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Kazakhstan is expected to deliver the highest uranium production growth in 2024, GlobalData says, driven by the planned higher output from the country’s largest uranium producer Kazatomprom. The continuous ramp-up of Canada’s McArthur River uranium mine will also contribute to the global increase, it adds.

Kazakhstan accounted for 37.3% (20.1kt) of total global uranium supply in 2023. Despite a 5.1% dip in output in 2023 due to planned lower production from Kazatomprom, its output is expected to recover in 2024, with forecast production of 23.2kt. This will be supported by the company’s plan to produce between 21.2-21.6kt on a 100% basis, while production is expected to increase to between 25.9-26.7kt with no restrictions in 2025.

Meanwhile, global uranium production in 2024 will be further bolstered by continuous ramp-up of Canada’s McArthur River, which is aiming to produce 6.9kt of uranium (8.2kt of U3O8) for 2024. In October 2023, the Canadian Nuclear Safety Commission renewed the licences for McArthur River for a further 20 years, allowing the mine to continue operations until October 2043.

Global uranium production is expected to grow with a compound annual growth rate of 4.1% from 2024 to 2030, as output reaches 76.8kt in 2030.

Read More: Uranium price jumps to 15-year high as top miner flags shortfall

W5 investigated how the Panamanian government’s 20-year mining concession with Canadian mining company First Quantum Minerals triggered mass protests and civil unrest amid allegations of corruption and fears of environmental degradation — prompting the country’s Supreme Court to intervene.

Mining continues to engage with the many difficult issues that affect the future of the industry and broader society, judging by the topics and turn-out at this year’s Investing in African Mining Indaba in Cape Town.

“The event remains a forum for productive, if challenging, conversations,” said Andrew van Zyl, SRK Consulting managing director, South Africa.

“Many of these issues – from climate change and decarbonisation to the just energy transition – can be controversial; what is important, though, is that all stakeholders feel that they can participate in robust dialogue to find sustainable solutions.”

Van Zyl acknowledged that many of the sector’s responses to the challenges of today and tomorrow were “works in progress” but emphasized how constructively it had adapted in recent decades.

“Part of the value of the Mining Indaba is that it brings together leaders and role players at both a strategic and technical level,” he said. “This allows not only for ideas to be shared and developed, but for experts to find practical strategies for implementing solutions.”

The rapid pace of global changes was making these forums for knowledge sharing even more important, he noted, as decision makers in mining needed to factor in fast moving variables. This related as much to the political evolution of African countries as it did to technological advancements in the energy sector.

“It is more vital than ever that, as players in mining, we regularly and frequently update our world views with quality information – so that we retain a relevant opinion on future demands and opportunities,” said Van Zyl.

An example is the steady improvement being made in renewable power generation and storage. Whereas certain orebodies were in the past uneconomic due to their remoteness from a centralised power grid, the renewable energy technologies of today could now remove that hurdle.

He pointed out that trends related to the energy transition continued to make commodity prices volatile – complicating the task of valuing mineral resources and planning mining operations. Various early-stage technologies in electric battery manufacture, for instance, still competed for market acceptance, affecting demand for the minerals each technology embodied.

“As in so many spheres that affect the demand for mineral commodities, the mining sector does not get to decide the final value of what it mines,” he said. “Neither does it decide on what the global economy wants to make with its mineral production; these external trends introduce ongoing disruption to which the sector must constantly adapt.”

As an industry, he argued, mining will continue to drive improvements in fields such as safety, operating costs, employee diversity, social value and environmental impact – while navigating the broader socio-economic trends.

Its resilience was well tested by the Covid-19 pandemic, when mining came to the rescue of many economies and communities.

In South Africa, for instance, the mines’ experience and infrastructure in respiratory illness helped protect employees and their communities – while its stand-out economic performance supported the national fiscus at a time when much of the private sector was in crisis.

“We need to appreciate the value of having honest discussions on what mining has to offer, what its considerable contribution has been, and what kind of future we are working towards,” said Van Zyl. “As a regular participant in the Mining Indaba, we see this forum as helping promote such conversations.”

The explorer entered voluntary administration in December, engaging in a formal restructuring. It’s now finalizing the audit of its 2023 financial accounts and is working towards resumption of trading on the Australian Stock Exchange in March this year, it said.

“The company’s balance sheet has been significantly restructured with all previous trade creditors and other payables agreeing to the settlement terms proposed in the deed of company arrangement presented on Jan. 19,” managing director and chief executive, Matt Shackleton, said in the statement.

Australian Potash noted it had also re-analyzed all previous results on the Lake Wells gold project and had identified walk up drill targets to target immediately. The explorer will also push forward with the requisite access and heritage agreements at the Nexus rare earths project in the West Arunta.

To mark the new phase, the company has appointed Jonathan Fisher to its board, while Natalia Streltsova and Rhett Brans have resigned their directorships.

An analysis of the firm’s database reveals that BMO Capital Markets advised on transactions worth a total of $27.4 billion, positioning it at the forefront of significant industry consolidations. Canaccord Genuity Group advised on 15 deals throughout the year, leading the sector in terms of deal volume.

“Canaccord Genuity Group registered significant growth in the volume of deals advised and ranking by this metric in 2023 compared with the previous year,” GlobalData lead analyst Aurojyoti Bose said.

“In fact, it was the only adviser to hit the double-digit deal volume in 2023.”

BMO Capital Markets secured joint second place by deal volume with nine transactions, with Allenby Capital matching this volume with nine deals of its own. Macquarie followed closely with seven deals and Rothschild & Co with six.

“BMO Capital Markets was the top adviser by value in 2022 and managed to retain its leadership position in 2023 as well. The total value of deals advised by it jumped by more than double-fold in 2023 compared with 2022,” Bose added.

Goldman Sachs took second spot in this metric, advising on deals amounting to $25 billion. Bank of America was not far behind with advisory deals totalling $22.6 billion. Barclays and Lazard also featured prominently, advising on deals worth $21.8 billion and $20.3 billion respectively.

Before the official inductions, MC and Northern Miner Group president Anthony Vaccaro recapped the highs and lows of 2023 — a difficult year that saw big shifts in geopolitics, terrible markets for miners, and sliding metals prices (with the exception of uranium and gold). 

Vaccaro, serving as MC for the fifth year running, got things rolling with a verbal and pictorial journey through the year that was, while reflecting on mining’s deep interconnection with global affairs, and playfully reimagining its public image. He also touched on the profound impact each of the night’s inductees have had on the industry in Canada and beyond. 

Watch the video below for his introduction to the 36th annual CMHF induction ceremony.

At the end of 2023, the MINING.COM TOP 50* ranking of the world’s most valuable miners reached a combined $1.42 trillion, up a healthy, if far from spectacular $48.7 billion over the course of 2023. Mining’s top tier is also worth $330 billion less than in March 2022.

Metal and mineral markets are volatile at the best of times – the nickel, cobalt and lithium price collapse in 2023 was extreme but not entirely unprecedented. Rare earth producers, platinum group metal watchers, iron ore followers, and gold and silver bugs for that matter, have been through worse.

Mining companies have become better at navigating choppy waters and as a whole the majors performed fairly consistently last year despite geopolitical and market turmoil, but within the ranking, 2023 fortunes were made and lost over what seemed like days.

The forced closure of one of the world’s biggest copper mines – and the subsequent collapse of owner First Quantum Minerals stock – served as a stark reminder of the outsized risks miners face over and above market swings.

Panama root canal

After months of protests and political pressure, at the end of November the Panama government ordered the closure of First Quantum Minerals’ Cobre Panama mine following a ruling by the Supreme Court that declared the mining contract for the operation unconstitutional.

Public figures, including climate activist Greta Thunberg and Hollywood actor Leonardo Di Caprio backed the protests and shared a video calling for the “mega mine” to cease operations, which quickly went viral. 

That mining cobre is at the nexus of the green energy transition is clearly an irony lost on those trying to save the world.  FQM is seeking arbitration and completely winding down operations will take time, but a reopening of Cobre Panama is not on the cards. 

From 25th position in the ranking at the end of March 2022 and a valuation well above $20 billion, the November-December sell off saw FQM drop out of the top tier altogether, ending 2023 at number 58 with a market cap below $6 billion. 

Cobre Panama supplied more than 40% of the company’s revenue, and with nickel prices plummeting FQM has also been forced to suspend operations at its Raventhorpe mine in Australia. 

Amid the inevitable takeover rumours now in circulation, shares in the Vancouver-based company have rallied in 2024, but still not enough to reenter the top 50.

No. 12 with a bullet 

If 2023 was an annus horribilis for FQM it was mirabilis for Amman Mineral Internasional. Stock in the Indonesian firm surged by 269% from its July debut in Jakarta to reach a market capitalisation of more than $30 billion at the end of last year – and number 12 in the ranking. 

That valuation is quite an achievement on annual revenue of $2 billion no matter how fat margins are at the company’s Batu Hijau copper and gold mine.  Batu Hijau is the third largest mine worldwide in terms of copper equivalent output (but no match for Cobre Panama when it comes to the orange metal alone)  and has been in production since the turn of the millennium. Amman is also developing the adjacent Elang project on the island of Sumbawa. 

Amman Minerals’ ascent has minted at least six new billionaires and the stock appears to be building on its success in 2024, rising by double digits in January already.

Indonesia’s other major mining IPO, Harita Nickel, was on a different trajectory altogether. After listing in April and raising $672m, the company has had a tough go of it and the stock has shed more than 38% since then as nickel prices continue to decline.

Shiny gold, dull silver, tarnished PGMs

The price of gold hit an all-time record on December 1, 2023.  But bullion’s best ever level passed without the usual fanfare and despite bullish indications for 2024, gold mining stocks did not exactly storm the rankings of the most valuable miners.

Over the course of 2023 gold and royalty companies on the MINING.COM TOP 50* ranking of the world’s most valuable miners added a collective $20.8 billion in market cap. 

And judging by gold miners’ performance so far this year, gold above $2,000 is not providing enough support. Newmont is already down 17%, Barrick has shed 13% and Agnico Eagle shareholders are 9% poorer. 

The number of precious metals companies in the top 50 has also been relatively stable over the years. With Newmont’s absorption of Newcrest now complete, the open slot was taken up by Kinross, which spent a few years in the wilderness. 

Anglogold Ashanti was just edged out by Jiangxi Copper for position number 50 on the last trading days of 2023, but based on its performance so far in 2024 the London-listed company is already back among the top tier. Indeed Anglogold is the only major gold player in the black year to date.

Silver has not been able to ride gold’s coattails and the top 50 has not had a silver specialist for a few years after Fresnillo dropped out (now at #61) and while Pan American Silver has come close in recent years at the end of last year it made it to #58 only. 

The exit of platinum and palladium majors like Sibanye Stillwater and Impala Platinum, now both valued at less than $4 billion, made space for Royal Gold to reenter at 47 at the end of last year, up from 57th in 2022. 

After a dismal 2023, the sole remaining PGM specialist Anglo American Platinum looks likely to lose more ground this quarter as palladium and platinum prices continue to slide into the new year.

Not too tough at the top 

London-listed Anglo American has had a rough year in part due to its exposure to platinum group metals and control of AngloPlat, and is now valued at $30 billion after peaking at $70 billion in March 2021.  

