Why it doesn’t make sense that all informal mining is deemed illegal – by Kgothatso Nhlengetwa (The Conversation – April 12, 2016)

https://theconversation.com/

Throughout Africa artisanal and small-scale mining, whether legal or illegal, has been associated with social problems such as conflict, environmental damage, health risks and child labour. Although there are no exact numbers of how many people participate in such mining activities, it is evident that it is widespread.

Despite its negative aspects, the contribution of small-scale mining to the resource sector and social development cannot be disputed. About 15% to 20% of the world’s non-fuel mineral production comes from this sub-sector. An example of this can be seen in Ghana, where small-scale mining has contributed US$460 million since 1989 and is estimated to employ 300,000 to 500,000 individuals.

In South Africa, illegal mining as it currently stands covers all aspects of unpermitted mining. But this definition does not allow for differentiation between invasive illegal mining and informal community miners. Invasive mining occurs when miners illegally enter the old mine workings of decommissioned mines. Informal mining is community based mining that typically follows customary law.

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Congo requests financial support from donors amid economic crisis – by Aaron Ross (Reuters Africa – July 6, 2017)

http://af.reuters.com/

KINSHASA, July 6 (Reuters) – Democratic Republic of Congo’s government has formally requested financial support from international donors as it confronts a worsening economic crisis, a letter seen by Reuters on Thursday showed.

Africa’s top copper producer has been hard hit by low commodity prices in recent years. It has only enough foreign currency reserves to cover about three weeks of imports and its franc currency has lost half its value in the past year.

The letter was dated July 4 and addressed to the U.N. Secretary General as well as in-country representatives of the African Union, the European Union, three regional African organisations and other foreign ambassadors. In it, Prime Minister Bruno Tshibala’s chief of staff, Michel Nsomue, wrote that the government “needs the support of the international community and thus of its traditional partners”.

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A brutal lesson for multinationals: golden tax deals can come back and bite you – by Maya Forstater and Alexandra Readhead (The Guardian – July 6, 2017)

https://www.theguardian.com/

A dispute in Tanzania highlights the tense relations that often exist between mining companies and governments

Mines are long-term investments, but relationships between mining companies and governments are often tense and impatient. Governments fear that they will be ripped-off by multinational companies, while the companies worry that governments will hold their assets hostage. Nervous companies seek contract terms that allow them to recover their costs as quickly as possible.

However, this leads to taxes trickling in while exports are beginning to flood out. The risk is that governments see their fears confirmed and threaten to rip up the contracts. This risk just became reality for Acacia Mining plc in Tanzania.

The FTSE 250 company is the largest gold producer in the country, and has long faced criticism for the amount of tax it pays there. Acacia’s “payments to government” report [pdf] released last week shows that the company, which operates three mines in Tanzania, exported $1bn (£770m) of gold, copper and silver last year, and only paid 8% of this in taxes and royalties to the government.

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Tanzania Passes Laws Enabling Renegotiation of Mining Deals – by Omar Mohammed (Bloomberg News – July 4 2017)

https://www.bloomberg.com/

Tanzania approved two laws that enable the government to renegotiate contracts with mining and energy companies as the state seeks a greater share of revenue from natural resources.

The bills, which deal with state sovereignty over mineral wealth and contracts containing “unconscionable terms,” were approved by parliament on Monday, lawmaker Peter Kafumu said in a text message. The Tanzania Chamber of Minerals and Energy, the main industry lobby group that has opposed the new laws, said the implications of the bills are “vast.”

“There are many areas that the three bills touch on,” TCME Executive Secretary Gerald Mturi said by phone Tuesday from Dar es Salaam, the commercial capital. “The industry is going to be affected big time.”

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Mining in Mali: balancing prospects and problems – by Heidi Vella (Mining Technology – July 3, 2017)

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

Landlocked between six other West African nations, including Burkina Faso and Guinea, Mali is a gold mining star in a resource-rich but troubled region.

The nation is the third-largest gold producer in Sub-Saharan Africa with seven projects currently in operation. UK mining firm Hummingbird Resources?is the latest company to get involved and is on course to start production at a $88m (£68.1m) open-cast gold mine this year. Yet only about six of the country’s 133 potentially gold-rich reserves have been mapped out, offering significant growth opportunities.

Furthermore, the government is keen to unlock the economic potential of its other resources, such as bauxite, manganese, lithium and uranium. In April, the Chamber of Mines announced that following several new discoveries, bauxite reserves in Mali’s Falea project are now estimated at 1.63 billion tonnes (Bt), which is equivalent to 572t of refined aluminium. A spate of investment deals signed with China, totalling about $11bn, aims to unlock the potential of other minerals.

