It’s possible that I shall make an ass of myself. But in that case one can always get out of it with a little dialectic. I have, of course, so worded my proposition as to be right either way (K.Marx, Letter to F.Engels on the Indian Mutiny)
Saturday, March 18, 2023
California, LA and Japan Sign Agreements for Green Shipping Initiative
California, Japan, Los Angeles, Tokyo and Yokohama will all participate in the efforts for clean ports and green shipping (file photo)
Representatives from the state of California and the government of Japan signed agreements to collaborate on clean ports and shipping including establishing green shipping corridors during a trade mission to Japan. The initiative was followed with a second agreement between the ports of Los Angeles, Tokyo, and Yokohama as part of the broad effort to collaborate on enhancing the global supply chain and addressing greenhouse gas emissions.
“The ports of California and Japan help power the global economy and will now help power a new era of clean energy, clean transportation, and good-paying green jobs,” said California Governor Gavin Newsom who was represented by the state’s Lieutenant Governor Eleni Kounalakis and business leaders including the executive directors of the state’s three largest ports.
The letter of intent signed in Tokyo calls for deepening cooperation, information-sharing, and discussion of best practices between the governments of California and Japan to support the development of green shipping corridors, expand offshore wind, and cut planet-warming pollution at ports in Japan and California. The initiative looks to build on trade and climate agreements launched between the state and Japan a year ago.
As part of the new agreement, the California State Transportation Agency will support green shipping corridors, port decarbonization, and the deployment of zero-emission transportation through the $1.2 billion Port and Freight Infrastructure Program, with awards for the one-time program scheduled to be announced later this month. In addition, the Japanese ministry along with GO-Biz, the California Air Resources Board, and the California Energy Commission, will share expertise and best practices on critical efforts to cut port-related pollution, including strategies for offshore wind development and zero-emission fuels and infrastructure.
The announcement of the broader agreement was followed by the signing of separate Memorandum of Understandings (MOUs) by the Port of Los Angeles with the Port of Tokyo and the Port of Yokohama to collaborate on sustainability and environmental issues.
The MOUs with the two ports call for cooperation and sharing of best practices on environmental and sustainability initiatives, including the digitation of the supply chain to optimize efficiency and reduce port operational impacts. Both the ports of Tokyo and Yokohama also agreed to establish a Green Shipping Corridor partnership with the Port of Los Angeles in the coming year, an initiative aimed at reducing emissions along their respective trade routes and promoting low- and zero-carbon ships and fuels. The Port of Los Angeles has already established similar partnerships with the ports of Shanghai and Singapore.
In addition to strengthening trade routes, maritime operational supply chain efficiencies, and environmental sustainability, other specific areas of cooperation identified under the two agreements include the testing and deployment of zero-emission vehicles, cargo handling equipment and vessels; exploring energy use and alternative energy sources; and cooperating on initiatives related to pollution-reduction technologies for terminals, ocean-going vessels, and drayage trucks.
“Global cooperation is critical if we are to make meaningful progress toward a cleaner and more sustainable maritime industry,” said Port of Los Angeles Executive Director Gene Seroka. “The Port of Los Angeles is proud of the role it has played in advancing port-related environmental technologies and supply chain decarbonization solutions, but we can do so much more with ports and other international stakeholders working together.”
Rhode Island Wind Farm Proposal Links Port and Shipbuilding Investment
Rhode Island began operating its first five wind turbines in 2016 (Block Island Wind)
As the competition continues among the major developers of offshore wind projects to win approval for new projects, the companies are seeking to sweeten the offering by highlighting the broader financial impact and with promises of investments in ports, shipbuilding, and manufacturing if they are selected. In the latest example, Ørsted and Eversource, which already have a partnership developing two wind farms off the Rhode Island coast, are seeking to sweeten their offer to win the state’s latest wind solicitation.
“We’re answering Rhode Island’s call for more offshore wind energy with a proposal that builds upon the groundwork we’ve laid in the Ocean State with our significant investments in port infrastructure, workforce training, and the local supply chain,” said Joe Nolan, Chairman, President and CEO of Eversource Energy. “Our latest proposal harnesses the unmatched combination of our onshore, regional transmission expertise together with Ørsted’s considerable offshore capabilities.”
The companies’ joint venture is proposing an 884-megawatt Revolution Wind 2 project that would be an additional wind farm within their existing federal lease which is being used to develop Revolution Wind 1. The companies hold a lease for an area about 15 miles south of Rhode Island which will provide a total of 704 MW of wind energy from the project that is already underway. Construction is expected to start later this year and when completed in 2025 approximately 400 MW will be supplied to Rhode Island with the remaining 300 MW going to neighboring Connecticut.