Were it not for the London-listed company’s iron ore operations, the 40%-plus slump in share value may have been deeper. Rumours that Glencore may be sniffing around now that the Swiss behemoth’s bid for all of Teck Resources has soured is also keeping Anglo from falling further down the rankings .  

Investors in Anglo, with a history going back more than a hundred years on the South African gold and diamond fields, have had a particularly wild ride over the last few years. In January 2016, Anglo’s market cap fell below $5 billion after it came close to suffocating under a pile of debt.  

Against expectations, iron ore seems to be holding above $120 a tonne, Chinese property bankruptcies and Beijing’s tepid stimulus response notwithstanding. 

Iron ore’s resilience despite Chinese troubles has also kept the share prices of the other diversified majors, which make their fattest profits from the steelmaking ingredient, from skidding. 

The top 10 mining companies have been able to keep their share of the total above 50% for a few years now. Not quite the magnificent seven, but size does matter in mining, particularly when access to capital is no longer a headache but a migraine. 

Expectations of another active year of M&A in the sector is likely to make the Top 50 top-heavier, especially now that it’s painfully obvious just how one-commodity companies like the lithium stocks can so easily be derailed. Coal miners’ strong 2023 suggests there are still exceptional minerals that prove the rule.   

Lithium losers 

After defying gravity early on, the combined losses for lithium miners in the top 50 climbed to nearly $30 billion in market cap over the 12 month period. Four counters occupy the worst performance table for 2023. 

The M&A drama surrounding Liontown, Albermarle and Hancock Prospecting turned out to be a soap opera and Chile’s move to take control of its lithium industry now appears far less consequential than feared.

Despite the precipitous decline in lithium prices in 2023, after hitting all time highs above $80,000 a tonne in November 2022, none of the battery metal miners’ stock performance was dire enough to drop out of the Top 50.

The merger of Livent and Allkem to form Arcadium Lithium could in fact up lithium mining’s representation in the ranking to seven should Pilbara Minerals’ January bleeding be stanched. But with lithium prices far from stabilizing, the battery metal’s presence in the top 50 may fade further. 

Pilbara Minerals, which unlike its peers was still able to show share price gains last year,  joined the Top 50 last year, bringing the number of companies based in the Western Australia capital to five, surpassing the tally of Vancouver, BC as the top home base in the ranking. 

With the exit of First Quantum, three mining companies in the top 50 call Vancouver home while the return of Kinross saw the ranks of Toronto-headquartered miners move back up to four.  

Nuclear options

Uranium prices more than doubled during 2023 and recently hit triple digits for the first time in 16 years. The breakthrough for the nuclear fuel comes after a decade in the doldrums following the Fukushima disaster in Japan.

Canada’s Cameco made the best quarterly performer list once again in Q4 and after doubling in market worth in 2023.  The Saskatoon-based company now sits at no 23 in the ranking after jumping 22 places since end-2022.    

The value of shares in Kazatomprom, the world number one uranium producer, topped $10 billion at the end of 2023, placing it at position 38.  Until last year the state-owned Kazakh company was outside earshot of the Top 50 since its dual-listing in London and Astana in 2018.  

None of the smaller uranium companies are likely to pierce the top 50 by themselves, but combinations among the rank and file may edge in when countries aiming to ditch fossil fuels stop thinking they can have their yellowcake and eat it too.

*NOTES:

Source: MINING.COM, Morningstar, GoogleFinance, company reports. Trading data from primary-listed exchange at December 28 2023 to January 2, 2024 where applicable, currency cross-rates January 2, 2024. 

Percentage change based on US$ market cap difference, not share price change in local currency.

As with any ranking, criteria for inclusion are contentious. We decided to exclude unlisted and state-owned enterprises at the outset due to a lack of information. That, of course, excludes giants like Chile’s Codelco, Uzbekistan’s Navoi Mining, which owns the world’s largest gold mine, Eurochem, a major potash firm, and a number of entities in China and developing countries around the world.

Another central criterion was the depth of involvement in the industry before an enterprise can rightfully be called a mining company.

For instance, should smelter companies or commodity traders that own minority stakes in mining assets be included, especially if these investments have no operational component or warrant a seat on the board?

This is a common structure in Asia and excluding these types of companies removed well-known names like Japan’s Marubeni and Mitsui, Korea Zinc and Chile’s Copec. 

Levels of operational or strategic involvement and size of shareholding were other central considerations. Do streaming and royalty companies that receive metals from mining operations without shareholding qualify or are they just specialised financing vehicles? We included Franco Nevada, Royal Gold and Wheaton Precious Metals on the basis of their deep involvement in the industry.

Vertically integrated concerns like Alcoa and energy companies such as Shenhua Energy or Bayan Resources where power, ports and railways make up a large portion of revenues pose a problem. The revenue mix also tends to change alongside volatile coal prices. Same goes for battery makers like CATL which is increasingly moving upstream, but where mining still makes up a small portion of its valuation.  

Another consideration is diversified companies such as Anglo American with separately listed majority-owned subsidiaries. We’ve included Angloplat in the ranking but excluded Kumba Iron Ore in which Anglo has a 70% stake to avoid double counting. Similarly we excluded Hindustan Zinc which is listed separately but majority owned by Vedanta.

Many steelmakers own and often operate iron ore and other metal mines, but in the interest of balance and diversity we excluded the steel industry, and with that many companies that have substantial mining assets including giants like ArcelorMittal, Magnitogorsk, Ternium, Baosteel and many others.

Head office refers to operational headquarters wherever applicable, for example BHP and Rio Tinto are shown as Melbourne, Australia, but Antofagasta is the exception that proves the rule. We consider the company’s HQ to be in London, where it has been listed since the late 1800s.

Please let us know of any errors, omissions, deletions or additions to the ranking or suggest a different methodology.

The report titled ‘Top of the charts: ‘Five low-carbon tech trends worth tracking’ looks at five key charts and identifies some key underlying trends across the low-carbon landscape.

Alongside the fall in Chinese solar hardware costs, the report also examines the meteoric rise of renewable energy, the efforts being made to diversify battery raw materials supply, the progress of carbon capture and storage and the growth of domestic heat pumps.

“With delegates at COP28 making a commitment to phase out fossil fuels, these five charts highlight the vital importance of all facets of the energy transition process,” said Dr. Steven Knell, VP power & renewables at Wood Mackenzie, who co-authored the report. “The charts (in the report) show the progress that is being made, but also underline how much still needs to be done.”

The report also states that policy is widening to support the build-out of domestic supply chains for low-carbon technologies and to develop new sources of critical minerals to reduce global dependence on China. While in some cases such as Chinese solar module production, costs are coming down, in others they will remain high.

“The charts contained in the report indicate the global scale of the energy transition process and identifies some of the challenges,” added Malcolm Forbes-Cable, VP upstream and carbon management consulting, another co-author.

“With $70 billion needed to be invested in global CCUS (carbon capture, utilization and storage) transport and sequestration infrastructure before 2030, the financial implications alone will require global solutions.”

The Scope 3 Emissions Target Setting Guidance underscores the importance of transparency and engagement with suppliers, customers, investors and regulators in setting targets to help accelerate emissions reduction throughout the value chain, ICMM said in a statement.

In 2021, ICMM members committed to achieve net zero Scope 1 and 2 greenhouse gas (GHG) emissions by 2050 or sooner, in line with the ambitions of the Paris Agreement. They also committed to report on Scope 3 emissions and set reduction targets by the end of 2023.

Scope 3 emissions are a critical area of focus for the mining and metals industry, representing up to 95% of a company’s total emissions, compared to 75% across other sectors, the Council said, citing a study by Mining Technology.

In September 2023, ICMM published Scope 3 Emissions Accounting and Reporting Guidance, establishing a standardized framework for mining and metals companies to calculate and disclose their value chain emissions. This new target setting guidance builds on these accounting and reporting principles.

According to ICMM, this guidance defines target-setting principles tailored to the specific considerations of the mining and metals sector, and is drawn from current EU, US, UK, Canadian and Australian regulatory frameworks, as well as guidance from the United Nations’ High Level Expert Group on Net Zero Emissions Commitments of Non-State Entities.

Acknowledging the inherent differences in commodities and value chains, rather than endorsing a specific methodology, it provides mining and metals-specific context around commonly used approaches, ICMM added.

The guidance establishes a robust framework that sets out leading practice across four maturity stages, with each stage outlining minimum expectations across five key dimensions: accounting and reporting, identification of emissions ‘hotspots’, business integration and alignment, assessment of decarbonization pathways and organizational governance.

“As the discussions at COP28 have made clear, each sector bears the responsibility to understand its part in the broader system and extend beyond immediate boundaries to unearth solutions to stubborn sources of emissions. As the base products in almost every industry – from renewable energy and sustainable transport, to construction and tech – metals and minerals are critical to advancing the Sustainable Development Goals and meeting the goals of the Paris Agreement,” ICMM chief executive officer Rohitesh Dhawan said in a statement.

“At Antofagasta, our commitment to addressing climate change permeates every aspect of our strategy and decision-making. The introduction of ICMM’s Scope 3 Emissions Target Setting Guidance is an important step in enhancing transparency and catalyzing collaborative efforts across the industry to curb these emissions,” Iván Arriagada, member of ICMM’s Council Climate Change Advisory Group, and CEO of Antofagasta plc, added.

Find ICMM’s Scope 3 Emissions Target Setting Guidance here.

We are excited to tell you all about the recent change in ownership of The Northern Miner Group. On Dec. 1, The Northern Miner Group was officially acquired by EarthLabs Inc. (TSXV: SPOT; OTCQX: SPOFF). This acquisition represents an evolution of The Northern Miner Group’s brands: The Northern Miner, MINING.COM and Canadian Mining Journal, which combined can reach over 1 million users monthly across our news sites, e-digests and social media channels.  

It will also usher in a wave of innovation as EarthLabs was previously GoldSpot Discoveries, a startup that sold its AI mineral exploration technology division to ALS Global in late 2022. 

“We have long been reviewing opportunities in the media space, waiting for the right opportunity to expand our portfolio,” Denis Laviolette, executive chairman and CEO of EarthLabs, said in a release. “The TNM Group assets are highly complementary to our own, with mining news and media products that will now benefit from greater distribution, including millions of valued users on CEO.CA.” 

The power of our vaunted media brands meshing with the culture of a successful tech company has us all looking towards new ways that we can better serve our readers and our clients with more interactive news source and more market awareness.  

EarthLabs currently consists of CEO.CA, the largest social media platform for mining investors that boasts more than 12 million unique viewers since inception and a highly engaged audience; DigiGeoData, a mineral resource database and mapping tool that provides geological, claim, drill hole and other contextual information; and a precious metals royalty portfolio that includes nearly 2,500 sq. km of prospective ground in Newfoundland. 

What does this mean for readers?  

The Northern Miner, established in 1915, along with Canadian Mining Journal, established 1882 and MINING.COM, established in 2008, have earned readers’ trust through our dedication to quality, unbiased journalism. That will not change as the media group will run independently under the same continued leadership.  

The Northern Miner Symposiums, our successful and growing events segment, has earned a strong reputation as a convener of some of the biggest names in mining. It will continue to provide exceptional networking opportunities and it will also grow as we and our partners, Precious Metals Summit Conferences, launch the Energy Transition Metals Summit in Washington D.C. from Apr. 29-30, 2024.

