Republic of Mining

Biggest mining equity rally in years built on shaky foundations – by Clara Denina (Reuters U.S. – March 18, 2016)

March 18, 2016

http://www.reuters.com/

LONDON – The biggest rally for mining company shares since 2009 risks fizzling out as gains have largely been driven by funds reversing bets on lower prices rather than long-term investors looking for value.

The benchmark FTSE 350 mining index, which tracks the performance of the UK’s 11 biggest listed miners, is up 26 percent this year, the biggest quarterly gain since September 2009, and marking a revival after three years of losses.

Sentiment in the sector has been helped by a weaker U.S. currency, which makes dollar-denominated commodities cheaper for non-U.S. consumers and expectations that top consumer China will use further stimulus to boost its flagging economic growth.

Yellen Reignites Commodities Rebound From Gold to Copper – by Luzi-Ann Javier (Bloomberg News – March 17, 2016)

March 18, 2016

http://www.bloomberg.com/

Federal Reserve Chair Janet Yellen’s dovish message reignited a commodities rebound that pushed up everything from gold and copper to miners including Teck Resources Ltd. and Freeport-McMoRan Inc.

The Fed on Wednesday signaled it won’t raise interest rates as much this year as forecast in December amid weakening global economic growth, sending gold prices surging just after futures capped the longest slump since November.

A gauge of 14 gold miners climbed to the highest in more than a year, while the Bloomberg Americas Mining Index surged to an eight-month high. “With loose monetary policy and low rates, we’ll have a lot of money out there in the system and demand will be higher,” Bob Haberkorn, a senior market strategist at RJO Futures in Chicago, said in a telephone interview.

BHP Billiton invites coal to join new world order – by Matthew Stevens (Australian Financial Review – March 17, 2016)

March 18, 2016

http://www.afr.com/

Two weeks before Andrew Mackenzie extended his mission of simplicity to Australian industrial relations, the coal workers of Queensland were offered documentary evidence of exactly what the BHP Billiton chief executive might have in mind.

“BHP Billiton believes it’s in the national interest to simplify workplace agreements so that our teams have the flexibility to succeed in the global market,” Mackenzie told The Australian Financial Review Business Summit on Wednesday.

True to his politically moderate roots, Mackenzie went on to note that industrial relations in Australia posed nothing like the competitive risk that it did in some of BHP’s other global constituencies. Rather he suggested that our inability to put the relationship between capital and labour on a more productive footing was a competitive advantage surrendered.

Grand Council of the Cree Grand Chief shocked at First Nation opposition to land claim – by Alan S. Hale (Timmins Daily Press – March 18, 2016)

March 18, 2016

http://www.timminspress.com/

Grand Chief Michael Coon Come said he was shocked by the wall of opposition from Ontario First Nations to the Grand Council of the Crees’ lawsuit to claim Aboriginal rights and title over a section of land on the Ontario side of the border.

The piece of land in question stretches from the southern coast of James Bay all the way to Lake Abitibi east of Timmins. Moose Cree First Nation is saying that is their traditional territory and an all rights and title to it belong to them exclusively.

Coon Come said that the Cree communities on the east coast of James Bay in Quebec are willing to come up with an arrangement where the rights and title to the land can be shared. But that didn’t stop the Moose Cree, the Mushkegowuk Council and the Nishnawbe Aski Nation all to denounce the lawsuit and demand that it be withdrawn.

How did the world’s miners not see it coming? – by Andy Home (Reuters U.S. – March 17, 2016)

March 18, 2016

http://www.reuters.com/

It is an extraordinary fact that in just three years, 2011,
2012 and 2013, China used more cement than the United States
did in the 20th century, 6.6 billion tonnes compared with 4.4
billion, according to figures from the U.S. Geological Survey.

LONDON – “Why did nobody see it coming?” With this simple question, posed to Professor Luis Garicano of the London School of Economics in November 2008, Britain’s Queen Elizabeth famously summed up the layman’s astonishment that an obscure part of the derivatives universe could trigger a global financial crisis.