Revolution 1 will be the state’s first utility-scale offshore wind farm and the companies are already investing in the state to support the development of this project as well as South Fork Wind, which is also south of Rhode Island. Due to start operations this year, the 132 MW project which has 12 turbines however will supply New York with power.
Ørsted and Eversource are promising more than $2 billion in direct economic impact to Rhode Island if the state approves the second phase project. Including further investments in port improvements and shipbuilding. They are saying if they are selected for Revolution Wind 2 they will invest $35 million to realize Quonset Development Corporation’s vision for a Regional Offshore Wind Logistics and Operations Hub at Quonset Point. Revolution Wind 2 they report would enable the construction of two new crew transfer vessels in Rhode Island to serve Ørsted’s U.S. portfolio, on top of the five already being built by Blount Boats and Senesco Marine as part of the Revolution Wind investments while also saying they are “planning other shipbuilding investments in Rhode Island to support the industry.”
Ørsted says it will open a new U.S. Engineering Hub in Rhode Island, creating roughly 75 new local engineering jobs in a state-of-the-art facility that will serve as an Ørsted engineering center of excellence in the U.S. This would be in addition to $1 million invested in a training partnership and the development of the regional offshore wind foundation component manufacturing facility at ProvPort, which is building the foundation components for South Fork Wind.
The companies point to all of their efforts saying they are ready to help Rhode Island continue to develop its homegrown offshore wind supply chain. They point to the state’s heritage of having in 2016 commissioned the first five 6 MW offshore wind turbines to replace the five diesel generations on Block Island. That project powers 17,000 homes with 10 percent of its power meeting Block Island’s needs and the remainder going onshore in Rhode Island. If chosen for the new project, the joint venture which was established in 2016, says it would help to continue to build the American offshore wind supply chain and support well-paying jobs and industry for Rhode Island.
Shell Funds Offshore Wind Research at Former Avondale Shipyard Site
The former Avondale Shipyard site, now used as a breakbulk pier and industrial hub (T Parker Host)
Louisiana-based company Gulf Wind Technology has secured funding from Shell to set up a wind power research and training facility at the former Avondale Shipyard site, a storied location which is ready for redevelopment.
With $10 million in backing from Shell, Gulf Wind plans to hire 30 people and found a new hub for offshore wind R&D in the region.
Gulf Wind has experience in improving the economic performance of operational wind farms and conducting research on rotor technology, primarily for onshore applications. It is headquartered at Avondale, with 30,000 square feet of workspace and access to 1.5 million additional square feet for fabrication. The new R&D program will be an expansion of its activities.
The company says that an investment in R&D for designing custom rotors - its primary area off experience - will be useful when it comes to adapting offshore turbines to the unique conditions in the Gulf.
“Wind resources in the Gulf region are more variable than what you find on the east coast where most of U.S. offshore wind development activity is currently happening,” said James Martin, GWT's CEO. “Seasonal hurricane conditions and moderate average wind speeds create a situation that requires a novel approach to the application of technology and the framework in which it is both developed and demonstrated. The Shell Gulf Wind Technology Accelerator program has been specifically created to address and fulfill this need."
The first demonstrator turbine at the site is expected to be ready as early as next year. In addition to its R&D work, the program weill also house an offshore wind workforce education and training initiative.
To get the project built in Avondale, the state of Louisiana offered Gulf Wind Technology a workforce development incentive package, including a $375,000 award to support site infrastructure improvements. The company is also expected to participate in two state tax exemption programs.
The news is a big boost for the former Avondale Shipyard, renamed Avondale Global Gateway under the ownership of terminal operator and stevedoring company T. Parker Host.
"When we took the risk of transforming Avondale shipyards, this is exactly the type of progress and partnership we envisioned. With hundreds of acres of laydown space for equipment like offshore wind blades, our site is the ideal location for this type of groundbreaking investment," said T. Parker Host CEO and President Adam Anderson. "We had a vision of Avondale Global Gateway becoming the first offshore wind hub on the Gulf Coast and with the launch of this partnership, we are quickly making this a reality."
Last month, the Port of South Louisiana agreed to buy and further redevelop the Avondale site, and the port's management welcomed the news that Gulf Wind will be expanding.
"Today’s announcement from Gulf Wind Technology and Shell is confirmation that Avondale is open for business and attracting commerce and investment from the world’s most recognizable organizations," said Port of South Louisiana CEO Paul Matthews. "This is just the beginning. We look forward to fostering more development and job creation as Avondale Global Gateway’s new owner."
T. Parker Host purchased Avondale from Huntington Ingalls in 2018 for $60 million and invested over $100 million more in its redevelopment. It has agreed to sell the site to the Port of South Louisiana for $445 million, reflecting upgraded expectations of the complex's future business opportunities.