In the near term you will see an increased focus on multi-media journalism as we bring you more site visits and interviews with leaders making a difference in both video and podcast formats. In addition, our advertisers will benefit from a larger engaged audience spread across a broader geographic reach with unparalleled performance tracking reports. 

We also plan to enhance our data offerings such as TNM Marco Polo mining intelligence platform by leveraging data and insights from DigiGeoData. TNM Maps and DigiGeoData Maps will also combine forces, emerging as the industry standard for mining project “Hot Play”activity mapping. It will distribute to an online audience of over 1 million plus more at in-person events. 

We look forward to serving you with best industry insights, data and networking opportunities for the next 100 years of our story.

Anthony Vaccaro, president of The Northern Miner Group

London, UK-based International Council on Mining and Metals (ICMM) said that it, the Copper Mark, MAC and the World Gold Council are working to consolidate their individual voluntary responsible mining standards into a single global standard with a multi-stakeholder oversight system.

As investor focus on environmental, social and governance (ESG) factors has grown, both mining companies and investors have found it difficult to keep up with the ever expanding number of ESG standards — often referred to as ‘alphabet soup‘ as each has its own acronym.

“This collaboration responds to direct feedback from investors, civil society, customers, policy makers and mining companies that confirmed the appetite for a less crowded and complex standards landscape that is more transparent, robust and encourages wider industry participation to drive impact at scale,” reads the ICMM release.

The proposed standard could have the widest coverage of any voluntary responsible mining standard to date, with initial implementation by more than 80 mining companies with around 700 operations in almost 60 countries worldwide. Broader participation by companies beyond the four organizations will help support the industry to further raise the bar on ESG (environment, social and governance) performance.

The process aims to take the best attributes of each organization’s standard while ensuring the resulting standard would be practical for any mine operator to follow, regardless of commodity, geography or size. Implementation of the single standard would be overseen by an independent, multi-stakeholder governance body and a credible assurance process, both of which are yet to be defined and developed.

Multi-stakeholder and industry advisory groups will play an essential role in providing a balanced perspective on the standard, assurance process and governance model. ICMM expects to launch a wide ranging public consultation and stakeholder engagement process next year.

Gold producer financial metrics remain strong for respective ratings partially driven by a period of high gold prices beginning in 2020, which drove higher shareholder returns and investment as well as stronger financial flexibility, the firm said.

Gold prices have been resilient despite raising real interest rates beginning in 2022, supported, in part, by geopolitical factors and flight-to-quality investment demand, it added.

Looking ahead, Fitch sees gold prices moderating but remaining elevated in 2024 and 2025 relative to our midcycle assumption of $1,500/ounce. Margins will be pressured given elevated costs despite cost cutting/productivity programs but should be relatively strong for respective ratings.

The full report “Global Gold Mining — Relative Credit Analysis” is available here.

ABS develops and manufactures a wide variety of heavy-duty and industrial battery packs, using lithium-ion batteries for commercial vehicles, transit buses and on- and off-road vehicles. The company provides both standard and custom battery systems optimized to each customer’s needs.

ABS’ technology, combined with the advanced product development knowledge and expertise of its people, enables the company to develop and manufacture battery packs designed to deliver superior performance and product life, and to enhance safety.

The acquisition of ABS will enable Komatsu to develop and produce its own battery-operated construction and mining equipment, through the integration of ABS’ battery technology with Komatsu’s knowledge and network. The first equipment produced with ABS’ batteries will be used to power mining equipment in North and South America, where demand for electrification has been increasing.

In the future, Komatsu will aim to expand the use of batteries in construction equipment and to establish a global supply system. The Japanese firm will continue to support ABS’ battery business to further develop the electrification business post-acquisition.

ABS will operate as a standalone business entity within Komatsu and will continue its growth plans by executing on its current and prospective customer programs in the commercial vehicle segments. The mining and construction opportunities provided through Komatsu will enable ABS to position itself as one of the world’s leading providers of battery systems in both on-highway and off-highway markets.

Through the acquisition, Komatsu will accelerate the development of battery-powered electric vehicles by utilizing ABS’ battery-related technology, along with other initiatives Komatsu is pursuing with its partners, to further contribute to the electrification of construction and mining equipment and the realization of a decarbonized society.

These efforts will help Komatsu achieve its management target of 50% reduction of CO2 emissions from the use of its products by 2030 (compared to 2010 levels) as well as the company’s challenge target of achieving its carbon neutrality by 2050.

As part of its growth strategy for the mid-term management plan “DANTOTSU Value – Together, to ‘The Next’ for sustainable growth,” Komatsu is working to develop and launch electric equipment to help achieve carbon neutrality, creating new value for customers with the development of new equipment, processes and technologies that will help operations step forward to the next stage for the workplace of the future and provide a more sustainable environment for the next generation.

Under the deal, which still must be approved by regulators in Ottawa, Glencore is to pay $6.9 billion for 77% of Elk Valley Resources, Teck’s coal business, while Japan’s Nippon Steel will take 20% and Posco of South Korea gets 3%.

The steelmakers are swapping their interests in specific coal producers for stakes in the wider company. Nippon is also to pay $1.7 billion to Teck.

The deal caps negotiations that have gone on since April when Teck rejected an offer from Glencore to buy all of Canada’s largest diversified miner. It also would seal Teck’s plans to sell off its coal operations to focus on its copper and zinc business. Industry and political debate has swirled around the plans as some concerns mounted Switzerland-based Glencore was buying up Canadian resources. Others noted Glencore actually employs more Canadians than Teck.

“This transaction will be a catalyst to re-focus Teck as a Canadian-based critical minerals champion with an extensive portfolio of copper growth projects, unlocking the full value potential of the company,” Teck president and CEO Jonathan Price said in a release.

“This sale will ensure Teck is well-capitalized and able to realize value from our base metals business and deliver strong returns to our shareholders while maintaining a robust balance sheet.”

The deal is expected to close in the third-quarter next year. Teck will keep operating the coal business until then and may earn as much as $1 billion during that time, it said.

Regulators in Ottawa must approve the foreign takeover. They would consider issues of national security and the transaction’s economic impact to determine if there is overall benefit to Canada.

The sale allows Teck to pivot to greener metals than coal, while the miner had expressed concerns about Glencore’s tarnished past with regulators that had disciplined it for alleged bribery and market manipulation. Teck expressed confidence in Glencore on Tuesday.

“Glencore has made strong commitments that will create new benefits for Canada and the Elk Valley and ensure responsible stewardship of the steelmaking coal operations for the long term,” Price said.

Norman B. Keevil, Teck’s chairman emeritus, had opposed Glencore’s plan to purchase Teck, but now backs the sale, noting it will keep jobs.

“This company was built on a foundation of sound geoscience and engineering excellence, with a record of successful mine-building second to none,” Keevil said in Tuesday’s statement. “That is the same foundation we see for Teck’s future. It’s time to get on with it.”

In a press release on Wednesday, Jonathan Wilkinson, Minister of Energy and Natural Resources, announced a C$5.4 million (~$4 million) investment over four years for the International Institute of Sustainable Development (IISD) to support its ongoing role as the Secretariat of the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF).

The IGF provides a range of services to its 81 member countries to support the advancement of their sustainable development goals through laws, policy making and regulations within the mining sector.

The IGF’s work encompasses a range of outreach and promotional activities to enhance awareness, engagement and cooperation across the mining industry. These activities include conducting Mining Policy Framework (MPF) assessments with member countries to identify gaps and best practices and implement the MPF, and delivering specialized training sessions and technical assistance focused on critical minerals and responsible mining, with an emphasis of promoting gender diversity and inclusivity.

Canada’s investment will serve as core funding to the operations of the IGF Secretariat, including the governance and technical capacity building delivered to the member countries of the IGF.

“Canada is a mining nation and, as such, is a world leader in the sustainable and responsible management of our mineral resources. As demand for critical minerals and the clean energy and technologies they enable increase, our high ESG standards and the expertise of our workforce will be critical advantages in the low-carbon economy of the future,” Wilkinson said in the statement.

“And by partnering with our international allies to advocate for responsible mining practices around the world, we are ensuring that the materials we need to lower emissions and ensure a prosperous economy are sourced in a manner that protects our planet.”

This funding comes from the C$70 million allocated for the Global Partnerships Initiative announced in December 2022 to advance Canada’s global leadership on critical minerals under Canada’s Critical Minerals Strategy.

NGen is the industry-led not-for-profit organization that leads Canada’s Global Innovation Cluster for Advanced Manufacturing. Its mandate is to help build world-leading advanced manufacturing capabilities for the benefit of Canadians.

The organization seeks projects with dual-use applications that will strengthen Canada’s technological leadership in space and help revitalize the long-term competitiveness of the nation’s most important industrial sectors.

The M4M3 program is expected lead to next-generation innovations that help tackle the challenges of establishing a permanent human presence on the Moon, leveraging Canada’s strengths in fields like artificial intelligence, robotics, quantum sensing, and additive manufacturing that can then be re-applied back on earth.

These innovations will have direct and positive impacts on environmental sustainability, productivity, talent and job creation in Canada’s mining, energy, and advanced manufacturing sectors, NGen said.

This initiative is undertaken with the financial support of the Canadian Space Agency (CSA) following an announcement of opportunity. NGen’s call for projects will support ISRU solutions and commercialization in the following areas: mining, critical minerals and manufacturing.

“NGen wants to draw on Canada’s expertise in space and advanced manufacturing technologies to build world-leading solutions for lunar resource development while contributing to the competitiveness of Canada’s critical manufacturing and mining sectors,” NGen NGen Jayson Myers said a statement.

“New solutions are needed for these dual-purpose applications that promise to put Canada at the forefront of industrial innovation in space and on earth.”

However, these companies may not have reached the peak of their investment and expansion efforts, as the 2023 planned capex is still $36.5 billion short of 2013’s peak of $145.7 billion, the firm adds.

“We expect investment in the next two years will become more challenging against a backdrop of high inflation and interest rates and slowing economic activity, leading the group’s capex to decrease 1.8% in 2024 and 0.7% in 2025,” says Ying Li, a metals analyst at S&P.

S&P notes that capex of the diversified companies may go towards items such as smelters, steel production, logistics or power generation, meaning the total spend of each company is not directly comparable. This analysis focuses only on the capex for metals and mining projects.

According to S&P, the highest capital budget spend in financial year 2023 is expected to come from BHP at $7.6 billion. The world’s biggest miner has increased its capex outlook for fiscal 2024 to $10 billion from a previous management projection of $9 billion. Capex for stage 1 of the Jansen mine in Canada was $647 million in fiscal 2023, and the project was 26% complete as of the close of the financial year. BHP expects its capex for stage 1 to increase to approximately $1.0 billion in fiscal 2024 and total capex for the project to reach $5.7 billion.

BHP also increased capex guidance to $11 billion per year for the medium term, of which approximately $4 billion in aggregate will be channeled to operational decarbonization before the end of 2030. The company approved a number of potential projects to begin in the next few years and will give an update on investment for its Escondida copper mine in Chile and iron ore operations in Western Australia, which will account for 71% of the total development capex in fiscal 2023–24, S&P estimates.

