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Thursday, October 21, 2021

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Green Energy Metals: Eight companies with big ambitions
Fri, 15 Oct 2021 20:23:00 +0000
Companies on the global hunt for lithium, nickel, copper, cobalt, and PGMs wherever they are.

Canada is rich with resources needed to fuel the electrification of modern society, and Canadian companies are rich with ideas for finding lithium, nickel, copper, cobalt, and PGMs wherever they are around the world.

American Manganese

American Manganese (TSXV: AMY; US-OTC: AMYZF) is concentrating its efforts on recycling lithium-ion (li-ion) batteries. If the company has its way, the batteries will be recycled and the lithium in them will last forever, thanks to its RecycLiCo patented process. The company says it is an environmentally friendly, hydrometallurgical solution for not only lithium but also cobalt, nickel, cobalt, manganese and aluminum. The process produces a high-quality feedstock that can be directly integrated into the remanufacturing of battery cathodes.

American Manganese’s pilot plant. Photo by AMY.

There are many benefits of RecycLiCo, the company says. Battery waste is recycled without mining. The process is economical, particularly when compared to the cost of exploration, drilling and mine development. RecycLiCo is a closed-loop hydrometallurgical process with no greenhouse gas (GHG) emissions, no landfill waste and low energy consumption.

American Manganese estimates that to smelt and recover a tonne of metal generates about 2 tonnes of carbon dioxide. Then only 40% to 60% of nickel and cobalt are recovered and none of the lithium. The base metals recovered need further processing and refining before they can be reused in batteries. The attraction of a hydrometallurgical way of recycling Li-ion batteries is its low energy consumption and low GHG emissions compared to conventional smelting.

American Manganese has conducted pilot plant studies on the RecycLiCo process and is ready to operate a 500-kilogram-per-day demonstration plant. Commercialization of the process is estimated to cost between C$15 million ($12.1m) and C$20 million ($16.1m), and there is the possibility of licensing the process or joint development with strategic partners.

The company may have found its niche as a critical elements recycler, but it had its beginning as a mineral exploration company. It owns the historic manganese producer Artillery Peak in Arizona, where it received a U.S. patent to process low-grade electrolytic manganese. The 31-sq. km property is home to 20 past producers.

The company has optioned the Rocher Deboule property in British Columbia, which includes the Victoria gold-cobalt mine, the Rocher Deboule copper-gold mine, and the Highland Boy copper-gold mine (all of which are past produces) to Longford Resources, which can earn a 60% interest. The Lonnie-Virgil niobium-rare earth element (REE) property in north-central British Columbia is wholly owned by American Manganese

American Manganese has a market capitalization of C$209 million ($168.7m).

Arena Minerals

Arena Minerals (TSXV: AN; US-OTC: AMRZF) is developing an integrated approach to lithium brine production. Executive Chairman Eduardo Morales and his team have developed a proprietary brine process, which creates a solution of at least 30% lithium chloride from conventional evaporation ponds. In that form it can be shipped directly to lithium carbonate plants and battery-grade material can be produced without purification circuits.

Arena Minerals’ Atacama copper property in Antofagasta, Chile. Credit: Arena Minerals.

The process results in lower capital expenditures, saves 40% to 70% on operating costs, makes a consistent battery-grade product with fewer process steps, and offers flexibility.

Arena’s Salar de Antofalla lithium project in Argentina is not yet in production, but the plan is to treat brine with a proprietary reagent, eliminating the use of lime. The concentration of lithium in the evaporation ponds would be at least 5%, which is a saleable concentration, the company says. Other evaporation ponds only reach about 1% lithium and are not marketable at that concentration. The evaporate from the ponds using Arena’s reagent can be fed to carbonate plants and a final battery-grade product made. Lesser grade evaporate can be fed to carbonate plants, but then the carbonate must be upgraded to meet the standards for batteries.

Geophysical surveys show a large aquifer saturated with brine beginning at 50 metres below surface. The aquifer is connected to surface brine hosted in shallower halites, and there is potential for a significantly larger resource, Arena believes.

The company has a second lithium project in Argentina, Sal de la Puna, for which permits for additional drilling and construction of a pilot plant have been received. Lithium-bearing brine starts at 140 metres below surface and has been drilled to at least 600 metres with grade that increase with depth. Pumping tests competed in 2019 averaged 533 milligrams (mg) per litre of lithium.

Thus far, only a small portion of the claim block has been drilled. A transient electromagnetic (TEM) survey done by the company suggested the possibility of expansion in four additional claims.

Arena closed the acquisition of Sal de Puna in July. The company has a strategic partnership with Ganfeng Lithium, which has agreed to invest $7.8 million for a 35% ownership share in the project.

Arena is also acquiring the Pampa Union copper property in Chile’s Antofagasta mining region. The company is earning an 80% interest from Chilean chemical company SQM. Over 23,240 metres of reconnaissance drilling have been completed on the property in addition to geophysical and seismic surveys. Two porphyry targets have been discovered with argillic-phyllic alteration signatures. Drill core assayed up to 0.2% copper. There are two targets permitted and ready for follow-up drilling.

Arena also holds 5.8 million shares of Astra Exploration, a newly formed private exploration company. That represents about a 40% interest in the company, which now holds the Pampa Paciencia epithermal gold property, also in the Atacama region in Chile.

Arena Minerals has a market capitalization of C$68 million ($54.9m).

Battery Mineral Resources

Battery Mineral Resources (TSXV: BMR) is focusing on several green metal opportunities — copper, cobalt, lithium and graphite. The company has chosen assets in stable jurisdictions, with existing infrastructure, and, in many instances, with historical production.

An aerial view of Battery Mineral Resources’ Punataqui complex. Credit: Battery Mineral Resources

The company’s first priority is to resume production at the Punitaqui copper-silver-gold mine, 120 km south of the city of La Serena and the port of Coquimbo in Chile. The mineral processing plant is centrally located to treat ore from the San Andres, Cinabrio, Cinabrio Norte, and Dalmacia deposits. The properties are located in a classic iron-ore-copper-gold (IOCG) and mantos-style copper belt.

Mining began at Punitaqui in 2007 under Tamaya Resources. The project was taken over by Glencore in 2010, then by Xiana Mining, which shut it down in April 2020. Battery Mineral Resources assumed ownership earlier this year.

The total acquisition cost, indebtedness, and costs to restart production is about $30 million. The company paid $15 million for the property. It is spending about $5 million on a drill program, technical report and maintenance. The cost of redevelopment for the underground mine and pastefill plant would be between $5 million and $8 million, the company says. The restarted project could generate earnings before interest, taxes, depreciation and amortization (EBITDA)of as much as $50 million a year, and Battery Mineral could use the funds to test other projects.

The processing plant is designed for 3,000 tonnes per day and could be expanded to 4,000 tonnes per day. It has a conventional flowsheet design with crushing, grinding and flotation to produce a copper-gold concentrate. Tailings management will transition to pastefill to extend the life of the containment facility. And the project has access to underground water sources and a local supplier.

Drill results from Punitaqui released in September included hole SAS-21-03, which returned 11 metres grading 1.39% copper, including 8 metres of 1.63% copper. Hole 04 intersected 16.7 metres grading 1.37% copper, including 11.7 metres of 1.64% copper, and a second interval of nine metres at 1.75% copper. Hole 07 returned 3.4 metres grading 2.1% copper and a second interval of 4 metres at 1.56% copper. Hole 08 cut 5.3 metres grading 1.39% copper and a second interval of 3.8 metres of 1.85% copper.

The upside at Punitaqui is the 25 km mineralized corridor in the region. Several other copper occurrences have been identified and will be drilled.

Once Battery Mineral has a profitable mine in its portfolio, the company plans to turn its attention to the many past-producing cobalt-silver properties it controls in Canada.  The properties could become a “hub and spoke” development with a centralized mill in Gowganda in northeastern Ontario, and fed from the McAra, Iron Mask, Cobra, Island 27 and other potential mines in Ontario as well as the Fabre cobalt-silver property in Quebec.

The company released its first underground resource estimate for the McAra project in March 2020. McAra has 34 million indicated tonnes grading 1.47% cobalt and 10.28 grams silver per tonne for  1.1 million lb. of contained cobalt and 11,260 oz. of contained silver. There is also an inferred resource of 5,000 tonnes grading 1.94% cobalt and 10.84 grams silver per tonne containing 214,000 lb. of cobalt and 1,650 oz. of silver.

Gowganda is the site of four historic silver-cobalt mines (Bonsail, Miller Lake-O’Brien, Millerette, and Capitol), which produced 60.1 million oz. of silver and 1.3 million lb. of cobalt from 1910 to 1989. Based on recent drilling, the historic mines near Gowganda that Battery Mineral hold contain an estimated 3 million oz. of silver.

The company has chosen high priority drill targets for a phase two program, which recently started. Near Gowganda it will drill the East, Bald Rock, Sydney Creek, and McAra South zone. Fabre West will also be tested.

Battery Mineral also holds a high-grade cobalt-copper-gold property in Idaho. This is the only permitted primary cobalt deposit in the United States, according to the company. Work there has outlined a 2 km long by 700-metre-wide target area of anomalous copper-cobalt mineralization. The best of the underground channel samples assayed 0.7% cobalt, 2.12% copper and 0.58 gram gold per tonne from the central part of the target area.

In addition, Battery Mineral has a pair of lithium properties in the United States. The Amargosa project lies about 130 km west of Las Vegas, Nevada, and the Franklin Wells project is located 15 km north of Death Valley Junction in California.

The company also has two brownfield graphite opportunities — Geuman and Taehwa — in South Korea. Both have exploration targets, but the Geuman deposit has a 43-101 compliant resource of 1.6 million indicated tonnes grading 6.6% carbon and 5.6 million inferred tonnes grading 5.5% carbon.

Battery Mineral Resources has a market capitalization of C$80 million ($64.5m).

Cypress Development

Cypress Development (TSXV: CYP; US-OTC: CYDVF) is working on a feasibility study for its 100%-owned Clayton Valley lithium project located between Reno and Las Vegas in Nevada. The study is due in the first or second quarter of 2022. The company acquired its claims in 2016 immediately east of Albemarle’s Silver Peak lithium producer, North America’s only lithium brine operation.

Cypress releases positive PFS for Clayton Valley in Nevada
Recovering drill core from Cypress Development’s Clayton Valley lithium project in Nevada, in 2017. Credit: Cypress Development

The Clayton Valley property contains a large flat-lying claystone occurrence with minimal overburden and no interbedded waste rock. Lithium is found in illite and montmorillonite clays to a depth of at least 150 metres below surface. An open pit mine is to be built without drilling and blasting. The ore will be scraped from the surface.

The company updated the prefeasibility study earlier this year and estimated a capital cost of $493 million to mine 15,000 tonnes per day and produce 27,400 tonnes of lithium carbonate-equivalent annually over a 40-year mine life.

The prefeasibility study indicated that the project has an after-tax net present value, at an 8% discount rate, of $1 billion and an internal rate of return of 25.8% based on a lithium carbonate price of $9,500 per tonne.

Production would be based on a probable reserve of 213 million tonnes grading 1.13% lithium for 1.3 million contained tonnes of lithium carbonate-equivalent. The total indicated resource is 1.3 billion tonnes grading 0.9% lithium for 6.3 million tonnes of lithium carbonate-equivalent.

A conveyor will move ore from the pit to an agitated tank leaching plant followed by direct extraction of lithium from the solution to produce lithium hydroxide at the site. Potential by-products include rare earth elements (REE). The study suggested a 2,500-tonne-per-day sulphuric acid plant featuring energy co-generation be built at the site to minimize the use of external power sources.

Metallurgical testing with diluted sulphuric acid demonstrated a lithium recovery of 86.5% with only 126.5 kilogram (kg) per tonne for acid consumption. The company has also successfully tested the use of hydrochloric acid and sodium chloride brine as a leach solution. The second option makes filtration and the washing of tailings easier and requires less process water. However, chloride-based leaching has its trade-offs with respect to power and acid supply.

To advance the Clayton Valley project, Cypress has leased a site for a pilot plant 160 km south of the project, in Nevada’s Amargosa Valley, and will begin testing chloride-based leaching in the third week of October. The company issued one million shares in exchange for a direct lithium extraction (DLE) licence for Chemionex’s Lionex process. A $3 million water rights deal also has been reached, and permitting activities continue.

In addition, Cypress owns the Gunman zinc-silver property, about 150 km south of Elko in Nevada. Cypress has optioned the project to Passinex Resources, which can earn an 80% interest.

Cypress Development has a market cap of C$177 million ($142.9m).

Grid Metals

Grid Metals (TSXV: GRDM; US-OTC: MSMGF) is focused on growing its Canadian projects for battery metals. Its efforts so far are concentrated on properties in Manitoba and Ontario as the company sets its sights on meeting rising demand for green energy metals.

A geologist at Grid Metals’ East Bull Lake palladium project, 80 km west of Sudbury. Credit: Grid Metals.

Makwa-Mayville is an advanced stage project consisting of two nickel-copper-platinum group metals (PGM) deposits. Grid Metals owns 100% of Makwa and 89% of Mayville. A preliminary economic assessment done in 2013 was based on the indicated resource for both deposits of 33.8 million tonnes grading 0.27% nickel and 0.37% copper. The total inferred resource was 4.8 million tonnes grading 0.19% nickel and 0.43% copper.

The company expects to complete an updated preliminary economic assessment for Makwa-Mayville later this year. It will include better nickel and cobalt recoveries than the earlier PEA, trade-off studies on mining, and a new exploration agreement with the Sagkeeng First Nation.

The Mayville property also hosts four known lithium-bearing dykes that Grid has identified. The mineralization contains high-grade spodumene with tantalum, cesium and rubidium. Drilling in 2018 returned 3.4 metres assaying 1.8% lithium oxide (Li2O5) beginning 75.5 meters downhole. The results were typical of other holes drilled at the time. The strike length of the pegmatite dyke has been traced over 775 metres.

Grid’s 100%-owned Bannockburn nickel project near Matachewan in Ontario also contains copper, palladium and cobalt. The current goal is to outline a bulk tonnage nickel sulphide deposit in the B zone. The company completed eight infill drill holes in the zone earlier this year. The first hole intersected 196.5 metres averaging 0.28% nickel, including a 112-metre section averaging 0.32% nickel with 48 metres of 0.24% nickel. Drilling identified a strike length of 600 metres. The company says the mineralization is similar to the Main zone at Canada Nickel’s Crawford nickel deposit.

Grid hopes to define an open pit resource of at least 100 million tonnes containing at least 200,000 tonnes of nickel in sulphide at Bannockburn. Additional metallurgical studies will be done for the B zone to confirm that a premium high-grade nickel concentrate could be produced.

The East Bull Lake PGM project 80 km west of Sudbury in Ontario is also 100% owned by Grid. The company made the discovery in December 2020 when hole EBL20-13 intersected 119 metres averaging 0.75 gram palladium per tonne, 0.21 gram platinum per tonne, 0.04 gram gold per tonne, 0.08% copper and 0.05% nickel (1.13 grams palladium-equivalent per tonne), including 48 metres of 1.85 grams palladium-equivalent, 14 metres of 2.97 grams palladium-equivalent, and 3.7 metres of 4.54 grams palladium equivalent.

