January Newsletter – 18.01.2021
HEADLINES
- Why President-elect Biden’s energy plans could derail the American Dream
- China: 12 workers trapped in gold mine are still alive
- Japan’s Itochu to exit thermal coal business, sell stakes in mines by March 2024
- Mongolia threatens to revoke Rio Tinto’s plan for Oyu Tolgoi
- China-Australia relations: breaking free of dependency on Australian iron ore would take years, but where is China looking?
- Atlantic coking coal: Shortage drives up prices
- Top uranium producer Kazakhstan decreases output by 15% in 2020
- Norway eyes sea change in deep dive for metals instead of oil
- Global uranium resources sufficient for the foreseeable future
- India Sees $55 Billion Investment in Clean Coal Over Next Decade
- R&B star Akon enters Congo mining sector in JV with state company
- Brazil signs accord with Japan to develop niobium potential
Why President-elect Biden’s energy plans could derail the American Dream
The coming inauguration of Joe Biden as the next president of the United States sets the stage for a policy agenda that openly and proudly demonizes the affordable, reliable energy resources we all rely upon.
Biden’s energy plans are bad for our national security, economy, public health, and overall quality of life. But the American people’s ingenuity and creativity — and the very nature of how our planet and energy systems work — mean all is not lost.
Under Biden’s attempts to “phase out” natural gas, petroleum, and coal, the prices we pay for energy will go up.
This should be no surprise to Biden and his political allies, since costs have soared everywhere “going green” has been tried. Californians are paying 30% more for electricity than they did 10 years ago. In Denmark, where wind energy became a priority in the mid-1990s, prices have more than doubled.
https://www.foxbusiness.com/energy/biden-energy-plan-derail-american-dream?action=profile_completion
China: 12 workers trapped in gold mine are still alive
The trapped miners managed to send a note to rescuers, urging them to send medicine. The workers have been stuck underground for over a week following a blast a gold mine in the Shandong province.
At least 12 workers who were trapped underground due to an explosion at a gold mine in eastern China are believed to be alive, local officials and media reported on Monday.
The blast occurred on January 10at the Hushan mine near Quixia city in the Shandong province, trapping 22 workers. The accident was not reported until 30 hours later.
The fate of the remaining 10 workers is still unknown. Four of the survivors currently trapped underground are believed to be injured.
The workers’ communication system had been destroyed during the accident. Debris blocked the mine shaft, which also led to a delay in finding them.
Trapped miners send note to rescuers
On Sunday, rescuers managed to drill down into the mine and said they heard “knocking sounds.” Rescuers also felt people pulling on iron ropes that had been lowered into the mine.
The miners managed to send up a note to rescuers detailing the conditions of the survivors, according to the official Xinhua news agency.
https://www.dw.com/en/china-12-workers-trapped-in-gold-mine-are-still-alive/a-56258260
Japan’s Itochu to exit thermal coal business, sell stakes in mines by March 2024
TOKYO, Jan 13 (Reuters) – Japanese trading house Itochu Corp 8001.T said on Wednesday it plans to exit the thermal coal business, selling its stakes in mines in Columbia and Australia by March 2024 as it aims to promote decarbonisation.
Itochu’s statement was the first confirmation from the company that it would completely withdraw from thermal coal business. It had previously said it would not invest in new stakes in thermal coal mines.
The move comes as other Japanese trading houses, including Mitsubishi Corp 8058.T, offload thermal coal assets on growing concerns about the fuel’s environmental impact.
Itochu’s decision is broadly tied to a new three-year business strategy through March 2024. Details of the plan, including profit and dividend targets, will be unveiled in April or May, when Itochu announces earnings for the current financial year ending March 31.
Mongolia threatens to revoke Rio Tinto’s plan for Oyu Tolgoi
The government of Mongolia may cancel and replace the development and financial plan for the country’s vast Oyu Tolgoi copper-gold mine, Turquoise Hill Resources (TSX: TRQ; NYSE: TRQ) said today.
The company, which is controlled by Rio Tinto (NYSE: RIO; LSE: RIO; ASX: RIO), said Mongolian authorities are dissatisfied with its plans and are particularly concerned about the costs of the expansion, recently updated to US$6.75 billion, about US$1.5 billion higher than its original estimate.
In 2019 Rio Tinto flagged stability risks associated with the original project design, which translated into as much as an additional US$1.9 billion cost and a 30-month delay.
