Archive | Asia Mining

Indonesia Wants Control of Freeport’s Grasberg Within Two Years – by Yoga Rusmana and Eko Listiyorini (Bloomberg News – March 23, 2017)

(Bloomberg) — The dispute engulfing the world’s second-biggest copper mine deepened as Indonesia’s government said it planned to take a majority stake in the local unit of owner Freeport-McMoRan Inc. within two years while workers at the pit threatened to go on strike.

The state enterprises ministry has cleared a government-run company to buy a majority stake in PT Freeport Indonesia, the local unit that runs the massive Grasberg mine in Papua province, according to Fajar Harry Sampurno, the deputy minister for mining, media and strategic industries. Freeport-McMoran would have to divest its share to a state-owned entity under a new contract that the Phoenix-based miner is yet to sign.

“We’re ready,” Sampurno said at a press conference in Jakarta on Wednesday. A local aluminum producer, PT Indonesia Asahan Aluminium, will be turned into a holding company to purchase the stake, he said. “Once the holding company is formed, they will immediately work on it.” Continue Reading →

Indonesia port graft investigation disrupting coal shipments – by Fergus Jensen and Henning Gloystein (Reuters U.S. – March 22, 2017)

Indonesia is cracking down on corruption and widespread graft at some of its top coal export hubs, disrupting shipments to destinations across Asia.

Indonesia is the world’s top exporter of thermal coal, still the main feedstock for global power generation. Interruptions to coal’s output and shipment can impact seaborne prices of the fuel as well as wholesale electricity markets.

The investigations that began on Friday are targeting port operations along the large anchorage area off Samarinda in East Kalimantan, officials said on Wednesday, delaying ships waiting to load new supplies from the region’s mines. Continue Reading →

Tribunal favours Barrick, Antofagasta in Pakistan lease denial case – by Cecilia Jamasmie ( – March 21, 2017)

A World Bank’s tribunal has ruled in favour of Tethyan Copper Co. (TCC), a joint venture between Barrick Gold (TSX, NYSE: ABX) and Antofagasta (LON:ANTO), in relation to the denial of a mining lease for the multi-billion-dollar Reko Diq copper and gold reserve in the Pakistani province of Balochistan.

The decision by the International Center for Settlement of Investment Disputes (ICSID), issued on Monday, confirms that Pakistan violated several provisions of its bilateral investment treaty with Australia, where Tethyan Copper is incorporated, Barrick said in a statement. The ruling also rejects Pakistan’s final defense against liability.

The case dates back to 2011, when the provincial government of Balochistan rejected TCC’s application for a mining licence at the remote Reko Diq site, near the Afghan-Pakistan border, even though the firm had been awarded a licence for exploration in the area in 2006. Continue Reading →

This Mile-Wide Hole Could Revolutionize Pakistan’s Economy – by Faseeh Mangi (Bloomberg News – March 21, 2017)

In the dusty scrub of the Thar desert, Pakistan has begun to dig up one of the world’s largest deposits of low-grade, brown, dirty coal to fuel new power stations that could revolutionize the country’s economy.

The project is one of the most expensive among an array of ambitious energy developments that China is helping the country to build as part of a $55 billion economic partnership. A $3.5 billion joint venture between the neighbors will extract coal to generate 1.3 gigawatts of electricity that will be sent across the country on a new $3 billion transmission network.

“When I came it was a mess. There was nothing here,” said Dileep Kumar, one of the first mining engineers at lead contractor Sindh Engro Coal Mining Co., standing atop the mile-wide hole in the earth, busy with yellow trucks and diggers on the floor below. “Now look at it. This wasn’t possible without the Chinese.” Continue Reading →

As China Adjusts for “True Cost” of Rare Earths, What Does It Mean for Decarbonization? – by Hongqiao Liu (New Security – March 21, 2017)

Known as the “vitamins of industry,” rare earths refer to a cluster of minerals widely used in green technologies such as wind turbines, rechargeable batteries, and electric vehicles. Rare earth elements embedded in these products keep them light, efficient, and affordable. They’re essential to the decarbonization of the global economy envisioned in the Paris Climate Agreement, agreed to by 192 countries in 2015. And we may soon face a significant shortage, due in no small part to changes in China.

The U.S. Department of Energy and European Union have both issued warnings of impending rare earths shortages. Medium and heavy rare earths, mined almost exclusively in China at the moment, top the list with the highest risk of shortage.

