March Newsletter – 28.03.2022


  • India leans toward continued import of Russian coking coal – minister
  • Vedanta to invest $1.5 billion across oil, zinc, steel business
  • Metals trading in Shanghai goes quiet on China covid caution
  • Mining sector needs to rebrand to attract Gen Z talent – report
  • China faces challenges supplying Russia with alumina – analysts
  • Algeria, China firms announce $7B phosphate mining deal
  • South African white diamond could fetch more than $20 million on auction
  • Ariana Resources rises on Newmont exploration alliance

India leans toward continued import of Russian coking coal – minister

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India’s steel minister Ramchandra Prasad Singh.

India is leaning toward continuing to import coking coal from Russia, the steel minister said on Sunday, seeming to buck a global trend to shun Moscow over its invasion of Ukraine.

“We are moving in the direction of importing coking coal from Russia,” Ramchandra Prasad Singh told a conference in New Delhi.

India plans to double imports of Russian coking coal, a key ingredient in making steel, the minister said. He said the country had imported 4.5 million tonnes but did not indicate the period he was referring to.

Western countries and Japan have slapped unexpectedly heavy sanctions on the government of President Vladimir Putin and people associated with him. India, a major buyer of Russian goods from commodities to weapons, has abstained from several key United Nations votes condemning the Feb. 24 invasion.

“Smooth supplies” from Russia of coking coal have been affected, Singh said, in an apparent reference to the war. He did not elaborate.

Vessels carrying at least 1.06 million tonnes of coking coal, mainly used for steelmaking, and thermal coal used primarily for electricity generation, are set to deliver the fuel to Indian ports this month, the most since January 2020, data from consultancy Kpler showed.

Russia, typically India’s sixth-largest supplier of coking and thermal coal, could start offering more competitive prices to Chinese and Indian buyers as European and other customers spurn Russia because of sanctions, traders say.

Vedanta to invest $1.5 billion across oil, zinc, steel business

NEW DELHI: Billionaire Anil Agarwal’s Vedanta Ltd on Friday said it will invest $1.5 billion across its oil and gas, zinc and steel businesses.

Its board at a meeting on Friday approved $687 million capital spending for drilling of new wells at the firm’s oil and gas unit, Cairn Oil & Gas, Vedanta said in a stock exchange filing.

It also approved a $466 million phase-2 expansion of the Gamsberg zinc project in South Africa and another $348 million for steel expansion.

The $687 million “capex investment is towards infill wells, development and exploration. The strategic priority for the Cairn Oil & Gas business is to increase near-term volume through infill wells and add resources through exploration,” the filing said.

It said that $360 million have been earmarked for infill wells in the prolific fields viz Mangala, Bhagyam, Aishwariya, Aishwariya Barmer Hill (all in Rajasthan block) and Ravva in eastern offshore.

“The exploration work programme with capex investment of $327 million shall be spread across the OALP blocks and PSC blocks including pilot wells for shale,” it said.

Metals trading in Shanghai goes quiet on China covid caution

Metals trading on the Shanghai futures market has started to go quiet, with investors growing cautious as China battles to control the spread of covid-19 in its industrial heartland.

Trading volumes in copper, aluminum and zinc on the Shanghai Futures Exchange all fell to the lowest level since Feb. 7, while turnover in nickel also dropped below average.

China, the world’s largest base metals producer and consumer, is fighting its worst coronavirus outbreak in two years. Lockdowns — in the country’s industrial bases such as the top steelmaking hub of Tangshan, as well as the commercial center of Shanghai — have hit all aspects of life, from logistics to manufacturing to consumption.

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As well as the lockdowns in China, the war in Europe and Federal Reserve rate hikes are clouding the outlook for prices. Nickel trading has slumped in Shanghai after rival London Metal Exchange halted trading of the metal after an epic short squeeze propelled prices to record highs. Trading is finally normalizing on the LME, with prices moving back in line with Shanghai.

Global base metal prices surged earlier this month to records before pulling back. The war between Russia and Ukraine continued to deepen concerns over commodity supplies including wheat, oil, nickel, aluminum and copper.

Mining sector needs to rebrand to attract Gen Z talent – report

About 70% of Canadians born in the mid-1990s aren’t interested in pursuing careers in the mining or oil and gas industries reveals a new survey, based on 148 ‘Generation Z’ respondents from school and universities.

The global study by BDO, an accounting and business advisory group, also states that nearly half of the world’s natural resources organizations find it difficult to attract and retain early-career professionals with just one in five Canadians considering a career in the industry.

Furthermore, the report notes that Canadian natural resources companies are behind their global counterparts in terms of prioritizing diversity and inclusion with just 36% of Canadian companies having programs in place to attract a diverse workforce, compared to 55% globally.

“The survey results show that there is both challenge and opportunity ahead for the attraction and retention of young talent within natural resources in Canada,” said Stephen Payne from Energy & Natural Resources Leader at BDO Canada, in a press release.

