Guinea approves joint development deal for Simandou iron ore project

Reuters | February 4, 2024 | 

Simandou project area. (Image by Rio Tinto.)

Lawmakers in Guinea approved on Saturday a joint development deal for its giant Simandou iron ore project involving the junta-led government, Rio Tinto, and Winning Consortium Simandou, the lawmaking body’s spokesperson said.


Simandou, set to be the world’s largest and highest grade new iron ore mine, has been the subject of prolonged negotiations due to its complex ownership structure, delays caused by legal wrangling, Guinea’s political upheaval and difficulties around construction.

The National Transition Council, which acts as parliament under Guinea’s interim regime, voted to approve laws that ratified the agreement, which envisages the completion of construction by end-2024, council spokesperson Mory Dounoh told journalists after the vote.

Rio Tinto owns two of four Simandou mining blocks as part of its Simfer joint venture with China’s Chalco Iron Ore Holdings (CIOH) and the government of Guinea. Rio Tinto holds a 53% stake, while CIOH holds the rest.

The two other mining blocks are being developed by Winning Consortium Simandou (WCS), made up of Singapore-based Winning International Group, Weiqiao Aluminium – part of the China Hongqiao Group – and United Mining Suppliers.

(By Saliou Samb and Alessandra Prentice; Editing by Emelia Sithole-Matarise)

MONOPOLY CAPITALI$M

De Beers expands presence in Angola’s diamond sector

Cecilia Jamasmie | February 6, 2024 |

Angola’s Catoca is the world’s fourth biggest diamond mine. (Image courtesy of Endiama.)

De Beers, the world’s largest diamond producer by volume, has inked a series of agreements with the Angolan government, including one with state-owned diamond miner Endiama, covering processing and exploration prospects.


The pacts between the parties build on exploration contracts signed in 2022, which marked the return of De Beers to the country it left in 2012.

“We believe this is a real step forward in our cooperation,” chief executive Al Cook said during the signing ceremony in Cape Town, South Africa.

Among the agreements inked by De Beers, a unit of Anglo American (LON: AAL), there is one with Angola’s national diamond trading company Sodiam, which seeks to ensure the use of best practice on sorting and processing rough diamonds mined in the country.

Other joint activities include reviewing several kimberlite deposits to reassess their economic attractiveness through the application of new De Beers technologies and promoting transparency and traceability of diamonds produced in Angola. The parties will also work together to identify opportunities to build local community capacity by leveraging De Beers’ Building Forever sustainability framework.

Al Cook, De Beers CEO and Ganga Júnior, Endiama CEO. 

(Image courtesy of De Beers Group.)

Angola has long been a hot spot for diamond finds, but most companies, including De Beers, left in the early 2000s.

Rio Tinto (ASX: RIO) came back to Angola in 2019, on condition to own 75% of the initial phase of any mine developed with Endiama. The contract lets Endiama boost its stake to 49% in the future.

Angola – the world’s sixth-largest diamond producer according to Kimberley Process statistics – generated 8.7 million carats in 2022, down from 9.3 million carats the previous year.

SAVING THE AMAZON

Brazil prosecutors seek annulment of contract for Belo Sun gold mine

Reuters | February 6, 2024 | 

The Volta Grande project consists of an open pit, a gold recovery process facility, water and tailings management and supporting infrastructure.

 (Image taken from Belo Sun’s presentation.)

Brazilian federal prosecutors asked a judge to annul a contract between Canadian miner Belo Sun and Brazil’s land rights agency to build a gold mine valued at 1.2 billion reais ($242 million), according to a legal document seen by Reuters.


The controversial mining project is located in Brazil’s Amazon rainforest, near the Xingu river in northern Para state.


The request of prosecutors to end the project is part of a lawsuit over land rights originally filed by public defenders in 2022.

The document, dated Jan. 30, indicated that prosecutors back the right of families living in settlements near where the mine would be built to be consulted on the project before any decision allowing it to proceed.

Belo Sun did not immediately respond to a request for comment.

The company has previously valued the project at 1.2 billion reais, but its future has been clouded due to controversy over potentially harmful environmental impact.

The prosecutors request is the latest obstacle faced by Belo Sun’s would-be mining project.

