Don't disrupt our famous breeding: Aussie zoo to miner

Don't disrupt our famous breeding: Aussie zoo to miner
Rio Tinto revises Pilbara expansion
Barrick next chairman might get a helping hand from China
Zimbabwe's diamond mineworkers want 250% pay hike
Weak stock market debut for Chinese iron ore miner
Minister says Peru's copper production to jump 17% next year

Posted: 01 Dec 2013 08:52 PM PST

The Taronga Western Plains Zoo in Dubbo, New South Wales, is worried about noise from a proposed mine disrupting its breeding programs.

The mine, Alkane Resources' zirconium and rare earths project, would be built near Dubbo. If approved, construction would begin in 2014.

The zoo wants an "additional study of the maximum noise that can be expected taken from key locations within the zoo, including the Black Rhinoceros breeding facility," ABC News reports.

Half of the 60 submissions to Alkane involve public objection to "noise, traffic and dust."

Rio Tinto revises Pilbara expansion

Posted: 01 Dec 2013 08:25 PM PST

Rio Tinto CEO Sam Walsh says the company will go ahead with its Pilbara iron ore expansion, and will spend $3 billion less than previously planned.

"We will deliver the expansion at an estimated capital cost of more than $3bn below previous expectations."

"Under the revised plans for the project, mine production capacity would increase by more than 60m tonnes by 2017 and reach more than 330m tonnes in the next two years," the FT reports.

The original "Pilbara 360" plan targeted a production boost from 290 million to 360 million tonnes annually.

Iron ore accounts for the largest share of Rio's profits and Walsh expects the Pilbara expansion to drive company growth going forward.

The Pilbara is "the most attractive investment opportunity in the sector," Walsh said.

Barrick next chairman might get a helping hand from China

Posted: 01 Dec 2013 05:04 PM PST

Gold mining giant Barrick (TSX, NYSE:ABX) is reportedly seeking a deal with China, hoping to lift the company's balance sheet and expands its markets.

The move, reports Bloomberg, is likely to be announced Wednesday at the firm's boar meeting, when current co-chairman John Thornton, is confirmed as Barrick's next chairman, succeeding founder Peter Munk, 86.

After months of declining gold prices, a second-quarter loss of $8.6 billion and project writedowns of over $13 billion so far in 2013, Barrick's stock is trading around the $19 mark, making it one of the worst performers in the sector this year. The company has slashed its dividend by 75% and lost 41% of its market value.

Being the most debt-heavy company in the gold sector has meant for Barrick to be among those that have lost the most due to volatile bullion prices.

"The company has never been known for managing its cash or resources well or, for that matter, being investor friendly," writes Steve McDonald, bond strategist for The Oxford Club.

"It has a history of being too aggressive in its growth efforts and having too many underperforming assets that are too spread out," he adds.

But analysts see Thornton, 59, as the one who could change the company's direction. The former Goldman Sachs Group Inc. President seems quite open to a reorganization of the entire business, including the possible acquisition of mining assets in other commodities, such as copper, they said.

He also has experience dealing with Chinese firms, as he helped start up a business leadership program at Beijing's Tsinghua University and sits on the board of China Unicom, the country's second-biggest cell-phone carrier, Thornton is also a member of China Investment Corp.'s international advisory board, reports Bloomberg.

The U.S.-born businessman worked for Goldman Sachs Group from 1980 until 2003, helping to develop its European mergers-and-acquisitions business and serving as chairman of its Asian business.

Image: Screen grab of Brookings Institution via You Tube.

Zimbabwe's diamond mineworkers want 250% pay hike

Posted: 01 Dec 2013 03:52 PM PST

Zimbabwe's mineworkers have taken a leaf from the playbook of their peers to the south, asking for a 100% pay hike for 2014 in annual wage negotiations.

Zimbabwe is the second largest producer of platinum globally behind South Africa with production of some 365,000 ounces expected this year.

The country also has the world's second richest deposits of chrome and is a major supplier of diamonds.

