May Newsletter – 30.05.2022

  • Chinese Firms Vie for Control of Huge DRC Lithium Project – SCMP
  • Glencore bribery cases draw in billionaire former executives
  • In a bail-out attempt, Pakistan leases-out Gilgit-Baltistan to China for mining
  • Barrick Gold ups its ESG game in Tanzania
  • China’s slumping economy to cut coal use even as output swells
  • Billionaire’s seized mines pose quandary for new Zambian leader
  • Coal India to open big, new mine this year to fight power crisis
  • Germany: G-7 nations can lead the way on ending coal use
  • Biden plan would block Pebble gold mine
  • G7 countries say strict environmental rules needed for deep-sea mining


Chinese Firms Vie for Control of Huge DRC Lithium Project – SCMP

Chinese entities may retain major involvement or even end up controlling the huge Manono lithium project proposed by Australia’s AVZ Minerals once the legal fight over ownership ends, a report says

A legal tussle is playing out for control of the giant Manono lithium deposit, seen here, in the southeast of the Democratic Republic of the Congo in central Africa

The battle for control of the huge Manono lithium deposit in central Africa, possibly the world’s biggest, has been portrayed as a fight between China’s Zijin Mining and Australia’s AVZ Minerals, however Suzhou Cath Energy Technologies – owned by China’s battery giant CATL and Pei Zhenhua – has a 24% stake in AVZ, while Zhejiang Huayou Cobalt also has a holding, which suggests that Chinese entities will retain major involvement or could even end up controlling the project once the complex legal fight over ownership ends, a report by the South China Morning Post on Sunday says.

AVZ announced four years it had found about 400 million tonnes of lithium at Manono in the southeast of the Democratic Republic of Congo, but development has been held up by Zijin’s claim of a 15% stake in Dathcom Mining, the joint venture that owns the site set up by AVZ and Cominiere, the DRC’s state mining company, and a separate row over another 15% stake, it said.

Glencore bribery cases draw in billionaire former executives

The US corruption and market manipulation cases against Glencore Plc include allegations about the conduct of two former executives who formed part of the inner circle of the trading house’s top management for over a decade — and walked away as billionaires.

US Attorney General Merrick Garland announcing Glencore’s guilty pleas to foreign bribery and market manipulation schemes.

The US government did not bring any charges against top Glencore managers in the sweeping cases against Glencore to which the company pleaded guilty this week. But in legal documents on Tuesday, the US said that two former top Glencore executives, one of whom is identified as the “global head of the oil group” and the other as a Greek and UK citizen who was a “senior executive” in the copper and zinc department, were personally involved in corruption.

The descriptions make the men identifiable as Alex Beard, Glencore’s former head of oil, and Telis Mistakidis, its former head of copper, respectively.

The documents, which Glencore in one case accepted as true and in the other agreed not to deny as part of its guilty plea, state that a widespread and persistent culture of bribery wasn’t limited to local middlemen or rogue traders, but was perpetuated by some of the company’s most senior leaders. Both men had been at Glencore for decades and were some of the closest lieutenants of former chief executive Ivan Glasenberg before they departed about three years ago.

Beard did not provide comment for this article. Mistakidis didn’t respond to requests for comment. A spokesman for Glencore declined to comment.

A slew of anti-corruption investigations has dogged the commodity trading industry for years but has hardly touched the industry’s top executives. This is the first time in decades that the most senior echelons of the trading industry have been called out publicly by US regulators.

In a bail-out attempt, Pakistan leases-out Gilgit-Baltistan to China for mining

The economic war is spreading like a fire in the jungle and vexing the common people living around the globe. Sri Lanka’s deep economic crises are so real that they cast their shadow on Pakistan. In the present scenario, the political instability and social unrest have ultimately destabilized Pakistan’s economy to face difficult times.

The mega project of USD 46 billion known as the China-Pakistan Economic Corridor project (CPEC)   of the 21st century and China’s Belt and Road Initiative (BRI)   have been in the line of fire. China’s BRI is a strategy initiated by the People’s Republic of China that seeks to connect Asia with Africa and Europe via land and maritime networks with the declared aim of improving ‘regional integration, increasing trade and stimulating economic growth.’