A separate judge previously ruled that in order for the project to advance, its environmental licenses must first be approved by federal environmental protection agency Ibama, not state officials.

Ibama has yet to issue a decision on the licenses.

($1 = 4.9590 reais)

(By Ricardo Brito and Andre Romani; Editing by Lincoln Feast)

Rio Tinto unit faces criminal case in Canada over injured worker

Reuters | February 5, 2024 | 

Aerial view of Diavik diamond mine.

 (Image courtesy of Dominion Diamond.)

A Canadian unit of global mining company Rio Tinto is facing a criminal case after an employee was seriously injured at an Arctic diamond mine, according to an announcement by local authorities.


The accident took place on Jan 26, 2003 at the Diavik mine, which is located about 200 km (125 miles) south of the Arctic Circle in the Northwest Territories, the local Workers’ Safety and Compensation Commission (WSCC) said.

The WSCC has filed a case against the mine and the next step is a hearing on March 19 at the criminal court in Yellowknife, the capital of the Northwest Territories. The WSCC revealed the case in a statement issued on Friday.

“Diavik Diamond Mine is charged with multiple counts alleging violations of the Mine Health and Safety Act, including failure to implement and maintain safe work practices, and failure to take every reasonable measure to protect the health and safety of their employees, as well as other offences,” it said, but gave no details of the accident.

Rio Tinto said in a statement on Monday that Diavik took the health and safety of its employees very seriously. It declined to comment further, given the criminal case.

Six people died last month after a small plane carrying Rio Tinto workers crashed near Fort Smith in the Northwest Territories, shortly after taking off for Diavik. Four of those were employees of Rio Tinto.

In 2022, Rio Tinto reported zero fatalities and had an all injury frequency rate – the number of all injuries per 2,000,000 hours worked – of 0.40, the same as the previous year.

The company’s annual report said that in 2022, the number of potentially fatal incidents rose to 19 compared to 16 in 2021.

(By Divya Rajagopal; Editing by David Ljunggren and Nick Zieminski)

Gates, Bezos-backed KoBold Metals says Zambia copper find largest in a century

Cecilia Jamasmie | February 5, 2024 |

KoBold Metals is involved in nearly 60 explorations projects across three continents. (Image courtesy of KoBold Metals.)

KoBold Metals, backed by a coalition of billionaires including Bill Gates and Jeff Bezos, said on Monday its Mingomba asset in Zambia is the country’s largest copper deposit in a century and that it plans to fast-track its development.


The California-based startup has been drilling at its Zambian permit for a little over a year. During this time, KoBold president Josh Goldman said they have confirmed the “huge” size of the deposit.

Mingomba is shaping up to be “extraordinary,” he said, adding that the potential of the discovery compares to that of the Kamoa-Kakula mine, owned by Ivanhoe Mines and China’s Zijin Mining. This operation, located just across the border in the Democratic Republic of Congo (DRC), produced almost 400,000 tonnes of copper last year.

“The story with Mingomba is that it’s like Kakula in both the size and the grade,” Goldman said on the sidelines of Indaba mining conference in South Africa, according to Bloomberg. “It’s going to be one of the highest grade, large underground mines.”

KoBold bought into the project in 2022, via a joint venture with its existing owners – Australian private equity firm EMR Capital and Zambia’s state-owned mining investment vehicle ZCCM-IH (LON: ZCC).

KoBold still plans to have the $2 billion underground copper mine in Zambia built within the decade, with first production in the early 2030s, but it needs to update resource estimate and complete feasibility studies before it makes the decision to go ahead.

Goldman is not worried about securing capital. “The issue globally, is not a lack of availability of capital. It is a lack of availability of high quality projects and where there are returns, there is capital,” he said. “For a great project, there will be capital.”

If built, the Mingomba project would align with the vision of Zambia’s President Hakainde Hichilema to increase the nation’s copper production to three million tonnes by 2032 to help the country reduce its debt burden.
From Canada to the world

The company is not just focused on copper, but rather all minerals and metals considered critical for the energy transition.

It began its quest for battery metals began three years ago in Canada, after it acquired rights to the area in northern Quebec, just south of Glencore’s Raglan nickel mine, where it detected lithium.