Following closely in second is Rio Tinto, whose latest 2023 capex guidance is set $7.4 billion — including about $1.5 billion in growth capital — to be used to ramp-up projects, including Guinea’s vast Simandou iron ore deposit, the underground expansion of Oyu Tolgoi copper-gold mine in Mongolia and Argentina’s Salar del Rincon lithium project.

Rio Tinto’s investment over the next two years is starting to tilt more toward growth, with its total capital investments guidance for 2024 and 2025 set at up to $10 billion, which S&P says could vary depending on the rate of development at Simandou. It is worth noting, however, that even with the company’s capital spending growing a projected 42.8% in 2024, putting it three times higher than the 2016 low, it is still below the 2012 peak.

Anglo American trimmed its 2023 capex outlook to $6.0 billion in midyear reporting from previous guidance of $6.0 billion to $6.5 billion. This includes growth spending of $1.5 billion, of which $700 million is planned for the Woodsmith polyhalite project in the UK. The company’s share of the ramp-up associated with the Quellaveco copper mine in Peru is planned at approximately $100 million in 2023. S&P expects that capex will average $5.3 billion per year in 2024 and 2025, with sustaining capital planned to remain between $4 billion and $5 billion each year.

Vale’s capex totalled $5.5 billion in 2022 but was 8% higher than guidance due to investment in some projects in Brazil, namely the Sol do Cerrado solar energy complex, the Serra Sul iron ore expansion, the Capanema and Tubarao Briquette iron ore projects, and the Salobo III copper project expansion.

The company plans to spend approximately $6 billion in 2023 on projects, including the Onca Puma mine’s second furnace, the Thompson phase 1 part of Manitoba Division and the construction of Voisey’s Bay underground mine expansion, the continuing ramp-up of the Serra Sul operation, as well as the Morowali nickel project in Indonesia.

Rounding out the top 5 biggest spending miners between 2022-2024 is Glencore, which is due to invest approximately $4.8 billion this year. Capex at Glencore’s industrial assets is expected to average $5.6 billion per year between 2023 and 2025, with $1.1 billion per year for metals portfolio expansion activities, $3.2 billion per year for sustaining metals assets, and $1.3 billion per year for supporting the continued operations of the energy portfolio in line with the climate commitment, S&P says.

Key investment projects for Glencore over the next few years include the desalination project at the Collahuasi copper joint venture in Chile, the extension of Sudbury integrated nickel operations in Canada, the Zhairem zinc project in Kazakhstan, and the commissioning of Canadian Raglan phase 2 in 2024 and that of Onaping Depth in 2025.

The Khoemacau copper mine in Botswana is valued at as much as $2 billion. As many as three Chinese companies with state ties or owners are reportedly in the running to bid for the copper deposit.

Khoemacau Copper Mining is wholly owned by Cuprous Capital Ltd., which has its registered office in Vancouver and was incorporated in B.C. in 2012. Cuprous, in turn, is 88.1 per cent owned by U.S. private equity firm Cupric Canyon Capital LP, a company majority owned by funds managed by London-based Global Natural Resources Investments, and 11.9 per cent by Resource Capital Fund VII LP.

Copper is listed as a critical mineral by the Canadian government and Canada’s most important ally, the United States, has been leading a push to ensure unimpeded access to metals and minerals vital to the economy and leading-edge technology.

Pierre Lassonde, co-founder and chairman emeritus of mining royalty company Franco-Nevada Corp. (TSX: FNV), urged the Canadian government to look at any sale of the Botswana copper mine very carefully.

“The bottom line is a Canadian company controlling a critical mineral – a very valuable critical mineral asset,” he said.

Mr. Lassonde said Ottawa needs to get involved, particularly because of the size of a potential transaction.

In late October last year, the Canadian government warned that it would make it harder for foreign state-owned companies to make big purchases in this country’s critical minerals sector – and that these approvals would only be exceptions.

“Significant transactions by foreign state-owned enterprises in Canada’s critical minerals sectors will only be approved as of likely net benefit on an exceptional basis,” Innovation Minister François-Philippe Champagne and Natural Resources Minister Jonathan Wilkinson said in the statement.

“As well, should a foreign state-owned company participate in these types of transactions, it could constitute reasonable grounds to believe that the investment could be injurious to Canada’s national security, regardless of the value of the transaction.”

Bloomberg reported last month that Zijin Mining Group Co., MMG Ltd. and Aluminum Corp. of China Ltd., known as Chinalco, all made it to the second round of bidding for the Khoemacau project. It also said MMG has been in talks to team up with Citic Metal Co., an arm of Chinese state-owned conglomerate Citic Group. Other bidders include two South African companies.

It reported Khoemacau is ramping up annual output to more than 50,000 tonnes after starting operations in mid-2021.

The U.S. has shown a keen interest in keeping Western assets within the control of like-minded countries and out of the hands of the Chinese state. On Tuesday, the U.S. State Department held a webinar on encouraging interest in the redevelopment of Toronto-based Premium Nickel Resources Ltd.’s PNRL-X nickel, copper and cobalt assets in Botswana, calling them three of the largest critical metals deposits in that country and “some of the largest deposits of their kind on the continent.”

Asked about the Khoemacau mine sale, the Canadian government said in a statement that a transaction involving Cuprous would fit the criteria for a review, but would not comment on whether it would review a takeover affecting the company.

“The Investment Canada Act (ICA) provides for the review of the most significant investments by non-Canadians to ensure their likely net benefit to the Canadian economy. And all investments, no matter their value, can also be subject to a national security review under the ICA. Therefore, the acquisition of a Canadian company by a foreign company could be subject to a review under the ICA,” Laurie Bouchard, director of communications for Mr. Champagne, said in a statement.

“As mentioned in our policy, cases involving critical minerals are also scrutinized closely. The protection of Canada’s critical minerals is not only a matter of national security, it is a matter of economic security as well. Due to the confidentiality provisions of the Act, we cannot comment further.”

A spokesperson for Khoemacau Copper Mining declined to say whether investors would seek approval from Canada should a sale commence.

“We do not comment on ongoing processes. However, we confirm that all applicable laws have been and will be complied with,” Alan Fine, a senior principal at R&A Strategic Communications, said on behalf of Khoemacau.

With reports from Reuters

Simultaneously, Mainland China’s service-led recovery, along with weak global demand continue to pressure prices along with investor sentiment towards industrial metals, including copper.

Although Fitch expects prices to improve slightly from current levels in 2023, the analyst  does not expect a return to the highs seen in 2022 as China’s real estate sector remains in doldrums.

Prices have averaged $8,628/tonne in the year to date as of September 19 2023, lower than the average of $8,788/tonne seen in full year 2022, on the back of subdued global demand in the main, the analyst said in its latest market report.

Prices have been on a steady downward trend since mid-January 2023, after peaking at $9,356/tonne on January 23 2023 on the back of expectations of a strong rebound in Chinese demand.

Prices were hovering around $8,293/tonne as of September 19, down 11% from the year to date high of $9,356/tonne.

The forecast of $8,550/ tonne for 2023 means Fitch expects prices to remain under significant pressure in Q4 as weak demand and rising inventory levels hammer prices.

Production

Globally, Fitch forecasts refined copper production to remain in growth territory over the coming decade despite some short-term supply disruptions from outside China, as a number of smelters undergo maintenance that will ultimately reduce total annual output volumes.

The analyst also expects supply issues in Latin America to hamper copper concentrate supply growth, leaving the market tight and putting pressure on refined copper supply in the coming months.

Fitch forecasts global refined copper output to climb from 27.3mnt in 2023 to 35.2mnt by 2032, averaging 3.1% annual growth.

Consumption

The analyst predicts global copper consumption growth to rise in 2023 by 2.9% to 27mnt, amid an uneven economic recovery in China and a drag from other markets.

Fitch notes that the green energy transition will partially offset this downside pressure. Over the rest of the decade, the firm anticipates strong demand growth driven by the renewables and autos construction industries.

The analyst expects global copper demand to increase from 27 million tonnes in 2023 to 36 million tonnes in 2032, averaging 3.3% annual growth.

Read the full report here.

Froneman has been the CEO of Sibanye-Stillwater for over 10 years and brings over 40 years’ experience in the mining industry. Under his leadership, Sibanye evolved from a South African gold producer to a multi-national diversified mining and processing business with assets in five continents. It has also built a leading position in platinum group metals recycling (circular economy) and tailings reprocessing.

In addition to Froneman’s appointment, WGC also welcomed Niël Pretorius, CEO at DRDGOLD, to its board of directors. Based in South Africa, DRDGOLD specializes in the extraction of gold through the large-scale retreatment of mine dumps and tailings dams.

These appointments mark continued evolution and diversity of experience and industry contributions to the board of WGC, the Council said in a press release.

“I would like to thank Randy for his leadership of the board over the last few years. Under his tenure, the World Gold Council has embarked on several new initiatives, from our transformational Gold247 program to help digitalize the global gold industry, to bringing gold to the attention of millions of retail investors,” WGC CEO David Tait said.

“We welcome the appointment of Neal as the new chairman. His wealth of experience in the industry will greatly benefit myself and the rest of the board. I look forward to working with him in this new capacity, and to further our work to improve the gold market and demonstrate the valuable contribution responsible gold mining makes to the world and host communities.”

Also this week, the WGC announced the launch of a new documentary: GOLD: A Journey with Idris Elba, created in partnership with Pioneer Productions.

This docuseries explores the value of gold in past, present and future, while discovering its impacts on individuals, communities and economies. It also highlights how the industry is navigating current challenges, from post-mining regeneration and energy consumption to the future of the workforce in gold mining.

The documentary is now available on YouTube. Click here to watch.

Speaking at the 2023 Gold Forum Americas conference on Tuesday, Palmer says he expects the combined business to deliver around $500 million of annual synergies, with a target of $2 billion in cash from portfolio optimization.

The Newcrest acquisition, says Palmer, is expected to strengthen Newmont’s portfolio and create the best collection of Tier 1 gold and copper assets concentrated in favorable mining jurisdictions.

The biggest value drivers of the transaction will come from Newcrest’s two Tier 1 operations, Cadia and Lihir, located in Australia and Papua New Guinea, respectively.

The Newmont executive draws comparison to what the company experienced at the Peñasquito in Mexico, which has returned some $5.8 billion since its acquisition over four years ago.

A full transcript of Palmer’s speech is here.

According to the New York-based firm, the financial profiles of miners will remain resilient in the short to medium term as commodity prices remain above mid-cycle levels. This is despite “significant normalization in prices year-to-date,” which it says will provide financial flexibility for M&A.

As such, deal activity is on track to reach the highest for a decade this year, with miners experiencing increased financial flexibility as a result of extraordinarily high profits over 2021-2022.

“Changing demand patterns brought about by the energy transition, increasingly lengthy greenfield project construction timelines and limited organic growth options should support deal activity beyond 2023,” Fitch says.

“Miners will be particularly active in future-facing metals such as lithium, nickel and copper, where the market is likely to be in structural deficit beyond 2026.”

In addition, lower prices in the coming years may also spur further acquisitive activity, Fitch adds, as “lower valuations present strategic consolidation opportunities, particularly in the still fragmented gold sector.”

Click here to access the full report.

The world’s major gold miners are showing signs of improvements when it comes to their ESG (environment, social and governance) performance, according to Metals Focus, which published its Gold ESG Focus 2023 report on Tuesday.

