Eurometaux urges Brussels to release gas reserves

19 January  | FINANCES

US coal prices have jumped to their highest level since 2009 as miners attempt to keep pace with the surging demand for the fossil fuel. Demand for coal usually rises significantly during the winter months. With most coal sold under long-term contracts, the sudden rush for the remaining supplies can prompt these sharp rises.

The metals industry within Europe is set to face another wave of closures unless the EU makes significant steps to address the continually rising cost of energy, Eurometaux, a non-ferrous metals association, has warned.

So far, more than half of the EU’s aluminium and zinc smelters have reduced capacity or have closed temporarily, with silicon production also cut as a result of record power prices and squeezed supplies. This, in turn has resulted in larger industrial consumers, including automotive and electronics companies, turning to China and the US to fill the gap.

“Without stronger EU and member state action, there is a real risk of further curtailments and closures in our sector, to the detriment of Europe’s strategic autonomy goals,” wrote Euromentaux in a letter addressed to European Commission President Ursula von der Leyen. 

“The EU has temporarily lost 650,000 tonnes of primary aluminium capacity; about 30% of the total,” continued the letter. “Europe’s supply gap must be bridged with imports, often with a higher [carbon dioxide] footprint.”

Goldman Sachs estimated that 820,000 tonnes of primary aluminium capacity and 750,000 of primary refined zinc smelting capacity had been suspended across Europe in recent months. Aluminium Dunkerque, Europe’s largest producer of the metal, has cut production by 15% and Nyrstar, the zinc producer, has halved its output across three of its sites.

19 JANUARY | deals

AngloGold Ashanti closes $370m deal to acquire Corvus Gold

AngloGold Ashanti has concluded the takeover of Canada-based mineral exploration company Corvus Gold for nearly $370m in cash. According to the deal signed in September 2021, Corvus Gold shareholders received $3.24 in cash per share from AngloGold.

The firm purchased 80.5% outstanding common shares of Corvus Gold, which is developing gold-silver projects in the Beatty District in the US state of Nevada. Prior to the transaction, AngloGold owned an indirect stake of 19.5% in Corvus.

AngloGold plans to initially develop the Corvus’ North Bullfrog project, which comprises leased, patented and unpatented mining claims covering an area of 90.5km². Located 10km north of Beatty and 8km north of the Bullfrog Mine, the project is scheduled to start production in the next three to four years.

AngloGold Ashanti CEO and executive director Alberto Calderon noted: “The combination of Corvus’ assets along with our own neighbouring targets – including Silicon, Merlin and Rhyolite – provides the opportunity for the Beatty District to become a potential Tier 1 asset with first production in approximately the next three years.
“We look forward to further engagement with local stakeholders as we develop the Beatty District.”

Corvus president and CEO Jeffrey Pontius added: “AngloGold Ashanti’s long history of success and responsible exploration, development, mine building and operations will further augment the exceptional discoveries at the North Bullfrog and Mother Lode projects.” 

18 JANUARY | Projects

Rio Tinto to delay Jadar lithium project

Rio Tinto has announced that the first production from its new lithium mine in the Jadar Valley, Serbia, has been pushed back by at least a year due to slow progress in obtaining the necessary licenses for an environmental assessment.

The delay means that the first saleable production from the project will be available by 2027, rather than 2026 as first projected. Progress on the mine had also been curtailed by a sustained protest movement objecting to both Rio Tinto’s project, and Zijin Mining’s recently-opened Čukaru Peki copper and gold mine, amid claims they will pollute land and water in the Balkan nation.

In response to these concerns, Rio Tinto released a statement: “We fully understand the concerns amongst some Serbian stakeholders about environmental impacts, and we will continue to engage in demonstrating the project has developed mitigation solutions in the project plan.”

If the project goes ahead, Jadar will become one of the biggest lithium mines in the world, with a construction cost estimated at $2.4bn. Rio Tinto has estimated that over its 40-year life, the mine will produce 2.3 million tonnes of battery-grade lithium carbonate and 160,000 tonnes of boric acid annually. Both of these are critical to developing lithium-ion batteries and renewable technology.

“I think it is a decision for the future, and I believe it would be smarter, better, and fairer if it is brought by the political elites that will lead the country in the next four years,” said Serbian Prime Minister Ana Brnabić.

