June Newsletter – 07.06.2021

HEADLINES

  • Mining industry to continue flying high through 2022 – report
  • Scientists develop ‘cheap and easy’ method to extract lithium from seawater
  • More Than 2 Billion Tons Of Coal Mining Capacity Is About To Come Online
  • Russian gold miner Nordgold is planning a big listing in London
  • UPDATE 1-Sundance Resources refers iron ore dispute with Cameroon to arbitration
  • Barrick CEO hopes Papua New Guinea gold mine will restart this year
  • EXCLUSIVE Mexico now ready to welcome private lithium miners
  • Centerra’s Kyrgyz units seek bankruptcy protection over Kumtor mine expropriation

Mining industry to continue flying high through 2022 – report

Global miners can continue to expect an “exceptional year of earnings” through 2022 as a broad commodity price rally underpins strong financial results for most actors, according to a new report from Fitch Solutions.

pic1 Behre Dolbear newsletter 07.06.2021

Image from Rio Tinto

Despite sky-high earnings, Fitch expects miners to maintain restraint over capital expenditure, instead focusing on further debt reduction with the additional profits generated this year and next.

According to the report, the industry is in the age of disruption with technology, changing consumption patterns and environmental, social and governance (ESG) considerations shaping the future of market players and inevitably determining success — or the contrary.

https://www.mining.com/miners-to-continue-flying-high-through-2022-report/

Scientists develop ‘cheap and easy’ method to extract lithium from seawater

Researchers at King Abdullah University of Science and Technology developed what they believe is an economically viable system to extract high-purity lithium from seawater.

Previous efforts to tease lithium from the mixture the metal makes together with sodium, magnesium and potassium in seawater yielded very little. Although the liquid contains 5,000 times more lithium than what can be found on land, it is present at extremely low concentrations of about 0.2 parts per million (ppm).

To address this issue, the team led by Zhiping Lai tried a method that had never been used before to extract lithium ions. They employed an electrochemical cell containing a ceramic membrane made from lithium lanthanum titanium oxide (LLTO).

https://www.mining.com/scientists-develop-cheap-and-easy-method-to-extract-lithium-from-seawater/

More Than 2 Billion Tons Of Coal Mining Capacity Is About To Come Online

More than 2.2 billion tons in annual coal mining capacity is currently under development, threatening the Paris Agreement targets, environmental think-tank Global Energy Monitor said in a new report.

The report notes that most of this capacity, or some 1.663 billion tons annually, is in the early stages of development and could be canceled, but the rest is already under construction.

“The prospect of a low-carbon transition puts these projects at risk of up to $91 billion USD in stranded assets,” Global Energy Monitor said, adding “But if they proceed, without unprecedented cutbacks in global production over the next decade, proposed capacity could boost supply to over four times a 1.5°C-compliant pathway.”

Stopping so much new coal mining capacity will be a tough job. Most of these projects are hardly in the developed economies of Western Europe or North America. Last year, China started more coal plants than the rest of the world retired, illustrating how important coal remains even for advanced economies such as the Chinese one.

Besides China, Russia, Australia, and India are the countries where more than three-quarters of the new mining capacity will be located. Together, these four will account for 1.75 billion tons in additional annual production capacity. China is the undisputed leader with 452 million tons in capacity under construction, followed by Russia, with 59 million tons under construction, Australia with 31 million tons under construction, and India with 13 million tons in mining capacity under construction.

https://oilprice.com/Latest-Energy-News/World-News/More-Than-2-Billion-Tons-Of-Coal-Mining-Capacity-Is-About-To-Come-Online.html

Russian gold miner Nordgold is planning a big listing in London

There is a new player in town and they could be one of the biggest. Nordgold is planning to IPO in London and wants to float at least 25% of their company. According to their website, Nordgold is an international gold producer with a business that spans from America to Siberia. They say they are guided by a strategy focused on finding, developing, and streamlining assets, and have a proven track record of creating value for stakeholders.

Nordgold is currently controlled by the family of billionaire Alexey Alexandrovich Mordashov. Mordashov (born 26 September 1965) is a Russian billionaire businessman. He is the main shareholder and chairman of Severstal, a Russian conglomerate with interests in metal, energy and mining companies. According to Forbes he has a net worth of $32.2bln and also owns about 30% of TUI Group, one of the biggest travel and tourism companies in the world.

Recently the Russian lost a furious battle with China’s Shandong Gold over Australian company Cardinal Resources. A long-running battle between Nordgold and China’s Shandong Gold over Cardinal Resources took a fresh turn, after the Russian gold miner matched Shandong’s bid of A$1 per share, over double the companies share price at the time. Cardinal has said it will provide an update to shareholders as soon as it is able. It has now delisted its shares from the Australian stock exchange after the board accepted the Chinese offer.