The Portuguese Navy is relieving 13 sailors and opening a criminal investigation after they refused to board their assigned vessel and assume their posts in preparation for a mission to track a Russian vessel transiting near Madeira. The Navy is responding saying that the vessel despite faults was seaworthy while raising suspicions that the assignment to track a Russian vessel may have also been a factor in the incident.
The sailors are assigned to a base in the Madeira archipelago manning a patrol boat. On the night of March 11, they were ordered to head to sea to track an unidentified Russian vessel sailing north of the island of Porto Santo. Portuguese media is reporting that the vessel was believed to be a spy ship and that it was a routine mission to track the vessel while it was near the islands. The Navy is further defending the mission saying that it was a short-duration assignment and that the patrol ship would have remained close to the coast operating in good weather conditions.
Four sergeants and nine enlisted men assigned to the ship, however, refused to board the ship and undertake the mission. Reports indicate that the cited safety concerns after the vessel, the NRP Mondego, a Tejo class patrol vessel acquired in 2014 from the Danish Navy, experienced engine troubles earlier in the day. Media reports are further saying that the vessel has repeatedly experienced engine failures among other problems including oil, water, and sewage leaks.
A Portuguese admiral flew to the base and boarded the ship on March 16 speaking with the captain. Media reports said he wanted to also speak directly to the 13 sailors and addressed the entire ship’s company. Speaking with reporters after leaving the vessel he reiterated the safety of the vessel and the importance of the chain of command.
The Portuguese Navy in its official statement said the 13 sailors engaged in an act of insubordination for refusing to fulfill their military duties and usurped functions, powers, and responsibilities not inherent in their respective posts and positions.
“Because possible criminal matters may be at stake, the Navy informed the Military Judicial Police of all the events that occurred,” said the statement. The sailors they reported were being relieved as soon as possible while the process of an internal disciplinary action proceeds.
While Mondego’s commander reported that the ship had experienced an engine fault, he reported through the Navy’s command chain that the vessel had the ability to conduct the mission. The Navy contends the captain was given the freedom to abort if he felt the mission was unsafe.
“Warships, being a set of very complex and very redundant systems, can operate in a very degraded way without impact on safety. This evaluation, once again, belongs to the command line and the Material Superintendence, as the responsible technical entity. Both entities did not consider the ship unsafe to sail,” reported the Navy.
It added that the sailors refused to undertake the mission despite being trained to operate the vessel in a degraded condition. Sailors, they said, are prepared to deal with the inherent risks that are part of the military conditions.
Despite the 13 assessing the ship and concluding it was not ready to sail, some told the commander that if the mission were to save lives they would have gone to sea. Based on these comments, the Navy is considering if the team deliberately refused to carry out the mission of tracking the Russian ship.
Reports of the poor conditions aboard the vessel have sparked a series of defenses both from the Navy and government officials. They cited monies allocated in the upcoming budget for overhauls of the vessels while saying social media reports and a video of flooding on the Mondego were a year old and out of date.
Mondego is part of a series of three ships that make up the Tejo class in the Portuguese Navy. Formerly named HDMS Glenten, the ship was in service with the Royal Danish Navy from 1992 to 2010 before it was sold to Portugal in 2014. Renamed Mondego, and after a period of reconfiguration and modernization, the vessel operates patrols and surveillance of Portugal’s maritime spaces.
Fatal Accident on Fuel Barge in NYC Harbor Prompts Safety Reminder
Fire and Police Harbor units responded to the accident (ABC7NY/screen shot)
A fatal accident is serving as a reminder of the dangers when performing seemingly routine tasks. Reports are indicating that a 53-year-old crewmember working for Centerline, a tug and barge operator that provides fueling services and transports petroleum between refineries and terminals, was killed early Thursday morning. The company terms the circumstances of the accident as a reminder to raise situational awareness around everyday tasks.
The crewmember with more than 20 years experience was at the company’s dock on the Kill Van Kull Channel near Staten Island, New York reportedly offloading trash around 6:00 am while it was still dark outside when he misjudged distances between two barges. He fell between the barges. Other crew at the scene tried to recover the individual and also called for New York City’s rescue teams.
The New York Fire and Police departments both responded to the scene and news helicopters were on site. Reports indicate that the man was recovered from the channel and rushed to a local hospital where he was pronounced dead.
Centerline responded to the tragedy, informing its crews, and ordering an immediate safety review to highlight routine tasks and unforeseen hazards. Captains were instructed to conduct a safety meeting within 24 hours with their crews and record the meeting in the logs. They were instructed to conduct a discussion on everyday tasks and how to remain vigilant, reducing complacency and increasing safety.
USCG Recommends Bollards Test After Failure Caused Drillship Collision
Valaris DS-16 docked in Mississippi for repairs when high winds caused it to brake free (USCG)
The snapping of a deteriorated bollard caused the collision of a drillship and a bulker in Pascagoula, Mississippi last year, leading to nearly $5 million in damages, the National Transport Safety Board (NTSB) has determined. They raise concerns about a lack of testing and inspections while also noting the increased size of ships and its impact on previously sufficient facilities.