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Banro halts gold mine in Congo due to violence, shares collapse – by Cecilia Jamasmie (Mining.com – July 3, 2017)

http://www.mining.com/

Shares in Canadian gold miner Banro Corporation (TSX:BAA) (NYSE MKT:BAA) were getting hammered Monday after the company revealed it had to suspend operations and temporarily evacuate employees at its Namoya gold mine in eastern Democratic Republic of Congo due to violence.

The Toronto-based miner said the measures were taken after learning that 23 trucks belonging to a contractor of the mine were caught in crossfire between soldiers and a local self-defence militia near the town of Lulimba.

While drivers of those vehicles are safe, militiamen have not yet cleared the release of the trucks, the company said.

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Can development minerals avoid abuses and fuel African growth? – by Kieran Guillbert (Reuters July 3, 2017)

https://www.reuters.com/

DAKAR, July 3 (Thomson Reuters Foundation) – On a continent better known for enriching colonisers and corporations by exporting its gold, copper and diamonds, so-called “development minerals” – ranging from limestone to granite – could help Africa fuel its own economic growth.

The sector, estimated by the United Nations to employ at least 8 million Africans, could create millions more jobs across the continent – many for young people and women – to meet a fast growing need for housing and infrastructure, mining experts say.

Development minerals refer to materials and minerals that are considered low-value – such as granite, gravel and sand – and are mined, processed, manufactured and used locally in industries from construction and manufacturing to agriculture.

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Funding dearth, restrictive laws and lack of leadership from govt stifling SA junior miners – by Dylan Slater (MiningWeekly.com – June 30, 2017)

http://www.miningweekly.com/

JOHANNESBURG (miningweekly.com) – The junior mining sector in South Africa has “huge potential” to grow and re-establish itself in the domestic mining environment; however, this potential is being blunted by a lack of funding, restrictive legislation and a lack of leadership from the Department of Mineral Resources (DMR) and government.

This is the sentiment expressed at the yearly Junior Mining Indaba, held earlier this month at The Country Club, in Auckland Park, Johannesburg. Speaking during a Junior Mining Indaba panel discussion on obstacles and challenges facing junior miners in the quest for funding, Botswana Diamonds executive chairperson John Teeling said there was simply “no money” and that it had been impossible for the bulk of junior miners to raise significant sums of money from equity financing.

Attempting to operate startup and junior mining companies during the past couple of years had been a “complete disaster”, he said. Teeling explained that the type of people who provided capital tended to do so at the end of a cycle, as “they have made a lot of money elsewhere and think that the future is going to be a little more rosy”, citing their intention to capitalise on any upswing in the mining industry.

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AngloGold may axe third of workforce – by Allan Seccombe (Business Day – June 28, 2017)

https://www.businesslive.co.za/

Mining union ‘angry and shocked’ at decision, but costs at Kopanang and Savuka are unsustainable

AngloGold Ashanti, the world’s third-largest gold miner, could cut up to 8,500 jobs, or a third of its South African workforce, as two unprofitable mines reach the end of their lives.

In SA, the mining industry has shed 70,000 jobs over the past five years because of high costs, volatile commodity prices and — in the case of platinum, stagnant, weak prices — as well as declining productivity.

“This is a difficult decision, which follows a period of significant and, ultimately, unsustainable losses and also the evaluation of the options available to return our South African business to profitability,” said Srinivasan Venkatakrishnan, the CEO of AngloGold.

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MINOR METALS-Weak demand from China stainless steel mills hits ferrochrome prices – by Eileen Soreng and Vijaykumar Vedala (Reuters Africa – June 28, 2017)

http://af.reuters.com/

June 28 (Reuters) – Global prices of ferrochrome, used to make stainless steel, have tumbled to their lowest levels this year due to weaker demand from stainless steel mills in top producer China, according to traders in Asia and Europe.

Low carbon ferrochrome FECRO-LC-RU was last quoted at $1.80 a lb, its lowest since Nov. and down 20 percent since late January. High carbon ferrochrome FECRO-HC-RU is at an eight-month low at 93 cents a lb and more than 30 percent lower since late January.

“The Chinese ports have about 10 weeks of chrome ore stocks and that coupled with reduced ferrochrome demand has sent the prices of ore and alloys crashing,” said Ravi Prakash, marketing and business development head for ferro alloys and minerals division of Tata Steel Ltd.

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Canada’s Mkango aims for rare earths production from 2020 – by Barbara Lewis (Reuters Canada – June 26, 2017)

http://ca.reuters.com/

LONDON (Reuters) – Canada’s Mkango Resources (MKA.V: Quote) MKA.L, one of a handful of rare earth miners outside China, aims to start production in Malawi in 2020 to catch an expected leap in demand for the metals that are used in electric vehicles and other new technologies.

