Republic of Mining

Mass Layoffs in China’s Coal Country Threaten Unrest – by Jane Perlez and Yufan Huang (New York Times – December 16, 2015)

December 16, 2015

http://www.nytimes.com/

HEGANG, China — In the dank shower room where the miners soak, the coal dust from their bodies staining the water chocolate, a lone worker sat smoking a cigarette, staring at the floor.

He lingered, he explained, because since his pay had been cut in half, he had been eating dinner at his parents’ apartment, and he dreaded the humiliation of going there again.

“If any of the leaders would do their job properly, the situation would not be like this,” said the worker, Mr. Guo, 39. “If they want to sack me, they should just do it. Can it get any worse?” It probably will.

Queensland court agrees Adani overstated benefits of Carmichael coal mine -by Lisa Cox (Brisbane Times – December 16, 2015)

December 16, 2015

http://www.brisbanetimes.com.au/

A Queensland court has found Indian mining company Adani exaggerated the economic benefits of its proposed Carmichael coal mine, including the amount of jobs and royalties the $16.5 billion project would generate.

In a judgment on Tuesday, the Queensland Land Court recommended the Queensland government grant mining leases and environmental approvals for the controversial project, which would become Australia’s largest coal mine.

But the approvals should only be given with additional environmental conditions, including regular monitoring of water bodies near the mine site in central Queensland and a more thorough assessment of the presence of threatened bird species, the black throated finch.

Fed raises interest rates, cites ongoing U.S. economic recovery – by Howard Schneider and Jason Lange (Reuters U.S. – December 16, 2015)

December 16, 2015

http://www.reuters.com/

WASHINGTON – The Federal Reserve hiked interest rates for the first time in nearly a decade on Wednesday, signaling faith that the U.S. economy had largely overcome the wounds of the 2007-2009 financial crisis.

The U.S. central bank’s policy-setting committee raised the range of its benchmark interest rate by a quarter of a percentage point to between 0.25 percent and 0.50 percent, ending a lengthy debate about whether the economy was strong enough to withstand higher borrowing costs.

“The Committee judges that there has been considerable improvement in labor market conditions this year, and it is reasonably confident that inflation will rise over the medium term to its 2 percent objective,” the Fed said in its policy statement, which was adopted unanimously.

UBS Analyst Who Called Mining Stock Slump Says Rout Not Over – by Adam Haigh (Bloomberg News – December 15, 2015)

December 16, 2015

http://www.bloomberg.com/

David Cassidy, who correctly told investors to shun Australian mining stocks in 2015, says the worst is yet to come for the industry as China’s economy decelerates.

Investors should hold fewer commodity producers than are represented in the S&P/ASX 200 Index because shares are yet to bottom, says Cassidy, UBS Group AG’s head of equity strategy for Australia.

Instead of speculating on some of the stock market’s worst performers, he’s telling investors to buy firms with profits that are closely tied to an upswing in the economy, such as developer LendLease Group and retailer Harvey Norman Holdings Ltd.

“We’re closer to the bottom but not yet willing to call the bottom here,” Cassidy said in a phone interview from Sydney on Dec. 14.

Gold investors sold the rumor of higher U.S. rates – will they buy the fact? – by Jan Harvey (Reuters U.S. – December 15, 2015)

December 16, 2015

http://www.reuters.com/

LONDON – Gold bulls hoping an anticipated rise in U.S. interest rates will paradoxically boost the metal’s price might just be disappointed, as the wider environment offers little to justify a rebound.

Gold has fallen 10 percent so far in 2015, hitting its lowest in nearly six years largely on speculation that monetary policy will tighten. In theory, higher interest rates weigh on bullion by lifting the opportunity cost of holding such a non-yielding asset.

While expectations of a rate rise have driven selling, some bulls say it is so well priced into gold that the reality of any slow and gradual rise from record lows after this week’s forecast increase could reinvigorate investment.

Although gold has managed to rise in the face of rising rates before, there is not enough support from other factors to push prices up this time around, analysts said.

Bloom Lake ‘bargain’ a long term investment, says iron ore expert (CBC News Newfoundland and Labrador – December 16, 2015)

December 16, 2015

http://www.cbc.ca/news/canada/newfoundland-labrador/

The new owners of the Bloom Lake iron ore mining project in northeastern Quebec got a bargain, but a mining analyst says don’t expect production any time soon.

“We think it’s a great deal,” said Garrett Nelson Tuesday in an interview with CBC Radio’s Labrador Morning.

“We think this asset will have significant value, longer term.” Quebec Iron Ore Inc., a subsidiary of Champion Iron Ltd., said Friday it had agreed to pay $10.5 million for the mine, railway and mineral claims just across the border from Labrador.

It will also assume responsibility for nearly $42 million in environmental liabilities.

OPINION: Mine uranium, stop climate change – by Stephen Antony (Boston Globe – December 15, 2015)

December 16, 2015

https://www.bostonglobe.com/

Stephen Antony is the president and CEO of Energy Fuels.

Fresh off the successful negotiations in Paris, there is an unprecedented international coalition now focused on the important issues of climate change and clean energy.

Nuclear energy has rightfully been one of the major topics of discussion because no other power source — not wind or solar — has the scalability or reliability of nuclear energy to significantly reduce air and carbon emissions. If we are even remotely serious about reducing greenhouse gas emissions, nuclear power must be part of our energy future.

That’s why I’ve chosen this moment to respond to two misleading HuffPost and New York Times columns, both written by Mark Udall, former US senator from my home state of Colorado.