In an investigation report on the collision of offshore drilling unit Valaris DS-16 and dry bulk carrier Akti in March last year, the NTSB found out that a deteriorated bollard that failed at the ST Engineering Halter Marine and Offshore (STEHMO) shipyard dock had also been modified to increase its height. The area was experiencing strong winds higher than normal during the passage of a cold front which created the added forces that caused the failure, and the vessel laid up undergoing repairs did not have power, despite using its anchors, to stop its uncontrol drifting across the channel.
The 752-foot drill ship was built in 2014 and is 52,242 gross tons. The vessel had been taken out of service and laid up in Las Palmas, Spain in August 2020. The vessel arrived at the shipyard in Mississippi on January 6, 2022, to undergo work for reactivation. According to the NTSB, it has a draft of 49 feet with its propulsion provided by six thrusters. Due to limited clearance at the dock, the thrusters were reacted above the keel before mooring rendering propulsion unavailable although the diesel generators were continuing to provide power while the vessel was docked.
A detailed ‘Quayside Mooring Analysis’ was carried out before the arrival of the drillship that identified some concerns including the spacing of the bollards. Although the analysis considered the loss of a single mooring line and calculated critical components, it did not consider the unlikely event of losing a bollard. Shipyard engineers did not have any records for pull test ratings specifically conducted on the bollards but they did have a pull certificate for 1534 metric tons from a tugboat’s bollard pull test at the pier. Before the vessel arrived in Mississippi, the captain working with the engineers modified the plan which was approved by the operating company engineers and sent to the shipyard.
The vessel was undergoing repairs with welders, operators, contractors, and others living aboard. At the time of the incident, there were 164 people aboard. In early March, the captain of the Valaris DS-16 became aware of a weather forecast for a strong cold front. Around the same time, a semisubmersible rig arrived in the yard docking to the north of the drillship and requiring a slight rearranging of some of the lines. Weather forecasts for March 12 predicted winds at 25 knots with gusts to 30 knots and gusts as high as 44 knots by morning.
Shortly after midnight, the captain woke believing he had heard the sound of a mooring line snap. Crewmembers confirmed that bollard 6, which secured four bowlines for the DS-16 and two stern lines for the nearby rig had broken free from the dock at its base. The bow of the DS-16 began to peel away from the pier and the remaining mooring lines parted. The general alarm was sounded while they also used the radio to alert nearby vessels and summon tugboats. Everyone aboard was mustered as they prepared for possible contact with another vessel.
Both anchors were deployed and several tugs arrived to assist. The anchors stopped the drift, but the tugs were unable to hold the stern and at 0041 DS-16 struck the Akti moored across the channel.
In the analysis, bollard 6 was specifically identified as a critical component in the mooring plan. In its report, the NTSB said that it performed ultrasonic thickness tests on the 13 bollards at the shipyard with results showing there was deteriorated steel at the lower portion for most of them besides signs of external corrosion and wastage. Further, all the bollards used to secure the DS-16 were modified from the original 1997 design, with vertical components added to each of them to accommodate more lines.
The collision caused sustained damages to the drillship in its riser handling system, deck fittings, transfer hose-reel system, walkways and platforms, and other equipment on board. A bulwark panel was also deformed on the starboard side with insets on the side shell plating and port stern also noted. Although there were no damages to the underwater portion of the hull, the drillship damages were estimated at $4.2 million. The Akti sustained damage to the starboard-side bridge wing, handrails, deck coaming, side shell plating, and lighting fixtures estimated at $778,000 while STEHMO estimated the cost to replace bollard 6 at their facility at $20,000. There were no reported damages to Chevron dock no. 6 where the Akti was moored.
The investigation concluded that under the pressure of strong winds, coupled with the fact that the drillship was an extremely large vessel, bollard 6 snapped and caused Valaris DS-16 to drift and collide with the bulk carrier.
The broken top of bollard 6 was not recovered from the channel and was not analyzed although a post-casualty measurement of the remaining 18-inch-diameter base of the bollard showed that the steel wall thickness was less than 0.25 inches on the side farthest from the edge of the pier—an apparent reduction in thickness of about 0.5 inches from the original bollard design of a wall thickness of 0.75 inches.
Additionally, several bollards showed signs of external corrosion and wastage while steel wires and chains were looped around the bases of bollards from which pier fenders hung, causing chafing and wear.
The NTSB concludes by highlighting that neither the U.S Coast Guard nor Occupational Safety and Health Administration (OSHA) has regulatory requirements for facilities to inspect and verify loading capacities of bollards at shoreside facilities. They also recognize the normal issues of exposure to seawater created a high risk for corrosion, as well as issues of wear. Further, “As a result of continuing increases in vessel size and sail area, bollards that were previously sufficient may not have adequate capacity to moor larger vessels,” writes the NTSB.
