November Newsletter – 15.11.2021


  • China Keeps Pressure on Coal Mines to Cut Prices as Winter Nears
  • Greenland passes law banning uranium mining
  • Eramet teams up with Tsingshan to restart lithium plant project in Argentina
  • Australia vows to sell coal ‘for decades’
  • China’s exports bring little relief to tight lead market
  • Fortuna’s San Jose silver mine in Mexico faces closure due to expired permit
  • Ransomware attack on mining operations “almost inevitable,” says cybersecurity expert
  • China to step up strategic mineral resource exploration
  • Kazakhstan Launches Fuel Production for Nuclear Power Plants, Fosters Partnership with Chinese General Nuclear Power Corporation

China Keeps Pressure on Coal Mines to Cut Prices as Winter Nears

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(Bloomberg) — Beijing is maintaining pressure on coal miners to cut prices to keep a power crisis at bay as a burst of frigid weather provides a hint of the harsh winter that may be ahead.

Some coal mines in Shanxi province, the top producing region last year, have capped the price of 5,500-NAR grade coal at the pithead to 900 yuan ($141) a ton, after being required to do so by the National Development and Reform Commission, according to traders and analysts who asked not to be identified as they aren’t authorized to speak publicly.

The new cap is 25% lower than a previous limit set in the province two weeks ago. Still, it’s substantially higher than a 528-yuan ceiling the NDRC was considering last month. The economic planning agency may no longer push for the lower level after resistance from miners, the people said.

The planning body didn’t respond to a phone call and a fax inquiry from Bloomberg News.

China has taken several measures to intervene in the coal market after prices surged to a record, engulfing the world’s second-largest economy in an energy crisis that sparked a blackout and power rationing. Beijing pushed state-backed miners to accelerate coal output, stepped up purchases of overseas supplies and scrapped measures meant to keep electricity prices low.

Greenland passes law banning uranium mining

Greenland’s parliament voted Tuesday to ban uranium mining and exploration in the vast Danish territory, following through on a campaign promise from the ruling left-wing party which was elected earlier this year.

The Inuit Ataqatigiit party won snap elections in April that were originally triggered by divisions over a controversial uranium and rare earth mining project.

The IA won 12 seats in the 31-seat Greenlandic national assembly, beating its rival Siumut, a social democratic party that had dominated politics in the island territory since it gained autonomy in 1979.

On Tuesday 12 MPs in the national assembly voted to ban uranium mining, with nine voting against.

The IA had campaigned against exploiting the Kuannersuit deposit, which is located in fjords in the island’s south and is considered one of the world’s richest in uranium and rare earth minerals.

The project, led by the Chinese-owned Australian group Greenland Minerals, has not yet been officially abandoned.

Eramet teams up with Tsingshan to restart lithium plant project in Argentina

Eramet SA agreed to restart the development of a mothballed lithium plant project in Argentina during the first quarter of 2022 under a partnership with China-based steel company Tsingshan Holding Group Co. Ltd., with commissioning eyed in early 2024.

Tsingshan will acquire a 49.9% stake in the project by providing up to $375 million in financing. French metals company Eramet will own the remaining 50.1% stake in the plant, which will have an annual production of 24,000 tonnes of lithium.

The restart decision is in line with the strong market growth for lithium, a key metal used in electric vehicle batteries, Eramet said Nov. 8. The company paused the project in April 2020 due to uncertainty linked to the COVID-19 pandemic.

Eramet and Tsingshan operate the Weda Bay nickel joint venture in Indonesia, with Eramet owning a 38.7% stake and Tsingshan owning a 51.3% stake. PT Aneka Tambang Tbk holds the remaining 10%.

Australia vows to sell coal ‘for decades’

Sydney: Australia said Monday it will sell coal for “decades into the future” after spurning a pact to phase out the polluting fossil fuel to halt catastrophic climate change.

More than 40 countries pledged to eliminate coal use within decades during the COP26 UN climate summit in Glasgow, which aims to cap the warming of Earth since the Industrial Revolution to between 1.5 and 2.0 degrees Celsius.