17 JANUARY | Employment

Miners’ unions threaten strikes at Sibanye-Stillwater operations

South Africa’s mining unions have been cleared to strike after a breakdown in wage negotiations with Sibanye Stillwater. The Commission for Conciliation, Mediation and Arbitration, an independent dispute resolution body issued a certificate of non-resolution in relation of the dispute conciliation process between the miner and the labour unions.

The certificate permits the unions to embark on a strike and the company to implement a lock-out within 12 months from issuance. Sibanye Stillwater has urged unions and employees to reconsider the wage offer, which they argue remains in line with consumer price inflation (CPI), and follows several years of wage increases that are above the rate of CPI increase, ensuring that all stakeholders are fairly remunerated.

The current offer would mean that employees between categories four and eight would receive an increase of $33.70 (R520) per month in year one.  This would increase to $40 (R610) per month in year two and $41 (R640) per month in year three, which would include a $3 (R40) per month increase in the living out allowance each year. In addition, miners, artisans and officials would receive an increase of 4.1% in year one, 4.7% in year two and 4.7% in year three.

The National Union of Mineworkers, the Association of Mineworkers and Construction Union, UASA and Solidarity have been negotiating as a coalition since October. Sibanye Stillwater has stated that it will continue to engage with the unions to reach a “fair and reasonable” agreement.

14 JANUARY | Employment

Teck Resources reports strike notice at Highland Valley Copper

Teck Resources has reported that United Steelworkers Local 7619, a union branch representing 1,048 workers at its Highland Valley Copper Operations in British Columbia, Canada, has issued a strike notice.

The notice entitles the union to begin strike action following a 72-hour strike notice period and 48 hours after the mediator reports to the Labour Relations Board, making the earliest date strike action can take place 16 January. The potential strike notice comes when both parties are negotiating a collective bargaining agreement, replacing the expired agreement. Negotiations between the two sides are ongoing, with both parties scheduled to meet on 14 January to try and strike a deal preventing a work stoppage.

Highland Valley Copper is the largest open-pit copper mine in Canada. It has been operational since 1962, producing both copper and molybdenum concentrates through autogenous and semi-autogenous grinding and flotation. Annual copper production from 2022 to 2024 is expected to be between 135,000 tonnes and 165,000 tonnes per year.

The potential work stoppage will be the second one in the space of a year after wildfires forced an evacuation order on 14th August, leading all workers on site to be demobilised and moved to safety.

13 JANUARY | Deals

Lithium Power to demerge Western Australian lithium assets

Lithium Power International (LPI) is planning to demerge its hard rock lithium assets in Western Australia into a subsidiary that will look to list on the Australian Securities Exchange.

Over the coming six months, the firm will create a dedicated Western Australia-focused lithium exploration company to realise the assets’ value. LPI currently owns highly prospective assets in the exploration stage in Western Australia. These include three tenements in the Greenbushes region and three tenements in the Pilbara region.

LPI shareholders will secure the spun-out shares on a pro-rata basis, which will be done through a capital reduction and in-specie distribution. The company also expects the demerger process to be completed in the first half of 2022, subject to securing all necessary approvals. The demerger forms part of LPI’s efforts to focus on developing its Maricunga Lithium Brine Project in Chile.

Lithium Power CEO Cristobal Garcia-Huidobro said: “These assets deserve their own time, attention and resources, and LPI’s Board believes that it is the best outcome for LPI shareholders to create a dedicated, Western Australia-focused company that has the technical, human and financial resources to advance these exciting assets.”

In brief

Calidus establishes lithium exploration joint venture with Haoma Mining

Calidus Resources has established a joint venture with Haoma Mining to undertake lithium exploration activities in the Pilbara, Western Australia. The new exploration venture, known as Pirra Lithium Pty Ltd will be 50/50 owned by the two companies, and Calidus will initially provide $1.13m (A$1m) for the exploration work.

Astro Resources plans to spin-off diamond assets

Astro Resources is looking to spin-off its diamond project in Western Australia. Through its subsidiary Argyle Resources, the company plans to spin-off the project via an initial public offering on the Australian Securities Exchange, with the company’s shareholders to secure a priority allocation in the offering. The spin-off would comprise Astro’s East Kimberly project, as well as other projects in Australia.

Canada’s Calibre Mining concludes Fiore Gold takeover

Calibre Mining has finalised the acquisition of all issued and outstanding common shares of US-based Fiore Gold, creating an Americas-focused mid-tier gold producer. According to the deal signed in October 2021, each of the former Fiore shareholders secured 0.994 per Calibre common share and $0.08 (C$0.10) in cash for each share held.