The Coast Guard has recommended that facility owners and operators develop routine inspection programs for bollards and other mooring equipment.
CRIMINERAL CAPITALI$M
LME rocked by new nickel scandal after finding bags of stones Bloomberg News | March 17, 2023 |
Stock image.
The London Metal Exchange has discovered bags of stones instead of the nickel that underpinned a handful of its contracts at a warehouse in Rotterdam, in a revelation that will deliver another blow to confidence in the embattled exchange.
The amount of metal represents just 0.14% of live nickel inventories on the LME, worth about $1.3 million at current prices, so the immediate impact on metals markets is limited. But the shock announcement has much wider implications: in an industry riddled with scandals, the LME’s contracts are viewed as unquestionably safe. The news that even a few of them have been compromised will raise fresh questions about its systems and procedures while the 146-year old exchange is still wading through the fallout of its last nickel crisis.
“LME warehouse warrants used to be the gold standard of warehouse warrants around the world, treated as a near-cash equivalent,” John MacNamara, chief executive officer of Carshalton Commodities Ltd. and a veteran commodity trade finance banker, wrote on LinkedIn. “Something has gone horribly wrong at the LME.”
It also comes at a fraught time for the wider metals world, after trading giant Trafigura Group revealed in February that it had been the victim of a vast alleged fraud involving missing nickel cargoes. The news that a powerful player like Trafigura is facing hundreds of millions of dollars in losses has spooked others in the industry and prompted some to check on their own metal cargoes.
However, the one place where metal has always been considered perfectly safe is once it has been registered “on warrant” in an LME-approved warehouse. Contracts on the LME, which are the global benchmarks for industrial metals including aluminum, copper and nickel, are underpinned by physical metal in the network of warehouses around the world — any trader holding a contract to delivery receives a parcel of metal in an LME-registered warehouse.
The LME discovered the problem after it received reports that some nickel delivered out of a warehouse in Rotterdam contained bags of stones instead of nickel briquettes. The warehouse is operated by Access World, according to people familiar with the matter. The company was previously owned by Glencore Plc, and said in January it had been acquired by Global Capital Merchants Ltd.
Access World, which is one of the more prominent companies that operates facilities registered on the LME network, investigated and subsequently found that the bags of “nickel” underlying nine contracts — representing 54 tons of metal — did not contain the nickel that they should have done. The nine warrants have been invalidated and the warrant owner has been notified, the LME said, without naming the owner. The metal had been registered as live in the LME warehouse since early 2022, according to one of the people.
Spokespeople for Access World and Glencore declined to comment.
The LME warehousing system has over the years proved resilient to wider instances of fraud in the metals industry, which typically involve falsification of shipping and storage documents. The LME system is viewed as more secure because the exchange creates its own warehouse warrants and transfers ownership of them digitally. But it relies on warehousing companies to check the material as it enters their facilities to ensure the integrity of the market — including by weighing the bags that move in and out of the system.
It’s not clear whether the bags ever contained nickel, and whether the issue is a result of error, theft or fraud.
However the LME said that the bags clearly didn’t match the expected weight, suggesting that the warehouse at the very least failed to weigh those that were shipped on the way out.
The LME said there is no reason to believe that other warehouses are affected, but the exchange has asked that licensed operators recheck warranted nickel, it said in a statement. It noted that the issue related to nickel briquettes packed in bags, and so other metals, which do not allow bagged delivery, “are not susceptible to this type of irregularity.”
Trafigura said in a statement that the LME announcement had no connection with its own legal action against a group of companies connected to and apparently controlled by businessman Prateek Gupta. Trafigura does not own any of the nine warrants that have been invalidated by the LME, the company said.
For the metals industry, a long history of risk and fraud means that missing cargoes are far from unusual, and nickel is a particular favorite because of its high value. In 2017, French and Australian banks got hit by loan losses in 2017 that totaled over $300 million after they discovered fake documents for nickel stored in Asian warehouses owned by Access World, while Bloomberg has reported that Russia’s Sberbank PJSC discovered in 2018 that containers of nickel in Rotterdam that it financed on behalf of Sanjeev Gupta’s Liberty Commodities had already been emptied.
And just last month, Trafigura said it was facing more than half a billion dollars in losses after discovering metal cargoes it bought didn’t contain the nickel they were supposed to.
Yet metal placed on the LME is supposed to be different. For the exchange, the issue is a major headache, coming as it is still dealing with the fallout of its last nickel crisis — the cancellation of billions of dollars in trades after prices spiked last year. Its regulator, the Financial Conduct Authority, earlier this month announced its first ever enforcement probe into an exchange over the LME’s conduct in the nickel crisis, and the exchange has promised to announce a series of reforms by the end of this month.
