IG Global enters Kazakhstan’s mining industry with new subsidiary

IG Global Group (IGG) has established a wholly owned subsidiary, IG Copper and Gold, to enter the mineral-rich country of Kazakhstan.

The firm said it sees huge potential in the country’s mining sector, both in terms of magnitude and scale of projects.

IGG president and CEO Thomas Bowens said: “We are very excited to have established IG Copper and Gold and our first corporate offices in Kazakhstan. IGG will initially be targeting high-value gold and porphyry copper-gold assets for exploration and development.

“This marks our entry into the third country following on from our highly successful operations in both Russia and the United States.”

Upon becoming a member of the Committee for Mineral Reserves International Standards in 2016, Kazakhstan implemented simplified mineral licensing in 2017 to ensure open access to geological data and its digitisation.

The country also simplified the procedure of providing potential companies with subsoil use rights.

Some of the country’s mining projects currently under development include the Aktogay open-pit mine in the East Kazakhstan Region, the Bozshakol copper mine in the Pavlodar Region, and the Koksay copper mine in the southeastern part of the country.

In a press statement, IGG said: “IGG’s team and experience in the Russian Far East and Asia is a strategic advantage in its ability to operate in this region.”

Alamos seeks $1bn from Turkey over stalled gold project

Alamos Gold is seeking more than $1bn in claims from the Turkish Government for what it considers as ‘inequitable treatment’ of its Kirazli gold project.

The Canadian firm and its two Netherlands-based subsidiaries intend to file the claim under a Netherlands-Turkey bilateral investment treaty against Turkey for ‘expropriation and unfair and inequitable treatment’ concerning the stalled gold mine.

Alamos Gold said in a statement: “Alamos and the subsidiaries have invested over $250m in Turkey, unlocked over a billion dollars worth of project value, and contributed over $20m in royalties, taxes and forestry fees to the Turkish Government.”

The claim amount represents the sum value of all its assets in Turkish, the firm noted.

Alamos Gold said despite the firm meeting all legal and regulatory requirements for the renewal, the Turkish Government failed to grant a routine renewal of the project’s mining licences in October 2019.

All operations at the Kirazli mine in the Çanakkale Province were suspended by the firm in 2019 following protests by local citizens and environmentalists.

In October 2020, the forestry permit renewal for the gold mine was also cancelled by the government.

Alamos Gold added: “The failure to renew the company’s mining licences will result in the loss of over half a billion dollars in future economic benefits to the Republic of Turkey, including tax and other revenues, and thousands of jobs within Turkey.”

Australia’s Orocobre signs $3bn merger deal with Galaxy Resources

Australian lithium chemical company Orocobre and rival firm Galaxy Resources have signed a $3.09bn (A$4bn) deal to merge and create a global lithium chemicals company.

The merger would create the fifth-largest global lithium chemicals company.

The two firms have signed a binding merger implementation deed whereby the parties will merge through a Galaxy scheme of arrangement. Pursuant to this, Orocobre will acquire 100% of Galaxy Resources’ shares.

According to the deal, Orocobre will issue 0.569 of its shares for Galaxy Resources’ shareholders for each share held.

Orocobre CEO and managing director Martín Pérez de Solay said: “The merger brings together assets and teams with highly complementary skills and knowledge, with a unique opportunity to create a leading independent lithium company.

“The merger consolidates the combined group’s position in Argentina and will give us significant operational, technical and financial flexibility to deliver the full value of our combined portfolio.”

The combined entity’s head office will be located in Buenos Aires, Argentina, while its corporate headquarters will be on the Australian East Coast.

Upon the completion of the merger, Orocobre shareholders will own a 54.2% stake in the combined entity while the remaining 45.8% stake will be held by Galaxy Resources’ shareholders.

MetRes to acquire mothballed Australian coal mines from Peabody Energy

The MetRes joint venture (JV) between Stanmore Coal and M Resources has agreed to acquire the Millennium and Mavis Downs coal mines in Australia from Peabody Energy.