The start-up now has about a dozen exploration properties in places including Zambia, Namibia, DRC, Quebec, Saskatchewan, Ontario, and Western Australia, which have resulted from joint ventures with BHP (ASX: BHP) and with BlueJay Mining (LON: JAY) to explore for minerals in Greenland.

It also has exploration activities underway in South Korea and the United States and, in December, it launched a four-continent search for lithium deposits.

Using artificial intelligence, Kobold aims to create a “Google Maps” of the Earth’s crust, with a special focus on finding copper, cobalt, nickel and lithium deposits.

It collects and analyzes multiple streams of data — from old drilling results to satellite imagery — to better understand where new deposits might be found.

Algorithms applied to the data collected determine the geological patterns that indicate a potential deposit of cobalt, which occurs naturally alongside nickel and copper.

The technology, KoBold said, can locate resources that may have eluded more traditional geologists and can help miners decide where to acquire land and drill.

Goldman noted the company was considering going public in the next three or four years.

GATES-BEZOS-KOBOLD

Silicon Valley Startup Claims Massive Copper Discovery in Africa

By Irina Slav - Feb 07, 2024

• Kobold Metals uses artificial intelligence to explore the Earth’s crust to find metals and critical minerals for the energy transition.
• 
  
• KoBold Metals has announced what it says is a huge copper deposit discovery in Zambia.
• 
  
• A spokesperson for the California company told CNBC this week that the project “will be one of the world’s biggest high-grade large copper mines.
• 
  

A Silicon Valley firm dubbed KoBold Metals has announced what it says is a huge copper deposit discovery in Zambia—one of the biggest producers of the metal in Africa.

Kobold Metals uses artificial intelligence to explore the Earth’s crust to find metals and critical minerals for the energy transition. The company has the financial backing of Jeff Bezos and Bill Gates, as well as Richard Branson and Ray Dalio, among others.

Per its own website, Kobold Metals aims to accelerate the “clean energy future” by securing the metals and minerals that this future will need in significant quantities. It does that by using AI to explore for these metals and minerals.

It now appears that this use of AI has paid off in the Mingomba project in northern Zambia—near the border with the Democratic Republic of Congo, on whose other side sits the Kamoa-Kakula copper mine, one of the largest in the world.

A spokesperson for the California company told CNBC this week that the project “will be one of the world’s biggest high-grade large copper mines.” It is indeed a timely discovery since the energy transition essentially rides on copper, and new mine openings are a rare occurrence these days.

KoBold started making plans for the Mingomba project last year before it confirmed the scale of the deposit. Reuters reported in September, citing company executives, that KoBold planned to put $150 million into speeding up the exploration work on the project. The rush was motivated by the urgent demand for more copper.

Indeed, there have been a lot of warnings from the mining industry and energy analysts that a copper shortage could interfere with the planned pace of the energy transition. This has added to worries that the targets set out by various countries will remain elusive despite the amount of effort invested into pro-transition regulation and attempts at eliminating competing technologies via ICE car bans and gas boilers.

Yet despite these warnings, ramping up the global output of the basic metal has been challenging for several reasons. One is that a new mine takes a lot of upfront investments, and somebody has to come up with it. To come up with it, investors need to be sure there will be a return on this investment, and miners have become extremely cautious when it comes to such investments—because copper prices do not justify them.

This is the paradox of the copper market right now. Everyone seems to believe that a shortage is looming as demand skyrockets, with millions of EVs envisioned on roads and millions of wind and solar farms covering the planet’s surface. But copper prices don’t follow these visions—they follow economic indicators that could point traders to where the global economy is going. And those indicators are not flashing green right now, it seems.

There is also the problem of forecasts versus reality. It is true that EV sales are rising, but they are rising nowhere near fast enough for the forecasters that saw them going mainstream years ago. What’s more, EV makers are scaling back their manufacturing plans on weakening demand. That’s not exactly motivating for miners.

This appears to be the reason why KoBold Metals is using private capital to finance its exploration and development work in Zambia. The company said soon after its discovery announcement that it might look for partners to shoulder the $2-billion financial burden of turning the Mingomba discovery into a producing mine. This, according to the company, should take about a decade—highlighting one of the insurmountable obstacles along the way of higher copper supply.