The nickel market has struggled to return to normal since the crisis, and is still operating on shortened hours. The LME had planned to allow the beleaguered nickel contract to resume trading during Asian hours from Monday, but has delayed the move by a week.
“We need the LME to function properly,” said Michael Widmer, head of metals research at Bank of America Corp. “It’s just not at the moment, that’s the problem.”
(By Jack Farchy, Mark Burton and Archie Hunter)
MONOPOLY CAPITALI$M
Volkswagen to invest in mines in bid to become global battery supplier
Reuters | March 17, 2023 | The SAIC-Volkswagen assembly line in Shanghai. (Photo: Xinhua via Twitter)
Volkswagen plans to invest in mines to bring down the cost of battery cells, meet half of its own demand and sell to third-party customers, the carmaker’s board member in charge of technology said.
Its strategy aligns with a wider trend of carmakers seeking greater control over parts of the supply chain traditionally left to third parties, from energy generation to raw material sourcing, as they compete for scarce resources they urgently need to meet electrification targets.
Europe’s biggest carmaker wants its battery unit PowerCo to become a global battery supplier, as well as meet half its own demand with plants mostly in Europe and North America, Thomas Schmall told Reuters in an interview.
PowerCo will start by delivering cells to Ford (F.N) for the 1.2 million vehicles the US carmaker is building in Europe on Volkswagen’s electric MEB platform, he said.
“The bottleneck for raw materials is mining capacity – that’s why we need to invest in mines directly,” he said.
The carmaker was partnering on supply deals with mining companies in Canada, where it will build its first North American battery plant.
Such partnerships guaranteeing finance can cut years off mine development times for junior miners, John Meyer, senior analyst at boutique investment bank SP Angel, said.
Schmall declined to comment on further locations under consideration or when Volkswagen might invest directly in mines until the market was more settled.
“In future, there will be a select number of battery standards. Through our large volume and third-party sales business, we want to be one of those standards,” he said. Ambitious roadmap
Acquiring batteries at a reasonable cost is a challenge for carmakers like Volkswagen, Tesla and Stellantis looking to make electric vehicles (EVs) affordable.
Only Tesla has pledged more investment into battery production than Volkswagen, a Reuters analysis showed – though even the US EV maker is struggling to ramp up production and is recruiting Asian suppliers to help.
Few carmakers have disclosed direct stakes in mines, but many have struck deals with producers to source lithium, nickel and cobalt and pass them onto their battery suppliers.
Securing those resources in time, close to refineries and from places outside of China is key to winning the battery race, Geordie Wilkes of the UCL Insitute for Sustainable Resources said.
PowerCo, set up last year, is targeting over 20 billion euros ($21.22 billion) in annual sales by 2030.
It is an ambitious roadmap for a unit not yet producing at scale. Production will start in 2025 at PowerCo’s plant in Salzgitter, Germany, 2026 in Valencia, Spain, and 2027 in Ontario, Canada.
Still, Schmall is confident the carmaker can expand quickly – and must do so if it wants to build an affordable EV, in which 40% of the costs come from the battery.
Volkswagen released on Thursday the details of a 25,000-euro EV it aims to sell in Europe from 2025. China’s BYD, which also produces batteries, is far ahead of Volkswagen in the affordable EV race and outsold the German carmaker for the second time in four months in China in February.
Half the staff at Volkswagen’s PowerCo are industry veterans from Asia, where producers like CATL, LG Chem and Samsung SDI dominate global cell production.
Reducing costs
In Volkswagen’s 180-billion-euro five year spending plan, up to 15 billion is earmarked for its three announced battery plants and some raw material sourcing.
The carmaker has so far nailed down raw material supply until 2026 and will decide in the next few months how to meet its demand from then on, Schmall said in the interview.
It has also ordered some $14 billion in batteries from Northvolt’s Swedish plant.
“Bringing down battery costs further is a challenge,” Schmall said. “We’re using all the instruments with PowerCo.”
($1 = 0.9427 euros)
(By Victoria Waldersee and Nick Carey; Editing by Susan Fenton and Angus MacSwan)
Workers organize core samples at the Santa Cruz copper project in Arizona.
Credit: Ivanhoe Electric
Ivanhoe Electric (TSX: IE; NYSE American: IE) says visible copper in a drill hole suggested by the company’s new technology bodes well for adding high-margin ore to the resource at the Santa Cruz copper project in Arizona.
Drill hole SCC-122 outside the mineralization area at the Texaco Ridge target intersected visible copper oxide starting from 429 metres depth, the company said. The hole is 200 metres west of the closest historic drill hole at the site located midway between Phoenix and Tucson, it said.
