Newsletter 11-9-2023

Newsletter – 11.09.2023

11/9/23                                      WEEKLY NEWSLETTER
  • US, Saudi Arabia in talks to secure metals in Africa, Wall Street Journal reports
  • Saudi Arabia’s crown prince looks to metals as new source of wealth
  • Antofagasta loses bid to revive Minnesota copper-nickel mine
  • Saudi’s Maaden named preferred bidder for two mining exploration sites
  • Remediation under way at former uranium mining sites in Uzbekistan
  • Zambia: Largest copper mine dodges liquidation
  • Tantalex secures Glencore’s backing for Congo lithium project
  • Portugal’s Lusorecursos gets environmental OK for lithium mine

US, Saudi Arabia in talks to secure metals in Africa, Wall Street Journal reports

The United States and Saudi Arabia are in talks to secure metals in Africa needed to help them with their energy transitions, the Wall Street Journal reported on Sunday, citing people with knowledge of the talks.

A state-backed Saudi venture would buy stakes in mining assets worth $15 billion in African countries such as the Democratic Republic of Congo, Guinea and Namibia, which will permit U.S. companies to have rights to buy some of the production, the report added.

The U.S. is in a race to catch up with China for supplies of cobalt, lithium and other metals that are used in electric car batteries, laptops and smartphones.

In a similar arrangement in July, Saudi Arabian Mining Co (Ma’aden) (1211.SE) and the Saudi Public Investment Fund (PIF) acquired 10% of Brazilian Vale’s base metal unit, while U.S. investment firm Engine No. 1 acquired 3%.

The newspaper said the PIF approached Congo in June about investing in cobalt, copper and tantalum in the country via its $3 billion joint venture with Ma’aden called Manara Minerals.

Manara is also focusing on iron ore, nickel and lithium.

The White House is seeking the financial backing of other sovereign-wealth funds in the region, but talks with Saudi Arabia have progressed the farthest, the Journal added.

Saudi Arabia’s crown prince looks to metals as new source of wealth

In scorching summer heat, Renier Swiegers marches through the desert toward a drilling rig. He’s not looking for oil, the dynamo of Saudi Arabia’s economy the past 80 years, though. It’s another potential source of wealth and influence the kingdom now has its eye on.

Saudi Arabian Crown Prince Mohammed bin Salman is the Chairman of the Public Investment Fund

Having already used its energy riches to upend the worlds of sports, tourism and movies, Saudi Arabia’s Crown Prince Mohammed bin Salman is prepared to pour billions of dollars into tapping the more than $1.3 trillion of metals his government says is buried in places like this.

The plan may be among the less glamorous components of his grand Vision 2030 to transform the Saudi economy. The prospect of turning the country into a metals hub that can make a dent in a global industry also has no shortage of skeptics. But Saudi Arabia’s 38-year-old de-facto leader has no shortage of wealth or ambition. Key will be convincing international mining companies it’s worth their while.

If only partially successful, the dream would have implications beyond the Middle East, not just for metals mining but also Saudi Arabia’s relations with the US, China and the emerging markets the kingdom is inching closer to.

Swiegers, a Namibian who works for British mining firm Moxico Resources Plc, is a believer. He’s helping establish a new zinc and copper open pit mine about 200 kilometers (125 miles) west of the Saudi capital, Riyadh.

“I’ve done projects all over Africa, and I know the geology and where is good to mine,” said Swiegers, extracting earth samples from the rig from as deep as 200 meters and pointing to copper deposits glittering in the sun. “This site is just like those.”

Antofagasta loses bid to revive Minnesota copper-nickel mine

A US judge has rejected a bid by Twin Metals, a subsidiary of Chilean mining company Antofagasta, to restore the cancelled mining leases for the Minnesota copper and nickel mine, worth $1.7bn.

Antofagasta Minerals’ Chuquicamata, the world’s largest open-pit copper mine

If approved, the project would have been one of the US’s largest resource pools for metals needed for the green energy transition. 

In 2022, Twin Metals filed a lawsuit that challenged the decision of the US Interior Department to cancel leases for an underground mine near the Boundary Waters Canoe Area Wilderness. On Wednesday, US District Judge Christopher Cooper dismissed the lawsuit.

In January 2023, the Biden administration had blocked mining in part of northeast Minnesota for 20 years, over concerns it could pollute a major recreational waterway and also harm the state’s vast network of interconnected waterways.

The Interior Department determined that the leases were illegally renewed despite the US Forest Service objecting over concerns that mining could pollute the streams and lakes with potential toxins.

Saudi’s Maaden named preferred bidder for two mining exploration sites

Saudi Arabia’s Ministry of Industry and Mineral Resources has named Saudi Arabian Mining Company (Maaden) the preferred bidder for two exploration licenses for Muhaddad and Ar Ridaniyah, it said in a post on the messaging application X (formerly Twitter).

Muhaddad is located in the Asir region, nearly 456 square kilometres from Jazan Industry Port. The estimated area of exploration is more than 139 square kilometres (sq km), with possible deposits of copper, zinc, lead and gold.

Ar Ridaniyah is located within the unexplored Alamar in the Riyadh region. The estimated area of exploration is more than 75 sq km, with possible deposits of zinc and silver.

In April, the ministry released the list of 13 local and international companies that qualified to bid for the exploration sites of Muhaddad and Ar Ridaniyah.

