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Chelyabinsk Zinc reports rise in H1 output |
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Chelyabinsk Zinc Plant said its output rose by 56 percent in the first half of 2010 versus a year ago, indicating Russia's top zinc producer is restoring output after the economic crisis. The plant, Russia's largest maker of the anti-corrosive metal, produced 80,573 tons of zinc and zinc-based alloys, up from 24,327 tons a year ago. Some 44 percent of that output went to the domestic market. Chelyabinsk, which is controlled jointly by Russia's Urals Mining and Metals Co (UMMC) and the Russian Copper Company, had to cut output last year along with other Russian metal producers because of the economic crisis, which reduced demand and lowered metals prices. UMMC has pledged to restore output at Chelyabinsk to pre-crisis levels. Chelyabinsk subsidiary Nova Zinc LLC, which operates the Akzhal zinc and lead ore mine in Kazakhstan, processed 722,400 tons of ore in January-June 2010, 21 percent more than in the same period of 2009. But production of zinc in concentrate fell by 18 percent in the first six months to 14,038 tons, and lead in concentrate production decreased by 13 percent to 1,822 tons, as metals content in ore declined. Chelyabinsk's UK subsidiary, the Brock Metal Company, sold 14,713 tons of products in January-June 2010, 45 percent more than a year ago. |
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Nalco seeks alternate site for its proposed second aluminium plant |
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National Aluminium Co Ltd (Nalco) has zeroed in on Sundergarh in western Orissa to relocate its second aluminium-cum-power complex estimated to cost about Rs 16,000 crore, after the originally selected site of the project in Jharsuguda district ran into problem on environment grounds. The company is likely to submit a proposal on new location of the project to the state government. But sources said, the fate of the project, even at the new location, hinges on availability of water. The company has written to the state government for construction of a barrage on a seasonal tributary of Ib river to store water for use in the project. It has offered to bear the cost of the barrage estimated at about Rs 100 crore. Though the company proposed to build a 0.5 million tons per annum aluminium smelter and a 1260 MW captive power plant (CPP), sources said, the final project size will depend on the amount of water allotted to it. Going by the thumb rule, the project will require about 1,200 acres of land at the new location which is about 200 km from the earlier site in Jharsuguda. Nalco was crowded out of Jharsuguda, which boasts of three other mega proposals for aluminum-cum-power complexes from Vednata, Hindalco and L & T-Dubal on environment pollution grounds. Seeing the rush of investment at Jharsuguda, the Orissa government had asked the Nagpur-based National Environment Engineering Research Institute (NEERI) to conduct a pollution carrying capacity study for the region. NEERI, in its report, has capped the total aluminium capacity for the region at 2 million ton. This sealed the fate of Nalco's Jharsuguda plan as Vedanta Aluminium, Hindalco and L&T Dubal, which also have their projects in the same locality, have already received the government nod for 1.6 million ton, 0.36 million ton and 0.3 million ton aluminium capacities respectively, taking the aggregate envisaged aluminium output for the region past 2 million ton. Hence, Nalco had started looking for alternative sites for the project and sent teams to Sundergarh, Sambalpur and Bolangir to scout for new location. “After analysing various datas collected by these teams on availability of land, water sources and transportation facility etc at various places, we zeroed in on a place 40 km from Sundergarh town as most suitable for the project”, said BL Bagra, Director, Finance, Nalco. Meanwhile, the company sold 7,500 tons of aluminium ingots at a premium of US$92.50 a ton over the average LME cash price on a cost, insurance and freight basis. The company will supply the metal to South Korea's STX Corporation in five batches of 1,500 tons each from October to February 2011. |
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Zambia continues to attract mining investment |
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Zambia, Africa's largest copper producer, has continued to attract mining investments to lift output to 750,000 tons this year and 1 million tons in 2012, Central Bank Governor Caleb Fundanga said. The government and the Chamber of Mines of Zambia have both said investments in the mining sector, the country's economic lifeblood, have peaked at US$5 billion in the last eight years. Production of the metal, used extensively in construction and wiring, was just below 700,000 tons in 2009, after mines which had suspended output during the global economic crisis resumed operations. Fundanga said the Konkola deep project, part of Konkola Copper Mines (KCM), a unit of London-listed Vedanta Resources, located on the northern border with the Democratic Republic of Congo (DRC), was also on course to raise output to 500,000 tons of copper by 2012. The Konkola deep project which is key to hitting the 1 million tons has already been inaugurated, which means there is a lot of investment going into the mining sector. Fundanga said Zambia was likely to attract further investment in mining due to rising metals prices. Copper production in Zambia rose 16 percent to 321,132 tons in the first five months of 2010, shored up by rising global metals prices, central bank data showed this month. Copper mining is Zambia's economic lifeblood and the mines are a major employer in the country of over 12-million people. |