In this report, the UK-based consultancy attempted to make like-for-like comparisons for key ESG metrics across 17 major gold miners with annual data from 2014. The goal is to provide a better understanding of these companies from an ESG perspective alongside overall ESG trends in the gold mining industry.

Overall, the report pointed to several encouraging developments within the industry in 2022, highlighted by a 2% year-on-year decline in their combined scope 1 and 2 greenhouse gas (GHG) emissions. This decrease, according to Metals Focus, is attributed to improvements in emission reduction initiatives and less reliance on fossil fuels.

In addition, the companies reported a 7% reduction in water withdrawals and a 3% decrease in water consumption in 2022. Water recycling rates also improved as companies continue to prioritize efforts to minimize their water consumption.

The report also found while payments to governments fell by 16% y/y to $8.1 billion, spending on community projects rose considerably by 37% to $373 million, showcasing a growth in community development initiatives.

“The 2% decrease in combined scope 1 and 2 greenhouse gas emissions in 2022, spearheaded by proactive industry initiatives and decreased fossil fuel reliance, is a promising sign for the future,” Sarah Tomlinson, director of mine supply at Metals Focus, commented.

“Although there was a dip in government payments, reflecting lower gold production and increased operational costs, we witnessed a 37% rise in community project investments, underscoring the industry’s dedication to fostering resilient and sustainable communities.

These challenges were among the many discussed at the conference where Van Zyl and SRK Consulting US corporate consultant in mine closure Jeff Parshley were featured speakers.

“Demand for battery minerals is driving much of the excitement in mining today, but that demand remains very volatile – making valuations and other planning decisions difficult,” said Van Zyl. “This volatility is a significant issue as the mining sector raises the bar to meet increasingly stringent requirements for environmental, social and governance (ESG) compliance.”

Substitution

A case in point has been the varying lithium price, ramping up sharply in anticipation of supply shortages – only to drop sharply as a result of lower Chinese demand and as possible substitutions were announced for EV batteries, Van Zyl noted.

 Among the competing technologies are sodium-ion batteries, which have been developed as a lower cost alternative to lithium-ion. With early implementation underway in China, forecasts suggest that as much as 12 percent of all new battery electric light vehicles will be powered by sodium-ion batteries by 2030.

“Another example can be found with cobalt, where the price rocketed from around $20,000 to $100,000 per tonne,” he said. “A chemical company then announced a way to reduce the cobalt required in a battery by 75%, which contributed to the price dropping to $40,000 in just a few months.”

There were also concerns that rare earths – another important contributor to permanent magnets used in EV applications – may be limited in their availability, and that these constraints would hold back production.

Quality technical input

“Similarly, a leading battery and EV manufacturer has just reported that it plans to use permanent magnets that do not require any rare earths,” he said. This volatility in demand and price is expected to continue as a function of rapid innovation in battery technology, which responds quickly to commodity price fluctuations.

This highlights the importance of high quality technical input to due diligence studies and regulatory filing requirements.

“It is also clear that the shift to responsible sourcing of these battery minerals will have an impact on the risk exposure of mining operations,” he said. “In addition to the local legal requirements for compliance with labour, health and safety laws, customers in regions like Europe and North America are increasingly sensitive to ESG issues.”

Artisanal mining

He noted, for instance, that mining companies operating in many African countries were starting to engage more constructively with the entrenched artisanal mining sector – much of which is classified as illegal. While artisanal mining is often associated with labour exploitation, poor safety standards and even links to criminal networks, it is also a substantial job creator.

Governments are looking to formalise these activities in ways that are more sustainable, and the private sector is currently exploring models of how this could be achieved.

Van Zyl reiterated that despite commodity price volatility – which makes it more difficult to predict demand, project pay-back durations and value predictions generally – there are technical best practice foundations upon which all good mining projects must be built.

“These have not changed, and include optimising capital and operating costs, implementing responsible mining and achieving zero harm,” he said. With more support from technology, mining is harnessing data more effectively to meet these growing demands – making mining more efficient and reducing its carbon footprint.

“Bodies like the World Association of Mining Lawyers play a valuable role in bringing the industry’s legal and technical minds together,” he said. “This is vital to address the risks and opportunities of an era in which technology is changing faster than we can adapt our mining systems and production.”

The study, the firms say, presents a groundbreaking analysis demonstrating that when mining haul trucks are automated, bigger is no longer always better.

Whittle Consulting modeled the net present value (NPV) of mining a representative copper ore body through four different scenarios, taking into account all facets of the mining value chain over an 18 year life-of-mine (LOM) horizon.

Key findings include:

• The modeled mine operating with a fleet of autonomous 40-ton haul trucks would realize a 31% greater NPV than if the mine were operated with a fleet of manually driven 100-ton off-road haul trucks;
• Autonomy significantly improved effective utilization by reducing truck downtime, standby, and operating delays to 5% of availability versus 20% for manual vehicles and;
• One theorized flaw in the small truck logic was the prospect of traffic congestion caused by the increase in the number of trucks operating in the mine, potentially overcoming the efficiency gains of small truck and automation. In the study’s simulations, such traffic congestion did not materialize.

“The industry has long debated whether mining economics shift to favor smaller trucks when autonomous,” said Gerald Whittle, CEO, Whittle Consulting in a media statement. “We’re excited to publish the first rigorous analysis that demonstrates that for most mines – the answer is yes.”

The study also concluded that converting an existing fleet of haul trucks to autonomous operations increased NPV irrespective of truck size. Both conclusions are consistent with industry experience and past studies, including Whittle Consulting’s 2018 Autonomous Haulage Report.

“This study is exciting because it clearly articulates one of the many ways in which autonomy is revolutionizing the global economy today,” Anthony Levandowski, CEO of Pronto said. “The results also illustrate why our strategy has been centered around making automation accessible to the majority of mines and quarries around the world that aren’t running the Ultra Class trucks that the legacy AHS providers have been focused on.”

Pronto had previously demonstrated the commercial benefits of an AHS capable of scaling down to the smallest trucks and smallest operations, and the Pronto-Whittle study substantiates that by identifying the specifics of why small trucks are favored when autonomous: lower maintenance costs, better fuel efficiency, faster haul speeds, narrower benches / steeper pit walls are possible, and better overall fleet utilization, among others.

The full report is here.

Legal advisers

Weil, Gotshal & Manges and Fasken Martineau DuMoulin were the top M&A legal advisers in the metals & mining sector during H1 2023 by value and volume, respectively, according to GlobalData’s latest Legal advisers league table.

An analysis of GlobalData’s financial deals database reveals that Weil, Gotshal & Manges achieved its leading position in terms of value by advising on $20.4 billion worth of deals. Meanwhile, Fasken Martineau DuMoulin led in terms of volume by advising on a total of 12 deals.

“Fasken Martineau DuMoulin was among the only two firms with double-digit deal volume in H1 2023. However, despite leading by volume, it lagged in terms of value and did not feature among the top 10 by value,” said Aurojyoti Bose, lead analyst at GlobalData.

“Meanwhile, Weil, Gotshal & Manges, despite advising on less than half the number of deals advised by Fasken Martineau DuMoulin, managed to top the chart by value due to involvement in big-tickets. Weil, Gotshal & Manges advised on a $19 billion deal, which helped it lead by value,” Bose said.

Herbert Smith Freehills and White & Case jointly occupied the second position in terms of value, by advising on $19.1 billion worth of deals each.

Meanwhile, Cassels Brock & Blackwell occupied the second position in terms of volume with 10 deals, followed by Allens with six deals, Bennett Jones with five deals, and Weil, Gotshal & Manges with four deals.

Financial advisers

BMO Capital Markets and Canaccord Genuity Group were the top M&A financial advisers in the metals & mining sector during H1 2023 by value and volume, respectively, according to GlobalData’s latest financial advisers league table.

An analysis of GlobalData’s financial deals database reveals that BMO Capital Markets achieved its leading position in terms of value by advising on $37 billion worth of deals. Meanwhile, Canaccord Genuity Group led in terms of volume by advising on a total of seven deals.

“BMO Capital Markets advised on four deals out of which two deals were valued more than $15 billion. The involvement in these mega deals helped it top the chart by value in H1 2023. Interestingly, BMO Capital Markets occupied the top position by volume as well in H1 2022 but lost it to Canaccord Genuity Group in H1 2023,” Bose said.

BMO Capital Markets occupied the second position in terms of volume with four deals, followed by Red Cloud Securities Inc with four deals, Haywood Securities with four deals and Allenby Capital with three deals.

Meanwhile, Lazard occupied the second position in terms of value, by advising on $20 billion worth of deals, followed by Bank of America with $19.6 billion while Centerview Partners and JP Morgan jointly occupied the fourth position with $19.1 billion each.

Bentley Subsurface company Seequent has revealed the findings of its latest Geoprofessionals Data Management Report, which looked at the trends, challenges, and opportunities in subsurface data. 

The report found that eight in 10 geoprofessionals in mining saw data management as of high or critical importance for their organisation, and said they spent 27% of their time on data – but a third of respondents said they lacked the information they needed to make crucial data-driven decisions.

More than 700 geoprofessionals across industries that work in the subsurface responded to the survey, including 296 mining professionals. Other respondents included those from the civil, energy, and environment sectors. The report is the only one of its kind.

Findings across mining and other industries included:

• An increase since 2020 in the use of emerging technologies: 64% of geoprofessionals are using or considering the use of data science scripting, advance analytics, machine learning, or artificial intelligence, with 39% using or considering using more than one of these technologies.
• Views on the future of data management:
  • AI and automation will reduce time spent on menial tasks and drive efficiency and accuracy.
  • Cloud adoption will enable real-time collaboration and synchronisation across platforms.
• On average 22 people are interacting with their organisation’s subsurface data.
• Despite the high number of people interacting with subsurface data, 65% of organisations do not have an established framework governing data collection, analysis, and safeguarding (the so-called data chain of custody framework).

In mining, 61% do not have a data management framework that is viewed as vital, with 53% of the respondents from mining planning to create one within the next three years. Only 26% said they were “very ready” to leverage the cloud, with security and cost cited as the main factors.

 “The insights we have gathered provide a fascinating picture of the data challenges facing the mining industry. Clearly, the industry needs to tackle its lack of data-driven decision-making to maximise performance,” Rob Ferguson, Seequent’s Segment Director, Exploration and Resource Management said in a media statement.

“There is some work to do to educate the mining industry about the cloud, as the cloud is a cost-effective and secure solution that can help mining organisations transform their data management and collaboration. The adoption of emerging technologies will also be really important for the future of the industry.’’

Field work was undertaken in May 2023, with a total of 704 responses. The highest response rate was from the Americas, and the mining industry made up 42% of respondents overall.

Read the full report here.

Participants were Harry Burnett, partner at King & Spalding, Howard Rosen, Managing Director at the Toronto Secretariat and Brenna J.Y. Scholey, Principal Metallurgist and global disputes coordinator at SLR Consulting (Canada) Ltd.’s Mining Advisory Group.

This roundtable discussion is also published in  The Burford Quarterly 

Commission: According to a recent Jus Mundi study, the energy transition will require multi-trillion-dollar new global mining investments. What impact will this have on the volume of mining sector disputes, and what types of disputes do you anticipate?

Rosen: With the energy transition necessitating around $1.7 trillion of investment in the global mining sector, we can expect a significant increase in the volume of disputes. As more capital pours in, the complexity of issues associated with these investments will inevitably grow.