A similar question might be posed of the world’s miners right now. Having collectively bet the house on a commodities “supercycle” only to see the “super” part of that cycle dissolve in front of their eyes, they are now fighting the numerous fires engulfing their overstretched balance sheets.

Pardieu Brings Ruby Rush to Life with Stories, Updates from Madagascar – by Jaime Kautsky (Gemological Institute of America – March 10, 2016)

March 17, 2016

http://www.gia.edu/

A gem “fingerprint.” That’s what Vincent Pardieu, senior manager of field gemology for GIA in Bangkok, and his six-person team are looking for as they traverse the globe – and log hours in the lab – finding, analyzing and cataloging colored stones for GIA’s Colored Stone Identification and Origin Report reference collection.

So when Pardieu’s team learned of a newly discovered ruby deposit in northeast Madagascar in July 2015, they arranged a field expedition and set to work investigating and documenting the rubies of the island nation’s Zahamena National Park.

On Nov. 4, just a month after their trip, Pardieu and field assistant Manuel Diaz visited GIA’s Carlsbad campus to share their findings − and sometimes harrowing experiences − with students and staff.

Diamonds suffer from oversupply, price falls in new era – by James Wilson (Financial Times – March 16, 2016)

March 17, 2016

http://www.ft.com/

Only eight years ago, De Beers celebrated the opening of Snap Lake — a landmark project for the diamond producer. The diamond mine in Canada’s remote North West Territories was De Beers’ first outside its African heartland and the first completely underground diamond mine in the country. By the end of 2014, $2.2bn had been spent on development and operations.

Yet today, not a single diamond is being produced at Snap Lake, which has been closed with the loss of more than 400 jobs as De Beers responds to one of the worst market downturns in diamonds for years. This year, De Beers will consider whether the mine has a viable future. As recently as 2014 the mine was producing 1.2m carats of diamonds annually.

The temporary closure of the mine summed up the problems facing the diamond industry during 2015, when a downturn gathered pace and led to financial pain for miners, dealers and retailers.

UPDATE 1-Poland’s KGHM targets lower output after record 2015 loss (Reuters U.S. – March 17, 2016)

March 17, 2016

http://www.reuters.com/

Europe’s second biggest copper producer, Poland’s state-run KGHM, signalled on Thursday plans to cut its copper output this year after writedowns pushed its 2015 net loss higher than expected.

The miner posted a record loss of 5.01 billion zlotys ($1.3 billion) at the group level and 2.8 billion loss for the parent company, from which KGHM pays dividends. Analysts had expected losses of 4.81 billion and 2.29 billion respectively.

Earlier this year, the company reported writedowns of $1.3 billion on its foreign assetsdue to falling metal prices, with the largest drag coming from its main overseas mine Sierra Gorda in Chile.

South African Miners Say Being Unduly Pressured Over Licenses – by Paul Burkhardt (Bloomberg News – March 17, 2016)

March 17, 2016

http://www.bloomberg.com/

The Chamber of Mines of South Africa said it wants a probe into reports that mines are receiving notices from the government suspending operations because they don’t meet black ownership requirements. Those regulations are due to be ruled on by a court.

This week the High Court in Pretoria began hearing a case lodged by the Chamber, which represents companies including Glencore Plc, against the Department of Mineral Resources.

The judge is being asked to rule on the legality of a requirement added by the DMR to the mutually agreed mining charter in 2010 that requires mine assets to be at least 26 percent black-owned at all times even when black investors sell their stakes is legal. The Chamber also said safety stoppages are being issued improperly.

Documentary captures life of Appalachian coal mining – by Emma Austin (WKU Herald – March 17, 2016)

March 17, 2016

http://wkuherald.com/

The term “overburden” is used for the rock, soil, trees and ecosystem that lie above a coal seam. It is also the title of Chad Stevens’ documentary about environmental devastation in the Appalachian coal mining region and the effect it has had on the area’s surrounding communities.

Stevens, director and cinematographer of the film “Overburden,” visited campus Tuesday night for Bowling Green’s first screening. Before the viewing, Stevens recounted the experience that inspired him to begin the project.

