Archive | Australia/New Caledonia/Papua New Guinea Mining

Australia’s Kambalda faces future with no nickel output – by Josh Chiat (The West Australian – February 22, 2017)

Kambalda has run on nickel dust since it kicked off the base metal’s Australian boom in the 1960s. It is now facing having virtually no nickel production in the town by February next year, with Independence Group saying reserve life extensions at the harvesting phase Long nickel mine have proved unsuccessful.

Long — which delivered 2365 tonnes of nickel to the BHP Billiton Kambalda concentrator in the December quarter — and RNC Minerals’ Beta Hunt, which is now largely a gold operation, are the only producing nickel mines in Kambalda, where a series of operations have been put on care and maintenance amid low prices for the stainless steel ingredient since 2015.

Independence Group managing director Peter Bradford, who is also grappling with lagging development at the company’s flagship Nova nickel- copper mine 160km east of Norseman, said drilling at Victor West had proven unsuccessful. Continue Reading →

Iron ore rockets towards $US100 a tonne – by Jessica Sier (Sydney Morning Herald – February 22, 2017)

The price of iron ore has surged higher still, reaching its highest level since mid-2014, and flirting with the $US100 a tonne mark. A pick up in steel futures has sent Australia’s largest export soaring 21 per cent so far this year, and up 84 per cent in the last twelve months.

Iron ore, with a ferrous content of 62 per cent was fetching $US94.86 a tonne on Wednesday morning. China’s Dalian Commodity Exchange, most-active futures surged as much as 30 per cent this year to 723yuan ($136).

Consolidation in the Chinese steel industry, which iron ore fuels, has seen steel exports are slump 5 per cent month on month and down 24 per cent year on year, while iron ore imports are up 12 per cent year on year. Continue Reading →

Coal ‘an attractive business’: BHP Billiton chief Andrew Mackenzie – by Matt Chambers (The Australian – February 23, 2017)

BHP Billiton says Chinese coalmining policy that has reined in production means it could develop more Queensland coking coalmines after three years of focusing on squeezing the most cash it could out of the mines and not promoting their growth.

Speaking to investors last night after delivering a $US3.2 billion ($4.2bn) first-half profit, chief executive Andrew Mackenzie said coal remained an attractive business.

“There is no doubt the Chinese tried to restructure their mining activities in both coals, and indeed in iron ore, through their restructuring of steel,” Mr Mackenzie said. “It has probably made the bulks a little bit more investable than they would otherwise have been.” Continue Reading →

Canada’s Hope Bay fits Gekko mission – Staff (Mining Journal – February 20, 2017)

Gekko Systems Company Profile

As maiden gold pours go the one by TMAC Resources at its C$325 million Hope Bay project in Canada’s north was a momentous one. It not only marked the production start at a new generation mine in a standout emerging goldfield, but also realisation of a remarkable vision for the future of the industry conceived and developed by Australia’s Gekko Systems over the past 20 years.

“This is a project that fits with our reason for being, really,” says Gekko technical director and co-founder, Sandy Gray.

“We are focussed on step-change in the industry, through low-energy process flowsheet designs, low capital costs and small footprint and modular designs that are positive for the environment, deliver lower operating costs, and allow fast, low-risk, predictable project delivery and execution. Continue Reading →

Iron ore rally fires up Rio Tinto’s commodity merry-go-round – by Clyde Russell (Reuters U.S. – February 15, 2017)

JOHANNESBURG Reuters) – Mining company super profits appear to be back on the agenda as earnings stand to be turbo-charged by higher-than-expected prices for iron ore and other metals, while volumes are also likely to be strong.

It’s the stuff of dreams for mining company bosses: high prices and strong production that can be sold into a rally.

Iron ore has been the standout so far in 2017, and as the steel-making ingredient surged to its highest level in three year above $90 a ton, so too will profits at the three major producers, Brazil’s Vale and the Anglo-Australian pair of Rio Tinto and BHP Billiton.