Commercial disputes will arise due to disagreements between commercial actors over the terms of contractual obligations in the development of mining and processing facilities. Investor-state disputes will occur because of differences in the interpretation of mining laws and environmental regulations. Further, socio-economic disputes involving local communities, often related to land rights, labor conditions and environmental impact, could add to the number of investor-state disputes as investors fail to gain “social license” in the local community.

Finally, there may also be an increase in investor-state disputes if governments alter regulations during the development of a project or fail to provide expected investment protections.

Scholey: There is huge demand today for new mining investment. China has been investing in the development of mines and the critical metals needed for the energy transition and electric vehicle revolution (e.g., lithium, copper, nickel and cobalt), while much of the western world (businesses and governments) has remained quiet and is largely relying on previous investments. Legislative, industrial and financial forces in the western world are now focusing their attention on the supply and demand of critical metals for the energy transition.

Disputes arise when the goal posts move and there are elements of unpredictability or ambiguity. For example, there are countries where governments have changed their mining, environmental or water laws, which could have significant impact on demand for certain types of commodities. New laws may create significant risk for long-term investment in the mining sector. The extent of the new laws and the impact on foreign investments in the mining sector could lead to potential investor claims if the new laws have any adverse effect on existing or planned investments in a foreign country.

If I were to anticipate the types of mining sector disputes, then these two questions are front of mind from an investment perspective and could trigger a review of the rules and possible claims: One, are the standards of fair and equitable treatment being given to investors? And two, is there discrimination against investors in favor other investors from another country?

If impacts to investors are significant, remedies by way of international arbitration are options to seek compensation for potential damages.

Burnett: The energy transition advanced by the vast majority of western economies will have a profound impact on the mining industry. As Brenna notes in her response, this energy transition is predicated on lithium, copper, nickel, cobalt and other minerals. It is therefore no surprise that countries like Mexico, Chile and Argentina have declared resources like lithium as assets of national interest or just flat out nationalized those assets. However, many of the places where those resources are located lack the capacity or the technical expertise to explore them in a commercially feasible and technologically advanced way.

With more mining activity and exponentially increased investment the tension between mining companies and social and environmental concerns is expected to continue to increase. While, as discussed below, we see nation states adopting legitimate regulation to address these concerns, we can expect that some states will use social and environmental concerns as a means to restrict or limit mining operations beyond these concerns and to the benefit of the state and detriment of investors. These type of government actions will likely trigger investor-state disputes.

Greater demand for minerals will lead to greater investment by mining companies in developing projects, and, as we know, mining projects tend to generate all sorts of commercial disputes with business partners, builders, et cetera.  With the substantial impact of the energy transition on the mining industry, we expect a full gamut of mining disputes around the world.

Commission: As a result of the energy transition, lithium development is expanding, with Argentina, Bolivia, Chile and Mexico all seeking to expand lithium mining. Do you foresee more lithium-related disputes in the near future? How would nationalization of lithium in some LatAm jurisdictions impact the sector?

Scholey: Again, disputes arise when the goal posts move. Is nationalization of lithium or any other commodity or government interference in that purpose considered direct expropriation? The LatAm situation is currently very fluid. Governments and states are watching each other to see how this activity unfolds. Security of supply is leading to increased competition and is incentivizing new mining projects and partnerships. In the supply chain, miners are moving closer on the supply chain to the EV makers. There has been a global shift away from the business model of “mining and shipping” to the development of in-country “refining” due to taxation and other government subsidies or incentives. Geopolitical factors are also encouraging this shift.

Burnett: There is a case to be made that nationalization of lithium assets by LatAm jurisdictions may amount to both direct and indirect expropriation. From a legal standpoint, direct expropriation involves the physical seizure of a foreign investor’s property or the title to such property by a host state, whereas indirect expropriation involves measures resulting in a substantial deprivation of the use and value of a foreign investment, even though the actual title of the asset remains with the foreign investor. Nationalization will constitute expropriatory action unless it fulfills the requirements contained in the particular investment treaty or free trade agreement in question, which are typically that the expropriation must be: (a) for a public purpose; (b) non-discriminatory; (c) in accordance with due process; and (d) only effected upon payment of prompt, adequate and effective compensation. 

These requirements are cumulative and a host state’s failure to fulfill any one of them will suffice for an investment claim against the state and a finding of illegal expropriation. Among the relevant issues to watch for is whether governments will work with foreign investors for the development of these projects and partnerships or whether they will give in to forces that have previously resulted in expropriatory action, for example in the hydrocarbons industry.

Rosen: There is an imbalance in the demand and supply equation, which led to a short-term dip in the price of lithium from its high in November 2022, and which may have an effect on the capital that is drawn to this metal.

There is a lot of new investment in lithium due to its strategic importance as a contributor to “green energy” battery technology that has resulted in the decline of the commodity price. The time it takes to develop this new exploration into active mines that are contributing to the global supply of battery materials is currently quite optimistic, leading to the market’s reaction to prices.

It is more likely that these mines will take much longer to come online (lithium is easier to mine than most metals, but more difficult to produce economically), and thus there is enormous potential for disputes (both commercial and investor-state), as timelines to production are not met, and various cohorts of stakeholders are disappointed.  This will also lead to an eventual recovery in lithium prices, raising the stakes for the value of disputes.

The nationalization of lithium projects by LatAm jurisdictions would have a disastrous effect on the supply of lithium, as most countries do not have well developed human resources or experience in mining, processing and marketing (with perhaps the exception of Codelco in Chile, which was born out of the nationalization of the copper industry in 1971, and later combined in 1976). It is difficult enough for experienced mining companies to bring their projects to commercialization, and most jurisdictions do not have the proper mechanics in place to achieve commercial results. This could also have a chilling effect on commercial actors’ willingness to invest in countries that they perceive as too risky. 

Nationalizations, borne out of genuine concern for the environment or indigenous stakeholders or out of a sense of the ability to generate more value than will be realized from the “economic rents” currently negotiated with international mining companies, will inevitably lead to an increasing number of investor-state disputes.

Commission: What impact will the increasing focus on ESG have on mining sector disputes?

Burnett:  Recent examples have shown failure to focus on ESG issues can result in substantial reputational damage to corporations and stakeholders in the mining industry. Accordingly, if not for their own sake or for the fact that carefully considering environmental impacts, social impacts and ethical governance rules are inherently positive, mining companies will continue to focus on ESG issues because doing so is good for business.

We are seeing a “hardening” of legal norms on business and human rights with jurisprudence from the Inter-American Court of Human Rights providing that the UN Guiding Principles on Business and Human rights is a “legal duty” under the American Convention on Human Rights. National laws are now in place and there is proposed EU legislation providing for mandatory human rights due diligence by large companies based in, or doing business in, those countries. Recent ISDS awards and decisions show a trend toward increasing recognition of the relevance of international human rights law, including environmental law, at all stages of ISDS proceedings. 

Human rights-based arguments are raised in a variety of contexts, including jurisdiction based on compliance with governing law, investor human rights claims, arguable human rights obligations of investors, human rights and environmental defenses by states and counterclaims, remedies and annulment of awards. 

The mining industry is generally characterized by long-term investments and a keen focus on the future, which plays inherently well with ESG awareness. In addition, the focus on ESG scores from key financial stakeholders such as BlackRock or Vanguard ensures that ESG issues are not ignored in the mining industry. We expect that the focus on ESG issues will continue to increase and the mining industry will continue to adapt and adjust to these concerns as will other stakeholders and industries.

Rosen:  As stakeholders and regulators heighten their scrutiny of mining companies, disputes related to environmental damage, perceived social injustices and governance failures could multiply. Environmental plans and social license initiatives in the last decade have been as much a part of mining as exploration. The governance aspect is a concern for most public companies, and certainly the mining industry is populated by many small cap mining companies that have raised equity for the purposes of exploration.

Despite a homogeneous and widely accepted method of measuring compliance with ESG, disputes could emerge not only from regulatory bodies but also from aggrieved local communities, NGOs or shareholder activists who demand companies maintain ethical, sustainable practices. In addition, companies not conforming to ESG standards might face financial repercussions, reputational risks and investor disengagement. Shareholder legal actions against the perceived mismanagement of mining companies will undoubtedly lead to litigation as well (read the news concerning Glencore and Teck Mining in Canada), as shareholders are principally concerned with earnings and value of shares as opposed to some of the governance issues being faced and met (or unmet) by management.

Scholey: In the mining sector, there has been an increased focus on ESG impacts and their financial and reputational risk to companies. The mining business should care not only about making money, but also focus on compliance with respect to environmental impacts, social aspects and good governance. The closer connections being made between miners and EV makers will draw greater scrutiny on “commodity cleansing” by way of metal reprocessing or the production of metal by-products and the different global players involved in this activity.

European regulators have formulated new disclosure requirements and the need for investors to have greater information on ESG issues and whether such factors are deemed financially material. Double materiality is a concept that describes how a company’s information could be important from a financial perspective and the company’s impact on the world at large, especially with respect to environmental impacts and climate change.  In basic terms, a company’s impact on the world beyond finance can be material and therefore could require disclosure.  The concept of double materiality requires further analysis, and its meaning remains up for debate by experts.

In general, decarbonization remains somewhat of a puzzle for policymakers and for the mining industry.  Whether US regulators assess disclosure information on ESG issues as material for company reporting or mandate a set of climate disclosures will be under further consideration.

Commission: Calculating damages in investment mining disputes is particularly complex given the size and scale of projects. How should mining companies with pending claims assess potential damages?

Rosen: Mining companies are required to maintain meticulous records of exploration and development activities. This is required so that competent persons (as defined by various global mining codes) can examine and uniformly describe the state of advancement of a property (resources, reserves, et cetera) for various stakeholders.

Mining properties that have undergone exploration activities with positive results are generally worth more than the costs incurred to make a discovery (i.e., they have improved the value of the property). The stage of discovery and development of a property will signal an accepted methodology to value the company should they be subject to investor-state measures that are deemed to be breaches of a treaty. There are several mining codes around the world that are consistent in how the stage of development is described, and which valuation methodologies are generally accepted for public company disclosure. These codes are meant to protect ordinary investors in public companies and are not restrictive or prescriptive. 

In the commercial world, transactions between investors and mining companies happen on a regular basis and are reported on various information databases. These transactions and trading multiples provide a dataset from which market comparable information can be obtained. Additionally, if a project is sufficiently defined that an investor can reasonably create a cash flow projection, a discounted cash flow (DCF) calculation can be performed to determine value.

The codes that are used by professionals in the mining industry (both to define resources and reserves and to perform valuations) are generally relied upon in investor-state disputes. Again, these codes should be used as guidelines, but do not prohibit the use of market information (in fact, in all stages of development, these codes encourage the use of market information).

Companies with potential or pending claims should view the exercise as similar to getting their company ready for sale. They should reasonably expect that a calculation of damages would be similar to a price they would receive in the marketplace from a qualified buyer.

Burnett:  In mining disputes, parties and tribunals generally favor a DCF method to quantify damages over other methods of damages valuation (market approach or asset approach).  The DCF method quantifies the value of an asset through expected future cash flows, as opposed to the market approach (which uses comparable market prices to value assets) or the asset approach (which uses adjusted book value or net asset value to indicate the value of assets). The DCF method is also preferred in comparison to other income approaches such as capitalized cash flow (CCP) or adjusted present value (APV) because it allows parties and experts to properly account for their assumptions and risks in resulting discount rates, which provide greater certainty for tribunals.

