December Newsletter – 06.12.2021


  • China is mining much more coal again and that’s boosting its factories
  • Steel’s path to go green will cost industry up to $278 billion
  • WSJ: China to create new state-owned rare-earths giant
  • Congo replaces head of miner Gecamines for first time in decade
  • Billionaire Adani’s disputed mine shows ditching coal isn’t easy
  • Sumitomo making EV battery recycling progress
  • Turquoise Hill okays Oyu Tolgoi $75m bridging budget
  • MMG to shut down operations at Las Bambas copper mine by mid-December
  • China’s Chengtun to invest $245m in Indonesian nickel matte project

China is mining much more coal again and that’s boosting its factories

Hong Kong (CNN Business)China’s economy is finally getting some good news: Its big factories are staging a recovery as a power crunch that held back production starts to ease because of a big jump in coal supply.

A government survey of manufacturing activity increased to 50.1 in November from 49.2 in October, according to data released by the National Bureau of Statistics (NBS) on Tuesday. It was the first reading above 50 — indicating expansion rather than contraction — in three months. It was also the first time since March that the index increased over the prior month.

Beijing on Tuesday attributed the improvement to “recent policy measures” that have strengthened energy supply and stabilized soaring costs.

Steel’s path to go green will cost industry up to $278 billion

The world’s steel industry could eliminate its greenhouse gas emissions by 2050 through ramping up recycling, using hydrogen for fuel and capturing carbon from older plants, according to a BloombergNEF study. But getting there won’t be easy.

pic1 Behre Dolbear newsletter 07.12.2021

Steel production generates an estimated 7% of global greenhouse gas emissions and some processes can’t easily run on electricity. Switching to zero-carbon production methods will require the industry to spend $215 billion to $278 billion for capital investments, according to a report by Bloomberg’s energy data and analysis unit. Still, steel made under such a system could ultimately cost less than today’s prices.

The steel industry has a challenging path to decarbonization: It is heavily reliant on coal, has limited opportunities to increase its share of recycled production due to scrap availability, and will need to wait for hydrogen costs to fall to realize cost-competitive clean production,” BNEF analysts including Julia Attwood wrote in the report.

About 69% of current production is fuelled by coal in blast furnaces, according to the report. Given its combination of price and strength, there’s no obvious material replacement for steel required in everything from buildings to automobiles to toasters and medical equipment.

WSJ: China to create new state-owned rare-earths giant

The Wall Street Journal reported that China will create one of the world’s largest rare-earths companies with the aim of maintaining its dominance in the global supply chain of the strategic metals as tensions deepen with the US.

Citing unnamed “people familiar with the matter”, the WSJ said that the move is expected to be announced this month.

The new firm will be called China Rare Earth Group and will be based in resource-rich Jiangxi province in southern China as soon as this month, the sources said. The new entity would be created by merging rare-earths assets from some state firms, including China Minmetals Corp. , Aluminum Corp. of China Ltd. and Ganzhou Rare Earth Group Co.

According to the USGS, global mine production of rare earths was estimated to have increased to 240,000 tons of rare-earth-oxide equivalent in 2020. According to China’s Ministry of Industry and Information Technology, China’s mine production quota for 2020 was 140,000 tons (58% of global total), with 120,850 tons allocated to light rare earths and 19,150 tons allocated to ion-adsorption clays.

The 58% share of mining marks a sharp decline from a decade earlier—when China had near total dominance—due to the ramping up of mining efforts in other countries. However, China still maintains a lock on the subsequent refining of mined rare earths, with an 80% global share. I.e., even rare earths mined overseas are sent to China for final processing.

Congo replaces head of miner Gecamines for first time in decade

Democratic Republic of Congo’s President Felix Tshisekedi named Alphonse Kaputo Kalubi as chairman of Gecamines, the state-controlled copper and cobalt mining company.

pic2 Behre Dolbear newsletter 06.12.2021

Kalubi replaces Albert Yuma who served for more than 10 years at the helm of a company that’s key to mining in Congo, the world’s biggest cobalt producer. Tshisekedi’s spokesman, Kasongo Mwema Yamba Yamba, confirmed the leadership changes in a message on Friday.