Grid compares the geological and geophysical characteristics at East Bull Lake to the Lac des Iles palladium mine in northwestern Ontario and to the Arctic platinum project in Finland. It will continue drilling, particularly the Parisien Lake zone, where hole EBL21-09 recently returned 37.6 grams palladium per tonne, 6.68 grams palladium per tonne and 21.3% copper over 0.54 metre with a 2-metre interval averaging 10.7 grams palladium per tonne and 5.87% copper.

In early October, Grid signed an option agreement to acquire a 100% interest in a previously undiscovered spodumene and lepidolite-bearing pegmatite property — the Campus Creek property — located 250 km northwest of Thunder Bay in Ontario. Grab samples from outcrops have returned good grades of lithium and anomalous amounts of cesium, rubidium and tantalum. Geological sampling is underway.

Grid Metals has a market capitalization of C$10 million (about $8m).

Horizonte Minerals

Horizonte Minerals (TSX: HZM; US-OTC: : HZMMF) owns 100% of two advanced nickel projects and hopes the area will become a new nickel district in Brazil’s Para state.

The Araguaia nickel project is at the feasibility stage with an amended 43-101 report dated April 2021. The company plans to produce 52,000 tonnes of ferronickel containing 14,500 tonnes of nickel annually over a mine life of 28 years.

Horizonte Minerals secures $325 mln in financing for Brazil nickel project
The Araguaia project will produce ferro-nickel which is used in stainless steel. (Credit: Horizonte Minerals)

The initial 28 years of open pit production will generate after-tax free cash flow of $1.6 billion. After taxes, the net present value (NPV), at an 8% discount rate, would be $691 million with an internal rate of return (IRR) of 27%. The initial capital requirement is $443 million, and the project would pay for itself in three years.

Plan throughput could be doubled with the addition of a second rotary kiln electric furnace (RKEF) to double output. In that case, the mine life drops to 26 years, generating an after-tax cash flow of $2.6 billion with an estimated NPV of $741 million and IRR of 30.7%. Construction of the second kiln would cost $251 million and could be financed through operating cash flow. The payback period would be about four years.

The Araguaia project is construction ready, having received both its mining licence and power-line licence. The project has been de-risked, and negotiations are underway for long-lead time items. Horizonte is also negotiating for key operating inputs such as electricity, logistics and consumables. A syndicate of five international financial institutions have approved a senior secured project finance facility of up to $346.2 million for the ferro-nickel project

Horizonte’s second advanced project is Vermelho. It could be a producer of 25,000 tonnes of nickel and 1,250 tonnes of cobalt per year. Again, this would be an open pit but with high pressure acid leaching (HPAL) of ore. The test work is done for producing a battery-grade product, and additional revenue would be generated by a fertilizer (kieserite) by-product. The company is advancing the Vermelho project to the feasibility stage.

The base case preliminary feasibility study, also completed in April 2021, put the initial capital cost at $652 million, which could be paid back in just over four years. Net cash flow would be $7.3 billion over the life of the project. The after-tax NPV, at an 8% discount, would be $1.7 billion, and the IRR 26.3%.

Vermelho has a considerable upside should the nickel price go from $16,400 per tonne to $19,800 per tonne. The capital requirement would remain the same, but the project would pay for itself in 3.6 years and generate $9.5 billion over the mine life. The after-tax NPV in that scenario would be $2.3 billion and the IRR would be 31.5%

Measured and indicated resources at Vermelho are 145.7 million tonnes grading 1.05% nickel and 0.05% cobalt. These resources contain 1.5 million tonnes of nickel and 77,300 tonnes of cobalt. All measured and indicated resources within the pit designs are classified as probable reserves. The inferred resource is 3.1 million tonnes grading 0.96% nickel and 0.04% cobalt, containing 29,000 tonnes of nickel and 1,400 tonnes of cobalt.

Horizonte believes both Araguaia and Vermelho will be low-carbon producers. They have access to hydroelectric power and will share infrastructure because of their relative proximity to each other.

Horizonte also owns the Serra do Tapa nickel project, about 90 km north of the Araguaia project. A 2016 mineral resource estimate outlined 70.3 million measured and indicated tonnes grading 1.22% nickel and 0.05% cobalt for 857,000 contained tonnes of nickel. The inferred resource stands at 2.7 million tonnes grading 1.14% nickel and 0.06% cobalt for 31,000 contained tonnes of nickel. There are currently no field activities at the property.

Horizonte Minerals has a market capitalization of C$139 million ($112m).

Nickel 28 Capital

Nickel 28 Capital (TSXV: NKL; US-OTC: CONXF) owns 8.5% of the Ramu mine, the only nickel-cobalt producer in Papua New Guinea. The operator, Metallurgical Corp. of China, owns the rest. Nickel 28 obtained its share in 2019 with the acquisition of Highlands Pacific Ltd. When Nickel 28 repays Highlands’ share of the mine development costs, the company will own 11.3%

The Ramu mine is located near Madang, on the north coast of the country. Production has exceeded design capacity for the past three years. Guidance for 2021 calls for 33,000 tonnes of nickel and 2,900 tonnes of cobalt. Production attributable to Nickel 28 is 2,900 tonnes of nickel and over 600,000 lb of cobalt per year.

Anthony Milewski at the company’s Rotterdam cobalt warehouse in January 2018. Credit: Cobalt 27 Capital Corp.

The mine has proven and probable reserves of 54 million tonnes grading 0.88% nickel and 0.09% cobalt. The measured and indicated resources stand at 145 million tonnes grading 0.84% nickel and 0.09% cobalt, and the inferred portion is 21 million tonnes averaging 0.9% nickel and 0.1% cobalt. The area of the defined resources covers less than 15% of Ramu’s exploration licence.

Equally important to Nickel 28 is its portfolio of prospective nickel-cobalt properties in which it has royalties. Some of them are in Canada (Dumont, Turnagain, Triangle, Rusty Lake, Professor and Waldman, North Canol, and Sunset). Two (Sewa Bay and Star Mountains) are in PNG, and two are in Australia (Nyngan and Flemington).

In Canada, Nickel 28 Capital has a 2% net smelter return (NSR) royalty on the Turnagain nickel-cobalt property in British Columbia and a 1.75% NSR royalty on the Dumont nickel-cobalt property in Quebec.

In Australia, the company has a 1.5% gross revenue royalty (GRR) on the Flemington cobalt-scandium-nickel project, and a 1.7% GRR on the Nyngan scandium project.

Nickel 28 expects that rising nickel and cobalt prices will increase its cash flow from the Ramu mine, and should they go into production, its royalty properties would provide a steady income stream.

Nickel 28 Capital has a market capitalization of C$80 million ($64.5m).

Taseko Mines

The Gibraltar copper-molybdenum mine 65 km north of Williams Lake in British Columbia is the cornerstone of Taseko Mines’ (TSX: TKO; NYSE: TGB) growth strategy. The operation is a low carbon intensity project benefitting from hydroelectric power.

Taseko shakes management up as top bosses to retire
Taseko’s Gibaltar mine in British Columbia. Image from Taseko..

Production began in 1972, but former owner Boliden suspended mining in 1998 due to low copper prices. Taseko purchased the property the following year, but it was not until 2004 that the operation was modernized and restarted. Three major expansions have created a mine and 85,000-tonne-per-day mill with an annual output of 135 million lb copper.

At a cut-off grade of 0.15% copper, Gibraltar has  proven and probable reserves of 488 million tonnes (including ore stockpiles) grading 0.25% copper and 0.008% molybdenum. The mine life is about 17 more years.

The total measured and indicated resources (including reserves) are 907 million tonnes grading 0.25% copper and 0.007% molybdenum. The inferred portion is 53.5 million tonnes grading 0.21% copper and 0.004% molybdenum.

In 2014 Taseko acquired the advanced-stage Florence Copper project 100 km southeast of Phoenix in Arizona. This is a particularly green project, the company says, as it is being developed with in situ recovery. A water-based solution is injected into the deposit, the metal dissolves, and the copper-laden solution is pumped to the surface. It is currently operating as a phase one production test facility (PTF).

Taseko invested C$25 million into the PTF and solvent extraction/electrowinning (SX/EW) plant. It went into production in December 2018 with 24 wells. Eighteen months of testing provided the company with operational data, confirmed project economics, and produced high-quality copper cathode within stringent environmental guidelines.

Compared to conventional open pit mining, Florence Copper will consume 71% less energy, 93% less fresh water, and produce 83% fewer carbon emissions.

Taseko says it will take an initial capital expenditure of $227 million to reach commercial operation at a rate of 85 million lb. of copper annually over a 20-year mine life. The state has already issued a draft aquifer protection permit, and the company continues to advance its application for the underground injection control permit. Discussions with potential joint venture partners are also ongoing, as are Taseko’s efforts to raise the necessary capital.

Using a 0.05% total copper cut-off, probable reserves at Florence Copper are 313 million tonnes at a grade of 0.35% copper, for 2.5 billion lb. of contained copper. Reserves are contained within the measured and indicated resource of 389 million tonnes grading 0.33% copper for 2.8 billion lb. of copper. There are also 300 million lb. of contained copper within the 57 million inferred tonnes averaging 0.24% copper.

Taseko has two more advanced exploration projects in British Columbia — Yellowhead copper-gold and Aley niobium.

The Yellowhead project has the potential to be a 90,000-tonne-per-day open pit with about 15 billion lb. of contained copper. A 43-101 technical report was completed in 2020 indicating the project would have a life of 25 years after an initial capital investment of C$1.3 billion.

Yellowhead has measured and indicated resources of 1.2 billion tonnes grading 0.25% copper and 0.028 gram gold per tonne, plus 99 million inferred tonnes grading 0.024% copper and 0.026 gram gold per tonne. A cut-off of 0.15% copper-equivalent was used to calculate the resource.

The Aley niobium project in the northern part of B.C. is seen as a potential growth project. Niobium is used mostly in high-strength, lightweight and corrosion resistant steel. Taseko acquired the project, which contains one of the world’s largest niobium deposits, in 2007.

The Aley deposit has proven and probable reserves of 84 million tonnes grading 0.5% niobium oxide (Nb2O5) contained within 113 million tonnes of measured and indicated resources of 286 million tonnes grading 0.37% niobium oxide. The reserves are believed to contain 188 million kilograms (kg) of recoverable niobium.

Taseko is also the 100%-owner of the New Prosperity copper-gold project 125 km southwest of Williams Lake in B.C. It is opposed by the Tsilhqot’in First Nation on whose land it is located. The project has been idled almost two years by mutual agreement of Taseko and the Tsilhqot’in government. That ban on work is due to expire at the end of 2021.

Using a cut-off of 0.14% copper, the New Prosperity deposit has measured and indicated resources of 1 billion tonnes grading 0.24% copper and 0.41 gram gold per tonne. Within that material, the proven and probable reserves are 831 million tonnes grading 0.23% copper and 0.41 gram gold per tonne, containing 3.6 billion lb. of recoverable copper and 7.7 million oz. of recoverable gold.

Taseko Mines has a market capitalization of C$690 million ($557m).

(This article first appeared in The Northern Miner)

Industrial metals blast off as energy crisis drags down supply
Fri, 15 Oct 2021 18:40:02 +0000
Friday’s gains come after the benchmark index of six base metals on the LME rose to an all-time peak in the previous session.

The world’s most crucial metals continued to surge higher on Friday, with zinc recording the biggest daily gain in six years after hitting a 14-year high Wednesday and aluminum holding near a 13-year high, as energy shortages continue to disrupt the global supply chain.

Producers of industrial metals from zinc to aluminum are restricting output as rising energy costs outpace the spike in metal prices, or because of power restrictions in key economies such as China.

“As most metals are in backwardation and physical demand high, the ingredients are there for materially higher prices, most notably in aluminum and zinc but also permeating into the copper and tin market,” said Kieron Hodgson, an analyst at Panmure Gordon in a Bloomberg report.

“It is increasingly likely these prices may persist throughout the fourth quarter before the inevitable return-to-earth occurs.”

The latest victim was global miner and metals trader Glencore, which saw zinc production at its three European plants being cut due to surging power prices. This follows an earlier announcement that Nyrstar — another big producer — intends to reduce output at three European smelters by up to 50% due to rising power prices and costs associated with carbon emissions.

Zinc spiked as much as 12% on the London Metal Exchange (LME) in response, the biggest increase since October 2015. The industrial metal is now sitting at its highest since 2007, with pressure continuing to pile on manufacturers following the wave of smelter shutdowns across Europe.

Aluminum, which is particularly energy intensive, also gained on Friday, taking this year’s advance to 62% this year. Earlier this week, aluminum rallied to its highest since 2008 as the deepening power crisis squeezed supplies of the metal used in everything from beer cans to iPhones.

Last month, analysts at Goldman Sachs and Citigroup boosted their price outlooks for aluminum, citing smaller output from China and tighter fundamentals for metals across the globe.

Matalco Inc., the largest US producer of aluminum billet, is also warning customers it may curtail output and ration deliveries as soon as next year amid a magnesium shortage.

Friday’s gains come after the benchmark index of six base metals on the LME rose to an all-time peak on Thursday. Year-to-date the LMEX index has gained 35%.

(With files from Bloomberg)

Now read: Energy crisis, bottlenecks blunt metal rally windfall for miners

Hochschild exercises earn-in option on Skeena’s Snip gold project
Fri, 15 Oct 2021 17:22:51 +0000
The former Snip mine produced approximately one million ounces of gold between 1991 and 1999 at an average gold grade of 27.5 g/t.

Hochschild Mining informed Skeena Resources (TSX:SKE) on Friday of its intention to take over operatorship of the Snip gold project and begin spending to earn 60% of Skeena’s interest, as per an agreement signed in September 2018.

The Snip project, located in British Columbia’s Golden Triangle, is a past-producing mine acquired by Skeena from Barrick Gold in 2017. The property consists of one mining lease and eight mineral claims totaling approximately 4,546 hectares in the Liard mining division.

In order to earn the 60% interest, Hochschild will need to incur expenditures of approximately C$100 million over a three-year period, starting on October 14.

Should Hochschild complete a minimum spend of C$22.5 million, it may extend the option period by another year by making a $1 million cash payment to Skeena.

Upon completion of the earn-in, a joint venture would be established between the parties, and Skeena would be entitled to anti-dilution protection of up to C$15 million.

“The Hochschild team has a reputation for being among the best underground miners in the world for narrow, high-grade deposits, and we are fortunate to have them as our formal partner on Snip going forward. Skeena’s shareholders will benefit from Hochschild spending a potential C$115 million at Snip, before the company would be required to contribute,” Skeena CEO Walter Coles Jr. said in a news release.

“We are pleased to exercise our option on the Snip project in Tahltan Territory, Canada. This represents a first step in our strategy to add another high-grade project with strong upside potential into our pipeline,” Hochschild CEO Ignacio Bustamante added.

Past production

The former Snip mine produced approximately one million ounces of gold between 1991 and 1999 at an average gold grade of 27.5 g/t. Since then, the project has been improved with the recent construction of nearby infrastructure and substantially higher gold prices.

Recent work by Skeena led to the release of an underground constrained mineral resource estimate on the property in July 2020, showing 244,000 ounces of gold hosted within 539,000 tonnes of indicated resources at an average gold grade of 14.0 g/t Au.