“The recent visual confirmation of additional oxide mineralization at Texaco Ridge is indicative of the upside potential of the area,” Ivanhoe Electric CEO Taylor Melvin said in a news release. BMO Capital Markets said the finding was another success for Ivanhoe Electric’s trademarked Typhoon exploration technology which uses electromagnetic pulses to probe for deposits.
“We view this as another positive exploration datapoint delivered by Typhoon, with leverage to add further potentially high-margin oxide mineralization at the Santa Cruz project,” mining analyst Andrew Mikitchook wrote in a note on Friday.
“Adding soluble copper mineralization is a positive for the project, and we would expect further oxide mineralization is likely to be discovered in step-out drilling across the Santa Cruz property.”
As Ivanhoe conducts an initial economic assessment of a potential underground mine at Santa Cruz, it reported infill drill hole SCC-058 cut 55 metres grading 3.1% copper from 596 metres depth, including 37 metres grading 4.2% copper.
Ivanhoe used Typhoon to identify the Texaco Ridge target as well as several others that may expand the East Ridge and Texaco deposits, define the Far Southwest target and potentially enlarge the whole Santa Cruz deposit.
“With our exploration drilling precisely focused on areas highlighted by Typhoon, we are excited about the potential at the Texaco Ridge exploration area and the development of the entire Santa Cruz copper project,” said Robert Friedland, the company’s executive chairman.
The project has an indicated resource of 226.7 million tonnes grading 1.2% copper for contained metal of 2.8 million tonnes, according to a Dec. 2022 estimate. The indicated soluble copper grade is 0.8% for 1.9 million tonnes contained soluble copper.
The Texaco Ridge drill hole SCC-122, showing visible copper, also displayed brecciated oracle granite with blue chrysocolla, a leachable mineral that is about 30% copper by weight, Ivanhoe said. Assay results for the hole are pending.
This drill hole also encountered chrysocolla, chalcopyrite, atacamite and chalcocite, leachable minerals which range from 34% to 80% copper by weight, the company said.
“At Texaco Ridge, the presence of primary hypogene chalcopyrite mineralization, and evidence of the same protracted supergene enrichment processes seen at Santa Cruz, is encouraging for the potential of a greater discovery of high-quality enriched copper mineralization,” the company said.
Peninsula Energy delays Wyoming uranium project restart, shares plunge
MINING.COM Staff Writer | March 16, 2023 | The processing plant at the Ross permit area (Image: Peninsula Energy)
Peninsula Energy (ASX: PEN) has delayed the restart of commercial production at its Lance project in Wyoming, from the first quarter of this year until mid-2023.
According to the company, there has been a delay in the delivery of equipment.
“The current inflationary economic environment and very real supply-chain constraints, in combination with an unusually difficult Wyoming winter, have presented challenges but the team has demonstrated their professional capability and resolve,” Peninsula CEO Wayne Heili said in a news release.
“Despite encountering some delivery delays that are outside of our control, the team continues to complete the transition construction work on a short timeline and within the projected capital framework,” he said.
The company capital expenditure to date is in line with the 2022 definitive feasibility study, which estimated a life-of-mine capital cost of $290.6 million, with the Stage 1 operation requiring an up-front capital investment of $2.7 million and a wellfield replacement and sustaining capital expenditure of $16.3 million.
The Lance project holds a resource of 53.7 million pounds of uranium oxide (U3O8), making it one of the largest uranium projects in the US.
It is estimated that the Lance could produce two million pounds of uranium a year at steady-state production from the fourth year of production, producing 14.4 million pounds of U3O8 over an estimated 14-year mine life.
Shares plummeted 14.3% in early trading on Thursday. The company has a $99 million market capitalization.
Activist shareholders accuse Azimut Exploration of ‘squatting’ on Quebec lithium lands
Henry Lazenby | March 16, 2023 | Outcrop of the Patwon gold zone at the Elmer property in Quebec. Credit: Azimut Exploration
Two activist shareholders with ‘substantial’ holdings in Azimut Exploration (TSXV: AZM) have accused the junior of “squatting” on some of Quebec’s most prospective lithium lands.
Coloured Ties Capital (TSXV: TIE) and privately held Bullrun Capital this week issued a second open letter to Azimut’s founder, president and CEO Jean-Marc Lulin, accusing the geologist of refusing to acknowledge or engage with them about its detailed exploration plans for its James Bay lithium portfolio.
The activists are turning up the heat on Lulin and Azimut after the Corvette lithium discovery by Patriot Battery Metals (TSXV: PMET; ASX: PMT; OTCQX: PMETF) and the Adina discovery of Winsome Resources. Patriot aims to publish the first resource on Corvette this summer.
The concerned shareholders say they are active investors in Quebec’s critical mineral exploration projects via investments in junior explorers.