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redanta Resources' metal output up |
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India-focused mining group Vedanta Resources Plc posted record first-quarter EBITDA of US$794 million in the three months to end June as production of its three most profitable metals rose. The London-listed miner said production of refined zinc, its second most profitable metal, rose 19 percent to 165,000 tons. Aluminium output grew 13 percent to 141,000 tons. At full-year results in May, the diversified miner said it was on track to deliver a substantial increase in production capacity across its businesses in 2011. Vedanta defended its human rights record at a recent shareholders' meeting where some fund managers joined pressure groups to protest over its plans to build a bauxite mine in an area sacred to indigenous people.. |
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Norilsk Nickel posts higher output |
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Russia's Norilsk Nickel, the world's largest nickel and palladium producer, boosted nickel production in the first half of 2010 by 3 percent year-on-year. Norilsk produced 145,410 tons of nickel, copper output rose by 2 percent in the first half to 199,125 tons year-on-year. Norilsk said in a statement that first-half palladium output rose 10 percent 1.494 million ounces and platinum output by 14 percent to 358,000 ounces in the same comparison. The data include Polar and Kola Divisions in Russia and international operations in Finland, Botswana and South Africa. Output by US unit Stillvater Mining Co. is not included." |
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UC Rusal ready to buy stake in Norilsk Nickel |
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UC Rusal, the world's top aluminium producer, said it was ready to buy the stake in metals giant Norilsk Nickel from rival Interros as it attempts to restore its position on the Norilsk board. Rusal and Interros, which both have slightly more than 25 percent in Norilsk, have been battling for control over the company, the world's largest nickel producer. They signed a truce in 2008 but the fight restarted in June, when Rusal lost one of its four seats on the company's 13-seat board, giving Interros, which still has four seats, the upper hand. The Norilsk board may prefer a share buyback to a dividends payout, while Rusal - struggling under a US$12.9 billion debt - wants the cash-rich metal and mining giant to share its profits with shareholders. In May, when Rusal and Interros had the same number of board seats, the Norilsk board rejected Rusal's request to pay 110 percent of its profit, or some US$3 billion, in a dividend for 2009 and approved a dividend payout of only US$1.3 billion. Under its 2008 truce agreement between Rusal and Interros, they had agreed that Norilsk should pay an annual dividend of around US$2 billion. |
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Kazakhmys copper output dips |
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Kazakh miner Kazakhmys posted a dip in first half copper production and reiterated its full-year target as demand stayed strong. The London-listed firm also reported surging generation and tariffs in its power business as electricity demand recovered after last year's global downturn. Customer demand remains firm for metals and the company's objective will be to maintain operational consistency in the second half of 2010, Chief Executive Oleg Novachuk said. The statement about healthy demand by Kazakhmys, which sells copper mainly to China and Europe, contrasts with recent cautious comments by big mining groups such as BHP Billiton and Rio Tinto. They are expected to post surging first-half profits but have been wary about the second half due to a possible slowdown in China and the debt crisis in Europe. Analysts welcomed Kazakhmys' first-half output figure of 164,300 tons copper cathodes from own concentrate, even though it was 3 percent lower than last year on lower grades, because it beat the company's guidance on an annualised basis. In April, the firm posted a 4.3 percent dip in first-quarter production, but said it was on track to meet its annual target. |
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Hindustan Zinc net up 24 pct |