With Hochschild on board as the project operator, Skeena said it will now shift focus on “aggressively exploring and advancing” Eskay Creek, another historical underground mine within the Golden Triangle.

The company is proposing to restart operations at Eskay Creek as an open-pit gold-silver mine and is working towards a feasibility study, which is expected to be released in Q1 2022. 

Gold price pares weekly gain as US bond yields rebound
Fri, 15 Oct 2021 16:35:12 +0000
Still, bullion is approaching its biggest weekly gain since August after receiving a boost from the latest US inflation report.

The gold price retreated on Friday as US Treasury yields rebounded on improved risk appetite, though a subdued dollar helped to cap its losses, while investors continue to weigh the outlook for stimulus following a hot inflation print.

Spot gold declined 1.6% to $1,767.74 an ounce by noon EDT, good for a weekly gain of 0.6%. US gold futures were also down 1.6%, trading at $1,768.20 an ounce in New York.

[Click here for an interactive chart of gold prices]

Meanwhile, both European stocks and US futures advanced after robust corporate earnings. US bond yields rose after three straight days of declines, causing non-interest bearing gold to sink through its 50-day moving average.

Still, bullion is approaching its best weekly performance since August after receiving a boost from the latest US inflation report.

The consumer price index showed high inflation persisting in the world’s largest economy, causing 10-year Treasury yields to sink earlier in the week as traders weighed how the Federal Reserve would react.

“The market, as a snapshot of that, priced in increased stagflation fear,” said Marcus Garvey, head of metals strategy at Macquarie Group, in a Bloomberg interview.

“That inflation now will bring forward tightening, but the economy won’t handle it, and, therefore, it will be a very limited tightening cycle.”

Bank of America chief executive Brian Moynihan joined fellow finance industry leaders, including Morgan Stanley CEO James Gorman and Goldman Sachs Group’s chief operating officer John Waldron, in predicting that inflation will stick around. Some Federal Reserve officials also are now less certain price pressures will prove transitory.

This sentiment has caused traders in the US short-term rates market to bet on the Fed raising rates faster and more aggressively starting at the end of next year. Whether the central bank takes action to curb inflation at the expense of employment will be crucial to gold’s performance over the next year, according to a Bloomberg report.

Investors so far remain cautious. Exchange-traded funds are set to cut their gold holdings for a fourth week running, according to an initial tally by Bloomberg.

“The gold investment market is still suffering from a hangover from last year,” said Adrian Ash, director of research at brokerage BullionVault. “It was always going to be a hard act to follow.”

(With files from Bloomberg)

Copper price soars to new high as stockpiles hit 47-year low
Fri, 15 Oct 2021 15:23:31 +0000
Copper price up 12% this week as LME warehouses empty out and inflation pressures rise across the globe.

Copper price hit a record high on Friday as surging power prices threaten to curb supply at a time when exchange stockpiles are at rock bottom.

Copper for delivery in December rose sharply for the third day in a row on the Comex market in New York, touching $4.7810 per pound ($10,518 per tonne), the highest since the record hit on May 12, 2021 — and a 12% gain for the week.

Inventories available on the London Metal Exchange are at the lowest since 1974.

[Click here for an interactive chart of copper prices]

Copper tracked by LME warehouses not already earmarked for withdrawal has plunged 89% this month after a surge in orders for metal from warehouses in Europe. Stockpiles have also been falling fast on rival bourses and in private storage, and LME spreads have entered historic levels of backwardation (prompt delivery metal pricier than futures), with near-term contracts trading at record premiums.

The rally fed through to producers, with shares in Freeport-McMoRan up 4%, Southern Copper up 2.4% and First Quantum Minerals up 5% on the day.

After fresh orders to withdraw metal on Friday, there are now just 14,150 tonnes of copper freely available in LME warehouses, in an industry that consumes about 25 million tonnes annually. 

“If more metal doesn’t make it into the exchange, then it really is in a difficult position,” Michael Widmer, head of metals research at Bank of America, told Bloomberg.

“Right now the LME is running a physical contract that effectively is not really backed by physical metal.”

“High power costs are also inflationary and this is boosting demand from investors for copper and other physical commodities as a hedge,” said Saxo Bank analyst Ole Hansen.

“It looks like we’ve got clear air ahead of us to that May peak,” he said.

CHARTS: Chinese investment in overseas copper projects just beginning

The international zinc and copper study groups said this month they expected both metals to be oversupplied next year, but analysts say the power crisis could change that.

While falling inventories across major exchanges point to a fundamental mismatch between supply and demand, some short-term relief could be seen if stockholders who have requested to withdraw metal in recent days instead decide to deliver it back to take advantage of sky-high spot prices.

There are currently 167,250 tonnes of copper scheduled for withdrawal from LME warehouses, but the steep backwardation creates an incentive for owners to immediately sell their holdings on the exchange and use the lower-priced futures contracts to buy the metal back at a later date. 

(With files from Bloomberg and Reuters)

BHP’s London investors back critiqued climate change plan
Fri, 15 Oct 2021 14:04:00 +0000
Miner won 83% support for its climate transition strategy despite concerns that the plan did not go far enough.

BHP (ASX, LON: BHP) secured this week key backing for its climate transition strategy, despite concerns that the long-term plan to tackle customers’ greenhouse gas emissions did not go far enough.

At its annual general meeting in London, the world’s largest miner’s climate change roadmap won 83% support — a much stronger outcome than the knife-edge result some analysts had predicted.

“It is important that all of our shareholders have an opportunity to engage with us on our climate strategy and actions, and this advisory vote is intended to provide a forum for discussion and feedback on the plan,” Chairman Ken MacKenzie said at the meeting

BHP committed in 2019 $400 million over five years to reduce greenhouse gas emissions from its operations and mined commodities. It has also vowed to reduce its Scope 3 emissions — those generated by customers using the company’s commodities — which are 40 times greater than those generated by its mines and oilfields.  

The master plan to cut such emissions by 30% by 2030 from last year’s levels, did not set hard targets for its steelmaking, which drew criticism from some investors. One of them, prominent advisory firm Glass, Lewis & Co., launched a campaign urging shareholders to vote down the plan. 

While steel is an important component in many of the products driving the decarbonization process, its production accounts for as much as 10% of global greenhouse gas emissions — and about 75% of BHP’s Scope 3 emissions. 

The company said it is working with industry giants BHP including China Baowu Steel and Japan’s JFE Steel of ways to reduce manufacturers’ carbon footprint.

BHP has also earmarked a further $75 million to partnerships focused on steel decarbonization with four of its major steelmaking customers, but warned the road to the sector’s net zero emissions remains uncertain.

Australian peer Fortescue Metals Group (ASX: FMG), raised the stakes on iron ore producers earlier this month by setting a 2040 target to achieve net zero customer emissions.

Goodbye London 

BHP sought to soothe concerns among its English shareholders as the company advances plans to scrap its local listing in favour of its presence in Sydney, by saying that London will remain “a vital location” for the mining group. 

“We value our partnerships and relationships in the UK and intend to maintain our London corporate office,” MacKenzie said. 

BHP dealt a blow to British investors in August when it said that it wanted to ditch its dual-listed status and retreat to a single primary listing in the home country. 

“(Share) unification will simplify BHP’s structure, make it easier for the company to make equity-based acquisitions, and make it easier for other corporate restructurings, including the Petroleum/Woodside merger,” Jefferies analysts said at the time. 

The company’s shares in London have traditionally traded at a deep discount to Australian stocks. 

UK investors including Legal & General expressed concern because the reform would mean BHP dropping out of the FTSE indices, pressuring passive investors and others benchmarking against those indices to sell their shares. 

Alrosa says global stock of rough diamonds “minimal”
Fri, 15 Oct 2021 13:13:42 +0000
The world’s top diamond miner by output says demand increase has not been met with any "meaningful" supply response.

Alrosa (MCX: ALRS), the world’s top diamond miner by output, warned on Friday that global stocks of roughs are nearing multi-year lows, as demand continues to increase with no meaningful supply response from miners.

The Russian producer, which posted results for the three months to September 30, said it had sold 9.2 million carats during the period. That’s a 20% drop from the previous quarter, which Alrosa attributed mainly to the lack of inventories available for sale.

“Rough diamonds stocks at miners are at minimal levels as supply structurally dropped, but jeweller demand is strong in all the key markets,” the company said in the statement. 

The diamond market came to a standstill at the height of the covid-19 pandemic, increasing worries that oversupply could hurt the sector for years. But surging purchases by intermediaries who cut, polish and trade stones has all but wiped-out miners’ stockpiles, even as the company and its closest competitor, Anglo American’s De Beers, have hiked prices. 

De Beers rose prices by about 5% at its first sale of the year, as the industry began bouncing back, and pushed them another 10% higher in June. The increases mostly applied to diamonds bigger than one and two carats, respectively.  

Alrosa’s diamond inventories fell to about 10 million carats in May, after peaking in the third quarter of 2020 at 30.6 million carats. 

“The rough market is hot. There’s enthusiastic buying across all rough categories,” Anish Aggarwal, a partner at specialist diamond advisory firm Gemdax told Bloomberg in June. “There are supply shortages at the moment. That’s creating a sense of scarcity at every stage of the pipeline.” 

Selling like it’s 2018 

The Moscow-based firm said it produced 8.8 million carats in the third quarter this year, adding that planned output boosts at some of its operations allowed it to increase its inventory of rough diamonds by 200,000 carats to 8.6 million. 

Alrosa confirmed that demand for rough diamonds remained strong, which is reflected in their prices. The company said prices for rough stones have returned to 2018 levels, while polished diamond prices have already exceeded that year’s average.

It also said demand in the key US market remained stable, supported by ongoing recovery in other regions, including Europe. Demand growth, however, slowed down in China, in response to economic growth developments in that country. 

The company is optimistic the market will continue to rebound in the coming months, especially as the upcoming Christmas season is expected to have an earlier-than-usual start in the US, as jewellers have been placing orders for polished diamonds since July. 

Canadian companies to use Czech manganese for li-ion battery cathode materials
Fri, 15 Oct 2021 13:06:00 +0000
Sourcing the metal from the Chvaletice project, Euro Manganese will develop manganese products for use in cathode materials made by Nano One.

Canadian companies Nano One Materials (TSX: NANO) and Euro Manganese (TSX-V, ASX: EMN) have joined forces to develop what they call “economically viable and environmentally sustainable” applications of high-purity manganese. 

In detail, the firms have entered into a joint agreement under which Euro Manganese will develop manganese products for use in cathode materials made by Nano One.

The metal is to be sourced at the miner’s proposed Chvaletice manganese project in the Czech Republic, approximately 90 kilometres east of Prague. The plan is to reprocess the resource contained in three adjacent flotation tailings piles that were emplaced on flat terrain immediately below the site of a flotation mill site, adjacent to the former Chvaletice open-pit pyrite mine.

The tailings consist of sandy to fine greyish material containing approximately 7.3% manganese, mostly occurring as rhodochrosite and kutnohorite, two mineral forms of manganese carbonate. From this resource, ultra-high-purity manganese products can be manufactured. 

The products are to be evaluated by Nano One in the formation of its cathode materials including lithium nickel manganese oxide (LNMO) and nickel rich lithium nickel manganese cobalt oxide (NMC).

In a press release, the companies said that LNMO and NMC materials will be prepared using Nano One’s patented One-Pot process, coated nanocrystal powders and M2CAM technology — which is metal direct to cathode active material, thus enabling the use of sulphate-free metals and lithium carbonate as low-cost and environmentally sustainable feedstocks.

The partners believe that LNMO, also known as high voltage spinel, and NMC both have great potential in conventional and solid-state battery applications for electric vehicles, renewable energy storage and consumer electronic devices. This is because LNMO delivers energy and power on par with NMC and is more cost-effective because it is manganese-rich, cobalt-free, low in nickel and does not require excess lithium. LNMO also operates at a voltage that is 25% higher than commercial high-nickel cathodes, which, the companies say, translates into fewer cells, improved productivity, efficiency, thermal management, and power.

“Nano One has ambitious plans to be a major participant in the battery-driven transformation of mobility and renewable energy storage, and we are doing so by changing how the world makes cathode materials,” Nano One CEO, Dan Blondal, said in the media brief.

“Our LNMO is unique [and] well-positioned to address the automotive industry’s recent interest in manganese-rich batteries and our coated nanocrystal NMC is targeting demand for increased durability in long-range battery applications,” Blondal said. “Manganese plays a critical role in both chemistries and we are aligned with Euro Manganese in developing low-cost high-performance cathode materials with a differentiated and environmentally sustainable supply chain.”

Canadian Mining Hall of Fame celebrates new inductees
Fri, 15 Oct 2021 13:00:00 +0000
The careers of industry giants Patricia Dillon, David Elliott, William Gladstone Jewitt, Steven D. Scott, and Mary Edith Tyrrell were celebrated for their contributions to the mining industry.

The Canadian Mining Hall of Fame welcomed five exceptional individuals during its thirty-third annual induction ceremony and gala dinner in August at the Aga Khan Museum in Toronto. The careers of industry giants Patricia Dillon, David Elliott, William Gladstone Jewitt, Steven D. Scott, and Mary Edith Tyrrell were celebrated for their contributions to the mining industry. The event was held outdoors on the terrace at the museum and due to the pandemic, the number of guests was limited to 125 in order to comply with Ontario’s health guidelines.

“It feels quite surreal to see you all here tonight — live and in person,” Pierre Gratton, chair of the Canadian Mining Hall of Fame, said in his opening remarks. “I don’t know about you, but I am pretty Zoomed out, so it’s wonderful to be here among such great company.”

Gratton noted that he was proud of how the mining industry had navigated Covid-19 and “continued to deliver the global supply of materials integral to the items each of us use every day.”

“Our time is now,” he continued. “Our sector delivers the critical minerals and metals needed for the global transition toward a low carbon future…Mining will be a constructive partner in the fight against climate change.” He also paid tribute to all the inductees of the Canadian Mining Hall and the group’s five newest members. “We are here tonight to celebrate our next group of individuals who make Canada’s mining industry a global leader…As exceptional leaders and champions, each of the inductees were instrumental in growing our sector.”

Master of ceremonies Anthony Vaccaro, publisher of The Northern Miner, brought levity to the event with several hand-picked anecdotes about each inductee. Calling Patricia Dillon “a force of nature,” Vaccaro noted that Dillon has “done so much good for this industry that we are trying to find a way to clone her so that each country with a mining industry can be steered in the right direction.”

Dillon was a female geologist in the 1970s, Vaccaro added, “back when being a female geologist was about as common as a Maple Leaf winning a playoff round is today.” He also quoted from Dillon’s geology professor at the University of Toronto, who told him that the young student stood out from the crowd and truly showed a love for learning. The professor went on to say, Vaccaro added: “’But that was not all she loved. Along came Ted, also an undergraduate and a geological engineer. They sat together in class and held hands, making notetaking a little difficult for both.’”

Steven D. Scott, Vaccaro joked, “may have been one of the industry’s deepest thinkers,” so deep “that he had to do his research on VMS deposits at the bottom of our ocean floors;” while fellow inductee David Elliott, an avid fly fisherman, “remains known for his humility and accessibility; you can pick up the phone and call him anytime and he will make time to listen and try to help. Well Dave, you might have a few more phone calls after tonight and need to reconsider that policy.”