Investors have already had a little taste of what may come, with Rio raising its dividend above market expectations when it released results last week. Continue Reading →

Australian Big miners to benefit from ‘fundamental shift’ in China’s iron ore appetite – by Peter Ker (Australian Financial Review – February 14, 2017)

Australia’s biggest iron ore miners are set to benefit from a “fundamental shift” in China’s demand for higher grade iron ore, which has sent spot prices rocketing and could keep them high for some time yet.

The benchmark iron ore price reached a 30-month high of $US92.23 per tonne on Tuesday, and the commodity’s strongest start to a year since 2014 is fuelling expectations for rising dividends from mining companies and dramatically improved revenues to the federal and Western Australian government.

The timing of the rally is particularly good for WA Premier Colin Barnett, who will face voters at an election in less than a month and can expect iron ore royalties to deliver billions of dollars of extra revenue into the state’s struggling finances over the next few years. Continue Reading →

Surging Iron Ore Won’t ‘Fall Off a Cliff,’ Says Rio Tinto – by David Stringer and Haidi Lun (Bloomberg News – Februay 13, 2017)

Iron ore will defy forecasts for a dramatic price collapse as China’s economy remains strong and the top buyer boosts demand for higher-quality imports, according to Rio Tinto Group, the second-largest exporter.

“I wouldn’t necessarily say that it’s going to fall off a cliff,” Chief Financial Officer Chris Lynch said Monday in an interview with Bloomberg Television’s Daybreak Australia. “I guess the key issue is that we have to be robust in case the price goes up, down or sideways, and that’s what we set out our business to do.”

Global exporters are benefiting as mills in China, the world’s top steelmaker, increasingly prefer higher-quality raw materials to raise efficiency and cut pollution, according to Lynch. Continue Reading →

Higher for longer: it’s all upside for mining stocks if restraint is shown – by Robert Guy (The Australian – February 14, 2017)

American writer Mark Twain may have dismissed mines as a hole in the ground with a liar at the top, but the surge in the share prices of some of the world’s largest dirt diggers shows that many investors are buying into the hopes of sustained strength in commodity prices.

The reversal in fortunes has been stunning: BHP Billiton and Rio Tinto rallied 83 per cent and 75 per cent, respectively, over the past year. But those returns look a little meagre compared to the 190 per cent gain recorded by South32 and the massive 300 per cent gain notched up by Fort­escue Metals as prices for iron ore, coal and copper have marched higher on hopes for a stabilisation in Chinese growth and a Donald Trump-inspired US infrastructure boom.

Iron ore, which sold for $US38 a tonne in December 2015, now fetches about $US87. Continue Reading →

ANALYSIS-As coal shortfall looms, miners enjoy unexpected boom – by Henning Gloystein (Reuters U.K. – February 9, 2017)

SINGAPORE, Feb 10 Many a swan song has been sung for thermal coal markets as renewable power generation and a push towards using more natural gas have gained traction. Yet a coal price spike last year, driven by a Chinese change in regulation that capped local mining operations, has shown how easily markets can swing from oversupply to shortfall.

While many analysts and investors see the long-term outlook for coal as bleak due to policies and technological advances that favour cleaner natural gas and renewable in power generation, the shorter-term outlook for the industry has seen a sharp reversal of fortunes.

This year, strong demand growth in Asia’s emerging markets will create a supply shortfall for the first time in at least half a decade. Consumption could even soon rise past the 2014 peak, according to Asia’s largest commodity trading house, Noble Group. Continue Reading →

[Australia mining] Brendon Grylls accuses BHP, Rio-backed mining lobby of ‘wet lettuce’ fight – by Julie-anne Sprague (Australian Financial Review – February 8, 2017)

WA Nationals leader Brendon Grylls has urged BHP Billiton and Rio Tinto to spend millions of dollars on a campaign against Prime Minister Malcolm Turnbull’s reluctance to change the GST distribution system.

Mr Grylls accused mining lobby group Chamber of Minerals and Energy (CME) of a ‘wet lettuce’ fight with the Federal government during a live ABC radio debate in Perth on Wednesday.