Years of pollution suffered as the world’s dominant supplier of rare earths have taken their toll on China’s soil, water, and people. In some cases, ponds of untreated tailing slurry have led to severe radioactive contamination. As the government begins cracking down on illegal mining and black markets and increasing environmental regulations, operation and compliance costs are going up. Continue Reading →

Freeport threatens action over copper mine dispute – by Sara Schonhardt (Wall Street Journal/The Australian – March 20, 2017)

Freeport-McMoRan’s standoff with Indonesia over the giant Grasberg copper and gold mine is entering a new phase, as the company scales back operations while trying to force a resolution to the dispute.

Last month, the US miner threatened to take Indonesia to arbitration, saying new rules the country imposed on miners in January violated the terms of an operating agreement struck in 1991 that runs to 2021.

The rules are part of a broad ­effort to gather more revenue from the mining sector. Under the rules, Freeport is banned from ­exporting a form of unrefined copper until it agrees to new operating rights that would eventually force it to cede control of Grasberg, the second-largest copper mine in the world, to Indonesian entities. Continue Reading →

CORRECTED-COLUMN-Nickel markets can shrug off any Philippine mining ban – by Clyde Russell (Reuters U.S. – March 20, 2017)

Just how worried should nickel markets be about the latest threats by Philippine President Rodrigo Duterte to stop all mining in the world’s biggest exporter of the metal ore? Probably not too much.

The reason to be relatively sanguine about the prospects for nickel supply isn’t that Duterte is unlikely to follow up on his latest threat, although he may not. It’s that even if he does, the market is likely to be able to cope with the loss of Philippine nickel ore, despite having to make some short-term adjustments.

In the latest twist to Duterte’s ongoing battle with his country’s miners, the bombastic and populist leader accused them of funding efforts to destabilise his government, and mooted a total ban on mining. Continue Reading →

WHAT’S STOPPING THE PHILIPPINES FROM MINING ITS RICHES? – by Calire Jiao (South China Morning Herald – March 19, 2017)

Half the nation’s mines were shut last month; foreign firms consider moving

When mining investors talk of the Philippines, they often boast of its wealth of untapped mineral reserves. But as one political controversy after another rocks the industry, miners are beginning to worry that’s all they will ever be: untapped.

In one fell swoop, the Philippines Department of Environment and Natural Resources (DENR) shut down more than half of all operating mines last month. According to Secretary Gina Lopez, its audit found “serious environmental violations” in 23 of the country’s 41 mines. The department also cancelled contracts for 75 mining projects still in their exploration stages. The projects are located in watersheds; Lopez said they never should have been approved to begin with.

Miners are up in arms, not only about the orders, but the way in which they are being carried out. They say their supposed violations haven’t been made clear and argue that they should be given the chance to address any issues. Continue Reading →

Billionaire Adani Sees Disputed Australia Mine Start by 2020 – by P R Sanjai and Perry Williams (Bloomberg News – March 20, 2017)

India’s Adani Group plans to begin extracting coal from the $16.5 billion Carmichael project in Australia in 2020 after environmental protests delayed the first phase of the mine.

The company will begin work on the project three months after it gets final approval from Australia’s federal government, Gautam Adani, billionaire chairman of the Indian group said on Friday. Adani expects permission from Malcolm Turnbull’s government for the project in Queensland’s Galilee Basin as early as May, with a final investment decision by May or June, he said.

The project is meant to fuel power generation for 100 million Indians and create 10,000 jobs in Queensland. It will likely proceed given the pressing need for fresh sources of power generation in India, according to David Lennox, an analyst with Fat Prophets in Sydney. Continue Reading →

Mining issues cloud Phl competitiveness – by Richmond Mercurio (The Philippine Star – March 17, 2017)

MANILA, Philippines – The Philippines may soon feel the backlash of the ongoing issues surrounding the closure and suspension of mining companies in its global competitiveness rankings, the National Competitiveness Council (NCC) said.

NCC private sector co-chairman Guillermo Luz told The STAR the decision of the Department of Environment and Natural Resources (DENR) to close 23 mine sites and suspend five others may affect the country’s standing in some global reports, particularly those that include rule of law, contracts and formation of public policy as indicators.