As for William Gladstone Jewitt, Vaccaro said, the induction into the Canadian Mining Hall of Fame is actually Jewitt’s second induction. His first was the Canadian Aviation Hall of Fame in 1978. “He brought aviation into exploration in a way that was never seen before, even training his geologist prospectors to fly themselves out to remote regions to do their work. They called it the Cominco Air Force.” Vaccaro noted that Jewitt was a true “renaissance man” who “could recite poetry in three languages, play the piano with virtuosity” and was an avid golfer. Finally, Vaccaro paid tribute to Mary Edith Tyrrell, or ‘Dollie’ as she was known.

Tyrrell created the Womens’ Association of the Mining Industry of Canada (WAMIC), he said, and was “at the forefront of a movement to support and give back to communities in and around the mining sector. Edith gained technical expertise by reading her husband’s geologic texts in her own time, yet she was always focused on the bigger picture and how mining metals could make Canada and society at large a better place,” he summarized.

“Edith has previously been described as ‘the wife of’ renowned geologist and explorer and CMHF member, Joseph B. Tyrrell. Now is our opportunity to give Edith her due and refer to Dr. Tyrell as ‘the husband of’ WAMIC founder and CMHF inductee Mary Edith Tyrell.”

The first inductee of the evening was Patricia Dillon. Born in Toronto, Dillon earned a BSc in geology in 1974 and a Bachelor of Education in 1976 at the University of Toronto. She joined Teck Resources as a geologist in 1979 and advanced to more senior roles over her 32 years at the company. She also took volunteer positions with the Prospectors and Developers Association of Canada (PDAC) and the Canadian Institute of Mining and Metallurgy and Petroleum (CIM).

Corporate responsibility initiatives

Her positions included committee chair, board member and president of both organizations (PDAC president 2006-2008 and CIM president 2000-2001). She also contributed to the Corporate Social Responsibility initiatives of the Mining Association of Canada (MAC), specifically the group’s ‘Towards Sustainable Mining Initiative’ and was the founder of Mining Matters, a charitable organization focused on educating students about the Earth sciences and the minerals and mining industry.

“I knew I was always going to take the sciences and so I had signed up for biology, physics, chemistry and mathematics, but you needed another course back in the day,” Dillon said in a tribute video played for the audience. “So, I was flipping through the university calendar, at that time it was a printed document, and I saw geology and I thought, well, that’ll be a nice addition to the other sciences.”

Dillon’s highest mark was in geology and she took it as a sign to pursue the science. Her first summer job was as a field assistant exploring for copper deposits in Ontario with Esso Minerals. It was “actually right in cottage country,” Dillon recalls on the video, “so it was pretty nice for a summer job.”

After graduation, Dillon and her then fiancé, Ted, both worked over the summer for Teck. “We ended up getting hired as a field team to go and work in Newfoundland around the Newfoundland zinc mines property,” she recounts on the video. But Dillon also says she recognized that she and Ted would have to “diversify” their skillset since they were in the same industry, and consequently she decided to go back to university and get a bachelor degree of education.

After teaching science at Lorne Park secondary school, Teck offered her a job she couldn’t refuse. She joined the company in 1979 and worked in various positions from project geologist to senior geologist. Between 2001 and 2007 she was Teck’s manager of corporate relations; from 2007-2008 manager of corporate affairs and government relations; and from 2008 until 2011, director of employee communications and engagement, and director of industry relations.

“Pat was a trusted, strategic and genuine leader within Teck’s management team that helped build a culture of meaningful employee engagement, Don Lindsay, Teck’s president and CEO, said in the video. “Pat empowered those around her to meet shared goals and did so with boundless energy. Her legacy is still felt throughout the organization today.”

Dillon’s passion for education led her to create in 1994 Mining Matters, dedicated to producing educational resources promoting knowledge about the minerals industry. She has held the position of president and CEO of Mining Matters for more than 25 years. The organization created its first Indigenous programming in 2002. Today Mining Matters has reached over 780,000 youth, educators and members of the public, and programs are delivered in English, French and Indigenous languages.

“Few individuals have so deeply and successfully helped build, nurture and spread the goodwill of Canada’s mining industry as Pat Dillon,” Teck’s Lindsay said.

Dillon’s career also included a secondment from Teck to work with the Lassonde Mineral Engineering program. “Pat’s commitments and enthusiasm in promoting the engineering profession and helping students get the most out of their university days through finding them summer jobs and employment made Pat the go-to person in the department,” Pierre Lassonde, a 2013 inductee of the Canadian Mining Hall of Fame, said on the tribute video. “Our applications to the program soared through her tenure and that’s a direct reflection of her work.”

Dillon said she was “happy, grateful, honoured, thankful and overwhelmed,” when she accepted the award. “It is an overwhelming honour to be inducted into the Canadian Mining Hall of Fame and to be joining the builders of Teck, Dr. Keevil, Dr. Keevil Sr., Bob Hallbauer, David Thompson and Ed Thompson, already recognized for their incredible contributions to the Canadian mining industry.”

The evening’s second inductee was Steven D. Scott, one of Canada’s most prolific and influential geoscientist researchers in the last fifty years. Scott ((1941-2019) was born in Fort Frances, Ontario and earned bachelor and master degrees in geology in 1963 and 1964, respectively, at the University of Western Ontario, followed by a PhD (1968) in geochemistry and mineralogy from Pennsylvania State University.

“I don’t believe there has been a Canadian or international scientist who has had a bigger impact on the education and research of marine geology,” Russell Pysklywec, a professor and chair of earth sciences at the University of Toronto, said on the tribute video. “His work—both as a primary researcher and leader in advancing this entire community has shaped current thinking on how hydrothermal systems and volcanogenic massive sulphide deposits develop.”

Scott joined the University of Toronto in 1969 and at the time was the institution’s youngest professor. Early in his career as an experimental geochemist, Scott developed the sphalerite geobarometer, a tool used to estimate temperature and pressure of formation or metamorphism of deposits, which helped predict the content of volcanogenic massive sulphide (VMS) deposits.

He later focused on “black smokers” and the genesis of seafloor massive sulphides. In 1982 Scott participated in an expedition aboard an ALVIN submersible investigating black smokers and later became a renowned marine scientist.

“As early as 1984 he was the first to recognize that the seafloor deposits could be an economic resource, which led to his interest on how they could be recovered, and limiting environmental issues,” Andrew Conly, an associate professor in the department of geology at Lakehead University, commented on the tribute video. “And within about 30 years after that initial discovery an innovative industry now exists around the concept of mining seafloor polymetallic deposits. Steve himself was a discoverer/co-discoverer of several deep seafloor metal-precipitating hydrothermal sites, including the Solwara 1 deposit in eastern Manus Basin, offshore Papua New Guinea.”

Scott went on 31 oceanographic expeditions and published 187 scientific papers. The body of students he educated around the world is affectionately called the “Scott Diaspora” by his wife Joan. He also was a visiting professor at universities in Australia, France, Hawaii and Japan. “Everybody was important to him,” Joan said on the video. “He would have them as grad students, and then they would become colleagues, and they would be wherever all over the world.”

“He was enthusiastic about his job,” Joan continued.  “He was enthusiastic about geology, enthusiastic about people knowing it, and about science and people knowing about science.”

Jim Franklin, an inductee into the Canadian Mining Hall of Fame in 2019, couldn’t agree more. “Steve managed to make them all outstanding because he taught them well, he mentored them well.”

“Steve is kind of like the great grandfather of the whole development of research out there now, that has dozens and dozens of top-notch people doing it [and] are following in his footsteps, really.”

Scott’s son Don and daughter Sue Killey accepted the award on their father’s behalf. “If Steve were here tonight he would be thanking all his colleagues, here and around the world, who challenged him, questioned him, carried his rock samples, helped with experiments, organized oceanographic cruises, pushed him into the computer age, or enjoyed a cold beer after a long day’s work,” Don said. “You all know the parts you played in his career to make it as special and as diversified as it was. Steve loved a party and this was always one of his favourites!”

The third inductee of the night was Mary Edith Tyrrell (1870-1945). Tyrrell was born in Saint John in New Brunswick and nicknamed “Dollie” at birth because she weighed just three pounds. After living in New Brunswick for 17 years, her father, a Baptist minister, took the family to England for six years, before moving back to Canada and settling in Ottawa.

Tyrrell was introduced to the mining industry through Joseph B. Tyrell, who when she met him, was already a renowned explorer and map-maker with the Geological Survey of Canada. Prior to their marriage in 1894, Tyrrell had discovered dinosaur bones and coal deposits in Alberta. (He was inducted into the Canadian Mining Hall of Fame in 1997).

Women’s Association of the Mining Industry of Canada

The couple travelled throughout their marriage, including to the Yukon during the Klondike gold rush, but moved to Toronto in 1905, where Joseph worked as a mining geology consultant. During their marriage Tyrrell was often away in the field for long periods of time, and she felt a need to connect with other wives of men in the industry. During World War I, Tyrrell joined the Women’s Auxiliary of the American Institute of Mining and Metallurgical Engineers, and in March 1921 she organized a group of ten mining wives to launch the Women’s Association of the Mining Industry of Canada (WAMIC).

 The group’s goal was to foster friendship among women in the mining industry or women associated with the mining industry; serve the industry and generate well-being in the community. Members of the organization in its early years supported war veterans in the 1920s; disaster relief in the 1930s; and the war effort in the 1940s. The WAMIC celebrated its 100th anniversary earlier this year.

“Towards the end of the 1930s, each member was asked to contribute $2 to a scholarship fund that they established for a student in the geologic, geology, or mining sciences,” Nean Allman, principal of Allman and Associates Corporate Communications, says on the tribute video.

Tyrrell served as WAMIC’s president for three years and since the organization was founded, it has distributed over C$1.8 million to good causes, including C$300,000 to various charities, C$300,000 in scholarships, and C$616,000 from the Sophia Wood bequest.

“I have been touched many times by the legacy of the founder of WAMIC,” David Harquail, chairman of Franco-Nevada’s board of directors, said in the tribute video, noting that as a mining student he had received an ‘Edith Tyrrell’ scholarship. “That $2,000 was then a princely sum for a student. In the 80s and 90s I saw WAMIC members tirelessly support the PDAC and CIM conventions when those organizations were so much more dependent on volunteers than today. I am grateful to both Edith Tyrell and the WAMIC organization she created.”

Peter Dalton, Tyrrell’s great-grandson, accepted her award. “As you can imagine, the limelight has been on her husband, my great grandfather, JB Tyrell,” he said. “I am honoured to be here today as we celebrate Edith and the remarkable woman she was.”

The fourth inductee of the evening, William Gladstone Jewitt (1897-1978), was honoured for making lasting contributions to mapping and mineral exploration in northern Canada.

During World War I, Jewitt joined Princess Patricia’s Canadian Light Infantry and for the first couple of years was a machine gunner in France. He later transferred to the Royal Flying Corps in England and became an instructor. At the end of the war, he became a test pilot for the Royal Air Force in Europe. A mid-air collision brought Jewitt’s time in England to an end.

“The other plane fluttered down and landed safely on the field,” his Jewitt’s son John, said on the tribute video. “Dad pulled out of the dive just in time to fly right through the main hangar doors, and the big Marlin engine in front of that plane he was flying took out seven other aircraft, as well as his own. That’s when he smashed his front teeth and both knees, and he survived.”

In 1923 Jewitt graduated with a BSc in mining engineering from the University of Alberta. His first few jobs were teaching a course in assaying for Royalite Oil, and was one of the first people researching ways of recovering petroleum from Alberta’s oil sands; and at Coleman Collieries and a gypsum mine in Nova Scotia. He then joined Cominco (which later became Teck Resources) as an assayer at the company’s smelter in Trail, British Columbia. In 1929 he transferred to the mining group as an exploration engineer and pilot, where he trained company engineers and geologists to fly as part of their exploration responsibilities. At the time the company had twelve planes that were used to explore unmapped territory in Canada’s North, especially in the Northwest Territories. Jewitt was inducted into the Canadian Aviation Hall of Fame in 1978 for his work mapping the uncharted North. (In 1930, he landed on the shores of Victoria Island in Canada’s High Arctic, setting a record at the time for the most northerly flight in the country.)

Jewitt contributed to the success of many projects during his career at Cominco. He retired as Cominco’s Vice President of Mines when he was 65 but continued working until he was 80 with Pine Point Mines, Coast Copper and Western Mines. “He was one of the giants in Canadian Mining in the mid-1900s and a legend at Cominco, as he led the modernizing of the Sullivan mine and the expansion at Pine Point in the north and Magmont in Missouri,” Norman Keevil, Teck’s chairman emeritus, said on the tribute video.

Jewitt’s son John accepted his father’s award in a pre-recording dispatched from the United States. “I know that he will treasure this prize alongside his membership in the Canadian Aviation Hall of Fame.”

David Elliott, the fifth inductee of the evening, is one of Canada’s preeminent resource financiers and founding partner of Haywood Securities. Over the course of his career, Elliott has funded more than 400 exploration and development companies and supported and mentored a generation of mining geoscientists. From its humble beginnings with 15 employees in Vancouver in 1986, Haywood Securities has grown to 300 employees and $16 billion of assets under management. “David has been instrumental in Haywood’s success and its four decade long focus on supporting Canada’s mining and exploration industry, deservedly earning him a reputation as one of the industry’s most dependable sources of capital for junior mining exploration companies,” Robert Blanchard, Haywood’s CEO, said in a video tribute.

Born in Kingston, Ontario, Elliott’s career in mining germinated during high school. While working as a caddy on a golf course, he heard golfers talking about their jobs on the stock market. In 1968 he joined the Montreal stock exchange as a junior programmer. A year later he became a securities trader in the city at brokerage firm Dougherty Robertson MacQuaid, and was later transferred to Vancouver, where he also spent summers working for a prospector in the Yukon. He joined West Coast Securities in 1972.and got his first taste of funding exploration projects, and also used his own money to invest in projects like Afton Mines.

“I, of course, didn’t have a lot of money but I bought some shares and then I watched the price go down,” Elliott recounts in the tribute video. “Anyway, they made a very significant discovery and drilled her off. It was later sold to Teck Resources and Teck put it into production. So I thought, well gee, this business is pretty easy. You just have to find some exploration projects and go drill them and you’ll find a mine. Well, it didn’t take me long to lose that money that I made on Afton, drilling some other exploration projects!”

The experience seeded what became Elliott’s fundamental philosophy on investing in mining companies and projects. “What I decided to do was to back really good science, and partner with geoscientists that had a track record of discovery, that were passionate about the search for minerals,” Elliott said on the video. “It’s very, very high risk, so you’ve got to be prepared to take those risks and it’s not for the faint of heart, for sure.”