The JV signed an agreement to purchase the mines, which are currently in care and maintenance, for an upfront cash consideration of nearly A$1.25m and a royalty agreement, which is capped at A$1.25m.

MetRes will also undertake rehabilitation obligations with an investment of around A$25.7m.

The scope of the deal includes the acquisition of 0.5Mtpa of long-term rail and port capacity and 349 million litres of long-term raw water supply allocation to support a mining restart. It also will also acquire all associated contractual rights and obligations.

In a press statement, Stanmore Coal said: “Restarting the Millennium and Mavis Downs Mine represents a low capital and quick to market investment opportunity in a high-quality metallurgical coal asset, supported by access to existing critical infrastructure.”

With a peak production of up to one million tonnes a year, the mine is slated to restart operations from July and expected to create between 150 and 200 jobs.

According to the JV agreement between M Resources and Stanmore Coal, the latter agreed to provide up to A$30m in financing to the JV to cover initial working capital requirements.

Philippines ends nine-year moratorium on new mining deals

The Philippine Government has removed a nine-year moratorium on new mineral agreements in the country to increase revenues.

This follows the signing of the executive order (EO) No.130 by Filipino President Rodrigo Duterte. It amends Section 4 of EO No.79, s. 2012 that was signed by President Benigno Aquino III.

The new EO enables the government to make agreements for new mining projects, subject to compliance with local laws.

The order also allows for undertaking reviews of existing mining contracts for potential renegotiation of the terms and signing of agreements.

The new EO also directs the Department of Environment and Natural Resources (DENR) to ‘formulate the terms and conditions in the new mineral agreements that will maximise government revenues and share from production.

This includes the possibility of declaring these areas as mineral reservations to obtain appropriate royalties, in accordance with existing laws, rules, and regulations’.

The EO also says: “The DENR shall likewise undertake a review of existing mining contacts and agreements for possible renegotiation of the terms and conditions of the same, which shall in all cases be mutually acceptable to the government and the mining contractor.”

The move by the government, however, raised concerns among anti-mining activists.

Commenting on the decision, environmental advocacy organisation Alyansa Tigil Mina (Stop Mining Alliance) said in a statement: “In the middle of a climate crisis and this pandemic, corporate interests and profit have won again over the welfare and benefits of the many.”

21 miners trapped at Chinese coal mine following flooding

Chinese authorities are rushing to rescue 21 miners trapped at the Xinjiang coalmine in Hutubi County, in the west of China, after the mine flooded over the weekend.

According to state-owned newspaper Global Times, 29 miners were trapped when flooding hit the mine during upgrade works, although the source of the flooding is unknown.

The water has proven to be a significant obstacle for rescue operations, due to both the dangers of the trapped miners drowning, and the difficulties associated with moving heavy machinery through submerged passages.

Rescue efforts have focused on removing the water, with emergency teams sending a length of ten metre-long pipes into the mine shaft to pump water out of the chambers.

However, Global Times noted that the cramped conditions of the mine made transporting and constructing the pipes difficult. As of Sunday, rescue workers were continuing to construct the pumping mechanism.

“The workers are trapped approximately 1,200m underground, according to Bao Yongsheng, deputy head of Changji,” announced the Xinhua News Agency, which is also operated by the state. “Ma Xin, director of Changji’s emergency management bureau, said that the underground environment is very complex and drainage is the foremost concern at present.

“Three sets of drainage equipment are pumping out water at speeds of 450 cubic meters per hour. A fourth set is currently being installed and is expected to double efficiency once in operation.”

Emergency crews, which include more than 1,400 people and 25 ambulances, have already managed to retrieve eight of the miners, and said over the weekend that they have located and would be able to rescue a further 12.

Since then, rescue workers have located the remaining miners, who are spread between two platforms and an escape route. The rescue teams are now working to remove water from all flooded areas containing the trapped miners.

Mining remains a cornerstone of the Chinese economy, with the industry valued at around $345bn in 2018, and coal production in particular enjoying three years of year-on-year growth between 2016 and 2018.

However, this rampant production has often come at the cost of safety regulations, with stories of trapped workers and fatal fires already dominating the news cycles.