August Newsletter – 30.08.2022

  • Electric vehicles bringing ‘silent revolution’ in India, says PM Modi
  • ‘Lives have been lost’: Blood Gold investigation sparks push for criminal probe
  • Rare earths processor buys mining rights in Greenland
  • Honda and LG to build $4.4bn EV battery plant in US
  • Goldman says ‘buy commodities now, worry about recession later’
  • Robert Friedland’s Ivanhoe Electric one of three finalists for Saudi Arabia project
  • Eurasian Resources to invest $230 million to build wind power plant in Kazakhstan

Electric vehicles bringing ‘silent revolution’ in India, says PM Modi

PM Narendra Modi and Suzuki Motor Corporation CEO Osamu Suzuki during the foundation stone laying ceremony of Suzuki EV battery plant and Maruti Suzuki vehicle manufacturinq facility, in Gandhinaqar on Sunday.

NEW DELHI: Prime Minister Narendra Modi on Sunday said that electric vehicles are bringing a ‘silent revolution’ in the country and will help India cut down on its carbon emissions.

Addressing a programme held to mark 40 years of Suzuki Motor Corporation in India at the Mahatma Mandir convention centre in Gujarat, the PM virtually laid the foundation stones of the Maruti Suzuki vehicle manufacturing facility for Haryana and Suzuki EV battery plant for Hansalpur in Gujarat.

India-Japan ties

The PM said the success of Maruti-Suzuki also signified the strong India-Japan partnership. ”The success of Maruti is a great example of the strength of the India-Japan relationship. In the last eight years, this relationship between the two countries has reached new heights,” he said.

‘Lives have been lost’: Blood Gold investigation sparks push for criminal probe

A senior politician says a Chinese state-backed miner should be considered for criminal prosecution after the deaths of dozens of miners next to an Australian mine site from which it allegedly stole millions of dollars worth of gold.

Andrew Head, a former mining manager at Cassius, accused Shaanxi of murdering local miners by blasting them with chlorine poisoning to protect the company’s investment in northern Ghana. Head said he had “no doubt in his mind” it was “murder, pure and simple”.

Teni Ghaatuon, mourns her husband, James Nbalebna, who died aged 21 from a mine blast by the Chinese mining company

Head’s allegations, supported by village leaders and victims’ families spoken to by The Sydney Morning Herald and The Age, have been denied by Shaanxi. The claims are part of a five-year dispute between the Australian-run Cassius and Shaanxi that also involves allegations of trespass, theft and corruption at the highest levels of the Ghanaian judiciary.

James Agalga – a senior opposition MP, former minister and deputy leader of Ghana’s Defence and Interior Committee – said the allegations were serious and could be tested by a criminal court.

“If the negligence was criminal in nature, then the state must take steps to prosecute,” he said. “In addition to that, human lives have been lost. Those left behind, breadwinners, the victims, they have to be adequately and properly compensated.”

The case between Cassius and Shaanxi has been tried in a civil court in Ghana, but the trial has been beset by delays and allegations of bribery involving a key senior judge. Cassius is now taking the Ghanian government to the London Court of International Arbitration over $395 million in losses from the Gban project. It claims the Ghanaian government allowed Shaanxi to continue to trespass on its land to steal millions of dollars in gold buried in the Australian concession while blocking the ability of Cassius to renew its licence.

Rare earths processor buys mining rights in Greenland

The move by Neo Performance Materials is part of an effort to expand rare earths production outside of China

The Canadian rare earth processor Neo Performance Materials plans to buy the rights to explore a mineral deposit in Greenland that contains the rare earth elements neodymium and praseodymium, which are used to make magnets for electric cars, wind turbines, and missiles.

This project is the company’s first step into mining and part of a strategy to create dual supply chains for magnets inside and outside of China. Neo hopes the mineral deposit will eventually supply its rare earth separation plant in Estonia.

“I think it makes all the sense in the world from an operating perspective to be looking to secure our upstream,” CEO Constantine Karayannopoulos said on an investor call earlier this month. The firm also wants to build a magnet plant in Estonia.

The US Geological Survey estimates that in 2021 about 60% of rare earth elements were mined in China. After they are mined, ores containing a mixture of rare earth elements are concentrated. The concentrated ore has to be separated into individual oxides and processed into rare earth metals. Finally, those metals are used to make magnets.

James Kennedy, president of the rare earth advisory firm ThREE Consulting, says China has a near monopoly on the separation of rare earths and the production of magnets.

Honda and LG to build $4.4bn EV battery plant in US

Japan’s Honda Motor and South Korean battery maker LG Energy Solution said on Monday they plan to invest $4.4 billion to build a new battery production plant for electric vehicles in the U.S.

The news comes on the heels of a string of recent announcements that aim at cutting China out of supply chains for EVs.

It also marks the latest plans by automakers to invest in US production of battery cells for EVs, as the industry works to meet stricter regulations and accelerate production of such zero-emissions cars and trucks. Others have included General Motors, Ford Motor and Hyundai Motor.

Panasonic said in July it would build a $4 billion battery plant in Kansas to supply EV maker Tesla. Last week, news of the Japanese automaker planning to build another battery plant in the US grabbed headlines.

Honda and LG Energy said their plant is expected to begin mass production of advanced lithium-ion battery cells by the end of 2025. The facility will be built and operated by a joint venture between the companies, which is expected to be established this year.

It will be the first manufacturing plant for EV batteries in the US for Honda, which has committed to stop producing fossil-fuelled vehicles by 2040, the companies said.