Here’s why Australia’s budget is still so dependent on iron ore – by Jonathan Barrett (Australian Financial Review – December 16, 2015)

December 16, 2015

http://www.afr.com/

This week, the federal government disclosed it would receive $7 billion less than anticipated over the budget years as a result of updated – and lower – iron ore price forecasts.

But how exactly does the iron ore price affect federal coffers? And how will it impact the states?

Most of the country’s iron ore deposits are in Western Australia’s Pilbara region, and, unlike gas reserves located in federal waters, the key steel-making commodity is owned by the state.

As the federal government doesn’t actually own the commodity, the obvious connection between the federal budget and iron ore price is the profitability of mining companies.

[Ontario] Province backs mining blueprint with cash- by Carl Clutchey (Thunder Bay Chronicle-Journal – December 15, 2015)

December 16, 2015

http://www.chroniclejournal.com/

After being harshly criticized for doing little to advance Ontario’s mining sector, the province’s mines minister tried to give assurances Monday that his ministry hasn’t been sitting on its hands.

Northern Development and Mines Minister Michael Gravelle said his department has earmarked $5 million so that junior companies can make headway on exploration projects. The money is part of a “renewed” provincial mineral development strategy that first surfaced in 2006.

Gravelle touted the renewed 10-point strategy as “a blueprint for how we will help the sector address the challenges of today and position it to grow and attract investment in the future.”

Lithium prices are soaring and Rio Tinto says it may start mining the commodity – by Peter Ker (Sydney Morning Herald – December 17, 2015)

December 16, 2015

http://www.smh.com.au/

It’s one of the world’s hottest commodities, and now Rio Tinto wants to join the lithium party.

Prices for lithium are soaring as traditional demand from ceramics and glass manufacturers coincides with rising demand from lithium ion battery and electric vehicle manufacturers.
Lithium prices rose from $US4900 ($6774) per tonne to $US5900 per tonne in the year to October 2015, and since then the price has almost doubled to $US10,000 per tonne.

UBS analyst Matthew Schembri said the onset of the northern winter had crimped production of lithium in China and duly created a shortage, and he predicted the price could continue rising over the next six months.

NEWS RELEASE: Chamber of Mines Urges the New NWT Government to Make Support of Mineral Industry a Top Priority

December 16, 2015

http://www.miningnorth.com/

(Yellowknife, NT – December 15, 2015) The northern minerals industry is appealing to newly elected Members of the NWT Legislative Assembly (MLAs) to build a strong economic agenda that would make improving the investment climate for the minerals industry a top priority.

“We need our new government to take appropriate steps to protect our minerals industry,” said Gary Vivian, President of the NWT & Nunavut Chamber of Mines. “And it’s really worth protecting. Our mines have made exceptional inroads in the past 20 years, through successful training and employment, and through huge spending with Aboriginal and non-Aboriginal businesses. Today, we have thousands of people looking to the guidance of the new Legislative Assembly to protect their jobs and their businesses.”

In good years, the mining industry has contributed as much as 50% of the NWT’s Gross Domestic Product; currently it provides 40%.

Investors put pressure on miners to respond to climate change (Reuters U.S. – December 16, 2015)

December 16, 2015

http://www.reuters.com/

An alliance of around 100 investors is calling on mining companies Anglo American Glencore and Rio Tinto to show that they are working to lessen the impact of climate change on their businesses.

The group of European fund managers and pension funds including Aviva, Amundi and Schroders, which together manage over $4 trillion in assets, will file shareholder resolutions to the firms this month, investor coalition “Aiming for A” said on Wednesday.

Shareholders will vote on the resolutions at company meetings to be held in the first months of 2016. Miners are already grappling with an industry crisis caused by plunging commodity prices.

The Chinese scramble to mine Africa – by Vladimir Basov (Mining.com – December 15, 2015)

December 16, 2015

http://www.mining.com/

A more than twenty-five fold jump in investment in fewer than 10 years. That’s how fast China is gaining control over Africa’s mining industry. And Beijing’s push is not ending any time soon.

China’s growing economy is thirsty for sustainable supplies of mineral resources. Despite being the number one mining nation in the world, China is facing a rapid depletion of its local mineral resources.

Reserves-to-production (R/P) ratio that represents the “burn rate” of proven reserves of mineral commodities when applying current levels of domestic mine production shows that China is in the “red zone” for future supplies of nearly all crucial minerals.

Anglo American Job Cuts Strike at Core of South Africa’s Mining Industry – by Alexandra Wexler (Wall Street Journal – December 15, 2015)

December 15, 2015

http://www.wsj.com/

JOHANNESBURG—When mining giant Anglo American PLC said last week that it would shed more than half its global workforce in the coming years, nowhere did the news hit harder than in South Africa, the mining behemoth’s ancestral home.

Anglo American, founded in Johannesburg in 1917, operated exclusively in southern Africa until the 1960s. Although the company upped stakes for London in 1999, ties to the old country still run deep.

Anglo American employed 72,000 people in South Africa as of the end of last year, about 48% of its total global workforce. Anglo American Platinum Ltd., majority owned by Anglo American but listed as a separate entity in Johannesburg, accounted for 49,763 of that total.

Ontario pledges to grow mining exploration industry over next 10 years (CBC News Sudbury – December 14, 2015)

December 15, 2015

http://www.cbc.ca/news/canada/sudbury/

On the heels of a scathing report by the province’s auditor general in recent weeks, the Ministry of Northern Development and Mines says it’s making some changes.

The province has released a renewed mineral development strategy that aims to grow the exploration industry over the next decade — and has announced an investment of $5 million towards exploration work by junior mining companies.

The investment is needed, says the executive director of the Ontario Prospector’s Association. “The main thing with the exploration industry’s needs is that we need to be able to raise money,” Garry Clark said.