It is typical in the pre-production phase of extractive projects for miners to conduct a great deal of information and data gathering. Miners usually engage experienced professionals and spend millions of dollars to conduct feasibility studies (scoping studies, pre-feasibility studies and definitive or bankable feasibility studies), which lend themselves to serving as the bases for DCF analysis. Projections of expenses and revenue can also be forecasted with reasonable certainty in mining projects, which would also serve as relatively reliable bases for DCF calculations.

The established international market for mineral resources provides reasonable certainty for pricing and demand, and market demand and prices are routinely forecasted by market analysts and exist irrespective of any individual project. Although we have seen ISDS tribunals award sunk costs for pre-production projects despite massive amounts of reliable data resulting from detailed studies, we consider that the DCF method is a highly reliable approach, even where production has not commenced, and we expect it to remain one of the prevalent damages’ valuation methods for mining disputes.

Commission: Given the high-value nature of disputes, claims in the sector are also very expensive. What role can legal finance play in helping companies to manage the associated risk and costs or generate liquidity from their pending claims or awards?

Burnett:  Legal finance can help companies manage risks and generate liquidity. First, legal finance allows companies to keep their funds where their rate of return is higher, which is generally core activities. In addition, contracting for legal finance allows companies to remove legal fees and expenses from their balance sheets, which then ceases to affect their quarterly and yearly results and provides additional predictability and security for stakeholders.

Second, legal finance allows companies to share the risk of potentially not recovering all their damages or being unable to effectively collect on those damages. At a minimum, the involvement of a funder reduces the required use of amounts of available cash that would otherwise constitute working capital and that companies end up having to earmark for disputes.

Third, legal finance provides not only an independent assessment of the strengths and weaknesses of the case, but also the comfort that a dispassionate third party concurs with the companies’ assessment and is willing to financially support that position through a non-recourse loan. The very nature of a non-recourse loan demonstrates its high risk for the lender, which means that a funder’s undertaking to finance a case is an indication of the strength of that case.

Lastly, not to lose sight of one of the key roles that funders can play, when damages are so destructive that the investor no longer has the financial capability to withstand a dispute, funding becomes an essential mechanism for the administration of justice. This can be especially important with newer or smaller companies that may have a single asset that has been suddenly and significantly impacted by a dispute. In our practice we have had several instances in which a host state left an investor so fundamentally broken that without the involvement of a funder the injustice would never have been properly redressed.

Rosen: Third-party finance plays an important role in managing risk, costs and liquidity in the face of high-value disputes in the mining sector. With the help of funding, mining companies can offload the significant financial risk associated with arbitrations. Funders bear the upfront costs and risk of losing the dispute, thereby allowing companies to pursue their claims without putting a cash flow drain on their resources. If the claim is successful, the funder receives a portion of the proceeds and thus acts as a buffer; safeguarding companies from the financial strain of arbitration while enabling them to focus their financial resources on their core business activities.

An important consideration that is often overlooked is the effect on the P&L of a public company that has cash flow generating operations. Using “off balance sheet” financing removes the cost of the arbitration from the ongoing operating profit of the company, and thus has no impact on earning and common measures of financial operating performance.

Harry Burnett is a partner at King & Spalding with a focus on international commercial and investor-state arbitration matters, along with general domestic and international litigation. He has been ranked in Chambers Global, Chambers USA, Chambers Latin America and Legal 500 for international arbitration and been recognized by The International Who’s Who of Oil & Gas Lawyers and The International Who’s Who of Energy Lawyers.

Howard Rosen is a Managing Director at Secretariat in Toronto with over 40 years’ experience of advising on all aspects of business valuations, damages quantification and corporate finance related matters. He has been listed by Who’s Who Legal as one of the top experts in international commercial arbitration worldwide, every year since the inception of the list in 2011. Mr. Rosen is recognized consistently by Who’s Who Legal annually in a number of key listings, including Thought Leaders Global Elite – Mining Experts 2023. He is also a qualified valuator under the Canadian Institute of Mining’s valuation standards and guidelines (CIMVAL), and a member of the CIMVAL committee.

Brenna J. Y. Scholey is a Principal Metallurgist and global disputes coordinator at SLR Consulting (Canada) Ltd.’s Mining Advisory group in Toronto with over 35 years in the mining and metals businesses. She advises on international mining disputes, performs due diligence and independent engineering reviews, and consults on mining operations and projects worldwide. Scholey is recognized as a consulting expert in Who’s Who Legal – Mining Experts 2019 to 2023.

Moderator:

Jeffery Commission is a Director with responsibility for overseeing Burford’s underwriting and investment activity in investor-state and international commercial arbitration. He is an authority in the field of international arbitration, having been involved with several multi-billion-dollar investment arbitrations and international commercial arbitrations throughout his career.

Panelists were Shelby Yee – geological engineer, co-founder and CEO of RockMass Technologies, Matt Blattman, director, technical services, Hecla Mining, Marcelo Godoy, chief technology officer at AngloGold Ashanti and Alex Boucher, technical solutions director at Seequent. The panel was moderated by Emily King.

The following passages are excerpts from the forum discussion, edited for length and clarity.  

King: What AI technologies are you seeing used and considered, and what are the biggest technological advances you’ve seen this year?

Shelby Yee – geological engineer, co-founder and CEO of RockMass Technologies:

The world I live most closely to is Lidar and I’ve really seen that explode in the past year. There are so many different applications and use cases for Lidar. You’re seeing  Lidar being applied to drones, to vehicles, technical services, used all in different applications. I think there’s a lot of room for several Lidar scanners. There’s not just one type of Lidar that’s going to serve all purposes. And then there’s a lot of experimentation with AI and VR with that 3D information, which I’m seeing uptake in that realm in the digital twin sector as well.

Really anything that enables people to better visualise and understand the information, the 3D information that they’re working with is starting to take off right now.

King:  What are some of the key challenges you’re seeing when you’re trying to adopt digital workflows?

Matt Blattman, director, technical services, Hecla Mining:

I think the simplest one, first is always people.  Change management is not always about dropping a new toy into a system and seeing what happens. It’s usually the people who are using it that become the biggest challenge of things. So, people and managing their expectations.

Sometimes something that’s inconvenient in a new workflow is not any worse than it was before, but because it’s something new, they stop using it and that’s one of the hardest things to deal with. The second thing we try to focus on is define the workflow first and then drop in the technology to fit the workflow that you’re desiring.

But what do you really want to do if you start with the tech and then build a workflow around the tech, you may end up with something that’s probably not as efficient or not what you really wanted to start with the final bit.

I think that our biggest challenge is finding those connectors. The days of having a single solution that does everything for everybody is probably not there. So realistically we’re buying tech from several different vendors and they don’t always play well with each other. And famine finds those connectors both upstream and downstream and making sure that they meet those needs is probably the biggest challenge we’re finding today, that’s what interrupts our workflows the most. It’s just this one’s not talking well with the other one.

And mining, I think compared to mechanical engineering, and maybe it’s because of the nature of our processes and we can’t standardise as much as automotive manufacturing. But it is a challenge to standardise across the system, which then makes it harder for everybody to talk to each other.

King: What new and emerging technologies are AngloGold Ashanti focusing on – specifically with regard to the company’s investments?

Marcelo Godoy, chief technology officer at AngloGold Ashanti:

“It’s important that technology roadmaps address specific requirements of each company. Right now we have a target to reach net zero emissions by 2050 with a substantial reduction to be achieved in 2030. So given this, I wanted to talk about three types of transformation technologies –technologies that we are investing in. They are the most important technologies I see at the moment in our portfolio.

Number one is electric vehicles. The use of EVs in underground mines is seen as a great step forward because it reduces ventilation requirements due to the significant reduction in diesel particulate matter and heat. We are currently running trials of electric power underground haulage systems and pretty excited about the possibilities of this technology.

Number two is advanced robotics or autonomous systems.  I have no doubt that by the time you reach zero net zero emissions in 2050, our minds will be run by robots. But for now we have been using autonomous drill rigs in which we can already see improvements, efficiency, precision and safety. We also make extensive use of semi-autonomous LHDs in our underground mines and we are studying the application of autonomous vehicles optimise efficiency and reduce risks in our projects in Nevada.

Number three is renewable energy integration. We are now incorporating renewable energy sources such as solar and wind power, internal operations of course to decrease emissions while lowering energy costs. There are plenty of other technologies we are applying, including advanced monitoring of tailing storage facilities, virtual reality for training, resource modelling, drones for geotechnical applications and machine learning to improve the process control in our processing plants.

King: What does technology like artificial intelligence of different kinds and digital twins bring into mining operations?

Godoy: I’m very excited about digital twins and the possibilities in that area, but there’s people out there trying to sell us digital twins for over $10 million for a given mine. That’s not really the answer in my mind.

I would like to see specifically AI systems that can run digital twins [and] create and run digital systems. This will allow us to model and simulate the behaviour and performance of entire mining complexes. It will help us optimise operations, predict failures, and test different scenarios for improved decision making.

It has a huge impact on our ability to design new mines because instead of having one or two or three designs, we can have thousands of different designs and can really explore the possibilities for that specific ore body. Another thing about digital twins is that it’ll break the instrument annual mining planning cycle that all mining companies go to every year and will allow for a quasi real time update that responds to the ever-changing conditions of mining operations.

King: When you’re investing in digital technologies, how do you view the risk versus reward calculus?

Godoy: This is very interesting because there are lots of vendors that come to us without a solution but are very willing to work with us for several months or years to get something developed. I don’t think that’s ever going to fly in with us as  mining clients. I think the OEMs,  the people out there that are developing technology could put a lot more effort and bring some real subject matter experts into their ranks so that they can develop solutions that are usable for the client.

We sincerely don’t have the patience and we don’t have the money to wait for months of development. What I’m talking about here is real technology off the shelf solutions that we can buy and we can apply and we can see value coming in. And I don’t think that’s going to change.

King: What do you see as the next real revolution in mining? Is this really about a continuous exchange of information between geology and operations that’ll bring about more of a truly revolutionary approach?

Alex Boucher, technical solutions director at Seequent:

First, if we want to get there, if we want to change things that are more than just on the margin, we have to re-look at the way we work today. And from [a] Seequent perspective, the way to get there is first to build a cloud platform where we can get data service applications connected where we can build new workflows. Currently the way we work is that we have a certain number of steps: A, B, C, D, and then we often look to improve step B, let’s improve step C and then gain the most fancy algorithms, but the gains will get marginal. So if you move one step from an hour to 30 minutes, then instead of spending one day you’ll spend eight hours.

The revolution will come when we try to look at things a bit more holistically and to say what’s the goal? What’s the solution, what do we want to achieve? And then from there, given the new technology, what can we do from there? As we always try to move to implement the step, the gain will always be marginal. There’s absolutely no way around that.

We need to think in terms of workflow. It’s very tricky because that forces big organisational change into our company. So this is a dance between service providers, what can we do to provide technology?

We believe that this change, this revolution if you like, we start from the platform but we’ll have to have the courage to change the way we’re doing [things] otherwise we’ll have marginal gain even if we have the smartest algorithms.