Obama Administration Offering $66 Million To Help Coal-Reliant Communities – by Maria Gallucci (International Business Times – March 17, 2016)

March 17, 2016

http://www.ibtimes.com/

The Obama administration on Thursday offered nearly $66 million to boost communities battered by the coal industry’s downturn and a string of recent mining bankruptcies.

The funds are part of the Partnerships for Opportunity and Workforce Development and Economic Revitalization (POWER) Initiative, a federal program to support coal-reliant communities in states like Ohio, West Virginia and Kentucky where mines are shuttering and coal-fired power plants are closing due to rocky market conditions and tougher environmental regulations.

The Obama administration last year awarded around $14.5 million in POWER grants to a dozen states. In Ohio, which received $2 million, one of the biggest slices, the money is helping pay for retraining and education programs in high-demand industries, namely trucking.

Glencore News Release: Geotechnical failure at Katanga Mining Limited – Update 4 (March 17, 2016)

March 17, 2016

www.glencore.com

Baar, Switzerland – Glencore notes the update made by Katanga Mining Limited (KML) earlier today. The search for the seven colleagues missing since the geotechnical failure has been underway for 10 days. All available resources have been allocated to the search and rescue effort. To date, three bodies have been located, one of which is still to be positively identified.

It is with deep sadness that Glencore must now assume that any individual who was in KOV open pit at the time of the incident will not have survived. The activities in KOV open pit will now be focused on the recovery phase of the operation as weather and ground conditions allow.

Both Glencore and KML express their sincere condolences to the family, colleagues and friends of the individuals who have died as a result of this tragic incident. All appropriate support will be provided.

Lithium-ion batteries can power African growth – by Prinesha Naidoo (Mineweb.com – March 17, 2016)

March 17, 2016

http://www.mineweb.com/

JOHANNESBURG – African mining companies stand to win big from the growing lithium-ion battery market, says Kenneth Ozoemena, chief scientist and research group leader at the Council for Scientific and Industrial Research (CSIR).

A key component of lithium-ion batteries are metal oxides which range from aluminium to cobalt, manganese, nickel and titanium.

Ozoemena told delegates at the 2016 Power & Electricity World Africa conference that Africa’s abundance of such natural resources could prove a boon not only for lithium miners but for associated raw material oxides as well.

Coal’s ‘Last Man Standing’ Dragged to the Brink of Bankruptcy – by Tim Loh (Bloomberg News – March 17, 2016)

March 17, 2016

http://www.bloomberg.com/

Welcome to the twilight of American coal. Peabody Energy Corp., the nation’s biggest miner, is on the verge of bankruptcy, crippled by $6.3 billion in debt. The company’s announcement Wednesday that it may file sent a decisive signal to the market: The U.S. coal industry is still too big.

“It’s the end of the era of publicly traded coal companies,” said Ted O’Brien, chief executive officer of Doyle Trading Consultants, an energy markets research group.

Peabody has lost 98 percent of its market value in 12 months and watched as its main rivals — Walter Energy Inc., Alpha Natural Resources Inc. and Arch Coal Inc. — all filed for bankruptcy, crushed by falling demand, massive debt loads, mounting environmental regulations and competition from cheap natural gas.

Gold smuggling thrives across Myanmar’s borders (Bangkok Post – March 16, 2016)

March 17, 2016

http://www.bangkokpost.com/

YANGON — The thriving illegal business in gold across Myanmar’s porous borders is likely to continue unchecked until the government legalises trade of the raw material, traders and industry sources said.

Industry bodies have asked the Commerce Ministry to strike the precious metal from its list of restricted goods, saying this would boost government coffers and help to combat smuggling, the Myanmar Times reported on Wednesday.

Traders exploit international price differences for the raw material, selling to smugglers who transport the metal out of the country, said Myo Myint, chair of the Yangon Region Gold Entrepreneurs Association.

Gold enters and leaves Myanmar through Muse on the Chinese border, Myawaddy on the Thai border and Maungdaw on the border with Bangladesh, he said.