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Hindustan Zinc said it recorded Rs 891 crore net profit for the quarter ended June 30, up 24 percent from Rs 719 crore a year earlier, as the metal commanded higher price. The price for zinc, used to rust-proof steel, averaged 37 percent higher in the quarter on the LME, bouncing back from the slump of a year earlier due to global recession. According to the World Steel Association (WSA), global steel consumption will exceed the 2007 record this year, rising 10.7 percent from a year earlier, as the world economy recovers. |
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Eramet expects volatility in metals |
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The world's sixth largest nickel producer Eramet expects volatility in markets due to customers reducing their stocks and is bracing itself for uncertain prospects in the second half, the French mining group said. The producer said demand for ore and manganese alloys could slow down more sharply than for steel in the third quarter in light of excessive ore and alloy stocks in China. The world production of steel is expected to slow down in the third quarter 2010 compared to the first half of 2010. Eramet's nickel goes into catalytic converters and coins and its alloys activities are key to the aerospace industry. The company said there was a growing divide between developed markets which still had not returned to pre-crisis levels and emerging markets which continued to gather strength. It also said the recovery in its alloys business was mixed and in certain sectors at levels that were significantly below pre-crisis levels. The outlook came as Eramet posted first-half earnings before interest and tax (EBIT) of 341 million euros (US$444 million) for the first half, generating an operating margin of 19 percent. The performance compared with an operating loss of 223 million euros a year ago. Sales in the six months to June 30 rose 38 percent to 1.788 billion euros, helped by a surge in nickel prices. In the second quarter alone, revenue was up 59 percent to 999 million euros. Eramet said last month Gabon agreed to buy a stake in the company and raise its holding in their joint local manganese miner Comilog to around 35 percent from 25 percent. |
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Chalco to invest in Guinea joint venture |
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Aluminum Corp of China Ltd (Chalco) has agreed to invest US$1.35 billion in a Guinea joint venture, which is the world's largest undeveloped iron ore deposit. The agreement to develop the Simandou project follows a non-binding deal signed in March by Chalco's parent, Chinalco, and is the Chinese group's first non-aluminium investment overseas. Beijing has recently given both Chalco and Chinalco the green light to add more assets to their core aluminium businesses, allowing them to push into iron ore and secure more natural resources that are helping fuel the world's third-largest economy. Analysts said the move would help Chalco diversify beyond a volatile aluminium market, which has seen prices swing between US$3,300 and US$1,300 a ton in two years. The Simandou venture is expected to begin production within five years. Chalco will pay Rio, which holds the rights to develop the project, US$1.35 billion over two years. The Chinese group would have 47 percent of the venture's interest, with Rio holding the remaining 53 percent. The joint venture will hold a combined 95 percent of the project, with International Finance Corp owning the rest. However, the Guinea government said it plans to exercise an option to own 20 percent of the Simandou project, which would reduce the joint venture and IFC's stakes proportionally. Rio, which has already invested more than US$650 million in the project, has been in dispute with Guinea over some blocks the government took from Rio and gave to BSG Resources, controlled by Israeli billionaire diamond trader Beny Steinmetz. |
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Japan's refined copper export falls |
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Japan's refined copper exports fell 22 percent in June from a year earlier to 45,180 tons, extending a year-on-year decline for the eighth straight month, Ministry of Finance data showed. Copper, used in goods including utensils, construction materials and computer chips, is often seen as a gauge of economic activity. China's share of exports from Japan stayed relatively low at 41 percent as recent Chinese data showed its refined copper imports fell for the third straight month in June. Refined copper output in China hit an all-time high in June as smelters worked near full capacity, but that may slow in the second half of the year due to maintenance work on several units and scarce scrap supplies. Taiwan, Indonesia and Thailand are also key markets for Japan's copper. |
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Nyrstar earnings boosted by higher zinc output |