Yorkton Ventures acquires Canadian lithium project

Yorkton Ventures has purchased Sirmac East Lithium Project, in the James Bay area of Quebec, Canada, on behalf of an anonymous firm. According to the deal, Yorkton Ventures will make a C$25,000 cash payment and issue 250,000 company units once the agreement is accepted by the TSX Venture Exchange.

12 JANUARY | Projects

Neo Lithium obtains EIA approval for 3Q Project in Argentina

Canada-based Neo Lithium has received environmental impact assessment (EIA) approval for the construction and operation of the Tres Quebradas lithium brine project (3Q Project) in Catamarca Province, Argentina.

The firm said that its wholly owned subsidiary Liex received a declaracion de impacto Ambiental (DIA) from the Environmental and Mining Authority in Catamarca Province. According to Neo Lithium, the DIA approved Liex’s EIA for the construction and operation of the project.

Based on a study, the project is expected to have an average annual production of 20,000 tonnes of lithium carbonate equivalent (LCE) in the first 20 years of operation. Production is expected to reduce thereafter.

According to estimates, the project has proven and probable reserves of 1,671,900 tonnes of LCE with an average 786 mg/l Lithium for 50 years of the life of mine, and 769,613 tonnes of LCE with an average 912mg/l of lithium for the first 20 years.

In a press statement, Neo Lithium said: “The issuance of the DIA confirms that the EIA is in compliance with the standards and regulations under the national and provincial mining law and contains customary requirements to maintain the DIA in good standing.

“As part of the issuance of the DIA, the company agreed with Catamarca Province to fund an infrastructure trust to be administered for the benefit of the 3Q Project and its impacted areas.”

12 JANUARY | Finances

Kazakhstan President orders mining companies to pay higher taxes

Kazakhstan President Kassym-Jomart Tokayev has ordered his government to levy higher taxes on mining companies in Kazakhstan.

The mining industry within the country is predominantly focused on the extraction and export of raw materials. Estimates are that 80% of mining products are exported from the country, representing 20% of the country’s total exports, and these exports have driven profits for the country’s miners.

The boom in income for miners came after prices of industrial metals surged in the last year. The Central Asian state holds vast mineral reserves, possessing 30% of the world’s chrome ore reserves, 25% of manganese ore, 10% of iron ore, 5.5% of copper, 10% of lead, and 13% of zinc, according to official estimates.

In his speech to parliament, the Kazakhstan President offered large incentives for mining companies in return for the increase in taxes. He stated: “I am ordering the government to come up with a plan [to bring] additional revenues to the budget. In exchange, we can provide large incentives for the exploration and development of new deposits for large mining and other companies.”

This decision also comes under the backdrop of severe unrest. Protests began on 2 January after a sudden increase in the cost of liquefied gas, fuelling protests across the country. In response, Tokayev declared a state of emergency, and with support from Russian troops, the protests were crushed, leading to the deaths of 164 people.

In brief

IG Lithium seeks partner for US brine lithium project

The IG Global Group is looking for a strategic partner for the development of the Panamint Playa Brine Lithium Deposit, which is located in a closed basin in a unique geological setting just west of Death Valley, in the US state of California.

Canterra acquires four Newfoundland mineral properties from NorZinc

Canadian firm Canterra Minerals has finalised the acquisition of four resource staged projects in central Newfoundland, Canada, from NorZinc: the South Tally Pond / Lemarchant Project, the Tulks South Project, the Victoria Mine, and the Long Lake Project.

Bowen obtains funding to restart Bluff coal mine in Australia

Bowen Coking Coal has closed an $8m (A$11m) placement and received a $10.9m (A$15m) debt facility from a private credit institution to enable the restart of Queensland’s Bluff Mine, following the signing of a deal last month to acquire the mine from mining contractor MACA for A$5m.

Eramet teams up with Tsingshan to build $400m lithium plant

French miner Eramet has teamed up with China’s Tsingshan Holding Group to build a $400m lithium plant in Argentina, following soaring demand for the metal and a sharp tightening of the market-leading prices to reach record levels in China.

ALROSA launches project to convert its vehicles to natural gas

Russian miner ALROSA has launched a project to convert its vehicles from gasoline and diesel to natural gas to cut greenhouse gas emissions and boost economic efficiency.