The miner confirmed the new cost estimate for the underground expansion in December, and noted that production would begin in October 2022.
China-Australia relations: breaking free of dependency on Australian iron ore would take years, but where is China looking?
Brazilian port operator Grao Para Multimodal’s executive director, Paulo Salvador, knows there is plenty of untapped high-grade iron ore in northern Brazil, but a mix of bureaucracy and limited capital have stymied efforts to begin production for years.
Across the states of Para, Piaui and Tocantins, there are at least three mines amounting to nearly 10 billion tonnes of iron ore reserves ready for production, but they continue to sit idle, he said, adding that those deposits are only the tip of the iron ore iceberg in Brazil.
With commercial will and financial resources, however, enough iron ore could be produced from these mines to rebalance the market that is seeing record-high iron ore prices, and to satisfy China’s demand for the metal, according to Salvador. There are plenty of raw materials to go around, but the key is extracting them, he said.
Atlantic coking coal: Shortage drives up prices
US coking coal prices continued to edge up, with buyers increasingly conscious that ongoing supply tensions that have carried over to the high-volatile coal segment since December may not ease in the near term.
Demand from Chinese buyers remains healthy well into the second quarter, while European spot interest is expected to stay similarly strong on the back of rising steel demand and prices.
The Argus-assessed fob Hampton Roads price for low-volatile coking coal moved up by $2/t to $159/t, driven by Chinese buying and shrinking availability of non-Australia coals in the latter part of the first quarter. The high-volatile A assessment rose by $2/t to $149/t as suppliers with spot cargoes available to load from March onwards are seeking $150/t or higher. The high-volatile B price is up by $2.50/t to $127.50/t as offers creep towards $130/t in a tight market.
A cargo of US low-volatile Buchanan coal for March loading was heard offered at $198/t cfr China, while a cargo of US high-volatile coal for March loading was heard offered at $190/t cfr China. The specifications of the latter offer are understood to be similar to a high-volatile B — 35.5pc volatile matter, 7.4-7.9pc ash, 0.95-1pc sulphur and 27,000 fluidity. But the offer suggests that it may be a blend or have dilatation index nearer a high-volatile A coal, said market participants.
Top uranium producer Kazakhstan decreases output by 15% in 2020
Local media sources reported today that Kazakhstan, the world’s largest producer of uranium, mined 19,500 tonnes of uranium in 2020, a 15% decline over 2019 results (22,808 tonnes).
The Kazakhstan’s Minister of Energy Nurlan Nogayev said at a government meeting on Tuesday, “In 2020, uranium production in Kazakhstan amounted to 19.5 thousand tonnes, which is 101% compared to the revised plan.”
Earlier, the Ministry of Energy reported that Kazakhstan reduced the plan for uranium production in 2020 from 22.75-22.8 thousand tonnes to 19.35 thousand tonnes due to the pandemic-related restrictions.
According to the World Nuclear Association, Kazakhstan produces the largest share of uranium from mines (42% of world supply from mines in 2019), followed by Canada (13%) and Australia (12%).
Norway eyes sea change in deep dive for metals instead of oil
OSLO (Reuters) – Norway’s oil and gas reserves have made it one of the world’s wealthiest countries but its dreams for deep-sea discovery now centre on something different.
This time, Oslo is looking for a leading role in mining copper, zinc and other metals found on the seabed and in hot demand in green technologies.
Norway could license companies for deep-sea mining as early as 2023, its oil and energy ministry told Reuters, potentially placing it among the first countries to harvest seabed metals for electric vehicle batteries, wind turbines and solar farms.
That could also place it on the front line of a controversy over the environmental risks posed by exploiting the world’s unexplored seabeds, however.
Norway on Tuesday announced it was starting preparations for an environmental impact study needed to open areas of its seabed mineral exploration and production.
The move follows three years of expeditions on which Norway has found deep-sea deposits containing copper, zinc, cobalt, gold and silver, according to the Norwegian Petroleum Directorate which conducted the work.
There could be up to 21.7 million tonnes of copper – more than the world’s copper output in 2019 – and 22.7 million tonnes of zinc on the Norwegian continental shelf, Norwegian University of Science and Technology (NTNU) researchers have estimated.
Global uranium resources sufficient for the foreseeable future
Sufficient uranium resources exist to support the long-term, sustainable use of nuclear energy for low-carbon electricity generation as well as for other uses such as industrial heat applications and hydrogen production.