Copper mines are not shale wells. They cannot start producing a few months after breaking ground. Copper—and all other—mines take years to turn into a production facility. Perhaps all those upbeat transition forecasters should have factored this into their forecast for a more comprehensive, realistic picture of the transition. 

By Irina Slav for Oilprice.com

Zambia set to negotiate bigger stakes in new mining projects

Reuters | February 6, 2024 

The Sentinel open-pit copper mine in Zambia. 

(Image courtesy of First Quantum Minerals.)

Zambia is keen to negotiate larger holdings in new mining projects in order to raise its revenue and boost spending by investors on social projects, mines minister Paul Kabuswe said.


The push by Lusaka through state-owned ZCCM-IH would apply to future agreements, but does not include existing mines and should not unnerve investors, Kabuswe told Reuters.

Zambia is Africa’s second-largest copper producer after neighbouring Democratic Republic of Congo and ZCCM has interests of 10% to 20% in mines including those owned by Barrick Gold, Vedanta Resources and First Quantum Minerals.

ZCCM sold a 51% stake in Mopani Copper Mines to a unit of United Arab Emirates’ International Holding Company, retaining the remainder, which previously belonged to Glencore.

“Stakes in new tenements will actually be moulded around such kind of partnerships,” Kabuswe said in an interview on Tuesday on the sidelines of the Africa Mining Indaba.

“We want to make sure that there is win-win, that there is no slave-master relationship and we also want to make sure that there’s social impact,” he added.

While Zambia’s government has set a copper production target of about 3 million metric tons within a decade, output has been declining gradually due to challenges at some operations including Mopani and Konkola Copper Mines.

“We are going to be very strong in negotiations,” Kabuswe said. “But not too strong to the extent of scaring away potential investors.”

Lusaka also plans to start buying minerals such as copper from projects it has stakes in to trade on its own, he said.

While the details of establishing a trading house are still to be worked out, a special purpose vehicle had been approved by the Zambian cabinet, Kabuswe said.

The Zambian government is also closely following developments on First Quantum’s Panama mine and hopes the challenges the Canadian miner is facing are resolved.

First Quantum has not informed the government of any plans to sell or bring in a strategic investor, he added.

“We are looking closely,” Kabuswe said. “But looking closely not in a negative sense, but hoping that things around them can be resolved so that it doesn’t affect ourselves.”

(By Felix Njini and Veronica Brown; Editing by Alexander Smith)

Zambia to start trading its own copper, competing with Glencore

Bloomberg News | February 5, 2024 | 

Lumwana is located in Zambia’s Northwestern Province. 

(Image courtesy of Barrick Gold.)

Zambia plans to directly buy and sell a portion of the copper produced in the southern African nation, competing with trading giants including Mercuria Energy Group Ltd. and Glencore Plc.


“We obviously want to do it in a way that’s fair, that’s commercially suitable for the mining companies,” Jito Kayumba, President Hakainde Hichilema’s senior economic adviser, said in an interview on Monday. “To say that we can come as a commercial player to compete with the other commodity traders, to make financing available for the mines for us to have a fair share of the resource.”

Zambia joins neighbors including Botswana and Democratic Republic of Congo in trying to secure greater economic benefits from its mineral wealth through getting access to the commodities to sell directly to buyers. While the government has shareholdings in some mines, it’s argued for decades that state revenues from them are too low.

Companies including First Quantum Minerals Ltd. and Barrick Gold Corp. operate mines in Zambia, Africa’s second-biggest copper producer.

The government could start with a limited amount of about $100 million and build its trading business, Kayumba said at the Investing in African Mining Indaba conference in Cape Town. It could have legislation ready in the next three to six months, he said, adding the government may opt to receive physical metals instead of royalties from some mines.

“We’ve reached the point where we have to be disruptive. Our benefits from the sector has been quite minimal,” Kayumba said. “There’s a lot of financial engineering, call it creative accounting — transfer pricing reduces our chances of getting a good dividend.”

The government will hire the necessary expertise to start trading its copper, and shouldn’t struggle to compete as it has direct access to the resources, according to Kayumba. The move will open a window into the financial world of commodity trading and help the government see how much profit from its copper remains abroad — some of it in countries like Switzerland, where commodity traders including Glencore are based, he said.

“It gives us transparency,” Kayumba said. “We’ll see ‘Ah! That’s what happened in Switzerland’.”