Demand for rare earths, which range from neodymium used in electric motors to lanthanum used to make batteries, is increasing with the emergence of new, greener technology.

While production of coal, iron ore and other bulk commodities is dominated by major mining firms such as BHP (BHP.AX: Quote) (BLT.L: Quote) and Rio Tinto (RIO.L: Quote) (RIO.AX: Quote), rare earths are mostly produced by China and small mining firms such as Mkango.

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Examining Barrick Gold’s Regulatory Risk In Developing Countries – by Trefis Team (Forbes Magazine – June 26, 2017)

https://www.forbes.com/

Barrick Gold’s African operations are mired in uncertainty amid the Tanzanian government’s ban on the export of unprocessed mineral ores from the country. In addition, the Tanzanian government has alleged that Acacia Mining plc, the Barrick Gold subsidiary which operates the company’s mining interests in the country, has been evading taxes by understating the amount of gold concentrate that it exports.

While Barrick has not altered its production guidance for its African mining operations yet, per Acacia plc (in which Barrick holds a 63.9% stake) the mineral export ban is reportedly costing the company nearly $1 million per day in lost sales, as there isn’t enough gold smelting capacity within the country.

Barrick’s woes in Tanzania are the latest in a series of developments for mining companies in developing markets that have adversely affected the viability of their operations in these jurisdictions.

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Banks Balk at Risk of Funding South Africa Mining Charter Deals – by Renee Bonorchis (Bloomberg News – June 26, 2017)

https://www.bloomberg.com/

South Africa’s plan to force mining companies to give the black majority a bigger stake in the nation’s mineral wealth faces a major obstacle: convincing banks to back billions of dollars of fresh deals in an industry in decline.

Mineral Resources Minister Mosebenzi Zwane said on June 15 that local mines should be at least 30 percent owned by black people, up from the previous requirement of 26 percent. The mining companies need banks to help fund transactions that transfer the stakes to black investors who often don’t have the capital to invest due to their marginalization during white rule.

Companies often use dividends or divert cash flows to pay off the debt on behalf on the black empowerment partners, which means full ownership only vests years later. “The charter will have an effect on our ability to finance the mining industry in South Africa,” said Ursula Nobrega, a spokeswoman for Investec Plc, one of South Africa’s five biggest banks. “We already exercise caution as to who and what projects we finance.”

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Future of diamond mining in the sea – by Magreth Nunuhe (The Southern Times – June 26, 2017)

https://southernafrican.news/

WALVIS BAY – Having the richest marine diamond deposits in the world, Namibia has set its sights on the ocean as the output of marine diamond production continue to enormously outstrip production of the precious stones on land.

Last year, marine diamond production yielded 1.17 million carats, while land operations generated 403,000 carats, contributing over billions of dollars in revenue. Namibian diamond mining takes place at around 120 to 140 metres below sea level.

In the next 15 years, it is estimated that diamond production on land in Namibia will run out and that 95 percent of diamond production will come from the sea. With approximations that the 3,700 miles squared concession area at sea on the south-west coast of Southern Africa will provide plenty of gemstones for the next 50 years, De Beers Group and Debmarine Namibia inaugurated the world’s most advanced exploration vessel, dubbed the mv SS Nujoma at the coastal town of Walvis Bay on 15 June 2017.

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Pioneering Canadian system ensures conflict-free gold – by Geoffrey York (Globe and Mail – June 26, 2017)

https://www.theglobeandmail.com/

Rigorously documenting exports from small-scale sites boosts miners’ revenue, gives buyers ethical certainty

The work is exhausting and dangerous. Under the harsh sun on the side of a Congolese mountain, men and women dig rocks from a crude pit, crush them with hammers and wash them in a muddy river, searching for tiny flakes of gold. For this gruelling labour, the hardscrabble miners earn an average of just 94 cents (U.S.) a day.

It’s a long journey from these mountain shafts to a boutique jeweller in downtown Toronto, where the rough nuggets are transformed into engagement rings and wedding bands. But under a new Canadian ethical-trade program, the mine workers will have a chance at a higher income. And consumers will have precise proof – for the first time – that their gold jewellery is free from the taint of war or corruption.

In late May, a passenger named Joanne Lebert carried an unusual item in her hand luggage on the lengthy flight from eastern Congo to Toronto. In a sealed bag inside a glass jar, she carried 238 grams of gold, purchased from small-scale mining sites near the remote town of Mambasa.

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