mining Archives - African Financial & Economic Data

03 May

South African Gold Producers Agree to Settle Lung-Disease Suit

Mining companies including Anglo American Plc agreed to settle a class-action lawsuit from workers who said they contracted deadly lung diseases in South African gold mines.

The agreement provides for compensation for all eligible workers suffering from silicosis or tuberculosis who worked in the companies’ mines at any point since March 1965, the parties said in a statement Thursday.

The six producers last year set aside about 5 billion rand ($396 million) to settle the lawsuit. The settlement will be submitted to South Africa’s South Gauteng High Court for ratification.

The workers say they were negligently exposed to large amounts of silica dust over decades, causing silicosis and pulmonary tuberculosis. South Africa’s mines, which have produced a third of all the world’s gold, have drawn in millions of poor, black workers from across the region in the 130 years since gold was discovered.

The mines remain among the world’s deepest and most dangerous even after the end of apartheid rule in 1994, before which safety standards and environmental restrictions were minimal.

There is no limit on the number of potential claimants, the parties. The agreement was reached following three years of negotiations and is the first class action settlement of its kind in South Africa.

“The parties to the agreement believe that a compromise settlement is far preferable for all concerned than an inevitably lengthy and expensive litigation process would be, allowing for claimants more quickly to receive compensation and relief for their conditions,” they said.

Anglo American, African Rainbow Minerals Ltd., AngloGold Ashanti Ltd., Gold Fields Ltd., Harmony Gold Mining Co. and Sibanye Gold Ltd. were represented by the Occupational Lung Disease Working Group. Spoor, Abrahams Kiewitz Inc. and the Legal Resources Centre represented the class members.

Source: https://www.bloomberg.com/news/articles/2018-05-03/south-african-gold-producers-agree-to-settle-lung-disease-suit

26 Feb

Deal Wizard of South African Gold Mining Is Scaring Investors

Investors might be running out of patience with Sibanye Gold Ltd.’s colorful chief executive, Neal Froneman.

The South African miner’s stock plunged by a record 16 percent Thursday after the company warned it may consider selling assets, metals streams and — only as a last resort — new shares, if the recent strength in the rand persists.

Sibanye is under pressure to reduce debt after a rapid-fire series of deals that transformed the company from a staid and steady gold producer to a diversified precious-metals miner with both southern African and U.S. assets.

The company’s net debt is 2.6 times underlying earnings and almost as high as its current market value.

So far, investors have given Froneman, an industry veteran who earned himself the the nickname ‘Mr Fix-It’ for turnaround successes in the 1990s, the benefit of the doubt. But Thursday’s plunge suggests that might not continue forever.

“The biggest issue here is there is too much debt,” said Arnold van Graan, an analyst at Nedcor Securities. “We are seeing a lot of balance sheet risk building up if the rand-gold price stays where it is.”

South Africa’s rand has gained about 20 percent versus the dollar in the past three months, as investor optimism builds following leadership changes in the ruling party and President Cyril Ramaphosa’s appointment. Gold priced in rand has declined by about 14 percent in the same period.

Gold and platinum-group metals are sold in U.S. dollars, and while the majority of Sibanye’s gold and a substantial amount of the group’s costs are denominated in rand, its results and financial condition are affected if there is a material change in the value of the rand.

Sibanye gained 1 percent in Johannesburg Friday. The plunge in the company’s share price was overdone and it is still generating free cash flow, Morgan Stanley analysts said in a note. But the company’s debt level could present a challenge if the rand keeps strengthening.

To read the full article, click here.

05 Feb

Culture Needs to Be `Less Alpha Male’: Africa Mining Update

Mining executives, investors and government ministers are meeting in drought-hit Cape Town for the African Mining Indaba, the continent’s biggest gathering of one of its most vital industries.

Recent multiyear highs for many commodities have the world’s biggest miners swimming in cash and new demand from electric vehicles mean once-overlooked metals like lithium and cobalt are grabbing the spotlight.

But it’s not all blue skies, as the industry grapples with regulatory changes and uncertainty in countries including the Democratic Republic of Congo and Tanzania, as well as host South Africa.

Here are the latest developments, updated throughout the day. (Time-stamps are local time in Cape Town.)

Mining Culture Needs to Be ‘Less Alpha Male’ (11:18a.m.)

The mining industry’s culture needs to become “less alpha male” and has a long way to go to create a workplace that includes women, said Mike Fraser, president and chief operating officer for Africa at Perth-based South32 Ltd.

From safety gear to facilities, the sector often doesn’t cater enough for women, he said. “Those kinds of conversations, whilst they are now emerging to the surface, are probably 20, 30, 40 years too late and I would say there’s still a significant amount of work we have to do.”