The European country accounts for about 46% of Zambian export earnings, according to official data.

(By Matthew Hill)

Anglo American explores for copper, cobalt in Zambia

Reuters | February 5, 2024 | 

Aerial view of Victoria falls, Zambia. Stock image.

Anglo American is in the early stages of exploring for copper and cobalt in Zambia’s North-Western province, its chief executive officer Duncan Wanblad said on Monday.


“Zambia’s mining sector appears to be on track for renewed activity – and that is good for Zambia and African mining,” Wanblad told delegates at the African Mining Indaba in Cape Town.

“I am pleased that we are progressing with early-stage exploration in Zambia’s North-Western Province to identify potential copper and cobalt opportunities.”

However, Wanblad also said much more needed to be done to make a compelling argument for Africa given intense global competition.

“We sometimes forget this simple truth: mining jurisdictions across the world are competing for every dollar of investment. Capital is highly mobile and, increasingly, as we are all seeing, the best capital will go to those countries that are set on making themselves competitive for the long term.”

Anglo American aims to cut capital expenditure by $1.8 billion by 2026, as it grapples with a fall in demand for most of the metals it mines and a writedown for its British fertilizer project.

The company joined peers, including Rio Tinto, Teck Resources and Glencore, in reporting lower profits and returns in the first half of the year, as reduced economic growth hit commodity prices.

(By Olivia Kumwenda-Mtambo, Felix Njini, Bhargav Acharya and Veronica Brown; Editing by Alexander Winning and Barbara Lewis)

South African platinum industry could shed up to 7,000 jobs to cut costs
Reuters | February 5, 2024 | 

Sibanye’s Kloof operation. (Image courtesy of Sibanye-Stillwater.)

Restructuring of South Africa’s platinum group metals (PGM) industry in response to rising costs and falling prices could result in between 4,000 and 7,000 job cuts, the country’s Minerals Council said on Monday.


South African PGM miners, home to around 70% of global mined platinum output, are discussing the need to restructure unprofitable production, the council said at the start of the Investing in African Mining Indaba conference in Cape Town.


The Minerals Council said the sector, largely dependent on automakers’ use of PGMs to curb exhaust emissions from engines, faces “a great deal of uncertainty” as the world pivots towards electric vehicles.

Top global PGM producer South Africa has some of the world’s oldest and deepest platinum mines, which are expensive to operate, especially when metal prices are low.

The prices of palladium and platinum fell by 40% and 15% last year, respectively, mainly because of weak demand in China.

Electricity and labour costs account for most of PGM miners’ total costs, the Minerals Council said in a statement.

“In light of this, various prominent PGM miners are restructuring their operations potentially impacting between 4,000 to 7,000 jobs,” it added.

Anglo American’s CEO Duncan Wanblad told delegates at the Indaba that margins for mining companies facing declining ore grades and sharply increased input costs “evaporate quickly”.

“What matters is the industry’s and government’s ability to navigate these challenges to ensure that the industry does survive and prosper – yes with smaller direct workforces, and this is a reality that the industry is contending with right now,” he said in a speech at the Cape Town conference.

Anglo’s South African PGM unit Anglo American Platinum (Amplats), which employs over 20,000 workers in South Africa, is reviewing costs.

Anglo American as a whole aims to cut capital expenditure by $1.8 billion by 2026, after reporting lower profits and returns for the first half of the financial year.

Sibanye Stillwater, South Africa’s biggest mining sector employer, has also said its planned restructuring could lead to the closure of four loss-making PGM shafts and the loss of 4,095 jobs.

Impala Platinum said it was offering voluntary job cuts to workers at its South African operations.

(By Olivia Kumwenda-Mtambo, Nellie Peyton, Nelson Banya and Clara Denina; Editing by Alexander Smith, Veronica Brown and Barbara Lewis)

IMPERIALI$M

Canadian government aims to support First Quantum after mine closure, minister says

Reuters | February 6, 2024 |

Cobre Panama copper mine. (Image courtesy of Franco-Nevada assets handbook.)

The Canadian government will do its best to support First Quantum Minerals, the trade minister said on Tuesday without elaborating, as the Canadian miner deals with the fallout from the closure of its flagship copper mine in Panama.