“These companies have made discoveries that have made James Bay the lithium exploration capital of the world and provided amazing shareholder returns to all investors in the James Bay region,” they said in a Tuesday press release.
For example, Patriot enjoyed a more than 2,200% run-up in its equity through January.
In contrast, Azimut holds what the activists believe is the best and most prospective critical minerals ground in the region. Recently, Azimut went on a staking frenzy to stake additional ground.
The activists argue Azimut’s stock price has a discounted valuation compared with its peers. It reflects the market’s frustration with Azimut’s refusal to explore these vast critical mineral land holdings and its sole focus to expend all its efforts and working capital in searching for gold deposits in remote locations of the province.
“This practice to acquire vast critical mineral land holdings in Quebec and then squat on these highly prospective lands is in direct contrast to others from outside Quebec and Canada who may ‘know the land less’ but have established critical minerals deposits on ground adjoining or surrounding Azimut ground in the last three years,” the activists charged.
They’re advocating for a revamp of Azimut’s business practices. They insist the company establish a critical minerals division and engage a qualified critical minerals exploration executive team to run it.
They want Azimut to engage in business practices that are respectful of all shareholders, adjoining property junior exploration companies and all other stakeholders, including Canada’s current mandate to develop critical minerals assets in Quebec.
In a response on Thursday, Azimut characterized the activists’ assertions as containing “numerous inaccuracies, mischaracterizations, and false statements.”
“The recent re-election of all company’s directors at the annual general shareholders’ meeting, with support ranging between 92.5% and 99.9% of the shares voted at the meeting, demonstrates that shareholders endorse the company’s current leadership and business strategy,” Lulin said in the statement. Bullrun Group’s ‘bullying tactics’
The company said it had demonstrated an openness to the activists’ repeated requests for meetings and communications in the past. “However, rather than engage constructively, the Bullrun Group has adopted bullying tactics to drive their self-interested agenda forward,” Lulin said.
Azimut said it had engaged in conversations and written exchanges with the group on several occasions regarding their intent to acquire a stake in several of Azimut’s properties. “Following those exchanges, which have unfortunately escalated to multiple harassing and belligerent messages, the board determined that the propositions of the Bullrun Group were not compelling for Azimut or its shareholders, and the board concluded that it was not in the company’s best interest to further engage with the Bullrun Group at that time.”
In February, Azimut outlined its key 2023 objectives for its lithium properties.
At the Pikwa and Galinée properties, it plans to implement an aggressive field program to assess the lithium potential. The properties are directly on strike with the two most important recent lithium discoveries (Corvette and Adina) in the Eeyou Istchee James Bay region. Azimut holds the assets in a 50-50 joint venture with Soquem.
The company also holds 100% of the Corvet and Kaanaayaa lithium prospects. It plans to implement an aggressive field program to assess the lithium potential on these properties located south of the Corvette discovery area.
Lastly, Azimut also holds the James Bay lithium project, one of the largest lithium portfolios in the Eeyou Istchee James Bay region, comprising 16 claim blocks for 2,234 claims. It plans to undertake reconnaissance prospecting supported by remote sensing and advanced geochemical targeting this year.
Shares in Patriot had come down from its 12-month high of C$17.69 to currently trade at C$11.20, still up 1,500% over the last year, giving it a market cap of about C$1 billion. Shares in Azimut are down 10.7% over the 12 months at C$1.16, after also spiking recently to a year high of C$1.80. It has a market cap of C$92.2 million.
Hydrogen-based thermal power produced using aluminum scrap
Staff Writer | March 17, 2023 | Found Energy’s process uses hard-to-recycle aluminum scrap grades such as foil. (Reference image by blikss, Flickr).
Boston-based startup Found Energy announced that it has successfully produced 20 kW of continuous, hydrogen-based thermal power in an experimental reactor using 1 kilogram of low-grade aluminum scrap such as foil as a fuel source.
According to the company, the scrap is treated with a proprietary catalyst that causes it to liberate hydrogen particles contained in a water bath, which can either be burned for thermal energy or stored in a fuel cell.
Once the reaction is over and the heat and hydrogen dissipate, aluminum hydroxide is left behind. Aluminum hydroxide is a chemical precursor to alumina that primary smelters use to make pure aluminum metal.
The reactor, capable of producing electricity in the kilowatt range, is the company’s initial offering. The plan in the third quarter is to begin testing a model capable of producing electricity in the megawatt range.
Found Energy hopes to market the low-emission power source to heavy industrial energy consumers such as aluminum smelters, long-haul trucking and ocean-going freighters, all fueled by oil-based products with more extensive carbon footprints.
The firm also expects ammonia producers for fertilizers – who typically use hydrogen extracted via steam methane reforming – to look into the new technology as it is an alternative solution capable of delivering hydrogen in a safer manner and with higher volumetric energy density.
