Newsletter 04-03-2024

Newsletter – 04.03.2024

4/03/24                                      WEEKLY NEWSLETTER


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  • Chinese money still chasing Canadian critical mining deals despite Ottawa's scrutiny
  • Myanmar’s Illicit Rare Earth Industry Grows Despite Insurgency
  • Ma’aden returns to profit after brief blip, latest filings show
  • FTSE miners plunge as stocks hit lowest level in over two years
  • Exclusive: Glencore eyes Shell Singapore assets as CNOOC pulls out, sources say
  • Uranium firms revive forgotten mines as price of nuclear fuel soars
  • Kyrgyzstan Seeks A Restart Of Uranium Mining, And A Russian-Built Nuclear Plant

Chinese money still chasing Canadian critical mining deals despite Ottawa's scrutiny

TORONTO, Feb 27 (Reuters) - A year after Canada tightened foreign investment rules for the critical minerals sector, Chinese money has continued to pour into Toronto-listed miners, according to proprietary research conducted by the University of Alberta.

The inbound flow is raising hopes among some junior miners that it will be easier to find Chinese funding.

Canada had forced three Chinese investors to sell their stakes in Canadian critical mineral companies in 2022. Some of these companies did not have their mines in Canada.

In October 2022, the government added an extra layer of scrutiny for inbound deals in critical minerals.

The changes did not specify which country's investments would be scrutinized, but the government says it wants to secure the critical minerals sector, which is strategic to Canada's national security.

Still, Canada's critical miners received at least a dozen investments worth C$2.2 billion ($1.6 billion) in 2023 from new and existing investors in China and Hong Kong, a huge increase over C$62 million in 2022, data compiled by the University of Alberta's The China Institute shows.

Myanmar’s Illicit Rare Earth Industry Grows Despite Insurgency

As the world attempts to shift from fossil fuels toward renewable energy, rare earth mining has rapidly expanded in Myanmar. The country is now one of the top ten global producers of rare earth elements - but at what expense?

Amid the past year's escalated armed conflict, in which the Burmese insurgency has intensified an offensive against the military junta, Myanmar's rare earth mining industry has caused not only irreversible environmental damage but threatens to exacerbate internal displacement.

With restricted access to the country, satellite imagery is being used to track rare earth mining in the highlands of northern Kachin state near the border with China's Yunnan province. Global Witness has identified mining operations covering an area around the size of Singapore.

Ma’aden returns to profit after brief blip, latest filings show

RIYADH: Profits for Saudi Arabian Mining Co. rebounded in the final quarter of 2023, with the company registering gains of SR890.4 million ($237.4 billion).

This came after the firm, also known as Ma’aden, posted a SR83.4 million loss over the previous three months.

According to a press statement, the performance of the company in the three months to the end of 2023 was driven by a surge in total revenue, which reached SR8.03 billion, representing a rise of 28 percent compared to the previous quarter.

Lower operating costs and favorable raw material expenses were other factors that contributed to a rise in revenue, the company added.

For Saudi Arabia, developing the mining sector is crucial, as the Kingdom is steadily diversifying its economy, aligned with the goals outlined in Vision 2030.

In the press statement, Ma’aden CEO Robert Wilt said the firm will continue with explorations in 2024 to unlock the Saudi mining sector’s potential which is currently valued at $2.5 trillion.

FTSE miners plunge as stocks hit lowest level in over two years

FTSE mining stocks have plunged to their lowest level in more than two years amid a flood of cheap Indonesian nickel onto global markets.

Many of the world’s largest nickel mines have been left unprofitable amid plummeting prices for the metal, which is vital for the development of green technologies.

Western governments are scrambling to secure supplies of nickel as they seek to hit net zero goals but coal-fired nickel mining in Indonesia, backed by China, is pricing out more climate-friendly producers.

Nickel prices are trading around their lowest levels in more than two years, although prices have ticked up by about 4.3pc over the last month.

Industrial metal miners across the FTSE 350 have fallen by as much as 2.6pc today and by more than 7pc over the last month to their lowest level since November 2021, as they have also been hit by declining copper prices.

Anglo American chief executive Duncan Wanblad said last week: “There is a serious structural challenge as a result of Indonesian nickel. They don’t seem to be letting up anytime soon.”

Exclusive: Glencore eyes Shell Singapore assets as CNOOC pulls out, sources say

Vessels pass the Shell oil refinery on Pulau Bukom in the waters off the southern coast of Singapore February 26, 2016

SINGAPORE, Feb 28 - Swiss miner and commodities trader Glencore is looking at buying Shell's oil refinery and petrochemical units in Singapore as the oil major seeks a buyer for the sites after earlier suitors dropped out, several industry and trading sources said.