Bester-Hilaire Ntambwe Ngoy Kabongo was named chief executive officer, while Leon Mwine Kabiena becomes his deputy, Yamba Yamba said.

Billionaire Adani’s disputed mine shows ditching coal isn’t easy

Billionaire Gautam Adani’s coal mine in Australia, a project that’s become a global emblem for opposition to fossil fuels, is preparing to begin exports after more than a decade of bitter dispute over its development.

Proposed in 2010 and stalled by legal challenges, financing setbacks and a sustained campaign from climate activists, the operation is scheduled to ship first cargoes before the end of December and aims to supply an initial 10 million tons of thermal coal annually for at least 30 years.

Sumitomo making EV battery recycling progress

Subsidiary of Japanese conglomerate reportedly nearly ready to scale up to shred 7,000 tons of lithium-ion batteries per year.

Japan-based Sumitomo Metal Mining (SMM) is reportedly making progress in its effort to scale up what it considers to be a cost-effective process to harvest metals from end-of-life lithium-ion electric vehicle (EV) batteries.

On its website, SMM says the focus of its research is “to establish a stable and efficient system to supply materials using this high-purity nickel [recovered from end-of-life batteries] to customers.” The company also acknowledges the development of cost-effective recycling processes for lithium-ion batteries has proven “difficult.”

In 2019, SMM announced it had started recovering and recycling copper and nickel from lithium-ion batteries at its Non-Ferrous Metals Division’s Toyo Smelter & Refinery in Saijo City, Japan, beginning in July 2017.

On its website, SMM says its process “selectively recovers nickel, cobalt and copper as an alloy by using a pyrometallurgical refining process independent of the existing process to separate most of the impurities from the lithium-ion batteries.”

Turquoise Hill okays Oyu Tolgoi $75m bridging budget

Turquoise Hill Resources’ (TSX, NYSE: TRQ) board has approved a bridging budget of $75 million that allows the parties involved in the vast Oyu Tolgoi copper-gold mine in Mongolia to progress the operation’s underground expansion.

The Canadian miner, in which Rio Tinto (ASX, LON, NYSE: RIO) has a 50.8% stake, said the board’s decision reflected the progress made in the ongoing negotiations between the Government of Mongolia, Rio Tinto and the company.

It also said the approved budget “should be sufficient” to sustain development work on the underground mine up to mid-January 2022.

Turquoise noted that, while it believes the budget approval was a “necessary and positive step”, there can be no assurance that the board of Oyu Tolgoi LLC will approve any future crucial additional investments to continue progressing the mine’s underground section.

Shares in the company climbed on the news and were trading 2.5% higher at $15.2 in New York  at the opening.

China’s Chengtun to invest $245m in Indonesian nickel matte project

China’s Chengtun Mining Group Co Ltd said on Thursday it would invest $245 million in a project to make nickel matte in Indonesia as a raw material for electric vehicle (EV) battery chemicals.

The venture, known as PT ChengMach Nickel, will produce 40,000 tonnes per year of nickel matte on a metal content basis, Chengtun said in a filing. Chengtun unit Hongcheng International will hold 70% equity, with the remainder held by a Singapore-registered company called Extension Investment Pte.

Total investment is pegged at $350 million, including Extension’s share.

The venture will be Chengtun’s second nickel matte project in Indonesia and – like the first, with capacity of 34,000 tonnes per year – will be located in Weda Bay on the island of Halmahera.


Link for more detailed information

comm1 Behre Dolbear newsletter 06.12.2021 comm2 Behre Dolbear newsletter 06.12.2021 comm3 Behre Dolbear newsletter 06.12.2021