Elliott strengthened Haywood’s research, corporate finance and compliance departments during the 1990s and added an institutional desk in 1998. Among his career wins was his involvement in a predecessor of Glamis Gold, which Goldcorp acquired in 2006 for $8.6 billion. He also teamed up with Stewart L. Blusson to form Pioneer Metals and backed Blusson’s early exploration for diamonds in Canada. Other success stories was an initial C$5 million financing for Arequipa Resources, which went on to find the Pierina gold deposit in Peru. Barrick Gold acquired Arequipa and the 10 million oz. Pierina deposit in 1996 for C$1.1 billion. Elliott also supported a string of other companies, including Bema Gold, Alamos Gold, CGA Mining, GlobeTrotter Resource Group, Midas Gold, Ventana Gold, Reservoir Minerals, Fiore Gold, EMX Royalties and Transition Metals, among others.

“When you have someone like David, who is there to support you through and help you make good choices, I think it’s invaluable,” Richard Osmond, CEO of GlobeTrotters said on the video. “It really makes a huge difference to the success of a company and it gets you through those downturns, and when the money does get difficult. He gives you support that you’d need to keep things together and keep moving forward.”

Osmond added that Elliott’s support knew no boundaries. When he and his partners were attacked and shot on a road in Peru, Elliott “jumped on a plane and he was in Peru by the time we managed to get back to Lima,” he said. “And he spent pretty much the next week just by our side, that’s the kind of person he is.”

 Andrew Williams, a partner at Haywood Securities, described Elliott as a patient investor. “David is not fazed by the volatile equity markets and the cyclical nature of the commodity market,” he noted in the video. “Instead, he focuses on the project, management, and good science. David is an extremely patient investor—he does not expect overnight success and supports companies through thick and thin with great poise and calmness even in the most turbulent markets.”

Fellow CMHF inductee Stewart L. Blusson, perhaps summed Elliott up best. “I can’t imagine that there is anyone in his line of work that has contributed more enduring benefit to the early-stage exploration in our industry, while at the same time mentoring so many others.”

In his acceptance speech, Elliott said his passion for the industry and raising financing for it, hasn’t diminished over the years. “Today at 73, I’m as passionate about the mineral sector as I was forty years ago and luckily, life and circumstance put me on a parallel path with those geologists and engineers I so admire. A path that has allowed me to make sure they have the financial backing to get the job done … the means to explore, to discover and ultimately to create value where none existed.”

(This article first appeared in The Northern Miner)

Kirkland Lake Gold CEO on Agnico Eagle Mines merger, electrification
Fri, 15 Oct 2021 09:55:00 +0000
Kirkland Lake is in the midst of one of the Canadian gold sector's most important mergers.

Canadian Mining Journal held its first Reimagine Mining Suppliers Symposium on Wednesday in partnership with Costmine, welcoming president and CEO of Kirkland Lake Gold (TSX: KLG), Tony Makuch, as its keynote speaker.

Kirkland Lake is in the midst of one of the Canadian gold sector’s most important mergers in recent memory with Agnico Eagle Mines (TSX: AEM), with Makuch slated to soon be CEO of the new Agnico Eagle.

As part of a session moderated by Henry Lazenby, multimedia content producer with CMJ’s sister publication, The Northern Miner, Makuch fielded questions from the audience, including those about why Agnico Eagle did not offer a sizeable premium on the Kirkland Lake share price.

“Kirkland Lake Gold has a track record of growing itself as a company,” he said. “In making a premium deal, you have to see new value that can be created. If we insisted on a premium, it’s the same as me saying to shareholders we haven’t created the value we could have for you.”

The mega-merger was announced on Sept. 28 – a deal that will create a high quality, senior producer with 48 million oz. of gold in reserves. The boards of both companies have approved the arrangement, and current Agnico CEO Sean Boyd will become chair of the board.

The deal carries $2 billion worth of savings through synergy. But where will they come from?

According to Makuch, savings can be found by sharing exploration knowledge, technology, processing opportunities, infrastructure, and the support of local communities and regulators both Agnico Eagle and Kirkland Lake have.

If Kirkland Lake embarks on a project that might take it three or four years, such as creating a smart mine, Makuch said they would look to an Agnico mine where it has already been done, and the implementation timeline would be shortened.

“Unlocking technology will play a big part in reducing costs,” Makuch said. “We rely on exploration technology to drive value in our industry. . . If we can find an ounce of gold for $5 or $10, then upgrade the resources for $150 an ounce, you have created value.”

Likewise, technology and R&D will play a big part in unlocking synergy.

The merger is worth an estimated C$13.5 billion as Kirkland Lake shareholders will receive 0.7935 of an Agnico Eagle common share for each of their shares.

Kirkland Lake’s strengths are the Macassa and Detour Lake gold mines in Ontario and the Fosterville gold mine in Victoria, Australia. Agnico Eagle has built its strength on the Meadowbank, Canadian Malartic, Goldex, Hope Bay, LaRonde, and Meadowbank gold mines in Canada. The company also has gold mines in Mexico (Pinos Altos and La India), and Finland (Kittila). Both companies have pipeline projects that create a synergy for the future.

Aggressive exploration to continue

“The new Agnico Eagle is always going to be an aggressive explorer, and we have the capital resources to do that,” he added.

Makuch also sees advantages to electrifying underground beyond savings on ventilation, based on experience implementing battery electric equipment at Kirkland Lake’s operations in Ontario.

“Such trucks are already fitted with computers. (That’s) how we can create a smart or autonomous piece of equipment. Then you can connect them all and create a smart mine,” he said.

The merged Agnico-Kirkland Lake will maintain the goal of net-zero carbon emissions by 2050 or before.

“We can get to net zero if we close all our mines,” Makuch said, “but we want to operate our mines.” That means improving processes, going electric, adopting smart technologies, and always seek sustainability.

“The big challenge is people. Innovations and change need trained people and people with new skills,” he said. He wants the new company to get away from underground diesel engines and the exposure of people to diesel exhaust fumes.

He said that to create a sustainable business, part is technology, and part is how people and the environment are treated, how processes are improved, how business support can be more efficient – at the same time keep costs at the low end of the industry.

“Over the next few years, there are going to be exciting times,” Makuch promised.

A load of ideas for the future

Besides keynote speaker Tony Makuch, the morning keynote at CMJ Reimagine Mining Symposium was given by George Hemingway, managing partner and head of innovation practice at Stratalis. He spoke on how to harness trends to get mining’s message to the public.

There were future-focused panels on the pathway to decarbonization in mining; how to get the public to view mining positively sponsored by SRK; as well one on capturing data beyond line of site sponsored by Emesent. Also looking to the future, speaker Brad Terhune of Costmine offered pointers for estimating project costs, and Don Duval of Norcat outlined how mining companies are speeding up their adoption of technology.

CMJ thanks all its sponsors including Sandvik (global), Eaton (silver), Eaton (silver), BBA (bronze) and KalTire (bronze) and corporate presenter Exyn Technologies.

(This article first appeared in the Canadian Mining Journal)

Turquoise Hill stock crushed after Oyu Tolgoi funding gap swells by $1.2 billion
Thu, 14 Oct 2021 23:08:58 +0000
Rio-owned TRQ says underground expansion funding requirement increases to $3.6bn and open pit metal production delayed beyond 2024.

Shares in Canada’s Turquoise Hill Resources (TSX, NYSE: TRQ) cratered on Friday after the company shocked the market late on Thursday by announcing the ongoing expansion of the massive Oyu Tolgoi copper mine in Mongolia required $1.2 billion in additional funding than previously expected.

The Vancouver-based miner, in which Rio Tinto (ASX, LON, NYSE: RIO) has a 50.8% stake, lost almost 22% of its value on Friday in both New York and Toronto, with the stock dropping to $12.09 and C$14.88 respectively in early trading.

Delays in underground mining as well as some deferred open-pit metal production have caused an increase in estimated incremental funding requirement to $3.6 billion — up from the $2.4 billion expected in July.

Total costs for the move underground is now approaching the approved total budget of $6.75 billion, which already is significantly higher than the original $5.3 billion set in 2016.

Some metal production from open-pit mining is expected to be delayed to beyond 2024, the company said, partly due to under way impacts of on-site covid-19 curbs and geo-technical events that have resulted in delayed waste movement.

BMO analyst Jackie Przybylowski said it was unclear how such a material change to sequencing and cost emerged over the past three months. The project is quickly approaching its authorized spending, she said, and all work could be halted if further investment is not approved by the Oyu Tolgoi board, she wrote.

“In our view, successful execution in terms of timing, budget, and securing the required financing is increasingly risky,” Przybylowski said.

Turquoise Hill noted further delays would increase the incremental funding requirement further yet, and would also likely in turn adversely affect the ability of both the company and Oyu Tolgoi to obtain additional funding, or re-profile existing debt as set out in an agreement with Rio Tinto inked last April.

The miner’s disclosure could stoke tensions with the Mongolian government, which has called for more transparency from Rio Tinto and its development vehicle on the problems at Oyu Tolgoi. It comes as financial regulators in the UK and US examine Rio’s disclosures about issues previously announced.

Rio Tinto last month challenged the findings of an independent review into $1.4 billion in cost overruns and delays at Oyu Tolgoi, saying the project’s troubles were caused by unpredictable geology issues. 

The Independent Consulting Group’s (IGG) report concluded last month that poor management was the main reason the mine’s underground expansion has run into problems affecting its cost and timeline. 

The company said its copper production rose 16% to 41,935 tonnes in the third quarter from a year ago, while gold output more than tripled to 130,799 ounces.

It also said copper and gold production guidance for 2021 remains within the ranges of 150,000 to 180,000 tonnes and 400,000 to 480,000 ounces respectively.

Once completed, Oyu Tolgoi’s underground section will lift production from 125,000–150,000 tonnes in 2019 to 560,000 tonnes at peak output, which is now expected by 2025 at the earliest. This would make it the biggest new copper mine to come on stream in several years.

The mine is the country’s biggest source of foreign direct investment, having created thousands of jobs and generated almost $3bn of taxes and fee revenue over the past decade.

The Mongolian government holds a 34% stake in the Oyu Tolgoi project, with Turquoise Hill holding the remainder.

(With files from Reuters)

Video: Uranium in the stars and on the cards
Thu, 14 Oct 2021 22:39:34 +0000
Uranium got a bad reputation as a fuel used by nuclear plants, but some academics argue nuclear power must be part of the clean energy transition.

Global asset manager Sprott has launched a new educational video — Uranium: Born of the Stars which explains how, in the “history of humanity, there have been few commodities as conflicted as uranium.”

Uranium got a bad reputation as a fuel used by nuclear plants, and nuclear is a word that became synonymous with ‘destruction,’ but some academics argue nuclear power must be part of the clean energy transition.

While some environmentalists cringe at the word ‘nuclear’, nuclear technology can actually generate electricity without carbon output to produce clean energy for the mining industry.

Investors have poured more than $1 billion into uranium ETFs this year in a bet on nuclear power’s resurgence, as an appetite for uranium returns.

Learn more about uranium by watching the full video here.

Mining People: Forsys, Generation Mining, Intrepid, Mundoro, Nevada Copper, Voyageur
Thu, 14 Oct 2021 21:30:00 +0000
Key moves in the mining sector.

Management appointments announced this week:

E79 Resources announced that Martin Pawlitschek will assume the role of interim president and CEO following the departure of Rory Quinn.

Richard Parkhouse has been appointed executive director responsible for investor relations at Forsys Metals.

Generation Mining has named Gordon Lung as project services manager and Pierre Legare as senior project advisor; both are employees of LG Consulting.

Intrepid Metals (formerly Voleo Trading Systems) has added Daniel MacNeil and Alan Wainwright to its project development technical team.

Peter Wong has joined Mundoro Capital as CFO.

The new president and CEO of Nevada Copper is Randy Buffington.

Fraser Laschinger is the new president and CEO of Voyageur Mineral Explorers. Brian Howlett has stepped down from those duties.

Board moves include:

Cordoba Minerals announced the resignation of Eric Finlayson as chairman and director. He is also president of Cordoba’s largest shareholder, Ivanhoe Electric.

Blake Morgan was named to the board of Forty Pillars Mining after Alex Klenman stepped down.

Dorian L. (Dusty) Nicol is now a director of Mountain Boy Minerals.

Mundoro Capital welcomed Stephen Altmann to its board.

Samantha Shorter now sits on the board of Pacific Empire Minerals.

Voyageur Mineral Explorers has named Robert Cudney executive chairman as William Phillips has resigned that post.

(This article first appeared in the Canadian Mining Journal)

Minerva’s Intelligence Driver software wins Axora Technology Challenge
Thu, 14 Oct 2021 20:14:00 +0000
The competition was launched to discover new digital solutions for the metals and mining industries and promised to identify the solution that would best deliver rapid benefits, including full payback, within 12 months.

Vancouver’s Minerva Intelligence, an artificial intelligence software company focused on building decision support tools for climate risk, mineral exploration and mining, announced the company has won Axora’s Global Cost-Saving Technology Challenge. The competition was launched earlier this year to discover new digital solutions for the metals and mining industries and promised to identify the solution that would best deliver rapid benefits, including full payback, within 12 months.

Minerva held off competitors with its AI-powered platform, DRIVER, which analyzes multi-element data to simulate the 3-D distribution and overlap of all the elements in a drilling dataset, where typically millions to tens of millions is spent on drilling.

DRIVER does this by employing machine learning-based statistical algorithms to automate the process of turning sparse drilling data into complete 3-D block models. DRIVER is fast, accurate and comprehensive, automatically generating 3-D block models of an entire drilling dataset within minutes, allowing decisions on them to be made quickly.

“It was an extremely close competition, but the judges unanimously agreed to award Minerva Intelligence’s DRIVER the first prize because its business case was so compelling,” said Dr. Nick Mayhew, chief commercial officer at Axora. “Minerva was able to demonstrate how its platform could save $75,000 upwards per drilling hole that you don’t drill, typically saving many times the cost of the solution, providing a hard cash saving together with time-to-completion advantages and a relatively simple deployment model.”

The competition’s judging panel included experts from Boston Consulting Group’s Digital Ventures and other key companies and organizations across the technology, oil and gas, and mining and metals sectors. Minerva’s winning cost saving solution will be onboarded onto the Axora marketplace and its digital marketing program, which drives demand for solutions like this one with mining companies all over the world.

(This article first appeared in the Canadian Mining Journal)

CHARTS: Chinese investment in overseas copper projects just beginning
Thu, 14 Oct 2021 17:45:59 +0000
After a $16bn spending spree, Chinese owned copper mines overseas now produce some 1.2 million tonnes annually – that’s not nearly enough.

China consumes nearly 14 million tonnes of copper each year – more than the rest of the world combined. But domestic supply last year was only around 2m tonnes, including scrap, and mined output has been stagnant for years.

In a presentation at the Wood Mackenzie LME Forum, Nick Pickens, research director for copper markets, showed two graphs that put China’s significant copper supply challenges in perspective.

Imported concentrate, including from roughly 30 Chinese-owned mines in Africa and elsewhere, now supplies 40% of the country’s needs, a share that has more than doubled over the past decade as imports set fresh records every year.

Tanked up on Tenge

Over and above direct foreign investment in mining projects around the world China, has splashed more than $16 billion on buying overseas copper companies and assets since 2010.

Glencore’s disposal, under some duress, of Las Bambas in Peru to a Chinese consortium, China Moly’s 2016 acquisition of the Tenke Fungurume mine from Freeport for $2.65 billion and Zijin Mining’s joint venture with Ivanhoe Mines on the Kamoa-Kakula mine, both in the Congo, are three high-profile examples. 