“First Quantum Minerals is a really important Canadian company,” Trade Minister Mary Ng told reporters in Ottawa.


“I’ve met with them, I continue to meet with them, and really, I’m really looking to supporting the Canadian company … as best as we can,” Ng said.

Large protests erupted last year against First Quantum’s contract to operate a lucrative Cobre Panama mine that was approved by the Panama government in October. Protesters argued it was too favorable to the Vancouver-based company.

In November, the Central American country’s top court ruled the contract unconstitutional, prompting the government to order the mine to shut down.

The Panama copper mine accounted for about 40% of First Quantum’s revenue and its closure led to a near-halving of the company’s market value.

First Quantum is now exploring options to “manage its balance sheet,” which include selling smaller mines, bringing strategic investors into its larger mines and evaluating ways to raise funds. It has also initiated international arbitration over the contested Cobre Panama contract.

Ng said Ottawa was monitoring the situation closely and she had been in contact with her Panamanian counterpart about First Quantum.

“I will stand up for Canadian companies where they operate, and First Quantum has operated in Panama for many years,” Ng said.

(By Ismail Shakil; Editing by Deepa Babington)

France extends New Caledonia nickel rescue talks

Reuters | February 5, 2024 |

Credit: Eramet

France will continue talks until the end of February to save New Caledonia’s nickel industry, the finance ministry said on Monday, after failing to reach a deal last month to fill a massive funding shortfall for the territory’s nickel processors.


New Caledonia has some of the world’s largest nickel reserves but high costs and political tensions in the French-controlled Pacific territory have left its three processing plants on the verge of collapse.


The French government has held talks on nickel in parallel to wider political negotiations with pro-independence and loyalist political parties. Finance Minister Bruno Le Maire said in late November he wanted a nickel deal by the end of January.

“The talks will continue until the end of this month,” a finance ministry spokesperson said, adding: “Later than that is not possible because the financing needs are immediate.”

Le Maire has estimated at 1.5 billion euros ($1.61 billion) the short-term financing needs of New Caledonia’s three nickel processing groups – SLN, KNS and Prony Resources.

Commodities group Glencore, which co-owns KNS, has said it will only provide funding for the firm until the end of February, while French miner Eramet has repeatedly said it will not provide more funding for SLN, in which it holds a majority stake.

A working group of political and industry representatives that has led the negotiations said in a progress report last month that falling nickel prices meant measures proposed so far still left a significant funding gap for 2024.

It called on current shareholders to consider extra financing.

Prony Resources, meanwhile, said in a statement last month it was seeking “a core shareholder” to boost its financing.

Prony has a number of minority shareholders including commodity merchant Trafigura with a 19% stake.

Glencore, Eramet and Trafigura each declined to comment on the talks.

Discussions have sought to address the unprofitability of nickel processing in New Caledonia through plans to improve mining productivity and subsidise energy costs.

The French government’s representative in New Caledonia last week said an emergency loan for the processing firms was also under discussion.

($1 = 0.9314 euros)

(By Gus Trompiz, Clara Denina and Melanie Burton; Editing by David Gregorio)

 

Samsung Heavy Industries Books Largest Order as Korean Shipbuilders Rebound

Samsung Heavy Industries booked its largest order ever with LNG carriers linked to Qatar (file photo)

PUBLISHED FEB 6, 2024 6:13 PM BY THE MARITIME EXECUTIVE

 

 

South Korea is highlighting a strong rebound in its shipbuilding industry with the second largest company, Samsung Heavy Industries, reporting it has signed the largest order in the company’s history. The new order, which rivals the largest order ever placed in South Korea, comes as the companies are reporting a strong start to 2024 and improving financial results.

SHI signed an order for 15 new LNG carriers each with a capacity of 170,400 cbm. The company highlighted that the order will be delivered by October 2028 giving it steady work for the next five years. Although they did not officially confirm the buyer saying only it is a “Middle East shipowner,” the deal is part of the ongoing expansion program being driven by QatarEnergy. SHI was reported since October 2023 to be negotiating the terms of the order based on the 2020 slot reservation from QatarEnergy.