In regards to their plans in London, the company said “Following a record year in 2020, and with a low cost, low risk development pipeline centred on the highly prospective Gross Region in Russia, now is the right time for Nordgold to seek a premium London listing,” Chief Executive Officer Nikolai Zelenski said in a statement Thursday.

https://www.kitco.com/news/2021-06-03/Russian-gold-miner-Nordgold-is-planning-a-big-listing-in-London.html

UPDATE 1-Sundance Resources refers iron ore dispute with Cameroon to arbitration

DAKAR, June 2 (Reuters) – Australia’s Sundance Resources has referred its iron ore dispute with the government of Cameroon to international arbitration, the company said in a statement on Wednesday, after taking the same step in a parallel dispute with Congo Republic.

Sundance said Cameroon’s failure to implement an exploitation permit granted to its subsidiary Cam Iron in 2010 violated the terms of their agreements.

https://www.reuters.com/article/cameroon-mining-sundance/update-1-sundance-resources-refers-iron-ore-dispute-with-cameroon-to-arbitration-idINL5N2NK3RD

Barrick CEO hopes Papua New Guinea gold mine will restart this year

TORONTO (Reuters) – Barrick Gold Corp Chief Executive Mark Bristow said on Friday he hoped the Porgera gold mine in Papua New Guinea (PNG) could restart this year after holding talks with PNG Prime Minister James Marape and local landowner groups.

Under an agreement reached in April, the PNG government took a 51% share in the mine, ending a year-long standoff with operator Barrick Niugini Limited (BNL), whose lease Marape had refused to renew.

BNL, jointly owned by Barrick and China’s Zijin Mining, holds 49% and remains the operator under the new deal.

“The road to re-opening is a long one, and between the state, local communities and BNL, the implementation details of the agreement still need to be finalized,” Bristow said in a statement issued by Barrick.

https://www.reuters.com/article/us-barrick-gold-porgera/barrick-ceo-hopes-papua-new-guinea-gold-mine-will-restart-this-year-idUSKCN2DG1HU

EXCLUSIVE Mexico now ready to welcome private lithium miners

Mexico’s leftist ruling party has dropped plans to nationalize lithium production and is now pushing to welcome private investors to help develop the country’s potential in the metal used to make batteries, the senior lawmaker behind the proposal told Reuters.

Mexico, a major copper and silver producer, is home to large potential reserves of lithium, used in electric vehicle (EV) batteries. Most of it is in hard-to-tap clay deposits that are costly and technically difficult to mine.

After touting the possibility of a state-run lithium monopoly late last year, Sen. Alejandro Armenta, chairman of the upper chamber’s finance committee and a key ally of President Andres Manuel Lopez Obrador, said he will instead author a bill to promote a regulated marketplace in the nascent sector.

“We’re convinced that we need private investment and we’re allies of domestic investors and also foreign investors who respect us,” said Armenta, attributing his new posture to having studied regulatory frameworks for lithium in other countries.

https://www.reuters.com/world/americas/exclusive-mexico-now-ready-welcome-private-lithium-miners-2021-06-02/

Centerra’s Kyrgyz units seek bankruptcy protection over Kumtor mine expropriation

Canada’s Centerra Gold (TSX: CG) announced late on Monday that its Kyrgyz subsidiaries have filed for bankruptcy in New York to protect investors and restructure the company, whose Kumtor gold mine was seized by the former soviet nation last month.

pic2 Behre Dolbear newsletter 07.06.2021

Kumtor accounts for a fifth of the ex-Soviet country’s total industrial output

The miner’s units Kumtor Gold Company (KGC) and Kumtor Operating Company (KOC) are seeking protection under Chapter 11 of the US Bankruptcy Code. The court-supervised process provides, among other things, for a worldwide automatic stay of all claims against KGC and KOC, Centerra said.

The Toronto-based miner said it hoped the internationally recognized restructuring process will facilitate potential negotiations with the government of Kyrgyzstan, which is now in full control of Kumtor.

Centerra also noted the ongoing proceedings will not impact any other areas of the company’s business, including its Mount Milligan copper-gold mine in Canada, the Öksüt gold operation in Turkey and the molybdenum business in North America.

https://www.mining.com/centerras-kyrgyz-units-seek-bankruptcy-protection-over-kumtor-mine-expropriation/

COMMODITY PRICES

Link for more detailed information
https://www.mining.com/markets-2/?utm_expid=.-13FrUPTTOeBdTR-7umA4A.1&utm_referrer=

comm1 Behre Dolbear newsletter 07.06.2021comm2 Behre Dolbear newsletter 07.06.2021comm3 Behre Dolbear newsletter 07.06.2021