But the sudden increase in terrorist attacks against Chinese teachers, engineers, technicians and workers at various projects of the CPEC in Pakistan clearly indicated that the Balochistan Liberation Army (BLA) violent activities and   the TTP’s  hostilities and dissatisfaction among main stakeholders are responsible for pushing the economic success and greater regional connectivity of CPEC in doldrums with Afghanistan and later with Central Asian Region (CAR)

Barrick Gold ups its ESG game in Tanzania

Barrick Gold (NYSE: GOLD) (TSX: ABX) said on Friday it would spend $6 for every ounce of gold sold by its two mines in Tanzania on improving healthcare, education, infrastructure and access to potable water in the surrounding communities.

The Canadian gold miner, which inherited the North Mara and Bulyanhulu gold mines in the country with the re-acquisition of Acacia Mining in September 2019, also said it had committed up to $70 million for value-adding national projects.

These include mining-related training, skills development and scientific facilities at Tanzanian universities, as well as road infrastructure.

Chief executive Mark Bristow said that since resuming operations in Tanzania, Barrick has worked on rebuilding relations with the State and renewing its social licence to operate there.

The world’s second-largest gold producer was embroiled in a battle with the Tanzanian government that began in March 2017, when the country banned the export of gold and copper concentrates. The move aimed to pressure mining companies into doing more smelting and refining locally.

China’s slumping economy to cut coal use even as output swells

China’s demand for thermal coal is likely to keep falling through the rest of the first half, as virus restrictions continue to mire the economy in a deep slump.


China’s Forbidden City from the Coal Hill

Alongside measures to boost output and build stockpiles, that’ll give China a better chance of satisfying peak power demand over the summer, when air-conditioning needs are at their height, and retaining enough of a buffer to keep industry supplied into the autumn.

A shortage of coal in the fall of 2021 contributed to unprecedented blackouts during a peak production period for many industries, and some southern provinces have warned this year over the potential for more outages heading into the hotter months.

Consumption of China’s mainstay fuel is expected to decrease moderately over May and June after slumping steeply in April, the China Coal Transportation and Distribution Association said at a briefing on Wednesday, citing weaker industrial activity and the availability of more hydropower following heavy rains. Rising temperatures and the easing of lockdown measures in Shanghai should offer some support to the market, it said.

Billionaire’s seized mines pose quandary for new Zambian leader

Zambia’s new business-friendly president faces a dilemma: risk a political backlash by returning mining shafts seized from an Indian company his mines minister once labeled as the nation’s worst-ever investor, or prolong a three-year legal dispute over one of its most important assets.

Hakainde Hichilema, who won power in August, has yet to say what he’ll do to revive Konkola Copper Mines Plc — a key to realizing his ambition of more than doubling the national output of the metal within five years and rebooting the debt-stricken economy.

Predecessor Edgar Lungu stripped majority shareholder Vedanta Resources Ltd. of the operation after a dispute over taxes and its expansion plans. Vedanta, owned by Indian billionaire Anil Agarwal, has been fighting the decision ever since, largely paralyzing one of Africa’s biggest integrated copper producers, which employs almost 13,000 workers.

Hichilema told reporters at a mining conference in Cape Town this month that agreement had been reached to end litigation, a detente Vedanta confirmed, prompting speculation the company will return. A public backlash ensued and the government swiftly denied a decision had been taken. It then emerged that Vedanta had filed a new lawsuit in the Lusaka High Court challenging the state’s appointment of a new provisional liquidator on May 11 — the same day the firm said it had agreed to terminate all legal action.

By the time Zambia seized Vedanta’s local assets, its reputation had been damaged because it failed to pay suppliers and contractors and working conditions at KCM were “so bad,” Mines Minister Paul Kabuswe said in an interview. “If ever they were to come back, these are the issues that need to be looked at.”

Coal India to open big, new mine this year to fight power crisis

Coal India’s record production has been brightspot in efforts to end India’s worst power crisis in more than six years.