Ownership of South32’s South African energy-coal business will go beyond the government’s minimum requirements on black empowerment, Fraser said.

Rio’s Mines of the Future (10:45 a.m.)

Here’s a glimpse into how the world’s number two miner sees the future. Rio Tinto Group’s Bold Baatar, head of energy and minerals, said the company will be competing with the likes of Facebook Inc. and Google for workers as mining automation increases. Currently, two-thirds of Rio’s engineers are miners, but within a decade that number will be halved, he said.

He also echoed a popular point from the industry: governments often have too high expectations for the money to be made from mines and don’t factor in the costs.

Source: https://www.bloomberg.com/news/articles/2018-02-05/anglo-hopes-for-reset-button-in-s-africa-africa-mining-update

19 Dec

Mining Wins as Chile and South Africa Back Pro-Business Leaders

In Chile, the world’s largest copper producer, voters returned billionaire Sebastian Pinera to the country’s presidency, with a promise to reduce corporate taxes and cut red tape. In South Africa — the top producer of platinum and also rich in gold, coal, ferro-chrome, iron ore and other minerals — the ruling party backed Cyril Ramaphosa as its new leader, putting him on a path to replace Jacob Zuma as the country’s president.

The political shifts are good news for the likes of BHP Billiton Ltd., Rio Tinto Group, Glencore Plc and Anglo American Plc, which have billions of dollars tied in mines in South Africa or Chile — and, in some cases, in both nations.

While Pinera made his fortune in banking and an airline, he’s seen as close to the mining industry, and certainly more friendly than President Michelle Bachelet, who raised corporate taxes and empowered labor unions. Pinera has promised to keep some of the reforms of Bachelet, but also make economic growth and attracting investment his priority.

Ramaphosa, a businessman turned politician who will now have to fight national elections in 2019, was once a business partner of commodities giant Glencore, including a joint venture investing in coal. The new leader of the African National Congress, which has won each national election since the end of apartheid in 1994, plans to run on a reformist agenda.

How both politicians would deliver their pro-growth programs is far from clear, however. Hence, it may be premature for miners to cheer. And, in a worse case scenario, their business-friendly programs could backfire into the mining industry if they trigger social unrest.

For Ramaphosa, it would be a difficult balance; before his political and business career, he was a mining union leader. The new ANC head will have to deal with multiple crises, from sovereign debt downgrades and power blackouts to a local mining industry that has virtually thrown the towel in after Zuma pushed ahead with controversial reforms known as the mining charter.

To read the full article, click here.

05 Dec

Sierra Leone ‘Peace Diamond’ Undersells for Over $6 Million At Auction

A Christian pastor had given away the more than 709-carat diamond so the government could fund local development projects. Officials hope its sale will also help combat illicit smuggling in the modern industry.

Sierra Leone sold one of the world’s largest diamonds at an auction in New York on Monday, fetching a lower-than-expected price of $6.5 million (€5.5 million).

The egg-sized, 709-carat “Peace Diamond” is one of the largest ever discovered in Sierra Leone and between the 10th and 15th largest ever found.

The international diamond trading network that handled the auction, the Rapaport Group, said the stone had gone to British billionaire and jeweler, Laurence Graff.

Diamond for peace

The stone was dubbed “Peace Diamond” after the Christian pastor who found it gave it away in the hope it would allow the government of Sierra Leone to raise money for local development projects.

The government said Monday it will use the $3.9 million in tax revenue from the sale to fund clean water, electricity, schools, health centers and roads.

Officials said they also hoped the sale will help combat the West African country’s illicit diamond trade.

“Peace diamond” plays on the term “blood diamond,” which were diamonds rebel groups sold during Sierra Leone’s brutal civil war in the 1990s to buy arms and ammunition. In many cases, groups used slave labor to mine the stones.

The UN enacted a ban on all diamond exports from the country until 2003, but illicit smuggling continues to mark the modern diamond trade.

‘New day in Sierra Leone’

The government had expected the stone, the first ever to be sold at a public auction, to fetch $7 million.

Senior officials were nonetheless optimistic about the sale’s effects on the illicit diamond trade in Sierra Leone.

“It will encourage all the diggers back home,” said Chief Paul Ngaba Saquee, head of Sierra Leone’s eastern Kono district where the diamond was found.

“Instead of being ripped off in some dark corners when they find their diamonds, that they will bring it and put it on the table in front of the government,” he said, adding: “Maybe this is going to be the beginning of a new day in Sierra Leone.”