Turning Japanese 

But if China is to follow the Japanese model of securing long term supply to feed its downstream industry — it has some work to do. 

Japan has managed, through well-known companies like Sumitomo, Marubeni and Mitsui acquiring minority interests and JVs in scores of projects, to own 70% of the copper in concentrate it imports.   

While larger in absolute terms at just shy of 1.2 million tonnes of metal in concentrate, Chinese-owned companies overseas supply only 20% of the country’s needs. Needs that have grown significantly in just the last few years on breakneck refinery buildouts.  

Scramble for Africa 

Asked which regions have the best investment potential Pickens said that it pretty much aligns with the current environment although investing in Chile and Peru has become a riskier proposition as political pressure increases in the two top producing nations. 

Vast reserves in the central Africa copper belt remains attractive, likewise North America, and further out Ecuador and Argentina could become the next copper frontiers, according to Pickens.

China enjoyed a pretty much open field in Africa, its number one copper – and crucially, cobalt – destination by some stretch, but the Congo is now chafing under some of these investments.

China may in the future also have to compete with the likes of BHP, which recently said it could consider looking at erstwhile no-go areas like Zambia or Congo following its foray into Ecuador (rumours of a BHP tie-up with Ivanhoe in the DRC remain just that at the moment though).

Kalium completes oversubscribed capital raise to fund potash project expansion
Thu, 14 Oct 2021 17:35:04 +0000
The company is looking to expand its Beyondie sulphate of potash (SoP) project in Western Australia to 120 ktpa.

Australian potash producer Kalium Lakes (ASX: KLL) announced on Thursday the successful completion of a A$50 million ($37m) capital raise through a two-tranche placement of new fully paid ordinary shares. A total of 278 million shares were issued at A$0.18 per share.

According to Kalium, which is looking to expand its Beyondie sulphate of potash (SoP) project in Western Australia, the offer was significantly oversubscribed, receiving strong demand from existing shareholders as well as new institutional investors.

The first tranche consisted of approximately 209.8 million shares to raise an initial A$37.8 million under the company’s existing share placement capacity. A second tranche of 68 million shares, to raise a further A$12.2 million, will be subject to shareholder approval at Kalium’s annual general meeting, scheduled for November.

In addition to the capital raise, Kalium will also conduct a share purchase plan (SPP) to raise up to A$10 million, allowing existing shareholders to subscribe for up to A$30,000 worth of additional shares in the company.

Kalium’s largest shareholder, Greenstone Resources, has committed to take up its rights to retain a holding of 19.8% post the offer and SPP under its anti-dilution right.

The funds raised will be used by Kalium on a A$43.5 million expansion of the Beyondie project from its current 90 ktpa capacity to 120 ktpa, which is targeted to be achieved by the fourth quarter of 2022.

The expansion followed Beyondie’s first SoP production earlier this month, becoming Australia’s only SoP producer. The project has an initial mine life of between 30-50 years.

Shares of Kalium Lakes were down by 11.3% on the ASX at market close Thursday. The company’s market capitalization stands at A$163.6 million.

Foran boosts McIlvenna Bay copper-zinc resource
Thu, 14 Oct 2021 17:06:27 +0000
Foran is working towards completing a feasibility study for the project, which is about 60 km west of Flin Flon, Manitoba, before the end of the year.

Foran Mining (TSXV: FOM) has updated the indicated resource at its 100%-owned McIlvenna Bay copper-zinc project in Saskatchewan, reporting a 70% increase in indicated tonnage. Foran is working towards completing a feasibility study for the project, which is about 60 km west of Flin Flon, Manitoba, before the end of the year.

The indicated resource has increased to 39.1 million tonnes from 223 million tonnes. The material grades 1.2% copper, 2.16% zinc, 0.41g/t gold, and 14 g/t silver, or 2.04% copper-equivalent. The company completed over 25,000 metres of drilling in 36 holes since the earlier estimate was published in 2019.

There is also a significant increase in contained metal in the indicated resource – a 74% increase in copper (103 billion lb.), a 21% jump in zinc (284 million lb.), a 58% increase in gold (40,000 oz.), and 47% rise in silver (18.1 million oz.).

Inferred resources total 5 million tonnes at 0.95% copper, 2.56% zinc, 0.27 g/t gold, and 16 g/t silver, or 1.77% copper-equivalent.

The McIlvenna Bay mineralization begins about 25 metres below surface and has been traced down-plunge 2 km, where it remains open in all directions.

One of the best hole results released in September was from hole MB-21-247d1, which intersected over 44 metres of continuous mineralization. It cut 2.5 metres averaging 1.13% copper, 1.66% zinc,  0.2 g/t gold, and 10.3 g/t silver from the massive sulphide zone plus 41.7 metres grading 0.92% copper, 0.21% zinc, 0.11 g/t gold, and 7.8 g/t silver from the copper stockwork zone.

The company is planning to make McIlvenna Bay the world’s first carbon neutral copper development project. Ten years’ worth of carbon emissions from exploration activities have been offset.

(This article first appeared in the Canadian Mining Journal)

Iron ore price rebounds despite Chinese steel curbs
Thu, 14 Oct 2021 16:42:10 +0000
The Chinese government has asked mills in more cities in northern China to cut output from Nov. 15 to March 15.

The iron ore price rebounded on Thursday after sliding for the past two days.

According to Fastmarkets MB, benchmark 62% Fe fines imported into Northern China were changing hands for $125.91 a tonne, up 1.4% from Wednesday’s closing.

Meanwhile, Benchmark Dalian iron ore fell 3% to its lowest level in nearly two weeks as the outlook for Chinese demand darkened.

The Chinese government, seeking to curb steel production to ensure clean air, has asked mills in more cities in northern China to cut output from November 15 to March 15.

China’s steel output reduction target in the first quarter of 2022, when the Olympic Winter Games are scheduled to take place in Beijing and the neighbouring Hebei province, was “more aggressive than market expectation,” Citi analysts said.

“If we assume the rest of the country keeps steel production flat, national steel output in 1Q22e should decline by 12% YoY, following 5% YoY growth in 8M21 and 9% YoY decline over September to December 2021,” the analysts said in a note.

(With files from Reuters and Bloomberg)

Atalaya lifts full-year copper guidance, stock up
Thu, 14 Oct 2021 16:26:40 +0000
The company now expects output to reach 54,000-56,000 tonnes for the year.

Atalaya Mining (TSX:AYM) is increasing its full-year copper production guidance following a strong third quarter, during which it produced 13,933 tonnes of the industrial metal.

Atalaya currently produces copper concentrates and silver byproduct at its wholly-owned Proyecto Riotinto site in southwest Spain. The operation comprises an open-pit mine and a modern 15 Mtpa processing plant.

During Q3 2021, the plant processed 3.9 million tonnes of ore, equivalent to a throughput rate of nearly 16 Mtpa. This included a planned SAG mill maintenance shutdown that was previously scheduled for Q4.

Copper recoveries of 87.29% were better than budgeted and helped to offset the impact of the mill shutdown and lower grades, resulting in only a modest decrease in copper production compared with previous quarters.

Year-to-date, Atalaya’s Proyecto Riotinto site has produced 42,670 tonnes of copper from 12 million tonnes of ore milled, for an average recovery rate of 85.76%.

Given the latest quarterly results, the company now expects output to reach 54,000-56,000 tonnes for the year, which is 2,000 higher than its original guidance.

Shares of Atalaya Mining surged 6.5% by 12:20 p.m. EDT on Thursday. The copper miner has a market capitalization of C$821.5 million.

Copper price tops $10,000 as energy crisis hits supply
Thu, 14 Oct 2021 16:23:43 +0000
Copper mining stocks jump as copper price rally gains momentum and traders scramble for prompt delivery of metal.

The copper price continued to rally on Thursday amid a global energy crisis that is knocking supply offline and heaping pressure on fabricators scrambling for metal.

Copper for delivery in December rose sharply for a second day in a row on the Comex market in New York, touching $4.6365 per pound ($10,200 per tonne), the highest since the beginning of June.

Copper climbed as much as 3.6% to $9,994 a tonne in London. The cash-to-three-month spread was trading at the biggest gap since 2012, as global exchange inventories plummet. Five out of the six base-metal contracts on the LME are now in backwardation (prompt delivery metal pricier than futures), signalling broad pressure on spot supply. 

Copper trades in steep backwardation as global inventories plunge.

The rally fed through to producers, with shares in BHP Group up 3.8%, Glencore plc up 3.3%, Freeport-McMoRan up 5.2%, KGHM up 4.8% and Southern Copper up 4.4%. First Quantum Minerals rose more than 6% on the day.

CHARTS: Chinese investment in overseas copper projects just beginning

Metal supply cuts are spreading from China to Europe, as energy shortages drive up costs for electricity and natural gas, threatening more inflationary pressure from rising commodity prices.

On Wednesday, the world’s second largest zinc producer, Nyrstar, said it will cut output at three European smelters by up to 50%, making the metal price surge to its highest price since 2007.

China growth concerns

The rebound in copper prices also comes despite concerns surrounding China and its debt-addled property sector.

“In the short term there are some headwinds, mainly due to concerns about China’s economy,” Jay Tatum, portfolio manager at New York-based Valent Asset Management, recently told Bloomberg.

“But once the world gets back to normal growth rates, evenly spread across the economy, we still think there’s a strong case to be made for metals like copper.”

Not everyone is convinced that copper’s outlook is rosy.

The International Monetary Fund has expressed concern that the world’s economic recovery, which drove copper’s blistering rally in May, has lost momentum and become increasingly divided.

Citigroup — one of the biggest cheerleaders for copper earlier this year — recently warned Bloomberg that prices could fall another 10%, with demand shrinking over the next three months.

(With files from Bloomberg and Reuters)

South32 buys stake in KGHM’s Chilean mine for $1.55bn
Thu, 14 Oct 2021 14:08:00 +0000
Sierra Gorda will be South32’s second-largest deal since it listed in 2015 and will add 70,000 to 80,000 tonnes of copper to its portfolio.

Australia’s South32 (ASX, LON, JSE: S32) has acquired almost half of the vast Sierra Gorda copper mine in northern Chile, majority-owned by Polish miner KGHM (WSE: KGH) for $1.55 billion. 

Japan’s Sumitomo Metal Mining and Sumitomo Corp, which together hold a 45% stake, had said last year that they were considering exiting the operation after years of losses.

Sumitomo Metal said the deal price would include a transfer of around $1.2 billion and copper price-linked payments of up to $350 million.

“Finding a producing copper asset of this size up for sale isn’t easy, but South32 has done it,” BMO Metals and Mining analyst David Gagliano wrote on Thursday.

The deal marks the Perth-based miner’s entry into the world’s largest copper-producing country ahead of an expected demand boom for the metal.

Sierra Gorda is located in the prolific mining region of Antofagasta in Chile, Gagliano noted, and has a production capacity of about 150,000 tonnes of copper concentrate and 7,000 tonnes of molybdenum.

“It’s long-life asset, with sulphide reserves of 1.5Bt at 0.4% copper (contained ~5.9Mt copper) and potential for future expansions,” the analyst said.

State-backed KGHM Polska Miedz SA, which has a 55% operating stake in Sierra Gorda, has been criticized for the steep investment allocated to developing the Chilean mine ($5.2 billion and counting).

Sierra Gorda, which began production in 2014, has constantly failed to meet expectations due to challenging metallurgy and difficulties in using seawater for processing. 

The Polish miner, which is looking to sell foreign mines and reinvest the proceeds in its domestic operations, has said it has no plans of putting Sierra Gorda on the chopping block. KGHM, however, has ruled out the possibility of taking on full ownership. 

The open-pit mine is located at an altitude of 1,700 metres and has enough ore to support at least 20 years of mining. South32 expects it to produce 180,000 tonnes of copper concentrate and 5,000 tonnes of molybdenum this year.

The Australian miner’s acquisition of Sierra Gorda is the second-biggest deal it has inked since it was listed in 2015, after being spun out of BHP

South32 paid $1.3 billion in 2018 for 83% of Arizona Mining, which had a zinc, lead and silver project in the US.

Rough path 

KGHM took control of the copper and molybdenum project in 2012, after completing the acquisition of Canadian rival Quadra FNX, in what was the largest-ever foreign acquisition by a Polish company. 

The miner had planned to expand Sierra Gorda earlier, but the 2015-2016 rout in commodity prices forced the company to place the project on the backburner

Two years later, KGHM secured environmental approval for a $2 billion expansion and upgrade of the mine to extend its productive life by 21 years. 

The options to expand production include building an oxide circuit and doubling the throughput of the sulphide plant. Planned output at Sierra Gorda was about 140,000 tonnes of ore per day, but the asset has only delivered 112,000 tonnes in its best year of operations to date. 

The oxide expansion would add 40,000 tonnes of ore per day for eight years, and the sulphide expansion another 116,000, BMO Metals estimates. 

While Sierra Gorda is a low-grade deposit, one of its main attractions is having an “extremely flat grade profile,” which is expected to remain around 0.34% for the foreseeable future. This, BMO analysts have said in the past, would potentially move the mine from a tier four to a tier two asset in time. 

Once the deal is completed, Sierra Gorda could add between 70,000 and 80,000 tonnes of copper to South32’s portfolio.

De Beers to extend life of Namibia mines to 2042
Thu, 14 Oct 2021 14:01:00 +0000
Namdeb, a joint venture between the Namibian government and the diamond giant, has extended its land-based mines’ life by 20 years.

Namdeb, a joint venture between the Namibian government and diamond giant De Beers, announced on Thursday the approval of new long-term business plan that will allow it to extend its land-based mines’ life by 20 years to 2042. 

Under the new deal, De Beers — which also mines diamonds offshore through its Debmarine Namibia unit — will receive royalty relief from 2021 to 2025, which implies a rate cut to 5% from 10%. 

This royalty discount translates an additional fiscal contribution for Namibia of approximately N$40 billion (about $2.7bn), thanks to additional taxes, dividends and royalties from the extended life of its mines, Namdeb said in the statement

“This new business plan means that Namdeb’s future is now secure, and the company is positioned to continue making a significant contribution to the Namibian economy, the socio-economic development of the Oranjemund community and the lives of Namdeb employees,” De Beers CEO Bruce Cleaver said.

The deal will enable eight million additional carats of Namibian diamonds to be produced, the executive said, adding that the life of mine extensions will create 600 new jobs. Namdeb currently employs 2,100 people.

Namibia’s mines minister Tom Alweendo said the closure of Namdeb’s mines would have been devastating. 

Namdeb CEO Riaan Burger said production will be ramped up over the next 2-1/2 years to approximately 160% of the current capacity, requiring a capital investment of around N$1.8 billion ($122 million) and a “significant” increase in operational cost. 

Market value of on-road fuel cell vehicles to grow to $160bn by 2042 — report
Thu, 14 Oct 2021 13:06:00 +0000
A report by IDTechEx states that major automotive markets are planning for the significant deployment of fuel cell vehicles.

A new report by IDTechEx forecasts the market value of on-road fuel cell vehicles will grow to $160 billion by 2042 at a compound annual growth rate of 23.9% over a 20-year forecast period.

“Major automotive markets including Japan, Korea, China, Germany, and California are planning for the significant deployment of fuel cell vehicles (FCEV),” the report reads.

