in Japan. The improved prospect for uranium, the raw material in reactor fuel, is in contrast to slowing demand and ample supply for metals such as aluminum and zinc, which sent the Bloomberg World Mining Index to a six-year low in July.

“What we’re seeing is the U.S. and Japan really renewing their commitment to nuclear power,” Rob Chang, a Toronto-based analyst at Cantor Fitzgerald LP, said Aug. 11 in a phone interview. “You’ve also got India and China pushing ahead with their nuclear expansion.”

Read more

Copper Cliff takes leak in stride – by Ryan Byrne (Sudbury Star – August 14, 2015)

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

Thursday’s leak of nitrogen dioxide at Vale’s acid plant has at least one Copper Cliff resident thinking.

Carrie Calvano said the situation was scary. “I didn’t hear (the horn) initially and then when I went to let my dog out, I heard the sirens and the trucks and everything coming in – I even had my radio on,” Calvano said.

“I closed everything and got my husband out of bed and said, ‘OK, let’s see what happens.'” Calvano said she received a call from her work telling her not to come in until the situation was resolved.

“It was scary – we had to let our dog out and she really had to go, but we had to wait and she doesn’t understand. We had phone calls from all the relatives making sure we were OK.”

Calvano said she has been living in Copper Cliff for 14 years worry free, but has been re-evaluating her lack of concern after yesterday’s events.

Read more

Gas leak didn’t endanger public: Vale – by Ben Leeson (Sudbury Star – August 14, 2015)

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

It was a tense Thursday morning for those who live and work in Copper Cliff and the surrounding area, but no injuries have been reported after two gases combined to form a toxic mist at the Vale acid plant.

While a joint investigation into the cause of the gas leak is still ongoing, company officials said there was a larger-than-expected reaction between water used to wash out a cooling tower and the acid remaining inside. That created a yellow plume of NOx, a combination of nitrogen oxide and nitrogen dioxide, in the air above the site.

Exposure to nitrogen dioxide can cause irritation of the nose, throat, eyes, skin and respiratory system. Large doses are potentially fatal. The gas is also a major pollutant that plays a role in causing smog.

Air horns began sounding at the smelter around 6 a.m. and a Level 3 emergency, denoting a release of hazardous material, was called. Police and emergency services personnel responded and roads around the area were closed to traffic, while residents were cautioned through local media to remain indoors.

Read more

Ontario sets stage for Energy East battle as watchdog says pipeline’s risks outweigh benefits – by Yadullah Hussain (National Post – August 14, 2015)

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

TORONTO – Ontario’s energy regulator has cast doubts over the economic benefits of TransCanada’s Energy East crude oil pipeline proposal, setting the stage for a clash between the province and Ottawa at National Energy Board hearings on the project.

“What we have found is there is an imbalance between the economic and environmental risks of the project and the expected benefits for Ontarians,” Ontario Energy Board vice-president Peter Fraser said Thursday as he released its review requested by the province’s energy ministry on the $12-billion project Thursday.

TransCanada’s proposal to transport 1.1 million barrels of oil per day from Alberta to eastern refineries and an export terminal in New Brunswick partially through an existing pipeline is currently being reviewed by the NEB.

“I can assure you that Ontario plans to be an active intervenor in the National Energy Board approval process and our participation will reflect the concerns of the Ontario public to the federal regulator,” Ontario’s energy minister Bob Chiarelli said in a statement.

Read more

Glencore: world of big mining agog at huge fall – by Nils Pratley (The Guardian – August 12, 2015)

http://www.theguardian.com/

Financial challenges ahead for Ivan Glasenberg as share price at mining and commodity-trading company falls by two-thirds since it came to market

How do you make a £2bn fortune from commodities? Answer: start with a £6bn fortune.

Ivan Glasenberg, chief executive of Glencore, won’t be laughing. Those numbers are the value of his shareholding in the mining and commodity-trading company at flotation in 2011 and now. Yes, Glencore’s share price really has fallen by two-thirds, from 530p to 180p, since it came to market with a fanfare. Among London’s big miners, only Anglo-American has done worse.

This week alone the fall has been 10% as the China-inspired rout has run through commodity markets and mining stocks. Glencore is being whacked harder than the likes of BHP Billiton and Rio Tinto for a simple reason – relative to earnings, it has a lot more debt.

Analysts predict borrowings will stand at about $48bn when the company reports half-year numbers next week, which is a hell of a sum even for a business making top-line (before interest and tax) earnings of $10bn-$12bn.

Read more

NEWS RELEASE BHP BILLITON CELEBRATING 130 YEARS OF HISTORY (August 13, 2015)

BHP Billiton is today celebrating the 130 year anniversary of the incorporation of BHP and its significant contribution to the Australian economy and society for more than a century.

BHP was formed in 1885 after a rich silver and lead deposit was discovered by Charles Rasp on a rocky outcrop known as the ‘Broken Hill’ in western New South Wales two years earlier.

BHP Billiton CEO, Andrew Mackenzie, said the milestone was an opportunity to reflect on the Company’s long history and events that shaped its culture.

“It’s not often that we get the opportunity to stop and take a look at where we have come from, but history has a lot to teach us,” he said.

“From humble beginnings mining silver and lead at Broken Hill and tin at Billiton (Belitung) island, Indonesia, in the mid-1800s, it has been a long journey to becoming the world’s largest diversified resources company.

Read more

Categories BHP

B.C. First Nations and Alaskan Natives Join Forces to Fight Border Mines – by Judith Lavoie (Desmog Canada.com – August 12, 2015)

http://www.desmog.ca/

A powerful alliance of B.C. First Nations and Southeast Alaska natives has been forged in the aftermath of the Mount Polley dam collapse and tribes, who have not worked together for generations, are aiming to put the brakes on B.C.’s border mining boom.

Tears flowed after a May meeting in Vancouver when Union of B.C. Indian Chiefs (UBCIC) president Grand Chief Stewart Phillip and vice-president Bob Chamberlin agreed to support the newly formed United Tribal Transboundary Mining Work Group in its bid for Alaskan — and particularly tribal — input into B.C.’s decision-making process on mines along the Southeast Alaska border.

“We are bringing together the tribes from both sides of the border and building a relationship. We can make more noise together than when we are separated by a border that has not been part of our tradition,” said Mike Hoyt, leader of the Teeyhittaan clan from the Stikine River.

It was a historic meeting that could be a catalyst for change, according to Phillip.

“It was very significant, coming together with our brothers and sisters in Alaska. I think it was a long time coming,” he said.

Read more