CME chief executive Reg Howard-Smith said the lobby group had spent $2 million fighting Mr Grylls’s proposal, which combined funds from BHP, Rio, the Minerals Council of Australia and the CME. Mr Howard-Smith agreed the GST distribution system was unfair and that the lobby group had publicly declared Western Australia needed a fairer deal. Continue Reading →

Rio Tinto gears up for $2bn Queensland mine sales – by Bridget Carter and Scott Murdoch (The Australian – February 10, 2017)

Australian mining giant Rio Tinto is believed to be hiring Bank of America Merrill Lynch to sell its Queensland coking coal assets that are estimated to be worth about $2 billion.

BAML was the bank that was hired by Anglo American to sell its Moranbah North and Grosvenor mines in the state for at least $1bn to private equity firm Apollo before the vendor changed its mind and the deal collapsed.

Both Rio and BAML have declined to comment, but it is understood that BAML will be formally mandated in the weeks ahead once the Moranbah sale is officially off. Up for sale by Rio is its Hail Creek Mine, 120km southwest of Mackay in central Queensland, which supplies international markets with hard coking and thermal coal. Continue Reading →

Barrick Sale of Super Pit Stake to China Buyer Stalls – by Brett Foley, Scott Deveau and Danielle Bochove (Bloomberg News – February 8, 2017)

Barrick Gold Corp.’s plan to sell its stake in the Kalgoorlie Super Pit mine to a Chinese bidder has stalled, as the buyer faces delays securing financing for the $1.3 billion deal, people with knowledge of the matter said.

Minjar Gold Pty, a unit of property developer Shandong Tyan Home Co., is also still seeking Chinese regulatory clearance for the purchase, according to the people. Barrick is awaiting an outcome and remains interested in selling to Minjar, which outbid other suitors by a large margin, the people said, asking not to be identified because the information is private.

Barrick may still decide to re-enter talks with other buyers or keep its 50 percent stake in the Western Australia asset, which is the country’s largest open-pit gold mine, the people said. Continue Reading →

BHP drives the next tectonic shift in Australian coal – by Matthew Stevens(Australian Financial Review – February 6, 2017)

Two weeks ago BHP Billiton rolled a dump truck driving simulator into a recruitment office in Townsville. While this is but a modest technical achievement, the training facility represents another important milestone in the changing the demographics of the Australian coal industry.

BHP operates two mining joint ventures in Queensland and it is the bigger of them – the BHP Billiton Mitsubishi Alliance – that irritated the coal unions by turning on this new training kit.

The bone of contention here is that BMA has identified Townsville as a new source of workers ostensibly, but not exclusively, for its Saraji mine. The plan is to employ upwards of 100 new fly-in, fly out workers through labour hire firms. They will, initially at least, drive the trucks and shovels that move the overburden at Saraji. They might eventually become a sort of truck and shovel driving flying squad who can be deployed anywhere around the BMA fleet. Continue Reading →

Mining boom not dead, says industry, as exports top tourism – by David Crowe (The Australian – February 6, 2017)

Australians are being urged to ­reject the “anti-business sentiment” that threatens to impose greater burdens on the mining ­industry, with a new campaign ­assuring voters the sector employs 225,000 workers and pays $12 billion a year in taxes and royalties.

The campaign counters claims about the end of the mining boom while also claiming the industry pays 54 cents in every dollar to governments, challenging calls for a mining tax or a lift in state royalties.

The TV advertisements tell the story of workers in manufacturing and other sectors that rely on mining, while an online campaign takes on claims that mining companies do not contribute enough to public services such as hospitals and schools. Continue Reading →

China helps put miners back in the winners’ circle – by Elizabeth Knight (Sydney Morning Herald – January 30, 2017)

In the next couple of weeks, investors will see real evidence of the fact that the Australian corporate earnings drought has broken. After two years of falling profits, they are now expected to rise about 6 to 7 per cent. For this significant turnaround we need have only one source for gratitude: China.

This is a China-led Australian earnings recovery based on increased prices it is paying for a number of our mineral resources, most specifically coal and iron ore.

Thus the real gains in earnings will come from resource companies such as BHP Billiton, Rio Tinto and Fortescue, whose earnings in the previous couple of years had fallen off a cliff and taken the aggregate Australian market profits with them. Continue Reading →