May Newsletter – 21.05.18
ANNOUNCEMENTS
TOP NEWS
U.S. confirms list of 35 key minerals, targets domestic supply boost
TORONTO, May 18 (Reuters) – Uranium and key rechargeable battery metals lithium and cobalt are on a final list of 35 critical minerals that the United States deems essential to its economic and national security and wants to produce more of domestically.
The Department of Commerce will use the list, which was published by the Interior Department on Friday and which confirms a draft issued in February, for a report that responds to a December presidential order to break U.S. dependence on foreign minerals.
The Trump administration wants to identify new domestic sources of critical minerals; increase domestic exploration, mining and recycling; give miners and producers electronic access to better mapping and geological data; and streamline leasing and permitting for new mines.
The list, which also includes aluminum bauxite, platinum group metals, and potash, will periodically be updated for changes in policy, supply, demand and concentration of production, the Interior Department said.
Contrasting performances for Sub-Saharan African, European miners – BMI
JOHANNESBURG (miningweekly.com) – Europe and sub-Saharan Africa are on opposite ends of BMI Research’s Mining Risk and Reward Index (RRI), as can be seen with Europe’s significantly stronger performance in country and industry risk indicators, while sub-Saharan Africa continues to lag in country reward scores.
Nevertheless, BMI’s index indicates that a highly dynamic mining sector with strong growth potential and a diverse commodity base will continue to mean sub-Saharan Africa remains as an attractive mining destination relative to the safer but slower growth environment in Europe.
Sub-Saharan Africa’s risk/reward index scores are, however, particularly hampered by a weaker risk profile, BMI said, as key markets remain more prone to social, economic and political upheaval that poses risks to mining operations.
Meghan Markle’s wedding band made with Welsh gold from historic mine
It’s the story of the weekend. Even if you don’t follow the Royals, you probably got a glimpse of Prince Harry and Meghan Markle’s wedding somewhere.
One of the most important elements in the ceremony was the wedding ring, particularly the one given to the bride. Similar to her engagement ring and following a 100-year-old tradition, Markle’s band was fashioned from a piece of Welsh Gold, gifted by Her Majesty The Queen.
The 24-carat piece of gold originated at the Clogau St. David mine, located near Bontddu in northwest Wales and owned by Clogau Gold of Wales. The Royals started receiving nuggets of the yellow metal from this mine back in 1923.
From Clogau St. David was also extracted the gold behind three generations of royal wedding bands, including those of the Queen Mother, the Queen, Princess Margaret, the Princess Royal and Diana, Princess of Wales.
Later on, in 1986, the Windsors started receiving gold from the Gwynfynydd mine, which is also located in northwest Wales and is now owned by Clogau.
The Clogau St. David and Gwynfynydd mines are currently closed, having last operated in the 1990s. However, early this year it was announced that the former might reopen.
http://www.mining.com/meghan-markles-wedding-band-made-welsh-gold-historic-mine/
Young Australians oblivious to mining
Despite mining contributing about 6 per cent of Australia’s GDP, a study by YouthSight revealed that 59 per cent of young people in the country know nothing at all about mining careers.
The results from the study were made public today at the MCA Minerals Education Summit in Melbourne and also through a press release issued by the industry-led, government-funded think tank METS Ignited, the Minerals Council of Australia, and the professional development organization AusIMM.
In the joint statement, the groups explained that the study used a nationally-representative sample of 1061 senior high school students and first-year university students aged between 15 and 20. The overarching finding was that their knowledge of mining careers was extremely low.
The poll also found that only 30 per cent of students had an interest in a career in mining or the mining equipment, technology and services, also known as METS, sector.
“Despite mining and METS providing jobs for 1.1 million Australians – or one in every 10 jobs – and great future prospects for our industry, it’s clear that we must do much more to make young people aware about the opportunities and rewards in mining and METS,” METS Ignited CEO Ric Gros said in the media brief.
http://www.mining.com/young-australians-oblivious-mining/
COMMODITIES
Cobalt price: Congo ebola outbreak compounds acute supply fears
The price of cobalt has been drifting after hitting near 10-year peaks in March to exchange hands for $91,000 a tonne on Friday.
Cobalt is still up nearly fourfold since hitting multi-year lows at the beginning of 2016 as worries about supply of the metal, a crucial element in batteries, combine with expectations of booming demand from the electric vehicle sector.
The city of Mbandaka [population 1.2m] is in proximity to the Congo river, which has significant regional traffic across porous borders
Supply risks for cobalt are centred on the Democratic Republic of the Congo which is responsible for nearly two-thirds of world output. And the country’s share will only increase over the next five years (see chart).
Fears of disruption from the conflict ridden central African country has intensified after an outbreak of the deadly ebola disease and the possibility of a return to civil war in the run up to long-postponed national election now set for December.