China faces challenges supplying Russia with alumina – analysts

Russia might look to its giant neighbour to replace Australian alumina supplies cut off by sanctions, but Chinese aluminium smelters need all the feedstock they can get and may be worried about secondary sanctions from the West, industry analysts say.

Australia on Sunday imposed an immediate ban on exports to Russia of alumina and aluminium ores, including bauxite, in response to Moscow’s invasion of Ukraine.

The move squeezes Russian aluminium giant Rusal, the world’s No.2 producer outside China. It gets about 19% of its alumina from Australia’s Queensland Aluminium (QAL), in which it holds a 20% stake.

While there is no concrete evidence that Russia is seeking Chinese alumina supplies, analysts say close ties, proximity and the size of the Chinese market make it a logical option.

China, the top global aluminium producer, is likely to step in and absorb Australian alumina exports that had previously headed to Russia and could then potentially on-sell supplies, said Wood Mackenzie senior manager Uday Patel.

“Chinese firms could buy alumina from QAL and then sell back to Rusal,” Patel told Reuters.—analysts-2022-03-24/rep_id:3650

Algeria, China firms announce $7B phosphate mining deal

The project seeks to produce 5.4 million tonnes of fertiliser per year in the Algerian region of Tebessa and create thousands of jobs.

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Majority Algerian-owned joint-stock company will exploit the Bled El Hadba phosphate deposit in Tebessa province.

Four Algerian and Chinese firms have announced a nearly $7 billion deal to relaunch a phosphate mining project set to produce millions of tonnes of fertiliser annually.

Under the new deal, Algeria’s Asmidal, a subsidiary of state oil firm Sonatrach, and mining firm Manal agreed with Chinese firms Wuhuan Engineering and Tian’An to create the Algerian Chinese Fertilisers Company, the firms said in a joint statement on Tuesday.

The majority Algerian-owned joint-stock company is to exploit the Bled El Hadba phosphate deposit in Tebessa, transform the product into fertiliser and export it via dedicated facilities at the Annaba port in the country’s far northeast.

“The company will produce about 5.4 million tonnes of fertiliser per year” and once the project is operational, it could create some 6,000 jobs, as well as an additional 24,000 indirectly, the statement said.

Mining near Tunisian border

The deal comes more than three years after Algerian state energy firm Sonatrach and Chinese firm Citic announced a $6 billion deal to mine the same deposit in Tebessa province near the Tunisian border.

They had planned to boost the country’s phosphate output from one million to 10 million tonnes per year, but the project appears to have stalled and a new tender process was launched.

South African white diamond could fetch more than $20 million on auction

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The stone, which is about the size of a chicken’s egg, was mined about 20 years ago in South Africa but is only now coming up for public sale. (Image: Christie’s)

The largest white diamond ever to come to auction will hit the block at Christie’s in Geneva on May 11. The 228-carat, pear-shaped diamond carries a presale estimate of $20 million to $30 million. The stone, which is about the size of a chicken’s egg, was mined about 20 years ago in South Africa but is only now coming up for public sale.

“Right now there is a great appetite in the market for diamonds,” says ​​Rahul Kadakia, the international head of jewelry at Christie’s. The firm also brokered the gem’s initial private sale to a collector, who held on to it for most of the past two decades. “With the market the way it is—in 2021 there was a huge resurgence both in the art market and the jewelry market—the second owner approached us and said, ‘How would you feel about marketing this for us at public auction?’”

Unsurprisingly, Kadakia felt just fine with an assignment to sell a record-breaking gem. “It’s a once-in-a-lifetime opportunity,” he says. “If, after the sale, you come up to me and say, ‘Can you find me another 230-carat diamond?’—well, I can’t.”

Ariana Resources rises on Newmont exploration alliance

The London-quoted equity of Ariana Resources (AIM: AAU) gained more than 10% on Thursday after it announced an exploration alliance with the world’s biggest gold producer, Newmont Corp (NYSE: NEM; TSX: NGT).

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The alliance will focus on copper and gold exploration in south-eastern Europe via Ariana’s 75%-owned Western Tethyan Resources (WTR) subsidiary, focusing on prospective regions within Bosnia and Herzegovina, Bulgaria, Greece, Kosovo, North Macedonia and Serbia.

The Tethyan Metallogenic Belt is one of the world’s foremost metal-producing regions. It is also one of the longest and most extensive, going through 33 countries, with six significant sub-regions differentiated along the belt.

The western side of the belt is the richest and is known for two main periods of gold and copper-rich magmatism, which occurred during the Cretaceous and Cenozoic eras. The Cretaceous aged deposits are dominantly copper-gold porphyry, high-sulphidation epithermal and volcanogenic massive sulphide deposits, whereas, in the Cenozoic magmatic belt, copper is significant in porphyry systems only.

Under the exploration alliance agreement, Newmont will invest $2.5 million in Ariana, based on the 10% premium to the 30-day volume-weighted average price to fund the alliance’s activities. Newmont will also open its regional database to Ariana.


Link for more detailed information

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