Newsletter 19-02-2024

Newsletter – 19.02.2024

19/02/24                                      WEEKLY NEWSLETTER
  • Canadian graphite miner NMG scores deals with GM, Panasonic
  • Gold mine boss detained as search continues for missing miners trapped after huge landslide in Turkey
  • Barrick CEO not interested in ‘piecemeal’ talks over First Quantum assets
  • KEFI Gold and Copper makes progress with project funding for Tulu Kapi Gold Mine in Ethiopia
  • CITIC slashes WA iron ore volumes after feud with Clive Palmer
  • AI Center for Manufacturing and Mining set for Saudi Arabia
  • First Quantum exercises option over two licences as it looks to expand in Zambia
  • Optimism for metals clashes with reality for juniors ahead of PDAC

Canadian graphite miner NMG scores deals with GM, Panasonic

Computer rendition of the Matawinie graphite mine, NMG’s flagship operation.
Nouveau Monde Graphite (TSX-V: NOU) (NYSE: NMG) inked on Thursday multi-year offtake agreements with General Motors (NYSE: GM) and Panasonic Holdings, with both companies also vowing to invest in the Canadian miner to help it produce high-quality graphite in North America.
GM and Panasonic have each committed to purchase 18,000 tonnes of  natural graphite active anode material annually over a period of six to seven years, the Montreal-based miner said. They are also making equity investments of $25 million each in the company.
The two firms and potential co-investors could join future rounds of financing worth hundreds of millions of dollars, Nouveau Monde Graphite (NGM) said in a statement.
NGM aims to raise $1.2 billion to build the whole project, with $725 million coming from debt and $475 million from equity. The miner aims to become North America’s first fully integrated source of natural graphite active anode material, which accounts for about half of an electric vehicle (EV) battery.
To achieve this goal, it is is developing the Matawinie project in Saint-Michel-des-Saints, Quebec, about 100 miles north of Montreal, where it also plans to build a graphite concentrator.
NMG will also install a refining facility for the production of active anode material in Becancour, Quebec. This is the same area where GM and Ford Motor Co. are already constructing EV battery-component facilities.
The Matawinie open pit mine is expected to produce 103,000 tonnes of graphite a year over the course of 25 years and is part of a larger strategy to turn Canada into a production centre for lithium ion batteries.

Gold mine boss detained as search continues for missing miners trapped after huge landslide in Turkey

The Copler mine after the landslide.
The boss of a mining company, which runs a gold mine where nine miners are missing after a massive landslide, has been detained by authorities in Turkey.
Cengiz Demirci, Turkey director and senior vice-president of operations at the Denver-based SSR Mining, was detained on Sunday morning.
Hundreds of rescue workers are searching for those trapped under rubble after Tuesday's disaster at Anagold Madencilik's Copler mine in the town of Ilic, in the mountainous Erzincan province in northeast Turkey.
SSR Mining is the parent company of Anagold, which has operated the mine since 2009, where more than 650 people work.
The workers have been missing for six days after the huge landslide which, according to Turkey's interior minister, Ali Yerlikaya, involved a mound of soil extracted from the mine.
Footage showed a huge mass of earth rushing down a gully, overrunning everything in its path.
Experts have warned the site is a potential environmental hazard, because the soil was laced with dangerous substances, including cyanide, used in gold extraction.

Barrick CEO not interested in ‘piecemeal’ talks over First Quantum assets
Barrick Gold Corp CEO Mark Bristow said on Wednesday he was not interested in “piecemeal” discussions when asked whether the company would consider bidding for any of First Quantum Minerals Ltd’s assets.

Bristow also said the company did not meet First Quantum shareholders as part of any roadshow to gauge their support for a potential takeover, following a media report to that effect last month.
“I’m not interested in working on any sort of piecemeal discussion,” Bristow told Reuters in an interview after the company reported quarterly earnings.
First Quantum, which is dealing with the fallout of an order to close its flagship copper mine in Panama that accounted for about 40% of its revenues, said last month it is exploring options to “manage its balance sheet”, including selling smaller mines and bringing strategic investors into its larger mines.

KEFI Gold and Copper makes progress with project funding for Tulu Kapi Gold Mine in Ethiopia
KEFI Gold and Copper PLC (AIM:KEFI, OTC:KFFLF) executive chairman Harry Anagnostaras-Adams joined Proactive's Stephen Gunnion with an update on the company's Tulu Kapi gold project in Ethiopia following stakeholder meetings at the Mining Indaba in Cape Town last week.
Anagnostaras-Adams detailed the innovative financing structure designed to progress these projects without relying on equity market capital. This approach includes utilizing conventional project finance, engaging mining and processing contractors for risk mitigation, and securing development bank support due to Ethiopia's evolving regulatory landscape.
The financing arrangement marks a pioneering effort in Ethiopia, representing the first internationally financed, bankable project development in the country's private mining sector. This development adheres to the highest International Finance Corporation standards for environmental and social governance, highlighting KEFI's commitment to responsible mining practices.
Furthermore, Anagnostaras-Adams emphasized the importance of community engagement and the meticulous planning required to ensure local support and security. With a comprehensive strategy encompassing physical, legal, and financial preparations, KEFI aims to launch the project in the first half of the year. This ambitious plan involves local capital investment, leveraging multinational subsidiaries in Ethiopia, and navigating the country's regulatory adjustments to facilitate foreign investment.