In February 2023, Zawya Projects had reported that Saudi Arabia had started the prequalification phase for five new mining opportunities that were showcased at the Future Minerals Forum 2023 (FMF 2023) in Riyadh in January 2023.

Maaden is committed to drilling more than 61,000 metres in the first two years of the accelerated mining program to explore deposit reserves as part of the Vision 2030 agenda, the ministry said.

Remediation under way at former uranium mining sites in Uzbekistan

  • ERA grant of €9 million will help remediate former uranium mining sites in Uzbekistan 
  • Works are under way at Yangiabad and Charkesar
  • Major environmental relief for the region

Remediation work at legacy uranium mining sites in Uzbekistan is under way, bolstered by a €9 million grant from the Environmental Remediation Account for Central Asia (ERA)­ set up on the initiative of the European Union (EU) and managed by the European Bank for Reconstruction and Development (EBRD). This is the second Central Asian state, where such remediation activity under the ERA is taking place.

The grant funds will support work to close the identified mine openings, demolish derelict facilities that were used for uranium ore processing, and to re-cultivate selected waste rock areas at the Yangiabad and Charkesar mines.

The former site is 75 km east of the country’s capital, Tashkent. It has seven mines spread across the mountainous terrain around the town of Yangiabad. Once remediated, this area, known locally as the Uzbek Alps, will be environmentally safe, allowing livelihoods and tourism to flourish. 

The Charkesar-2 mine site is 140 km east of Tashkent and 60 km to the west of the city Namangan in the Fergana Valley. The contaminated area of approximately 25 hectares contains 5 already remediated waste rock dumps and two abandoned mine shafts. The existing water diversion channels on site are dilapidated.

The ERA has now allocated funding to remediate five out of seven high priority sites in Central Asia (three of which are in the Kyrgyz Republic and two in Uzbekistan). As well as the mandatory remediation and demolition works, the ERA-supported activity will help prevent toxic material from dispersing into the river system across the Fergana Valley, home to more than 15 million people.

Zambia: Largest copper mine dodges liquidation

Zambia's largest copper mine has dodged liquidation and received a cash injection of $1 billion from its parent company, ending a years long legal battle.

London-listed Vedanta is the majority owner of Zambia's largest copper mining firm Konkola Copper Mines (KCM), which has been at the centre of a standoff with government.

The state-owned ZCCM-IH is a minority shareholder in KCM.

In 2019, the Zambian government placed KCM in liquidation proceedings after accusing KCM of violating its operational licence and not paying all its taxes, sparking a four-year legal battle with Vedanta.

KCM's liquidation process has now been halted and Vedanta would continue to run the mines as the majority shareholder with 79.4 percent stake, the government said Tuesday (Sep. 05).

"The KCM board will be reinstated and Vedanta Resources Limited will return to its previous role as the majority shareholders," the country's mining minister told a press conference in Lusaka.

The firm will enjoy "a renewed financing commitment towards investment in mine development and to increase production," mining minister Paul Kabuswe said.

Zambia is Africa's second biggest copper-producing country on the continent after the Democratic Republic of Congo, and the sector is a major employer.

Tantalex secures Glencore’s backing for Congo lithium project

Tantalex Lithium, a Canadian junior miner that is aiming to produce lithium from the Democratic Republic of Congo (DRC), said on Friday its tailings project has secured the backing of Glencore.

The Swiss miner and trader will pay a staggered $5 million to Tantalex as part of the marketing off-take agreement and has agreed to finance a third of the capital requirements for the DRC project, if it meets its conditions, Tantalex said in a statement.

Glencore has agreed a term-sheet to market the spodumene concentrate – or high-purity lithium ore – that will be produced at the Tantalex’s Manono tailings project in the Congo.

Tailings dams, which can tower dozens of meters high and stretch for several kilometres, are a common waste-disposal method for miners.

Some of the dumps at Manono tailings, deposited several years ago, reach maximum heights of 70 metres (230 ft), Tantalex said on its website.

The deal is subject to Glencore conducting due diligence and its backing of Manono helps to de-risk the project, Tantalex CEO Eric Allard said.

Glencore, which mines copper and cobalt in the DRC started to trade lithium around a year ago, even though it has said it has no interest in owning lithium assets outright.

Allard said Glencore’s expertise in the country “will be crucial for developing further our activities in the DRC.”

Globally, mining companies and manufacturers are scrambling to secure supplies for lithium, which is key to boosting growth in battery electric vehicles as the world seeks faster alternatives to clean energy.

Portugal’s Lusorecursos gets environmental OK for lithium mine

Portugal’s environment agency APA has given its approval for local company Lusorecursos to extract battery-grade lithium in what would be one of the country’s first such mines, expected to start producing by end-2027, APA said on Thursday.

That puts the project in the northern Montalegre area near the Spanish border and with a planned investment of 650 million euros ($696 million), in the lithium mining race in Portugal, along with London-based Savannah Resources which had also received a go-ahead for its own Barroso open-pit mine.

With more than 60,000 tonnes of known lithium reserves, Portugal has been seen central to Europe’s efforts to secure more of the battery value chain and cut reliance on imports.

However concerns about the environmental and social impact of lithium mining from nature preservation groups and local communities have led to multiple delays in approving lithium mining projects as well as a mega-auction of new concessions that the government initially planned for 2018.

Lusorecursos was awarded a mining concession in March 2019 but the start of the project was dependent on the final approval of the environmental impact assessment.


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