Harare-based Associated Mine Workers Union of Zimbabwe wants employers to boost pay to a minimum of $800 a month for diamond-mine workers, $700 for platinum mines and $573 for gold and other mineworkers, while the Chamber is demanding an inflation-linked adjustment, according to position papers presented at the Nov. 26 meeting reports Bloomberg.

The current minimum wage for all mineworkers is $227 while annual inflation is running at 0.59% in the dollarized economy of the country which suffered years of hyperinflation during the last decade.

Rising labour costs would add to the headache of foreign miners operating in the country which under the country's indigenization policy introduced in 2010 are compelled to sell or cede 51% of their local assets to black Zimbabweans or to the state.

In South Africa platinum workers have been threatening strikes over wage demands that at some mining companies would constitute a 60% pay hike. Labour disputes last year claimed up to 50 lives at South Africa's platinum mines.

Together Zimbabwe, South Africa and Russia is responsible for close to three-quarters of the global supply of platinum group metals.

Despite being the world's fourth-largest diamond miner, mainly thanks to the vast and rich Marange field, Zimbabwe has not been able to reap the full rewards of the industry.

Early this year the country's Finance Minister Tendai Biti accused diamond firms – many of them associated with the country's military brass and president Robert Mugabe – of failing to pay tax revenues in full to the authorities, claiming only $40 million out of an expected $600 million reached government coffers in 2012.

Weak stock market debut for Chinese iron ore miner

Posted: 01 Dec 2013 02:42 PM PST

Iron ore mining company Hengshi Mining Investments made a poor trading debut on the Hong Kong Stock Exchange this week.

The company lost 3.8% on its first day of trading on Thursday and slid again on Friday, ending the week at HK$3.06.

Hengshi is 75%-owned by a family trust controlled by Chinese billionaire and the company's chairman Li Yanjun and his son Li Ziwei. The family's investment is worth around $444 million.

Hengshi is incorporated in the Cayman Islands, with three principal operating subsidiaries,Jiheng Mining, Jingyuancheng Mining and Xinxin Mining and four producing iron ore mines located in Laiyuan County, Hebei Province, China's iron ore and steel hub.

Forbes reports the Li's are not the only billionaires invested in the iron ore miner and according to the company's IPO prospectus, "Hong Kong billionaire Francis Choi bought $20 million of shares and Chow Tai Fook Nominee Ltd., owned by Hong Kong billionaire Cheng Yu-tung, bought $15 million of shares in Hengshi's IPO. Chinese-Thai billionaire Chanchai Ruayrungruang's Reignwood International Investment also purchased $20 million of Hengshi stock."

Iron ore prices has held up well this year despite predictions of a slump as Australian and Brazilian producer up capacity with the benchmark import price of 62% iron ore fines at China's Tianjin port holding around the $130 a tonne level.

Domestic Chinese iron ore miners which have to deal with high costs and low quality ore have been losing ground to the big four exporters Rio Tinto, BHP Billiton, Vale and Fortescue which control close to 70% of the 1.1 billion tonne seaborne trade in the steelmaking ingredient.

Minister says Peru's copper production to jump 17% next year

Posted: 01 Dec 2013 01:30 PM PST

Peru's mining output will jump 10% over the next year due, primarily driven by a surge in copper production.

A a number of new mining projects are coming on stream in 2014 including Southern Copper Corp's Tía Maria and Anglo-American's Quellaveco mine in the south of the country.

In addition, Newmont's controversial $4.8 billion Conga project in the Cajamarca region is currently the subject of talks between the government and protesting local communities and the $5.9 billion Las Bambas project is scheduled to enter production towards the end of next year.

Glencore Xstrata is in the final stages of disposing of Las Bambas which is being built to produce 450,000 tonnes of copper a year in its first five years and 300,000 tonne a year thereafter.

According to Peru this Week the South American nation's Energy and Mines Minister, Jorge Merino, Peru's mining project portfolio totals more than $54 billion:

"We are working hard to start these projects. By 2014 we expect a 17% increase in cooper production while gold and silver production is expected to rise over 10%."

Peru's mining industry is plagued by illegal gold extraction and in 2011 an estimated $3 billion of illegal gold was exported and as much as 20% of all gold mined in Peru may be outside of official channels.