King: Whose responsibility is it to figure this out? Is it the service providers or is it the mining companies? What would a great model be for the industry to address challenges more collaboratively? How do we partner on those new revolutionary ideas?

Boucher: For the Seequent cloud platform we call Evo, we make it from the get-go an open platform that we’d like to bring partners. If a competitor wants to join, a competitor can. We cannot do everything. It’s impossible. If we work on feature A, that means we can live on feature B, but there’s lots of other companies, big and small networks and a connected environment and that we can build a network effect of the different applications so that someone is more knowledgeable and more capable in a certain space.

They can get on the platform, connect with the data, connect with leapfrog, connect with our service, and then we can start building things that I think will will increase significantly the velocity of innovation through connection and to be able to connect to the people –  because nobody in the mining sector is big enough to do everything.

King: A challenge I’ve noticed with companies in this space is access to different levels of proprietary information. You learn from each other and collaborate on the infrastructure side while still maintaining competitive advantage on certain key things. How do you think technology might be able to help with setting some of those boundaries?

Boucher: I think we need a different way to distribute technology. Currently we mostly distribute technology to software for an application. A way we’d like to see that is as soon [as you] start distributing technology front to API that you have a platform, you can distribute technology and then that means the same technology, the same algorithms can be used and Seequent software could be used within a client application, could be used from a Python notebook, but then you have this global repository of technology that [is] available from different directions.

 That means that we give ownership of a certain technology, but we don’t necessarily control other technologies used without the application, without the industry. And I think this is somewhere that could improve innovation by quite a lot.

The waiting game poses a major risk of overcapacity at the company’s storage facilities in the eastern region of Papua.

Indonesia banned in June exports of raw minerals in an effort to boost its metals processing industry, but vowed to allow several companies including Freeport and Amman Mineral International to continue exporting until mid-2024.

“If these two big companies complete their smelters, that means we will no longer export raw copper because it will be processed domestically to become copper cathodes,” President Joko Widodo said at the time.

Freeport’s export permit expired on June 10, when Indonesia began its raw mineral export ban, and the company said it has not made any shipments since.

Spokesperson, Katri Krisnati, confirmed to Reuters the company is still awaiting the issuance of the export permit. 

Without it, she said Freeport’s operational activities would be suspended, resulting in significant implications for overall operations and sales of mining products.

Freeport Indonesia produced 3 million tonnes of copper concentrate in 2022, an annual record. The company has in recent years transitioned into underground mining at its flagship Grasberg mine, the world’s second-largest copper operation.

With files from Reuters

For over two decades, the technology suite has been in use at several NGM sites, including Cortez, Goldstrike and Leeville. The implementation of Micromine Pitram at Goldrush, NGM’s flagship development project, represents an important next step in enabling the organization’s growth ambitions, the technology provider said in a statement.

Phase 1 of the Micromine Pitram implementation was successfully deployed at the Goldrush operation, consolidating and monitoring production data, including shift and daily production schedules of loaders, trucks, and drill fleets, in addition to improving accuracy on yield forecasting. As the site’s data backbone, Micromine Pitram also ensures operational teams and regional management have improved insight into shift and production activities to improve productivity and plan accuracy.

Micromine Pitram is an FMS and mine control system deployed to more than 60 of the largest mining operations around the world. The platform provides control room operators with a modern suite of tools that includes fleet and mine production monitoring, management of shift planning, materials movement and inventory, and the management of operator qualifications.

By harnessing the power of real-time data, Micromine Pitram also provides teams with increased visibility on live production yields, alleviating the need for manual data collection and reporting by staff from multiple sources.

“We believe in the power of data-driven decision-making, and we look forward to continuing to evolve with the innovative Nevada Gold Mines team to support their growth ambitions,” said Erich Guevara, head of business unit, Micromine Pitram – Americas.

“Micromine Pitram is uniquely positioned to support the rapid decision-making processes critical to large-scale mining operations across the globe,” Guevara said. “If you don’t have access to real-time information, you don’t have the granularity required to make the best decisions possible on key areas, including shift planning, material inventory management and safety. The implementation of Micromine Pitram at Goldrush is a testament to the platform’s maturity and industry credentials.”

Located in the Elko region, Nevada, on an annual basis, the network of ten underground gold mines collectively moves more than eight million tons of minerals.

In an interview with Goldreporter, Crowell explained that the reason why is the price of gold not higher has to do with a strong US dollar, an alternative safe-haven asset.

Another big driver is the central banks, she said, in particular the incredible central bank buying program that started in 2022 and continued into this year.

Also discussed in the interview are some of the key challenges the gold industry is facing today and recent developments in the gold market.

Click here to read the full transcript.

However, total assets under management fell slightly by 0.4% to $220 billion due to a lower gold price in the month compared to April. Nonetheless, May’s movement took year-to-date gold ETF flows into positive territory at $1 billion, which is equivalent to a 6-tonne increase in holdings.

Strong price momentum earlier in the month incited investors’ interests in gold ETFs before giving some back towards the end of May as the gold price pulled back, the Council said. In addition, US debt ceiling negotiations and looming banking industry concerns may have also led investors to seek safe-haven assets, contributing to the positive trend in May.

Almost all regions saw positive tonnage demand in May, except for Europe, WGC data shows. But fund flows in Europe remained above zero due mainly to the mechanics of the region’s FX-hedge products.

North American gold ETFs have now experienced net inflows for three straight months, adding $1.4 billion in May. In addition to the aforementioned drivers, a notable price rebound before the expiry date of major gold ETF options might have also contributed, as sizable inflows occurred that day.

Between January and May, funds in North America accumulated net inflows of $3.2 billion (+47t), dominating global inflows.

European funds ended May with positive fund flows (+$228m), but a reduction in gold holdings (-2t). This difference was mostly due to the mechanics of FX-hedged products in Switzerland and Germany, especially amid currency fluctuations related to US debt ceiling uncertainty, the WGC said. Positive fund flows during the month were concentrated in the UK and France.

But stubbornly high inflationary pressure was a stark reminder to investors that central banks in the region are not yet done with hiking. According to WGC, the latter has been a vital factor supressing gold ETF demand in Europe so far in 2023. Year-to-date European funds have led global outflows, losing $2.4 billion, with UK and Germany funds suffering the most.

Asia saw mild net inflows last month (+$9m, +0.1t). Outflows from Chinese funds were offset by Japanese and Indian inflows. Year-to-date Asian fund flows remained slightly negative at $27 million, chiefly due to China, the Council said.

Demand for funds listed in the other regions remained positive (+$25m, +0.04t). Turkey, Australia and South Africa all contributed to the positive flow. Year-to-date, there have been sizable inflows into Turkish funds, driven by local political and economic uncertainty, pushing the other regions’ flows positive to $197 million.

Trading volumes rebound

The WGC report also showed that daily trading volumes in the global gold market rose by 3% to $175 billion in May, despite a mild decline in the gold price. This was mainly driven by a 26% monthly surge in trading volumes of exchange-traded derivatives. Meanwhile, trading activities in the OTC physical gold market and in gold ETFs fell by 9% and 11%, respectively.

COMEX gold futures total net longs stood at 537 tonnes at the end of May, representing an 18% fall on April. The weaker gold price performance has led to tactical and shorter-term investors adjusting their futures positioning, contradicting trends in the physically-backed gold ETF market, which often represents investors’ strategic moves, the WGC wrote. Even so, they remain 2% above the 2022 average of 527 tonnes.

This was the observation from GlobalData’s annual survey in which the UK-based analytics firm asked 150 senior mine-site personnel regarding the degree to which they had invested in a range of technologies, and expectations for future investment.

Over the last five years, the share that had invested in drones has risen from 44% to 74%, collision avoidance from 62% to 72%, and fatigue detection from 53% to 72%, the survey found. Fatigue detection also had the third-highest share of respondents who expected to invest in the technology in the next two years (38%), after predictive maintenance for equipment (40%) and mine management software (39%).

“While the use of mine planning and management software, and communications systems has been high across the globe for many years, recently miners have invested more extensively in areas such as drones, collision avoidance, and fatigue detection, helping to ensure a safer working environment,” said David Kurtz, research and analysis director at GlobalData.

Drones were found to be principally employed for surveying and mapping (90% of those using drones) and monitoring and inspection (71%), with 33% using for tailings dam monitoring and 31% specifically for safety purposes. In Australia and Africa, the percentage of mines using them for safety purposes is 56% and 36%, respectively.

Some 30% of respondents indicated that they had fully implemented collision avoidance technology, with the largest share having invested in Australasia, and the highest share expecting to invest in the next two years in the Americas at 37%.

Respondents were also asked about the alignment of the majority of their fleet with the Earth Moving Equipment Safety Round Table (EMESRT) framework, and specifically the top three levels of incident control, which deal with notice to the operators (Level 7), alert controls (Level 8) and intervention controls (Level 9).

Of the respondents, 21% were at Level 7, 31% at Level 8, and 18% at Level 9. However, over the next two years, the share with the majority of their fleet at Level 9 is expected to rise from 18% to 28% to provide a faster response to any possible collision.

“Across the regions, Australasia was marginally ahead of the other regions in terms of the degree to which mines had invested in drones, collision avoidance, and fatigue detection, while the majors ranked above the mid-tier miners on collision avoidance and fatigue detection in particular, and surface mines had invested to a much greater extent than underground when it came to drones,” Kurtz said.

Full survey results are here.

The move, reported by the Globe and Mail, could prevent Glencore from acquiring the Vancouver-based mining giant, which in April rejected an unsolicited takeover offer of $23 billion from the Swiss miner and commodities trader.

Glencore has made it clear it would not back down and said it remained interested after Teck’s restructuring proposal was taken off the table.

“Teck wants to move forward, we’ve been told very definitively,” Lassonde told the Globe and Mail. “For them, it’s a question of consulting their bankers and consulting other groups. We’re told that they want to get something done between eight to 12 weeks.”

New York-traded shares of Teck were up 4.2% midday at $46.65 each. Class B shares climbed 5.5% to C$62.5, while Class A were changing hands at C$103.67 each or 5.4% higher.

The Canadian businessman and philanthropist, co-founder of Canada’s Franco-Nevada gold royalty company, will need the backing of Teck’s existing coal joint venture steelmaking partners, Japan’s Nippon Steel and South Korea’s Posco, for his proposal to succeed.

In the interview with the Globe, Lassonde said he was optimistic that both companies would back his proposal.

Federal Gov’t speaks

The possibility of Teck being swallowed by Glencore has become a broader political issue.

The Federal government has expressed that any takeover offer for Teck will have to go through a “rigorous process” to win government approval. 

Other than Prime Minister Justin Trudeau, Finance Minister Chrystia Freeland, Industry Minister François-Philippe Champagne, Natural Resources Minister Jonathan Wilkinson and British Columbia Premier David Eby have all weighed in on the issue. 

Large-scale mining takeovers are a sensitive topic in Canada since a wave of acquisitions more than 15 years ago eliminated many of the sector’s biggest players, including nickel miner Inco and aluminum producer Alcan.

When BHP attempted to buy Potash Corp. of Saskatchewan in 2010, the government of then-Prime Minister Stephen Harper blocked the deal on the grounds that it would not be of “net benefit” to the country.

(With files from Bloomberg and Reuters)