“Any area which affects investor interest is obviously an area of concern for us. Definitely, you can see the impact on the mining sector. Obviously, they are very concerned,” Luz said. Continue Reading →

Coal India missing output target doesn’t matter, mining millions of tonnes more does – by Clyde Russell (Reuters U.S. – March 17, 2017)

LAUNCESTON, AUSTRALIA – What’s more important? The fact the Coal India will once again miss its annual output target, or that it will produce over 31 million tonnes more than it did the previous year?

Recent media reports have highlighted that Coal India Ltd (CIL), the state-owned behemoth that’s the world’s largest miner of the fuel, will likely miss its target of producing 598 million tonnes in the fiscal year ending March 31.

“CIL may miss by 20 million tonnes and it should be between 570-578 million tonnes,” Coal Secretary Susheel Kumar said of the target, in an article in the Economic Times on March 12. Assuming CIL reaches the lower end of the range, the 570 million tonnes produced in 2016-17 would still be 31.25 million, or 5.8 percent, more than what it managed in 2015-16. Continue Reading →

Indonesia’s long relationship with Freeport at crossroads – by Staff (Asian Corrospondent – March 16, 2017)

AMERICAN mining giant Freeport-McRoRan Copper & Gold may soon pull out of Indonesia after more than four decades due to prolonged conflict with the government. The company, which is the country’s oldest international investor and largest taxpayer, has been embroiled in a battle with President Joko “Jokowi” Widodo’s administration over new national mining regulation.

Legislation introduced in January 2017 requires Freeport to convert its business contract into a special mining licence, dictating the company must divest 51 percent of shares in its local subsidiary within a decade and build a new US$2 billion smelter.

With economic nationalism a key aspect of Jokowi’s agenda, the government is also demanding higher royalties, land relinquishments and more materials to be procured from local suppliers. Continue Reading →

Billionaire Agarwal Plans to Buy $2.4 Billion Anglo Stake – by Ruth David, Dinesh Nair and Thomas Biesheuvel (Bloomberg News – March 15, 2017)

Anil Agarwal, an Indian mining billionaire, plans to buy as much as 2 billion pounds ($2.4 billion) of Anglo American Plc shares in the market after a merger proposal failed last year.

The full stake would equate to about 13 percent of Anglo’s stock, making Agarwal the second-largest shareholder after South Africa’s Public Investment Corp. It will give him a strong voice in the company’s strategy as the blue-chip British mining firm cements its recovery from a slump in commodity prices.

While Agarwal said the purchase was a family investment and he won’t make a takeover bid, the brash Indian tycoon offered to merge part his mining empire with Anglo American last year, only to be rebuffed. The London-based mining group, which is currently looking for a new chairman, is seen as a candidate for a potential break-up through splitting its South African assets from the global mining business. Continue Reading →

As China’s Coal Mines Close, Miners Are Becoming Bolder In Voicing Demands – by Rob Schmitz (Delaware Public Media – March 14, 2017)

The streets of Dalianhe, in China’s frigid northeast province of Heilongjiang, are lined with black snow. The town is home to one of China’s largest open-pit coal mines. Workers drive through its front gate into a massive gorge with cliffs the color of ink — a canyon of coal. Thousands of feet below, it’s silent but for the drip of melting snow.

It wasn’t always this way. Thousands used to work inside this mine on the northern fringe of China’s rust belt. It was established in 1960 at the height of Mao’s China, when the Communist Party considered this region a worker’s paradise. Coal mines and steel mills here employed millions.

Now it’s littered with deserted fossils of a bygone era. The 21st century’s Communist leaders are transforming China’s economy into a paradise for consumers, and have ordered inefficient, state-run mines like this one to close. Continue Reading →

Solving the Secret Behind the Chinese Gold Market – by Valentin Schmid (Epoch Times – March 13, 2017)

Expert estimates total holdings at 19,500 metric tons

The world is full of golden rules. There is one for every field—ethics, communication, fashion. But there is only one that counts: the golden rule of money, “Whoever has the gold makes the rules.” China, it seems, wants to make the rules in the international monetary system, which is why it has been acquiring vast amounts of gold through both private and official channels.

Because of the obscure nature of the Chinese gold market and the reluctance of Chinese officials to show their hand, nobody has been able to accurately calculate how much gold the Chinese have acquired since 2000, when they began amassing it.

Enter Koos Jansen, an analyst with Singapore bullion dealer BullionStar. He has studied the Chinese gold market for years and recently came up with an estimate of total Chinese gold holdings: 19,500 metric tons, or 21,495 U.S. tons, at the end of January 2017. Continue Reading →