On Friday, the world health organization raised the the DRC’s ebola health assessment risk to “very high.”
http://www.mining.com/cobalt-price-congo-ebola-outbreak-compounds-acute-supply-fears/
China Tightens Grip on Global Battery Metals With Chile Deal
Bloomberg
- Tianqi agrees to buy $4.1 billion stake in lithium rival SQM
- Chilean agency is seeking antitrust review of the transaction
China tightened its grip on the global supply chain for battery raw materials as Tianqi Lithium Corp. struck a deal to take a $4.1 billion stake in Chilean rival SQM, the second-largest lithium producer.
Chengdu-based Tianqi is seeking to almost triple production capacity through 2020, part of an aggressive expansion by Chinese companies to tie up sources of the metals and chemicals that are key to meet rising demand for rechargeable batteries and electric vehicles.
Gold to maintain its significance for decades to come – WGC
JOHANNESBURG (miningweekly.com) – Having compiled and published the ‘Gold 2048: The next 30 years for Gold’ report, the World Gold Council (WGC) has concluded that gold will “continue to be recognised, appreciated and valued in the years ahead”
The report, released on Thursday, looks at the next 30 years and considers ways in which the world and the gold market may develop.
WCG CEO Aram Shishmanian said that the key findings of the report included that the rapidly expanding middle class would “undoubtedly” increase demand for gold, that technology was an increasingly important sector for gold, and that the industry might struggle to reach and/or maintain
production levels in the next 30 years.
The report also stressed that production methods and stakeholder relations would have to evolve if the industry were to make a meaningful contribution to society over the next three decades.
LEGAL AND REGULATORY
Rising resource nationalism seen as ‘fire burning’ for miners
- Rio Tinto CEO says tide is gaining momentum around the world
- Kinross trims Mauritania spending as it talks with government
A rising tide of resource nationalism is causing miners to rethink where they invest and creating volatility for a sector already buffeted by brewing trade wars.
“A significant industry issue is resource nationalism,” Rio Tinto Group Chief Executive Officer Jean-Sebastien Jacques told investors at a conference in Miami this week. “From the DRC and South Africa to Mongolia and Australia, it is gaining momentum. As a result, the case for investment and FDI is clearly under threat.”
FINANCIAL
Congo billionaire seeks French loan to develop iron-ore railway
Bloomberg News
(Bloomberg) — Paul Obambi, a billionaire investor in the Congo Republic, is in talks with French lenders to fund a railway he’s building to export iron ore.
Obambi’s company SAPRO SA is negotiating with “a consortium of banks” to finance the 450-kilometer (280-mile) track that will link the southwestern town of Mayoko to a port at Pointe Noire, he said in a phone interview from Paris on Tuesday. Construction is expected to start next year and be completed by 2022, he said, without saying how much it would cost.
SAPRO operates an iron-ore project at Mayoko acquired from Pretoria, South Africa-based Exxaro Resources Ltd. in 2016. Exxaro sold the enterprise after failing to secure port and rail agreements with the Congolese government, booking a 5.76 billion-rand ($460 million) writedown in the process.
Obambi, one of Congo’s wealthiest individuals, says he’s worth about $1 billion.
Since buying Exxaro’s operations for $350 million, SAPRO has invested $550 million in Mayoko, which produced 3 million metric tons of iron ore last year, Obambi said. Exports of the steel-making ingredient helped SAPRO generate a $1.5 million profit last year from output at Mayoko, he said.
“We expect to reach 5 million tons at the end of this year,” he said. Expansion plans at Mayoko are expected to raise production to as much as 150 million tons, with exports being shipped through Pointe Noire and a port at Owendo in neighboring Gabon, Obambi said.
http://www.mining.com/web/congo-billionaire-seeks-french-loan-develop-iron-ore-railway/
PROJECTS
Anglo close to selling part of stake in giant Peruvian copper project
Anglo American (LON:AAL) may sell close to 30% of its $5.5-billion Quellaveco project in southern Peru to Japanese companies, including Mitsubishi, which already has a 18% stake in the asset, considered the world’s next major copper mine.
The miner, which has already invested over $1 billion in Quellaveco since acquiring the property in 1992, had said its board would not make a final investment decision until it has de-risked the project by reducing its 82% holding in the copper asset.
Chief executive Mark Cutifani has repeatedly said he wants to keep at least 51% of Quellaveco, which has the capacity to generate 225,000 tonnes of copper a year.
Chief executive Mark Cutifani told investors last year he wanted to keep at least 51% of Quellaveco, which has the capacity to generate 225,000 tonnes of copper a year, adding he had been “engaging” with potential parties interested in joining the project.
As an existing partner, Mitsubishi has an option to increase its stake in Quellaveco to 30%, sources familiar with the matter told Reuters on Thursday. The company may have to fend off fellow Japanese trading houses Sumitomo, Mitsui, JX Nippon Mining & Metals and Itochu, all of which are said to be about to present Anglo with a formal offer.
http://www.mining.com/anglo-close-selling-part-stake-giant-peruvian-copper-project/
COMMODITY PRICES