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Belgium's Nyrstar, the world's biggest producer of zinc, reported forecast-beating earnings before one-offs in the first six months, boosted by higher zinc output and first-time profits from mining. The group has over the past year expanded in mining, which offers higher margins than traditional smelting, buying mines or stakes in them in the United States, Peru and Greenland. It plans to buy another mine or seal a long-term supply contract for zinc concentrate in the second half of the year, Chief Executive Roland Junck said. From 2012, Junck said Nyrstar wanted mining to contribute as much as smelting to core profit (EBITDA). It was likely to represent about 35 percent at the start of 2011. First-half underlying EBITDA (earnings before interest, tax, depreciation and amortisation) tripled year-on-year to 93 million euros (US$121 million). With its Belgian Balen smelter back to full capacity, Nyrstar said first-half zinc market metal production rose 22 percent year-on-year to 530,000 tons. A stronger US dollar helped the group, which generates much of its earnings in dollars while its costs are in euros. A severe downturn in the construction and automotive markets at the end of 2008 and in 2009 led to lower demand for zinc, which is used to galvanise steel to protect against corrosion, and prices as low as some US$1,100 per ton. This forced Nyrstar to shut down the Balen smelter and cut back at other plants. Chinese galvanised steel consumption growth slowed in the second quarter of 2010, but ongoing urbanisation and development there would continue to drive long-term growth. Sales in diecast alloys and specialty alloys, used for car components such as seatbelts, had improved thanks to renewed growth in the automotive sector. |
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EMED Mining moves closer to restart production |
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EMED Mining has moved closer to achieving its ambitious goal of restarting production from the Rio Tinto copper mine in Spain in 2011 during this quarter, reaching significant milestones in the permitting process and securing access to the grid.
The most important developments achieved during the quarter included the submission of all relevant reports for the permission to commence production in 2011 and the receipt of authorisation to connect the mine to the national power grid.
EMED highlighted what it called the clarification of important commercial matters, which included the settlement of a debt owed to the Department of Social Security by a previous owner of the mine, finalisation of independent assessment of the bonding for compliance with environmental regulations and the completion of independent valuations of adjoining landholdings required for operations.
Operating cash flow is expected at US$ 117 million annually if the copper price meets forecasts of spot and average 10 year prices of US$3 per lb or US$ 6,600 per ton. The initial capital required for the start up of the Rio Tinto mine amounts to US$ 100 million, in line with previous estimates. The project's updated financial model calls for an increase in production to 9 million tons per annum in two years, estimating the ore reserve at 123 million tons at 0.48 percent copper for 585,000 tons contained with copper in concentrate averaging 37,000 tons per annum.
Drilling programmes have been planned along with project engineering to maximise the value while also stating there was significant potential to expand the life of mine and annual production. Meanwhile, EMED is continuing discussions with potential customers of the PRT product and financiers, while preparing to dual-list on the Toronto Stock Exchange. |
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Copper production down in Chile
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Copper output in Chile, the world's No. 1 copper producer, fell 0.6 percent in June from the same month a year earlier. In May, Chile's copper output dropped 5.4 percent from the same month in 2009, according to data released last month. Chile's copper industry, the backbone of its economy, emerged virtually unscathed from a February 27 earthquake that killed hundreds of people and battered the wood pulp, fishing, fruit and wine industries. |
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First Quantum Minerals to suspend production |
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Canada's First Quantum Minerals will suspend production at its Bwana Mkubwa copper processing plant in Zambia in August after running out of raw materials. Bwana Mkubwa had exhausted the copper ore oxide it imported from neighbouring Democratic Republic of Congo (DRC) and operations would be suspended until the plant sourced other economically viable raw materials. The company will be closing the plant in August because the ore has been exhausted earlier than it had initially thought due to higher output. |
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Guinea must review mining deals: Diallo |
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Guinea must review billions of dollars worth of mining deals signed since a coup in 2008 to make sure the West African state is getting its fair share of revenue.