Glencore (GLEN.L), opens new tab is working jointly with Indonesia's PT Chandra Asri Petrochemical to evaluate the assets, opens new tab, two of the sources said.

The assets include a refinery capable of processing 237,000 barrels per day (bpd) of oil and a 1-million-metric-ton-per-year ethylene plant located on Bukom island, just south of Singapore, as well as a plant that produces mono-ethylene glycol on Jurong island in the Southeast Asian city-state's west.

Buying the Bukom and Jurong assets would give Glencore a physical foothold for its trading in Asia's main oil hub. However, the ageing site has struggled to make money on its products, particularly for petrochemicals, and faces competition from newer refineries in China and elsewhere.

Shell (SHEL.L), opens new tab, which announced a strategic review of the assets last June, declined to comment.

Glencore said it does not comment "on market rumour or speculation," while Chandra Asri did not respond to a request for comment.

Uranium firms revive forgotten mines as price of nuclear fuel soars

Across the US and allied countries, owners of left-for-dead uranium mines are restarting operations to capitalize on rising demand for the nuclear fuel.

Arkansas Nuclear One power plant in the US

At least five US producers are reviving mines in states including Wyoming, Texas, Arizona and Utah, where production flourished until governments soured on the radioactive element following the 2011 Fukushima nuclear disaster in Japan.

Most of those American mines were idled in the aftermath of Fukushima, when uranium prices crashed and countries like Germany and Japan initiated plans to phase out nuclear reactors.

Now, with governments turning to nuclear power to meet emissions targets and top uranium producers struggling to satisfy demand, prices of the silvery-white metal are surging. And that’s giving those once-unprofitable uranium operations a chance to fill a supply gap.

Uranium has been used as an energy source for more than six decades, fueling nuclear power plants and reactors. About two-thirds of global production comes from Kazakhstan, Canada and Australia.

Uranium will be a topic of conversation as thousands of mining executives, geologists and bankers descend on Toronto for the Prospectors & Developers Association of Canada gathering this week. The annual event has attracted at least 10 uranium firms, including Denison Mines Corp., Fission Uranium Corp. and IsoEnergy Ltd.

As countries increasingly consider nuclear power to address climate change, demand for uranium is expected to skyrocket. The International Atomic Energy Agency estimates the world will need more than 100,000 metric tons of uranium per year by 2040 — an amount that requires nearly doubling mining and processing from current levels.

Kyrgyzstan Seeks A Restart Of Uranium Mining, And A Russian-Built Nuclear Plant

ALMATY, Kazakhstan -- Kyrgyzstan’s decision to ban uranium mining in 2019 was a hard-won victory for civil society and an acknowledgement of the tortured environmental legacy of industry during the Soviet era.

But Kyrgyz officials are now calling for the ban to be lifted, as populist President Sadyr Japarov continues his pursuit of state-led production in the extractive industries that he first championed more than a decade ago as an opposition politician.

And while the head of state eyes a new cash cow, other officials are speaking excitedly about a development at the other end of the nuclear fuel cycle -- a small atomic power station that Russia’s Rosatom is set to build to help plug the Central Asian country’s power deficit.

“These two things are probably not without a connection,” said Kalia Moldagazieva, a career environmental campaigner who was among those pushing for the ban five years ago.

“After all, for a nuclear power plant you need uranium. That means they will either have to bring it into the country, perhaps from Kazakhstan, or they will try to enrich it here. However they do it, we are firmly against it,” she told RFE/RL.

A Uranium Mining Present…

February 26 marked the beginning of a public discussion period for a law that would undo the uranium ban put in place when Japarov’s ousted predecessor, Sooronbai Jeenbekov, was in power.

That will end on March 25, with lawmakers set to consider the bill shortly afterwards.

But it seems very unlikely the moratorium will remain in place, as the president has a solid record for getting his way due to the Jogorku Kenesh’s (parliament) habit of nodding in agreement to his policies.

Addressing locals in his native Issyk-Kul Province last week about plans to develop Kyzyl-Ompol -- a uranium deposit licensed to a private investor at the time the ban was enforced -- Japarov said the site would now be “100 percent” developed by the state.

By way of comparison, he mentioned Kyrgyzstan’s largest gold mine, Kumtor, which his government seized in the first months of his presidency. The mine’s former operator, Canada’s Centerra Gold, later agreed to a settlement.


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