Source: http://allafrica.com/stories/201712050002.html

22 Sep

Mining issues in Africa: Private sector stakeholders share their views

The Africa Mining Day, organised by the Singapore Mining Club, gathered six high profile figures to talk about mining exploration and production in Africa on 12 September 2017. The talk, mediated by Geoff McNamara, partner at natural resource-focused investment firm Medea Capital and director of the Singapore Mining Club, was split into two segments: producers and explorers. The attendees included professionals and investors interested in learning more about Africa’s natural resource potential.

Nic Limb, non-executive chairman at Mineral Deposits Limited (MDL), whose company explores and produces titanium, zircon and gold in Australia and in Senegal, commented on one of the problems mining companies face in Africa: “The legislation that underpins all your mining and O&G activities is often quite old.” MDL operates the Sabodala gold project and the Grande Côte Mineral Sands operation (GCO), both in Senegal, West Africa.

According to Limb, “Getting logistics right is very important. If you have to start talking about building a port, you are in trouble.” That is why GCO is a fully integrated, mine-to-ship, large-scale mineral sands operation. It primarily produces high-quality zircon and ilmenite (iron titanium oxide). “We produce around 7% of the global feedstock of titanium,” Limb said.

John Welborn, MD and CEO of Resolute Mining Limited, spoke about his gold business in Africa. “I’m very passionate about Africa. I like the fact that when people ask me what I do, I say I’m a gold miner. But it’s much more complicated than that; it’s about really complex assets.” Resolute has been operating in Africa for the past 21 years, having started in 1996, in Ghana, and expanded to a gold mining project in Tanzania in late 1990s. “We operated that asset successfully for 15 years. Now we are out of that jurisdiction because it became rather problematic.” In Africa, the company now focuses on Mali (Syama Gold Mine).

20 Sep

Is Africa on the cusp of a new era of sustainable mining?

Africa’s sustainable mining industry is gaining momentum. Steadily rising commodity prices, particularly gold and copper, are creating a more stable environment; and exploration has returned. Combined with a greater level of regulatory oversight and new mining laws in some countries, these factors indicate that Africa’s mining industry may be on the cusp of a period of sustained growth.

Regulatory oversight has significantly improved in some parts of the continent. In the east, Kenya’s government unveiled a progressive new mining act in 2016, which forms part of its 20-year mining strategy, aiming to attract 20 major mining companies to the country. In addition to simplified permits (for small-scale operations) and licences (larger scale), prospecting restrictions have also been removed. The act also spells out important sustainability and environmental policies, which include technology transfer, local equity participation, labour laws and incentives on local investments. This is an attempt to strike the right balance between deregulation and environmental and social protections. On the other side of the continent, we are seeing similar moves to incentivise investment. The Angolan government is currently working on a new special tax regime for the mining sector, which may include new incentives concerning tax deductible costs and losses.

As the sector continues to evolve, we are also seeing an increase in the number of co-investment opportunities in several African nations – providing opportunities for investors to benefit from reduced operational costs and take on build, operate, and transfer projects with short-term operational returns and a long-term investment horizon. Naturally, governments benefit from co-investment because it reduces their capital outlay and achieves greater levels of productivity – as well as job creation and exports.

Investment opportunities are rising in number right across the continent, including in Angola, Ghana, Kenya, Mauritania and Senegal. The Angolan Ministry of Geology and Mining confirmed in February 2017 that it had secured funding for the Angolan National Geology Plan (Planageo), which is described by the Minister of Geology and Mining, Francisco Queiroz, as “The main instrument of the government’s strategy for protecting the geology and mining sector”.

Read more: Is Africa on the cusp of a new era of sustainable mining?

14 Aug

Nigeria Set to Benefit From Deep Sea Mining

The Director General of the Nigerian Maritime Administration and Safety Agency, Dakuku Peterside, has stated that Nigeria is set to benefit from the deep sea mining through effective harnessing of the opportunities by working with the International Seabed Authority.

The NIMASA DG who made this known at the opening ceremony of the 23rd Assembly of the International Seabed Authority (ISBA) held in Kingston, Jamaica said that irrespective of the numerous resources in Nigeria, there was the need to work more closely with the ISBA in the area of seabed resources exploration.

Peterside, who led the Nigerian Delegation to the event commended ISBA on its role in the optimal utilisation of seabed resources among maritime stakeholders and solicited assistance in the area of capacity building to survey deep sea and establish data base of mineral resources available for the benefit of all mankind.

He stated further that the federal government is currently developing policies that will aid the harnessing of seabed resources and will be working closely with the ISBA.

According to Peterside, “The Nigerian Federal Ministry of Transportation is developing a country blue economy policy and strategy which will incorporate the sustainable development of the country’s deep seabed resources”.