CITIC slashes WA iron ore volumes after feud with Clive Palmer
Chinese conglomerate CITIC is slashing production at its $US12 billion ($18.2 billion) magnetite operations in Western Australia in an escalation of a war with Clive Palmer, Australia’s fifth-richest person.
CITIC said it had run out of room at its Sino Iron operations on the Pilbara coast where it has operated for a decade, representing the biggest Chinese investment on Australian soil.
Its move to cut production by a third to 14 million tonnes in 2024 raises the prospect of job losses at mining and processing operations that employ about 3000 people.
WA’s government coffers and Mr Palmer will also take a financial hit: CITIC paid the WA government $US182 million in royalties last year and has made royalty payments to Mr Palmer’s private company, Mineralogy, of more than $US2 billion over the life of the mine.
Hong Kong-listed CITIC blames Mr Palmer for declining to release more land covered by tenements held by Mineralogy, necessitating the cut in production.
Mr Palmer hit back on Thursday, saying CITIC should not expect land for free in Australia. He urged CITIC to review previous court rulings in his favour.
CITIC has launched fresh legal action against Mr Palmer and Mineralogy, and is challenging a WA Supreme Court ruling handed down last year in favour of the maverick billionaire.
In that ruling, Supreme Court judge Ken Martin suggested it would not be unreasonable for Mr Palmer to seek a payment in the order of $750 million from CITIC in return for access to additional land.

AI Center for Manufacturing and Mining set for Saudi Arabia
RIYADH: Saudi Arabia is set to bolster national competencies in artificial intelligence with a new dedicated center, as part of a drive to turn the Kingdom into a leading industrial powerhouse.
On the sidelines of the first Global Smart City Forum in Riyadh, the Ministry of Industry and Mineral Resources, in collaboration with the Saudi Data and Artificial Intelligence Authority, announced the inauguration of the AI Center for Manufacturing and Mining.
This initiative aims to unlock the full potential of data and AI and support the strategic ambitions to make the Kingdom a global logistics hub, enhancing the growth rate of the industry and local content.
“Where we are focusing on helping our economy, be digitalized and be able to benefit from new technologies,” Minister of Industry and Mineral Resources Bandar Alkhorayef said during his speech.
He underlined that Saudi Arabia had initiated its national industrial strategy, which entails ambitious objectives such as tripling manufacturing gross domestic product, more than doubling manufacturing employment, and increasing exports threefold by the end of 2030.

First Quantum exercises option over two licences as it looks to expand in Zambia

Kansanshi is the largest copper mine by output in Zambia and is 20% owned by ZCCM-IH, with the balance owned by First Quantum Minerals.
Canadian miner First Quantum Minerals (TSX: FM), which is reeling from the forced closure of its flagship copper mine in Panama, has exercised its option over two licences in Central Africa Copperbelt, in a deal with African Pioneer (LON: AFP).
The move is part of an addendum to an October 2023 agreement granting First Quantum a two-year earn in period over two of four licences held by African Pioneer’s Zambian subsidiary in the Copperbelt. The area is a copper-rich region extending between northern Zambia and the southern Democratic Republic of Congo.
First Quantum now has to prepare a technical report before the end of February demonstrating an indicated mineral resource of at least 300,000 tonnes of contained copper to be able to earn a 51% shareholding in African Pioneer Zambia.
Shares in African Pioneer jumped on the news and were trading 16% higher at 2.32 pence each at midday on Friday. The explorer and developer focused on Sub-Saharan Africa has a market capitalization of £5.29 million ($6.65m).
Work completed by FQM during the initial period of the option agreement includes mapping, soil sampling, ground geophysics, air core and diamond drilling in excess of the minimum qualifying expenditure of $500,000 on each of the four exercised licences.
The Vancouver-based miner already has two copper operations in Zambia — Sentinel and Kansanshi — as well as the Fishtie copper project, near the border with the DRC.

Optimism for metals clashes with reality for juniors ahead of PDAC

The Prospectors and Developers Association of Canada convention returns to Toronto Mar. 3-6.

Increasing funding for battery metal and uranium projects versus gold brings home the global energy transition but big financing deals for preproduction companies have almost disappeared, new figures show ahead of the country’s largest mining showcase.

The data, from the Prospectors and Developers Association of Canada (PDAC) which holds its 92nd annual convention Mar. 3-6 in Toronto, shows just how much junior miners are struggling, despite a growing international recognition of mining’s importance.

Last year, for the first time in a decade, there wasn’t a single financing above C$125 million on the TSX Venture Exchange, where many junior mining exploration companies are listed. Deals at the C$200 million level had previously been fairly common, Jeff Killeen, policy and program director for PDAC, said in an interview.

“The juniors, particularly those outside of the critical mineral sphere, are facing more hurdles in terms of accessing capital,” Killeen said. “When they’re accessing it, there’s just smaller deals being done.”

Total financing on the TSX Venture has fallen for three years running, with the exchange falling far behind the main board in equity raised for the first time since 2017. Last year, the gap between the two grew to C$1.1 billion. With risk capital suffering overall though, junior miners actually “punched above their weight,” accounting for three quarters of all funds raised on the Venture Exchange last year.


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