Australia, along with some other major coal users such as China and the United States, did not sign up.

China’s exports bring little relief to tight lead market

(The views and opinions expressed herein are the views and opinions of the author, Andy Home, a columnist for Reuters.)

China exported 15,545 tonnes of refined lead in September, the highest monthly tally since 2007. The country has turned a significant net exporter for the first time since 2018.

This export surge was widely expected. China has been sitting on historically high stocks of lead, while supply in the rest of the world has been super-tight.

The London Metal Exchange (LME) lead contract has experienced extreme time-spread turbulence, the cash premium flexing out to $218.50 per tonne at one stage in August, the widest it’s been since 1990.

Fortuna’s San Jose silver mine in Mexico faces closure due to expired permit

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San Jose mine, Mexico.

A top Canadian miner in southern Mexico is trying to avoid the unprecedented closure of its 10-year-old silver mine after the expiry of its environmental permit last month left it in limbo.

The possible shutdown of the San Jose mine, operated by a local unit of Fortuna Silver Mines, is part of a prolonged fight over the project that could chill investor appetite in Mexico, the world’s biggest silver producer, and a top ten miner of more than a dozen other metals including gold.

While the San Jose mine has been in operation since 2011, its main environmental authorization expired on October 23, despite company efforts since May to petition the environment ministry to approve a 10-year extension. A recent court order allows the mine to keep running, but only on a temporary basis.

The high-stakes standoff highlights what many industry leaders view as the government’s resistance to the sector’s growth and its ties to anti-mining activists.

Ransomware attack on mining operations “almost inevitable,” says cybersecurity expert

Last month, Weir, a major supplier to the mining industry, was the victim of a crippling cyberattack that forced it to isolate and shut down its core IT systems, including enterprise resource planning and engineering applications.

The resulting disruptions included engineering, manufacturing and shipment rephasing, which resulted in revenue deferrals and overhead under-recoveries. The operating profit impact of Q4 revenue slippage is expected to be between $13 to $27 million for 12 months.

Cyber security was a growing threat for miners long before the pandemic – it was listed among the top 10 business risks and opportunities facing mining and metals for the last two years,  according to a 2020 EY report.

“The world’s leading mining companies are now unanimous in reporting that cyber threats are a principal risk to them achieving their goals,” according to a Marsh report, Cyber Risk: Threats and Insurance Protection for the Mining Sector.

China to step up strategic mineral resource exploration

China will step up exploration of strategic mineral resources including petroleum, natural gas, copper, chrome, tungsten, rare earths and others during 2021 to 2025, the top economic planner said on Friday.

The National Development and Reform Commission revealed the plan for promoting development in resource-dependent regions on its website.

China is also likely to end up in opposition to efforts at COP26 climate talks to phase out coal worldwide and urge countries to beef up their emissions plans as soon as next year.

Energy security concerns will keep China from supporting the proposal on coal, according to a person familiar with China’s position who asked not to be named.

While China plans to peak emissions by 2030, the country is now in the grips of an energy crisis and is ramping up coal output to record levels.

Kazakhstan Launches Fuel Production for Nuclear Power Plants, Fosters Partnership with Chinese General Nuclear Power Corporation

NUR-SULTAN – The official opening ceremony of the new Ulba Fuel Assembly plant was held via teleconference from the Ulba Metallurgical Plant in Ust-Kamenogorsk on Nov. 10, reports the Kazatomprom National Atomic Company press service.

Ulba-FA is a Kazakh and Chinese joint venture, the founders of which are UMP (a subsidiary of Kazatomprom) holding a 51 percent stake, and CGNPC-URC (a subsidiary of China General Nuclear Power Corporation), holding a 49 percent stake.

China General Nuclear Power Corporation (CGN) has been cooperating with Kazatomprom in the area of uranium mining, natural uranium sales, and pellet fabrication since 2006. The implementation of this joint fuel project propelled the partnership to a new historic level.

The plant, whose construction began in 2016, is provided with high-tech equipment produced in China, France, Germany and USA to manufacture fuel assemblies, which generate thermal power inside a nuclear reactor.


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