“Germany has already built around 100 hydrogen refuelling stations (HRS), offering a capacity to support 40,000 passenger cars, though their current fleet is less than 1,000. Germany is providing a testbed for FCEV in Europe and will challenge the assertion that the lack of hydrogen infrastructure is to blame for the lack of FCEV uptake. Relatively small fleets of heavy-duty FCEV could provide sufficient hydrogen demand to viably operate an HRS.”

According to the market analyst, the growing interest in the technology is due to the fact that incorporating a fuel cell into an electric vehicle powertrain, generating electricity from hydrogen, offers a pathway that delivers the critical reduction in on-road exhaust emissions whilst overcoming the potential range and charging limitations of battery electric vehicles (BEVs).

“The race to decarbonize on-road vehicles is undoubtedly being led by BEVs, however serious concern remains around whether BEV solutions can deliver the necessary duty cycle for those use cases that require significant range, brief downtime, and high operational flexibility. For example, long-haul trucking and high mileage city bus operations,”says IDTechEx.

The experts explain that in such long-haul applications, a huge 500+ kWh battery will be required to reliably deliver 350+ kilometres of range on a single charge, but full recharging, even with 350kW ultra-fast chargers, will take hours. This becomes an even greater challenge in a depot situation, where megawatts of power are required.

“Hyundai’s XCIENT fuel cell heavy-duty truck delivers ~400km of range, with a 73kWh Li-ion battery and hydrogen fuel cell system, requiring less than 20 minutes to refuel,” the review states. “The growing momentum pushing a rapid transition to zero-emission vehicles, combined with a genuine need for range comparable to diesel powertrains and quick refuelling, means massive automotive players like Toyota, Hyundai, GM, and Daimler are continuing to pump millions into improving fuel cell system technology and bringing down costs.”

Market value of on-road fuel cell vehicles to grow to $160bn by 2042
IDTechEx estimate of gCO2/km emissions for different truck powertrains. (Graph by IDTechEx).

In the market researcher’s view, the value proposition for fuel cell trucks and buses is stronger than that of cars and, thus, there is no expectation that fuel cell cars to be a commercial success comparative to battery-electric ones. 

However, the report emphasizes that the scale of the car market and substantial support for the development of a wider hydrogen economy by governments and companies in key regions mean that, in 2042, 60.3% of on-road FCEV market revenue will be from the passenger car market. 

“Fuel cell makers will benefit from the volume of the car market to drive down costs for other sectors where the technology is more critical,” the dossier reads.    

And precisely, costs are the Achilles’ heel of fuel cell vehicles. In IDTechEx’s view, system components need to go down in price in order to reduce the upfront vehicle cost, while rolling out sufficient hydrogen refuelling infrastructure to make driving an FCEV viable.

Another challenge the technology has to address is related to the availability of cheap green hydrogen produced by the electrolysis of water using renewable electricity, as opposed to cheap grey hydrogen generated from fossil fuels. For the analyst, this will be vital to FCEVs delivering the environmental credentials on which they are being sold.

Chile to open 400,000 tonnes of lithium reserves up for exploration
Thu, 14 Oct 2021 10:43:00 +0000
The copper-producing nation, which holds the world’s largest known lithium reserves, will tender for five quotas of 80,000 tonnes each.

Chile will open a tender for the exploration and production of 400,000 tonnes of lithium in an effort to reclaim market share and meet growing demand for the metal used in electric vehicles and high-tech devices. 

The copper-producing nation, which holds the world’s largest known lithium reserves, said is preparing bidding rules available to local and foreign firms for five quotas of 80,000 tonnes each.  

Companies that secure permits will have seven years, extendable for another two, to explore and develop projects, followed by 20 years of production, the Mining Ministry said in a statement

Chile, which until 2018 was the world’s top lithium producer, lost its crown to Australia and is about to descend further as China is projected to become the second largest producer of the metal by the end of the decade. 

The country currently generates about 29% of the world supply, but it plans to double production by 2025 to about 250,000 tonnes of lithium carbonate equivalent (LCE).  

Global demand for the metal, according to ministry projections, will quadruple by 2030, reaching 1.8 million tonnes of lithium. Available supply by then is expected to sit at 1.5 million tonnes. 

The world’s two top lithium miners, Albemarle (NYSE: ALB) and SQM, (NYSE: SQM) extract the metal in Chile’s Atacama Desert, one of the driest places on earth, by pumping brine from beneath surface and concentrating it through evaporation in pools. 

The companies’ use of water in the extraction process has become a bone of contention, jeopardizing their expansion plans.  

Indigenous communities living around the salt flat asked authorities in September to suspend SQM’s operating permits or sharply reduce its operations until it submits an environmental compliance plan acceptable to regulators. 

Chile’s environmental watchdog SMA in 2016 charged SQM with overdrawing lithium-rich brine from the Atacama salt flat, prompting the company to develop a $25 million plan to bring its operations back into compliance. Authorities approved that plan in 2019 but reversed their decision in 2020, forcing the miner to start again from scratch on a potentially tougher plan. 

Amid the legal battle, Chilean authorities announced they would conduct the region’s first comprehensive, publicly funded, hydrological survey of the salt flat. 

Lawmakers, academics, environmentalists, local communities, German carmaker Volkswagen and Chilean courts have all emphasized the importance of an environmental study to help dispel lingering questions on the impact of lithium mining in Chile. 

Zinc price hits 14-year high as Nyrstar cuts output
Thu, 14 Oct 2021 04:56:20 +0000
The world’s second largest zinc producer said it would cut production by up to 50% at its three European smelters from Wednesday.

Zinc prices climbed to their highest level since 2007 on Thursday on supply concerns after producer Nyrstar announced a plan to cut its output due to high power prices in Europe.

The most-traded November zinc contract on the Shanghai Futures Exchange surged as much as 8% to 25,700 yuan ($3,991.86) a tonne, its highest since October 2007.

Three-month zinc on the London Metal Exchange jumped as much as 6.9% to $3,637.50 a tonne, a level unseen since July 2007.

Nyrstar said it would cut production by up to 50% at its three European zinc smelters from Wednesday.

Electricity prices have reached record highs in recent weeks, driven by power shortages in Asia and Europe, with China’s crisis expected to last through to the end of the year and crimp growth in the world’s second-largest economy.

Click here for an interactive chart of zinc prices

“The cost burden of carbon emitted by the electricity sector which is passed on to industrial and domestic customers, means it is no longer economically feasible to operate the plants at full capacity,” Nyrstar said.

“Indirect cost compensation for energy-intensive producers to protect their competitiveness versus non-EU producers varies by European country and this puts Nyrstar’s Budel, Balen and Auby plants at a competitive disadvantage, compounding the impact of extreme energy prices.”

The firm is the world’s second-largest zinc producer and one of the biggest zinc smelting companies. It has operations across northern Europe, the United States and Australia.

Fitch Solutions forecasts an average zinc price of $2,600 per tonne in 2021.

“The global production surplus that emerged in 2020 should persist into the medium term, and the resulting increase of zinc inventories should gradually drag prices lower,” the analyst said in a recent report.

(With files from Reuters)

Volvo unveils world’s first fossil-free steel vehicle
Wed, 13 Oct 2021 20:50:55 +0000
The machine, a load carrier for use in mining and quarrying, was unveiled at a green steel collaboration event.

Volvo Group has unveiled the world’s first vehicle made of fossil-free steel from SSAB – made in Volvo Construction Equipment’s facility in Braås, Sweden, and announced that more vehicles will follow in 2022 in what will be a series of concept vehicles and components using fossil-free steel from SSAB. 

The machine, a load carrier for use in mining and quarrying, was unveiled at a green steel collaboration event on October 13, in Gothenburg hosted by Melker Jernberg, President of Volvo CE, and Martin Lundstedt, President and CEO Volvo Group.

“Our ambition is to have fossil-free steel used across all our products, with a step-by-step approach. This machine is proof that we really can make fast progress, when we work together in strong partnerships, when we are determined to act and we enable our skilled people to contribute to building the world we want to live in,” Jernberg said in a media release. “Not only for our generation, but for generations to come.” 

“This initiative with SSAB sets the benchmark for a fossil-free future. Just as the nations of the world come together at COP26 to address climate change, so too must organizations and industries work in collaboration to develop innovative new solutions for a greenhouse gas emission free future,” said Martin Lundstedt, CEO of Volvo Group. 

Volvo Group is committed to pioneering partnerships such as this with SSAB to develop attractive, safe and efficient new vehicles and machines that pave the way for a more sustainable transport and infrastructure system adopted for the future,” Lundstedt said.

With a commitment to be climate-neutral and achieve net zero value chain greenhouse gas emissions by 2040, Volvo Group said it is on the path towards developing sustainable transport and infrastructure solutions of the future. Along with the electrification of its vehicles and machines, Volvo said it is determined to reduce the carbon footprint of its entire supply chain. 

A move toward green steel is an important step for the transport and infrastructure industries as a whole, particularly considering that around 70% of a truck’s weight comes from steel and cast iron, with the figure for Volvo machines even higher.  

This first concept machine, produced at Volvo CE’s facility in Braås, is just the start, the company said, with smaller-scale series production planned by 2022, and mass production set to follow. 

BC First Nations say river’s health can be restored without shutting down Rio Tinto smelter
Wed, 13 Oct 2021 19:54:36 +0000
Nechako River First Nations hope for a compromise that would restore river flows without having to remove the Kenney Dam and shut down Rio Tinto’s aluminum smelter in Kitimat, British Columbia.

Sometime in the spring of 2022, several Nechako River First Nations hope the British Columbia Supreme Court will rule in their favour in a lawsuit against Rio Tinto Alcan Inc. that would address their concerns about the health of the river.

But they are also hoping for a compromise that would restore river flows to the Nechako without having to remove the Kenney Dam and shut down Rio Tinto’s BC Works aluminum smelter in Kitimat.

Chief Priscilla Mueller of the Saik’uz First Nation said Rio Tinto has lately shown some willingness to listen to the concerns of First Nations, which are focused mainly on the negative impact the dam and low river flows have had on salmon and sturgeon.

“We’ve never had a relationship with Rio Tinto, and I really believe now that we’re building a relationship,” Mueller said. “They’ve been out to our Nechako First Nations communities and those meetings were positive.”

The Nechako River was dammed in the 1950s to generate power for the Kitimat aluminum smelter.

Depending on the time of year, the Kenney Dam can reduce river flows to 25% of what they would be without the dam. In drier years, that can be a serious problem for fish.

“We literally have no salmon left,” Mueller said. “And the sturgeon, everybody knows that they’re becoming extinct. Today, we have to buy our salmon, which is very, very sad for our communities. This was our livelihood.”

The Nechako First Nations’ BC Supreme Court case claims that the dam has had a negative impact on their Aboriginal rights. If the court rules in their favour, it could have economic fallout for Kitimat’s biggest employer: the BC Works aluminum smelter, which employs roughly 1,000 people.

Somewhere between the interests of industry and jobs and the interests of the environment, fish and First Nations, there may be a compromise. Ideally, for the river and its fish, the Kenney Dam would be removed, allowing the river to be restored to normal flow levels. That’s not what the First Nations expect the BC Supreme Court will order. But they hope the court will recognize the impacts the dam has had on the river, fish and livelihoods of Nechako First Nations and recommend a plan to restore at least some of the river’s natural flow levels.

“There is a real opportunity to keep the smelter running 100% and restore natural flow in the river, and that’s what the nations are trying to get to,” said Alex Grzybowski, an adviser to the Nechako First Nations.

Rising river levels concern

The biggest concern about river levels is in the springtime, when levels would typically be at a seasonal high. In drier years, to maintain sufficient river flows, water could be spilled over the dam. Rio Tinto would have to forgo some power generation, but could buy the power it needs from BC Hydro. The Kemano Generating Station already produces more power than the smelter needs. Rio Tinto sells some of that surplus power to BC Hydro. Since the new Site C dam is expected to produce a power surplus, there should be sufficient generating capacity to sell power to the Rio Tinto when water needs to be held back in the spring.

Should such an arrangement be agreed to – or enforced by the court – it would require an amendment to, or replacement of, the 1987 Settlement Agreement, which governs Nechako water flows and release. Rio Tinto is bound by that agreement.

A new governance model being proposed by the Regional District of Bulkley-Nechako (RDBN) and the Saik’uz, Stellat’en, and Nadleh Whut’en First Nations appears to anticipate some new agreement for the Nechako – one that includes First Nations.

Earlier this year, the RDBN and the Nechako First Nations signed a memorandum of understanding aimed at giving those parties a seat at the Nechako River governance table.

Rio Tinto appears to be at least listening to the concerns of the Nechako First Nations.

“For the past three years we have been working with a variety of parties at the Water Engagement Initiative for the benefit of the Nechako River,” a spokesman for Rio Tinto said in a written statement. “We are committed to working with the Nechako First Nations, other First Nations, government and stakeholders to review all aspects of the Nechako Reservoir management process.”

(This article first appeared in Business in Vancouver)

Glencore sells Bolivian assets to Santacruz Silver Mining
Wed, 13 Oct 2021 17:57:04 +0000
The assets on a 100% basis, produced 6.4 million oz. silver-equivalent during the nine months ended on September 30.

Santacruz Silver Mining (TSXV: SCZ; US-OTC: SZSMF), which owns the producing zinc-lead-copper Zimapan mine in Mexico’s Hidalgo state, is acquiring a portfolio of silver assets in Bolivia from Glencore (NYSE: GLEN).

The assets include Glencore’s 45% stake in the producing Bolivar and Porco mining operations in its joint-venture with state-owned miner COMIBOL (55%); a 100% stake in the Sinchi Wayra business, which includes the producing Caballo Blanco mining complex; and the Sorocaya project; as well as the San Lucas ore sourcing and trading business.

Under the deal, Santacruz will pay an initial $20 million in cash when the transaction closes, and another $90 million over a four-year period, and Glencore will be granted a 1.5% net smelter return (NSR) royalty on the assets.

Santacruz says the assets it is acquiring from Glencore, on a 100% basis, produced 6.4 million oz. silver-equivalent during the nine months ended on September 30.

Silver producer in the Americas

Arturo Prestamo Elizondo, Santacruz’s executive chairman and interim chief financial officer, said the acquisition creates a leading mid-tier silver producer in the Americas. “The transaction represents a unique opportunity to significantly enhance our portfolio of operations — it is highly accretive on all key metrics and the transaction structure allows the company to finance the majority of the acquisition via the cash flow generated by these assets,” he stated in a press release. “Santacruz shareholders will participate in a larger, more diverse silver producer with strong production growth and enhanced cash flow profile.”

Santacruz’s CEO, Carlos Silva, noted that Glencore “has performed extraordinary work on these assets while achieving very high standards in terms of responsible mining practices and their commitment to responsible business and community relations.”

Glencore’s 45%-owned Bolivar underground silver-zinc-lead mine in Antequera, near the city of Oruro. A 1,200 tonnes per day processing plant produces zinc, lead and silver concentrates. It’s 45%-owned Porco mine, 50 km west of the city of Potosi, has two underground mines (Central and Hundimiento), and a 1,200 tonnes per day concentrator plant.