Furthermore, he said at the moment the Nigerian Navy Hydrographic office has been undertaking hydrographic survey and charting of our maritime area, and adding that in the same vein NIMASA is working with Nigerian Navy to effectively enforce the United Nations Convention on the law of the sea and other relevant international maritime instruments to which we are a party around our continental shelf.

He also noted that, while seeking exploitation of the mineral resources within the Seabed off our national maritime jurisdiction, marine environment preservation and protection will continue to be given top priority.

The NIMASA boss used the opportunity to congratulate Mr. Michael Lodge of the United Kingdom on his appointment as Secretary General of ISBA Council and Eugenio Joao Muianga of Mozambique on his election as President of the Authority’s 23rd session.

He said that Africa is proud of the feat of Muianga and pledged that Nigeria is ready to cooperate with and support the work of the Authority while looking forward to benefiting from available opportunities.

The International Seabed Authority is an autonomous international organisation established under the 1982 United Nations Convention on the Law of the Sea and the 1994 Agreement relating to the Implementation of Part XI of the United Nations Convention on the Law of the Sea.

Source from allAfrica

05 Jul

New Tanzania law requires government to have shares in mining firms

Tanzania’s parliament amended mining and tax laws late on Wednesday to make it mandatory for the government to own at least a 16 percent stake in mining projects, the state-run Tanzania Information Services said.

“In any mining operations under a mining license or a special mining license, the government shall have not less than 16 (percent) non-dilutable free-carried interest shares in the capital of a mining company,” read the text of the new law.

Japan donates US $906,000 to Mine Action in South Sudan

Last year alone, Japanese-funded teams cleared a total of 1,799,211 sqm, and closed 450 spot tasks including emergency operations by UNMAS Quick Response Teams to survey and clear civilian locations in Juba in the immediate aftermath of conflict in July 2016

JUBA, South Sudan, March 28, 2017

The Government of Japan has contributed USD 906,000 for the mine action project “Humanitarian Mine Action in Support of Conflict Affected Communities in South Sudan.” Over the past five years, Japan has contribution over USD 13 million to mine action operations in South Sudan. Last year alone, Japanese-funded teams cleared a total of 1,799,211 sqm, and closed 450 spot tasks including emergency operations by UNMAS Quick Response Teams to survey and clear civilian locations in Juba in the immediate aftermath of conflict in July 2016.

An estimated 7.5 million people have been directly affected by the conflict in South Sudan since it began in December 2013. Over the past year, the affected population has grown by more than one million. On 8 July 2016, the optimism for peace and socioeconomic development resulting from the Agreement on the Resolution of the Conflict in South Sudan was interrupted by an outbreak of conflict in Juba and several locations in South Sudan. The use of explosive weapons such as rockets, grenades, and mortars has further increased the proliferation of explosive hazards with accident levels in 2015 and 2016 being the highest in the last five years. It is clear that the explosive legacy of war will continue to inhibit social and economic recovery long after the guns have been silenced.

Continued funding from the people of Japan will support a Multi-task Team (MTT) to reduce the impact of explosive hazards, through survey and clearance as well as the provision of Risk Education, for conflict affected communities in Greater Equatoria. In South Sudan, where 92,840,000 sqm of contamination is known and hundreds of new hazards discovered every month, Mine Action is a critical enabler of humanitarian aid and a key driver of socio-economic development.

The Ambassador of Japan to South Sudan, Mr. Kiya Masahiko stated, “We feel a sense of mission as a peace-loving nation to support mine action in South Sudan as it lays the ground work for the people of this country to cancel out the negative past and to collectively embark on humanitarian and development efforts. Ahead of the International Mine Awareness Day, I wish to answer the global call for mine action with a USD 0.9 million contribution and to invite others to this indispensable mine action led by our long-standing partner, UNMAS.”

Mr. Tim Lardner, UNMAS South Sudan Programme Manager, emphasized the importance of the support from Japan. “Japan has been a reliable and encouraging partner in mine action to South Sudan and to UNMAS.They have always worked closely with us to support the goals of risk reduction to the population through the clearance of explosive remnants of war, but also maintain an important role in working closely with the government of South Sudan, through the National Mine Action Authority. It is great to have such a steady and reliable partner.”

UNMAS currently supports mine action programmes in Abyei (Sudan/South Sudan), Afghanistan, Central African Republic, Colombia, Côte d’Ivoire, Darfur (Sudan), Democratic Republic of the Congo, Iraq, Lebanon, Libya, Mali, State of Palestine, Somalia, Sudan, Syria and the territory of Western Sahara (MINURSO).

Distributed by APO on behalf of United Nations Mine Action Service (UNMAS).