Goldman says ‘buy commodities now, worry about recession later’

Goldman Sachs Group Inc. urged investors to pile into commodities as most recession risks coursing through global markets are overblown in the near term, arguing that raw materials stand to rebound amid a profound energy crisis and tight physical fundamentals.

“Our economists view the risk of a recession outside Europe in the next 12 months as relatively low,” analysts including Sabine Schels, Jeffrey Currie and Damien Courvalin wrote in a note. “With oil the commodity of last resort in an era of severe energy shortages, we believe the pullback in the entire oil complex provides an attractive entry point for long-only investments.”

Commodities hit a record in June as Russia’s invasion of Ukraine disrupted output and snarled supply chains, then eased as recession concerns flared and central banks including the Federal Reserve tightened policy to contain inflation. Last week, Fed Chair Jerome Powell signaled more interest rate rises will follow this half, and global stocks hit a one-month low on Monday.

“From a cross-asset perspective, equities could suffer as inflation stays elevated and the Fed is more likely to surprise on the hawkish side,” Goldman said in the note, which was entitled ‘Buy commodities now, worry about the recession later’. It added: “Commodities, on the other hand, are the best asset class to own during a late-cycle phase where demand remains above supply.”

Robert Friedland’s Ivanhoe Electric one of three finalists for Saudi Arabia project

Robert Friedland, Founder and Co-Chairman of Ivanhoe Mines, speaking at the 2022 Future Minerals Forum in Riyadh, Saudi Arabia.

Saudi Arabia has narrowed the field to three finalists for a massive mining exploration licence about 175 km west of Riyadh that it says contains about 25 million tonnes of zinc and copper at grades of 4.11% zinc and 0.56% copper.

The kingdom received six proposals for the 350-km Khnaiguiyah licence and has selected three for its short list: a consortium between Saudi Arabian Mining Company (Ma’aden) and Ivanhoe Electric (TSX: IE; NYSE-AM: IE); a consortium between Alara Saudi Ventures Pty. Ltd. Resources and AlTasnim Enterprises LLC; and a consortium between Moxico Resources Plc and Ajlan & Bros Mining Company.

The third and final stage of the application process will kick off on Sept. 4.

As part of its plan to transform the mining sector into the third pillar of its national economy, Saudi Arabia offers incentives including co-funding of up to 75% of capex through the Saudi Industrial Development Fund (SIDF); a five-year royalty holiday for miners and a 30% reduction on royalty payments for further downstream production processing.

The government hosted its first ever Future Minerals Forum in January to showcase its mining potential and the urgency of finding more critical metals. lt passed a new minerals investment law last year and in the first ten months of 2021 the country provided 13 reconnaissance licences, 133 exploration licences and eight exploitation licences, according to government data.

Mining companies active in the country include Barrick Gold (TSX: ABX; NYSE: GOLD), which has a 50-50 joint venture copper operation with Ma’aden. The Jabal Sayid mine went into commercial production in July 2016.

Eurasian Resources to invest $230 million to build wind power plant in Kazakhstan

Eurasian Resources Group announced Monday that it plans to invest nearly KZT110 billion ($230m) in building a major wind power plant in Kazakhstan, the Group’s home country.

To be commissioned in 2024, the new renewable energy facility will have a capacity of up to 155 MW, making it the most powerful plant in the Aktobe region, and is expected to reduce CO2 emissions by around 520,000 tons annually, the company said.

The wind turbine park will extend over 150 hectares near the town of Khromtau in Kazakhstan. About 300 jobs will be created during the construction phase, and the facility will provide 30 permanent jobs once it is commissioned.

The wind power generated will be used to supply ERG’s Kazchrome Donskoy GOK plant, the largest industrial enterprise in the Aktobe region, and cover the plant’s growing energy needs as it increases its production capacity in the coming years. The wind farm will supply energy to neighbouring industrial facilities and the Aktobe region more widely, reducing Kazakhstan’s usage of coal.

This will be ERG’s first proprietary wind farm project, and forms part of the Group’sESG strategy and decarbonisation program. In total, by 2030, ERG plans to reduce its emissions to air by 56%, emissions to water by 30% and water consumption by 33% through its energy strategy.

“President of the Republic of Kazakhstan Mr. Kassym-Jomart Tokayev recently announced that Kazakhstan intends to achieve carbon neutrality by 2060, and ERG is in full support of this initiative,” ERG board chairman Alexander Machkevitch said in the statement.

Fracking may decrease magnitude of microearthquakes at mining operations – study

Rock Springs No. 5 coal bed along Superior Cutoff Road, east of Superior, Wyoming.

New research published in The European Physical Journal B proposes the idea that fracking can decrease the magnitude and the microearthquakes that tend to occur in certain mining operations.

Hydraulic fracturing involves pumping large quantities of fluids into a wellbore at high pressures. This has the effect of enlarging fractures in the target rock formation which, in turn, results in an increase in the yield of oil or gas from rocks — especially from low-permeability rocks like tight sandstone, shale and occasionally coal beds.

The paper’s authors attempted to quantify the benefits of preconditioning with hydraulic fracturing by integrating previous investigative models to create a more realistic approximation of the seismic ruptures.

This model was applied to a mine in Chile’s O’Higgins Region to assess induced seismic activity due to the effect of hydraulic fracturing. The team also considered both the magnitude of microearthquakes and the time between events.

This was done by analyzing 15,436 microearthquakes recorded between 2003 and 2008 in three sections of the mine. Comparisons were then made on the basis of whether the section had been preconditioned with hydraulic fracturing or not.


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