Cellou Dallein Diallo, election front runner said that contracts signed by multinationals such as Rio Tinto, Vale and Chalco should be reviewed fairly, in a way that encourages foreign investment vital for the country's development.
Diallo, Party Head of UFDG said that "We will do things in a calm manner. And if we find Guinea has been taken advantage of we will open talks with our partners. We must protect because we need them to create employment, to create wealth in the country. These investors should be encouraged, protected and reassured by a government that does not discriminate but which is transparent and fair.”
Guinea's election is seen as its best chance at drawing a line under decades of authoritarian rule since independence from France in 1958 and could help cement fragile gains in stability in a region rocked by three civil wars in a decade.
Diallo warned authorities against indefinitely delaying the second round. This vote must take place in a reasonable timeframe by the end of August. Months before Guinea's election process began Rio Tinto and Vale surprised many by saying they would spend billions on iron ore projects there, betting that contracts would be upheld by the next government.
He said that the issue is to ensure the interests of Guinea are protected by the deals. That requires verification, an audit to ensure that Guinea is not taken advantage of in these deals and we need to do that. He added that if he wins the presidency, he will push continued reforms needed in the military notoriously rife with alcoholism and prone to random violence. |
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Chinese investors keen on partnering Atlas Mining |
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A number of Chinese firms have expressed interest in partnering with Atlas Mining and Development Corp. to develop its nickel mine in Palawan. Alfredo Ramos, Atlas President, said the company is negotiating with possible partners for its mine in Berong, Palawan.
The project has drawn the interest of Chinese investors since the price of nickel began to appreciate, he said.
The investor would be involved in the mining and processing of mineral resources in the Berong mine, which is the world's fourth-largest nickel laterite resource, the executive said.
“As the price of nickel begins to move [up], then you see the activity of interest again.
When the price is good, then there's a lot of interest. When the price is down, then it's down,” Ramos said on the sidelines of annual stockholders' meeting of Anglo Philippine Holdings Corp.
Ramos chairs APO, which owns 11.67 percent of Atlas.
Atlas is producing 35,000 to 36,000 tons of nickel ore per day and it plans to hike production to as much as 45,000 tons a day. |
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Sterlite net profit rises 50 pct |
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Sterlite Industries, the country's largest copper producer, today posted a 50 percent rise in June-quarter net profit at Rs 1,008 crore, over the corresponding period last year, as the metal commanded higher price. Sales rose 29 percent to Rs 5,925 crore. The billionaire Anil Agarwal-promoted Vedanta Group company said in a statement that it had consolidated cash of Rs 24,874 crore at the end of this quarter. Hindustan Zinc, a group company, last week posted a 24 percent jump in its profit after tax at Rs 891 crore, for the quarter ended June 30, over the year-ago period. Meanwhile, Sterlite Industries also said it was developing two ports in a joint-venture format in Andhra Pradesh and Orissa. The projects envisage a total outlay of Rs 900 crore. Meanwhile, Sterlite disclosed that the excise department has slapped a tax notice of Rs 324 crore on the company and charged it with violating several rules. The company claimed to have obtained a stay from the Madras High Court on both the counts.
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Nalco and Orissa govt sets up JV |
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National Aluminium Company Limited (Nalco) and the Orissa government formally set up the joint venture (JV) company Angul Aluminium Park.
In the company, while Nalco has 49.5 percent stake, the Orissa government-owned Industrial Infrastructure Development Corporation (IDCO) has 50.5 percent stake.
The park would come up adjacent to the existing smelter of Nalco at Angul at an estimated cost of Rs 75 crore. He said that both Nalco and IDCO would make available their expertise for successful implementation and operation of the park. The process of acquiring land for the park has already been started. It was in September 2009, Nalco and the state-owned IDCO had signed a MoU for setting up an aluminium park. He added that the park would host ancillary and downstream industries like coal tar pitch, aluminium fluoride, aluminium conductors, aluminium castings, extrusion, slugs and circles. Nalco will supply hot metal from its smelter to the aluminium processing units in the park to ensure considerable savings in consumption of power.
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