The new contract is being valued at approximately $3.4 billion which exceeds the previous largest order received by SHI in July 2023 from Evergreen for 16 methanol-fueled containerships which was valued at around $3 billion. The largest order ever received by the South Korean shipbuilders went to HD Hyundai in October 2023 for 17 LNG carriers valued at $3.9 billion and providing work for HD Hyundai till 2029.

The closing of the order by SHI was the next step in QatarEnergy’s long-term expansion program tied to the development of the new North Field. In the first phase of the program, QatarEnergy was linked to 60 LNG carrier orders. The second phase began with the 17 to be built by HD Hyundai and was followed in January by an order for six of the world’s largest LNG carriers to be built in China. Hanwha Ocean is believed to be finalizing the next order which will also involve 15 ships. Rumors in Korea are that this order will be finalized by March.

SHI highlights that with the new order, it has booked 17 ships in the first weeks of 2024 with a value of $3.7 billion, which is nearly half of its entire orderbook for 2023. Last year, SHI booked orders valued at $8.3 billion falling short of its annual target. Despite that, company officials are highlighting that they now have a backlog of 90 LNG carriers.

Rival HD Korea Shipbuilding & Offshore Engineering reports that its operation is off to an even stronger start to 2024 which may cause the company to raise its forecast for the year. In the first weeks of the year, the shipbuilding holding company reports its three shipbuilders have booked a third of its annual forecast. They have contracted 38 ships with a total value of $4.65 billion with the annual target set at $13.5 billion. 

The holding company had lowered its forecast for 2024 versus 2023 citing economic concerns and the outlook for the shipping industry. Last year, the company’s target was $15.7 billion but on the strength of the industry, they ended the year with $22.3 billion in orders including the QatarEnergy mega order. 

HD KSOE highlights that the new segment for large ammonia carriers is contributing to its growth in 2024. Since 2021, the company has booked orders for 74 large gas carriers, including LPG and ammonia, which is 56 percent of the global market. Since January, the company has booked orders for 11 ammonia carriers. 

The strength of the market permitted KSOE to swing to a profit for the full year 2023. The company reported today that it had a net profit for the year of $109 million versus a loss of over $222 million in 2022. Full-year revenues were up more than 23 percent. 

Despite the strong year, KSOE reported a fourth-quarter net loss of $67 million. The company however had an operating profit of $121 million and a sales increase of more than 21 percent. KSOE is the holding company for three shipyards and other operating companies. One of the shipyards, HD Hyundai Heavy Industries however reported a profit for the fourth quarter. It had a net income of $23 million in the quarter versus a loss of $121 million in Q4 2023. Operating profit at the shipyard was up more than 500 percent on a 27 percent increase in revenues.

Samsung Heavy Industries highlighted the improving financial picture for its operations and the industry predicted that “an orientation towards profitability in selecting orders will gain momentum.” Earlier in the year, media reports suggested that Hanwha Ocean was stopping future containership orders to focus on the more profitable market segments, but the company denied those reports.

 

Carnival Corp Highlights Strategies for Cruise Ship GHG Emission Reductions

AIDAnova was the first cruise ship able to operate at sea using LNG as its fuel (AIDA)

PUBLISHED FEB 6, 2024 8:30 PM BY THE MARITIME EXECUTIVE

 

 

Carnival Corporation is highlighting that its cruise ship operations are “on pace” to achieve its ambitious reductions in greenhouse gas emissions as it also reaffirms progress toward achieving its goals. The world’s largest cruise company, with a fleet of nearly 100 cruise ships, highlights that it is following a strategy to both reduce fuel consumption across the fleet and to adopt new technologies and lower emissions with the existing fuel alternatives.

Last year, the company reported it was accelerating its stated 2023 GHG intensity reduction goal by four years, committing to at least a 20 percent cut (measures on lower berth capacity) to be achieved by 2026 instead of 2030 when compared to 2019 levels. Now, Carnival Corp. reports it expects to reach an 18 percent reduction in 2024 (compared to 2019).

Measured against its first benchmark in 2008, Carnival Corp. says it expects to have reduced its GHG emissions by 42 percent (on a lower berth capacity basis). Carnival Corporation asserts today it has reduced GHG emissions by more than 10 percent versus its peak historical year (2011), despite increasing capacity by roughly 30 percent since that time.