However, the impact of the ongoing COVID-19 pandemic on the industry and recent reductions in uranium production and exploration could affect available supplies.
Timely investment in innovative mining and processing techniques would help assure that uranium resources are brought to market when they are needed.
These are among the main findings of the latest edition of Uranium – Resources, Production and Demand, also known as the ‘Red Book’, an essential global reference prepared jointly by the OECD Nuclear Energy Agency (NEA) and the International Atomic Energy Agency (IAEA).
The Red Book presents the most recent review of uranium market fundamentals, based in large part on official government information, and offers a statistical profile of the global uranium industry.
It includes data on uranium resources, exploration, production and stocks, along with 45 country reports with detailed information on mine development plans, the status of environmental and social aspects of uranium mining, and national regulations and policies.
https://www.miningreview.com/energy/global-uranium-resources-sufficient-for-the-foreseeable-future/
India Sees $55 Billion Investment in Clean Coal Over Next Decade
(Bloomberg) — India expects to invest 4 trillion rupees ($54.5 billion) in clean coal projects over the next decade as it seeks to tap domestic energy sources and curb imports, federal home minister Amit Shah said. The investment will be made in clean coal facilities, including coal gasification and coal-bed methane, Shah said at a signing ceremony to develop new mines. He said coal power will be breached despite setbacks due to Covid-19. Emissions from burning coal can be made cleaner but not totally erased. India, the world’s third-biggest emitter of greenhouse gases, expects coal to remain its dominant energy source for decades, even as large parts of the world shun the dirtiest fossil fuel, which is blamed for contributing to global warming and air pollution. The South Asian nation has defended its use of the fuel while also embracing large-scale renewable energy projects to transition to clean energy. “We have to meet a target to become a $5-trillion economy, and for that, we have to exploit our coal reserves,” Shah said to the winning bidders of India’s first auction of coal blocks for commercial mining.
R&B star Akon enters Congo mining sector in JV with state company
DAKAR (Reuters) – A company led by American-Senegalese R&B singer Akon has signed a deal to finance a copper and cobalt mine in the Democratic Republic of Congo in a joint venture with a state miner, according to a contract published by the mines ministry.
The Grammy-nominated singer, known for hit songs like “Don’t Matter” and “Smack That,” has launched a number of business and philanthropic ventures across Africa in recent years, including a $6 billion futuristic city in Senegal and a cryptocurrency called Akoin.
Akon’s foray into Congo’s mining sector comes through a U.S.- registered firm called White Waterfall LLC, of which he is the president and CEO, according to contracts published on the mines ministry website.
One of the contracts, dated Dec. 14 and signed by Akon, whose legal name is Aliaune Thiam, commits White Waterfall to paying a $2 million signing bonus and financing a feasibility study of the Kimono reserve in Haut Katanga province.
Congo is Africa’s top producer of copper and the world’s leading miner of cobalt, used in electric car batteries.
White Waterfall is a private equity fund that invests in mining companies that are not publicly traded, according to its website. The site does not list the company’s investors or any investments.
Brazil signs accord with Japan to develop niobium potential
The Brazilian government signed a cooperation agreement with Japan to implement new technologies to boost production of niobium and graphene in the South American country.
“This will allow for the exchange of information for experiments and prototypes and the exploration of niobium or graphene applications that can add value to products and the production chain,” Brazil’s mines and energy ministry said in a release.
“The instrument also provides for the exchange of experiences and partnerships with the involvement of the private sector in research and development,” it added. “In addition, it will be able to address technologies, experiences, good practices and sustainability and environmental protection programs applicable to mineral exploration; mining; recycling technologies related to niobium or graphene; and technologies for recovering metallic substances from waste electrical and electronic equipment.”
Brazil has rich resources of niobium, which is used in steel and superconductor production.
Local company CBMM, controlled by the Moreira Salles family, which also holds a 33.5% stake in Brazil’s largest private sector bank Itaú Unibanco, supplies 82% of global niobium production.
The development of niobium has been a focus of the Jair Bolsonaro administration, which says the metal could help the country diversify its mining sector, which is very concentrated on iron ore.
https://www.bnamericas.com/en/news/brazil-signs-accord-with-japan-to-develop-niobium-potential
COMMODITY PRICES
Link for more detailed information
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