State-run Coal India will open this year what is expected to become one of the country’s biggest coal mines, officials said, as India struggles to keep pace with surging power demand.

Output from the new Siarmal mine in eastern Odisha state would rise gradually, reaching capacity of 50 million tonnes in about five to seven years, Vinayak Jamwal, spokesman for Coal India unit Mahanadi Coalfields (MCL), told Reuters.

Production would initially start in the October to December quarter at an annualised rate of about 2 million to 5 million tonnes, Mr. Jamwal said.

Coal India’s record production has been brightspot in efforts to end India’s worst power crisis in more than six years, as a heatwave has driven up demand for power and forced the government to reverse a policy on cutting coal imports.

Germany: G-7 nations can lead the way on ending coal use

BERLIN — Germany’s energy and climate minister said Thursday that the Group of Seven wealthy nations can lead the way on ending the use of coal, a heavily polluting fossil fuel that’s responsible for a fifth of global greenhouse gas emissions caused by humans.

Senior officials from the G-7 countries are holding a three-day meeting in Berlin during which they will seek to agree on common targets for the shift from fossil fuels to renewable energy that scientists say is urgently needed to curb climate change.

“The G-7 (…) can perhaps take on a certain pioneering role to push forward ending the use of coal for electricity and in decarbonizing the transport system,” German Energy and Climate Minister Robert Habeck said.

G-7 members Britain, France and Italy have set deadlines to stop burning coal for electricity in the next few years; Germany and Canada are aiming for 2030. Japan wants more time, while the Biden administration has set a target of ending fossil fuel use for electricity generation in the United States by 2035.

Setting a common deadline would put pressure on other major polluters to follow suit and build on the compromise deal reached at last year’s U.N. climate summit, where nations committed merely to “phase down” rather than “phase out” coal — with no fixed date.

Biden plan would block Pebble gold mine

The Pebble mine project in Alaska

The Biden administration on Wednesday is outlining new pollution restrictions that would thwart a long-stalled plan to mine for gold near Alaska’s Bristol Bay.

Under the proposed requirements, the Environmental Protection Agency would broadly bar developers of the planned Pebble Mine from disposing waste near the site because of the potential harm to the area’s thriving, $2 billion salmon fishery.

The decision is another blow for Pebble Limited Partnership, a subsidiary of Northern Dynasty Minerals Ltd. that has been seeking for years to extract gold, copper and molybdenum from an area of southwestern Alaska that drains into Bristol Bay. It represents a victory for environmental activists and native Alaskans who say industrial mining operations threaten a pristine watershed.

“Bristol Bay and the thousands of people who rely on it deserve the highest level of protection,” EPA Region 10 Administrator Casey Sixkiller said in a news release.

“Two decades of scientific study show us that mining the Pebble deposit would cause permanent damage to an ecosystem that supports a renewable economic powerhouse and has sustained fishing cultures since time immemorial.”

G7 countries say strict environmental rules needed for deep-sea mining

omputer rendition of a seabed mining operation.

The Group of Seven countries on Friday agreed stringent environmental controls should govern deep-sea mining and that they would consent to such mining projects only if they did not seriously harm the marine environment.

“We determined that if there is deep-sea mining at all, it should only happen under the most strict environmental standards,” Germany’s environment minister, Steffi Lemke, told a news conference after a meeting of G7 ministers in Berlin.

The International Seabed Authority (ISA), a United Nations body, is drawing up regulations governing seabed mining in the high seas – areas outside any national jurisdiction. Until global rules are in place, sea bed mining is not allowed.

“With regard to possible future deep-sea mining, we highlight the unique chance to regulate a human activity before it is put into practice in order to prevent damage to the marine environment,” the G7 ministers said in the final communique from their meeting.

They also said that an ability to demonstrate that the deep-sea environment would not be seriously harmed would be critical for them to consider consenting to any future mining permits in the ISA council.

Deep-sea mining involves sucking up potato-sized rocks rich in cobalt, nickel and other battery metals from the Pacific Ocean floor at depths of 4-6 km (2.5 to 3.7 miles).


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