One of the key steps is reducing the fuel used by its cruise ships. Onboard they have taken steps such as upgrading the ships with modern and efficient HVAC systems, using LED and smart lighting technology, and remote monitoring which they report has reduced power and in turn fuel by five to 10 percent per ship.  Also, 60 percent of the corporation’s ships are now equipped to use shore power in port.

Fleet modernization is contributing with 26 older, less-efficient ships removed from the fleet since 2020 and a quarter of the fleet capacity is on newer, more efficient ships. The new ships include optimizing the hull design. They are also employing special coatings on the hulls to reduce drag and installing air lubrication systems which they report can reduce fuel consumption by up to five percent.

Carnival was also the first cruise company to introduce vessels able to operate on liquified natural gas, which the industry promotes as the cleanest fuel currently available. Today the company has nine LNG-capable ships in service and two more on order. They also report that more than 90 percent of the fleet is outfitted with advanced air quality systems, i.e. scrubbers, to reduce particulate matter. 

Other operational changes include developing more energy-efficient itineraries, slowing the ships when possible, using hydrodynamics and ocean currents, and other techniques such as weather routing.

To achieve the next phase of their targeted reductions the corporation continues to explore new technologies. They have already tested new fuels, including biofuel mixes, on several ships including both AIDA and Holland America Line. They are testing other technologies including a first-of-its-kind lithium-ion battery storage system, and for the future look to fuel cells powered by hydrogen derived from methanol.

As one of the most visible segments of the shipping industry, cruising is highly scrutinized and comes in for frequent criticism for its operations. Carnival Corporation like others in the industry continues significant investments they highlight as part of their sustainability programs. The company like the shipping industry overall says its strategy is to pursue net-zero emissions from ship operations by 2050. 

 

Post-Panamax Bulker to be Retrofitted with Wind Rotors in 2024

Rendering of the installation to be completed in the coming months of rotors on a large bulker (Oldendorff)

PUBLISHED FEB 5, 2024 8:19 PM BY THE MARITIME EXECUTIVE

 

 

Norsepower, a Helsinki, Finland-based manufacturer of modern wind rotors confirmed that a previously announced project to retrofit wind rotors on a large bulker is proceeding with the installation to be completed in the second quarter of 2024. The project involves the well-known shipping company Oldendorff and a vessel that operates under charter to Teck Resources, one of Canada’s leading mining companies.

Oldendorff which owns a fleet of 130 bulkers and currently has a total of 724 in operations counting charters, has been participating in a series of studies for the past few years to explore the potential of wind-assisted propulsion and specifically the application of the modern version of the century’s old rotor. The Norsepower Rotor Sail is a modernized version of the Fletter rotor that was first displayed in the 1920s. The rotors use a small amount of the vessel’s power to spin and that creates the propulsion force that lowers fuel consumption and emissions with the savings more than offsetting the operating cost of the rotors.

“We are extremely excited about reducing fuel consumption and emissions by harnessing the power of the wind,” said Torsten Barenthin, Director of Research & Development for Oldendorff. The company reports it has already built over 100 eco-friendly bulkers in the last decade and is also pursuing other elements including biofuels. In 2022, the company working with Lloyd’s Register and Shanghai Merchant Ship Design and Research Institute along with another rotor manufacturer, Anemoi Marine Technologies, participated in a study on the potential for rotors on large bulkers. The first project focused on a 210,000 dwt Newcastlemax bulk carrier from Oldendorff validating the potential savings. 

Oldendorff has been working with Teck since November 2021 to reduce supply chain emissions. They estimate the efforts have already saved approximately 115,000 tonnes of CO2 emissions.

The installation, which will happen by mid-2024 involves three 79-foot tall and 13-foot diameter rotors (24m x 4m) that will be installed on the Dietrich Oldendorff, a 100,449 dwt dry bulk carrier with a length of 770 feet (235 meters). The huge, spinning rotors are partly manufactured from approximately 342,000 plastic bottles.

Built in 2020, the vessel carries shipments of Teck’s steelmaking coal from Vancouver, Canada across the Pacific to Asia. The rendering shows the vessel outfitted with three rotors offset on the starboard side between the six hatches so as not to interfere was cargo operations. 

The companies report they have analyzed forty years of weather data which confirms that the trade between the Pacific Northwest and Asia is one of the best trade lanes for producing reliable wind energy.