Caballo Blanco, 100%-owned by Glencore, consists of three operating mines—Colquechaquita, Tres Amigos and Reserva—which supply the 1,000 tonne-per-day Don Diego processing plant, and produces zinc-silver and lead-silver concentrates. The complex also includes thermo and hydroelectric power generation facilities. Colquechaquita has been in production since 1988, and Tres Amigos and Reserva since 1996.

Glencore’s 100%-owned Soracaya is a greenfield project in Potosi situated 4.4 km along strike from Pan American Silver’s San Vicente mine, and its 100%-owned San Lucas ore sourcing and trading business was set up in 2017. The business generates most of its revenue by sourcing ore from third parties and processing it at plants at Bolivar, Porco and Caballo Blanco.

(This article first appeared in The Northern Miner)

Copper price surges to 2-month peak, shaking off China concerns
Wed, 13 Oct 2021 17:00:11 +0000
Power shortages and factory slowdowns did not stop copper from rallying to its highest levels since the beginning of August.

The global energy crisis that has led to power shortages and factory slowdowns did not stop copper prices from rallying to their highest levels since the beginning of August.

On Wednesday, copper futures for December delivery erased earlier losses to trade at $4.499/lb for a gain of 4.0% as of 3:40 p.m. EDT. The intraday high was $4.528/lb.

[Click here for an interactive chart of copper prices]

The rebound in copper prices comes amid short-term concerns surrounding China and its debt-addled property sector, plus the ongoing economic threat posed by the covid-19 delta variant.

“In the short term there are some headwinds, mainly due to concerns about China’s economy,” Jay Tatum, portfolio manager at New York-based Valent Asset Management, recently told Bloomberg.

“But once the world gets back to normal growth rates, evenly spread across the economy, we still think there’s a strong case to be made for metals like copper.”

Not everyone is convinced that copper’s outlook is rosy.

The International Monetary Fund has expressed concern that the world’s economic recovery, which drove copper’s blistering rally in May, has lost momentum and become increasingly divided.

Citigroup — one of the biggest cheerleaders for copper earlier this year — recently warned Bloomberg that prices could fall another 10%, with demand shrinking over the next three months.

“What tipped me over the edge in terms of becoming outright bearish was the power, coal and gas crisis,” said Max Layton, managing director for commodities research at Citigroup in London told Bloomberg. “The concern is that it gets a lot worse.”

Data on Wednesday also showed that the world’s top consumer has been picking up imports to counter its supply worries, which briefly drove down the price of copper.

(With files from Bloomberg and Reuters)

Gold price rallies as bond yields, dollar retreat
Wed, 13 Oct 2021 16:14:15 +0000
Gold advanced nearly 2% on Wednesday to its highest in a month.

Gold advanced nearly 2% on Wednesday on a retreat in the dollar and US Treasury yields, with investors’ focus on minutes from the Federal Reserve’s latest policy meeting for confirmation of its tapering strategy.

Spot gold rose 1.9% to $1,794.73 per ounce by noon EDT, near its highest in a month. US gold futures were up 2.0% to $1,795.40 an ounce in New York.

Other precious metals followed, with spot silver rising 2.7% to $23.17 per ounce, platinum gaining 1.1% to $1,023.50 and palladium adding 3.2% to $2,116.50.

[Click here for an interactive chart of gold prices]

“Gold is just following yields at the moment. The initial reaction after CPI (consumer price index) data was a big spike in yields, which is now starting to fade away,” Daniel Pavilonis, senior market strategist at RJO Futures, said in a Reuters report.

Gold initially pared gains as benchmark 10-year Treasury yields rose above 1.6% after data showed a solid increase in US consumer prices for September, with further price jumps expected in the coming months.

However, a subsequent pullback in yields, which reduced the opportunity cost of holding non-interest-bearing gold, drove a strong rally in the precious metals market.

“It’s a situation where gold is an inflationary metal, which should be going up, but initial rate shocks capped its upside potential,” Pavilonis added.

Bullion also drew support from a slide in the US dollar and worries that high inflation could hit global economic growth prospects.

“Given how the stagflation talks continue to drain global sentiment and promote risk aversion, this could support gold bugs,” said FXTM analyst Lukman Otunuga.

Investors now await the release of minutes from the US central bank’s September meeting amid expectations for tapering of economic support as soon as next month.

Meanwhile, a group of banks that partnered with the London Metal Exchange to launch gold and silver futures in 2017 is preparing to abandon the project after hoped-for volumes did not materialize.

(With files from Reuters)

World Copper pursues low-cost oxide strategy
Wed, 13 Oct 2021 15:34:46 +0000
The Zonia acquisition will give World Copper an advanced asset in the US.

World Copper (TSXV: WCU; US-OTC: WCUFF) is making headway on developing low-cost, oxide-resource-based copper projects in Chile and the United States, CEO Nolan Peterson told The Northern Miner in a recent interview.

A relative newcomer to the copper exploration and development sector, it has already outlined an alternative economic development case for the Escalones project in Chile, and it is set to add an even more advanced asset, the preliminary economic study-level Zonia copper-oxide project in central Arizona to its portfolio before year-end.

World Copper was created by founder Henk van Alphen, who has a long history in the mining industry. He has built successive mining success stories that have, over the years, created millions of dollars in shareholder value.

“We’re looking to replicate that success,” Peterson said in a recent interview.

Iron ore price falls on China demand worries
Wed, 13 Oct 2021 14:20:28 +0000
Steel mills in some 28 cities in northern China will have to cut production from Nov. 15 to March 15 next year.

The iron ore price fell on Wednesday on persistent unease about debt-saddled Chinese property firms and an overall bearish demand outlook.

According to Fastmarkets MB, benchmark 62% Fe fines imported into Northern China were changing hands for $124.17 a tonne, down 3.8% from Tuesday’s closing.

The most-traded January iron ore contract on China’s Dalian Commodity Exchange ended daytime trading 5.9% lower at 731 yuan ($113.32) a tonne, after a five-session rally.

Chinese property developers face payment deadlines defaults before the end of the year, and with China Evergrande Group’s fate looking increasingly bleak, fears are mounting of a wider crisis in the sector that accounts for about a quarter of the domestic steel demand.

Chinese iron ore demand has already collapsed amid environment-related steel production controls, curbing imports which declined 3% in annual terms during January-September.

“In mid-to-late September, the number of blast furnace maintenance… showed an explosive increase,” Zhongzhou Futures analysts wrote in a note.

“Under the strict production restriction policy, it is doubtful whether the steel plants… can resume production on schedule in October.”

Steel mills in some 28 cities in northern China will have to cut production from November 15 to March 15 next year, in order to clear the smog-blanketed sky in time for the Olympic Winter Games that will take place in February in Beijing and neighboring Hebei province.

The Chinese volume of iron ore imports dropped to 95.6 million tonnes in September from 97.5 million tonnes in August.

(With files from Reuters)

Zinc price touches near 14-year high as Nyrstar slashes output
Wed, 13 Oct 2021 14:05:03 +0000
Company said it will cut production by up to 50% at its three European smelters due to the soaring price of electricity.

The zinc price touched a near 14-year high in Shanghai on Wednesday, while in London it jumped to the strongest in over three-and-a-half years after Nyrstar said it will cut production by up to 50% at its three European zinc smelters due to the soaring price of electricity.

The most-traded November zinc contract on the Shanghai Futures Exchange closed up 1.5% at 24,000 yuan ($3,721.68) a tonne, its highest since November 2007. Benchmark zinc on the LME had gained 3.3% to $3,372.50 a tonne by 09:30 GMT, the strongest since March 2018.

Click here for an interactive chart of zinc prices

“The cost burden of carbon emitted by the electricity sector which is passed on to industrial and domestic customers, means it is no longer economically feasible to operate the plants at full capacity,” Nyrstar said.

“Indirect cost compensation for energy-intensive producers to protect their competitiveness versus non-EU producers varies by European country and this puts Nyrstar’s Budel, Balen and Auby plants at a competitive disadvantage, compounding the impact of extreme energy prices.”

The firm is the world’s second largest zinc producer and one of the biggest zinc smelting companies. It has operations across northern Europe, the United States and Australia.

Nyrstar did not say how much zinc production would be lost or provide the production capacity of the three smelters.

Electricity prices have surged to record highs in recent weeks, driven by power shortages in Asia and Europe.

“Chinese (zinc) smelters have cut production for several times in the past months, and we have revised down the production forecast by 80,000 tonnes compared with our previous forecast in early 2021,” said CRU analyst Dina Yu in Beijing.

According to the International Lead and Zinc Study Group, the global zinc market will be slightly over-supplied this year and next.

Fitch Solutions forecasts an average zinc price of $2,600 per tonne in 2021.

“The global production surplus that emerged in 2020 should persist into the medium term, and the resulting increase of zinc inventories should gradually drag prices lower,” said the research firm in a recent report.

(With files from Reuters)

Silver-infused bacteria make fuel cells more efficient
Wed, 13 Oct 2021 13:06:00 +0000
Microbial fuel cells utilize natural bacteria to extract electrons from organic matter in wastewater to generate electrical currents.

A new study published in the journal Science describes the development of microbial fuel cells — a technology that utilizes natural bacteria to extract electrons from organic matter in wastewater to generate electrical currents.

It has been known that populations of bacteria can help decontaminate groundwater by breaking down harmful chemical compounds, but the new research also shows a practical way to harness renewable energy from this process.

Led by a team at the University of California – Los Angeles, the study is focused on the bacteria genus Shewanella, which can grow and thrive in all types of environments — including soil, wastewater and seawater — regardless of oxygen levels.

Once inside the bacteria, silver particles act as microscopic transmission wires, capturing more electrons produced by the bacteria

Shewanella species naturally break down organic waste matter into smaller molecules, with electrons being a byproduct of the metabolic process. When the bacteria grow as films on electrodes, some of the electrons can be captured, forming a microbial fuel cell that produces electricity.

However, microbial fuel cells powered by Shewanella oneidensis have previously not captured enough currents from the bacteria to make the technology practical for industrial use. Few electrons could move quickly enough to escape the bacteria’s membranes and enter the electrodes to provide sufficient electrical currents and power.

To address this issue, the researchers added nanoparticles of silver to electrodes that are composed of a type of graphene oxide. The nanoparticles release silver ions, which bacteria reduce to silver nanoparticles using electrons generated from their metabolic process and then incorporate into their cells. Once inside the bacteria, the silver particles act as microscopic transmission wires, capturing more electrons produced by the bacteria.

“Adding the silver nanoparticles into the bacteria is like creating a dedicated express lane for electrons, which enabled us to extract more electrons and at faster speeds,” Xiangfeng Duan, the study’s co-corresponding author, said in a media statement.

With greatly improved electron transport efficiency, the resulting silver-infused Shewanella film outputs more than 80% of the metabolic electrons to an external circuit, generating power of 0.66 milliwatts per square centimetre — more than double the previous best for microbial-based fuel cells.

With the increased current and improved efficiencies, the research showed that fuel cells powered by silver-Shewanella hybrid bacteria may pave the way for sufficient power output in practical settings.

Tesla inks multi-year nickel supply deal with Prony Resources
Wed, 13 Oct 2021 10:53:00 +0000
The New Caledonian miner will provide the US carmaker with about 42,000 tonnes of the metal needed to produce batteries that power its EVs.

Electric vehicle giant Tesla (NASDAQ: TSLA) has inked a multi-year nickel supply deal with New Caledonia’s Prony Resources, which guarantees the US carmaker about 42,000 tonnes of the metal needed to produce the batteries that power its EVs. 

Prony, which bought the loss-making nickel and cobalt operations in the French territory from Vale (NYSE: VALE) earlier this year, said it’s targeting production of 44,000 tonnes of nickel by 2024. That’s about double the expected 2021 output.

The deal was negotiated by Swiss commodity trader Trafigura, one of Prony’s main stakeholders, and it makes Tesla by far the miner’s largest customer, CEO Antonin Beurrier said in a statement.

The South Pacific archipelago of New Caledonia, 1,200 km (750 miles) east of Australia, was gripped by riots over the sale process of Vale’s local business in February, with protesters saying a locally led offer had been unfairly overlooked. 

Click here for an interactive nickel price chart 

Vale Nouvelle Calédonie (VNC), which was the operator of the troubled Goro nickel-cobalt mine, proved to be a financial burden for Vale since it began operations two years behind schedule in 2010. 

Mounting issues, including a $1.6 billion-write down related to the ailing mines, pushed the company to announce in 2019 its intention to exit New Caledonia.

Vale later cut its 2020 nickel production guidance to 200,000 – 210-000 tonnes per year from 240,000 tpy to account for the anticipated loss of VNC’s 60,000-tpy output. 

A few weeks later, the miner revealed it had received non-binding offers for VNC, which includes the Goro mine, a processing plant and a port. 

Tesla was already associated with Prony as an adviser on product and sustainability standards. The move followed the EV maker’s announcement that it was planning to move into the mining business to secure resources for battery production.  

Related read: All the mines Tesla needs to build 20 million cars a year

Prony is one of the mounting nickel suppliers Tesla has inked deals with to secure supply of the battery metal. The list includes mining giant BHP (ASX, LON, NYSE: BHP), which is investing heavily in expanding operations to meet expected soaring demand.

Analysts estimate the nickel market could face a shortage as soon as 2023. The metal helps cram more energy into cheaper and smaller battery packs, allowing EVs to charge faster and travel farther between plug-ins. 

Tesla boss Elon Musk promised last year a millionaire contract to any company able to provide the company with sustainable nickel.

Prony is 51%-owned by New Caledonia’s provincial authorities and other local interests, while Trafigura has a 19% stake, and the rest is held by a joint venture between Prony Resources management and investment firm Agio Global. 

Breakthrough for Rio Tinto’s smelter hydropower project in British Columbia
Tue, 12 Oct 2021 21:50:23 +0000
The tunnel boring machine cut 7.6 kilometres through the rock in remote mountains over 30 months, completing the route for a 16 kilometre tunnel that was started in the early 1990s.

In a major milestone for Rio Tinto’s Kemano T2 hydropower project in British Columbia, the tunnel boring machine has broken through to the other side.

The Kemano T2 Project is completing a second tunnel to carry water into the Kemano Powerhouse, to ensure the long-term reliability of the power supply for Rio Tinto’s BC Works smelter in Kitimat.

The tunnel boring machine cut 7.6 kilometres through the rock in remote mountains over 30 months, completing the route for a 16 kilometre tunnel that was started in the early 1990s.

“This is a significant milestone towards finishing the second tunnel and securing the long term reliability of hydropower for Rio Tinto’s smelter in Kitimat, which produces some of the world’s lowest carbon aluminium,” said Kemano T2 Project Manager Alex Jones in a media release.

“Boring this tunnel is a highly-skilled and technical feat that has been achieved in an extremely remote location that is only accessible by air or sea. We thank all of our partners who are supporting this important project – from our employees, to contractors, First Nations, government and community members,” said Jones.

The 1,300 tonne Herrenknecht tunnel boring machine is named tl’ughus by the Cheslatta Carrier Nation after a legendary giant monster snake and is decorated with artwork by Haisla Nation students. It is 190 metres long and more than six metres in diameter.

The tunnel will be filled up with water in the middle of next year, with the project expected to be complete in the second half of 2022.

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