UK competition watchdog to investigate 8 major UK housebuilders

Neil GerrardSenior Editor, Construction Briefing

26 February 2024 

Aerial view of a new housing development being built in the UK 

(Image: Sam Foster via AdobeStock - stock.adobe.com)

The UK’s competition watchdog is to investigate eight of the country’s biggest housebuilders following evidence that suggests they may have been sharing commercially sensitive information.

News of the launch of an investigation came as the Competition and Markets Authority (CMA) concluded a study into the housebuilding market in England, Scotland and Wales.

The CMA said that during the study it had found evidence “which indicated some housebuilders may be sharing commercially sensitive information with their competitors”. That could have influenced the build-out of sites and the prices of new homes it claimed.

The CMA’s investigation under the Competition Act 1998 involves eight housebuilders:

Barratt
Bellway
Berkeley
Bloor Homes
Persimmon
Redrow
Taylor Wimpey
Vistry

The CMA stressed that it has not reached any conclusions at this stage as to whether or not competition law has been infringed.

It added, “While the CMA does not consider such sharing of information to be one of the main factors in the persistent under-delivery of homes, the CMA is concerned that it may weaken competition in the market.”

‘Substantial intervention’ in housebuilding market recommended

Meanwhile, following its market study, the CMA recommended a “substantial intervention” by the government in the UK housebuilding market after uncovering “fundamental concerns” about how it operates currently.

Great Britain saw fewer than 250,000 homes built last year, which is below the target of 300,000 for England alone.

The report found that Britain’s planning system is “complex and unpredictable” and that this, combined with the limitations of speculative private development, is responsible for persistent under-delivery.

It also found concerns with the quality of some new housing, after the number of owners reporting snagging issues increased over the last 10 years.

And it raised concerns about estate management charges, with home owners often facing “high and unclear” charges for management of roads, drainage and green spaces.

Sarah Cardell, chief executive of the CMA, said, “Housebuilding in Great Britain needs significant intervention so that enough good quality homes are delivered in the places that people need them.

“Our report – which follows a year-long study – is recommending a streamlining of the planning system and increased consumer protections. If implemented, we would expect to see many more homes built each year, helping make homes more affordable. We would also expect to see fewer people paying estate management charges on new estates and the quality of new homes to increase. But even then, further action may be required to deliver the number of homes Great Britain needs in the places it needs them.

“The CMA has also today opened a new investigation into the suspected sharing of commercially sensitive information by housebuilders which could be influencing the build-out of sites and the prices of new homes. While this issue is not one of the main drivers of the problems we’ve highlighted in our report, it is important we tackle anti-competitive behaviour if we find it.”

 

Hyundai E&C says Kozloduy signals South Korea's nuclear resurgence

26 February 2024

The Bulgarian Parliament has given the go-ahead for talks to take place with Hyundai Engineering & Construction, as the sole shortlisted constructor for engineering, construction, delivery and commissioning of the new AP1000 units planned for the Kozloduy site.

Kozloduy currently has two operating reactors (Image: Kozloduy NPP)

As well as giving approval for the talks to begin, parliamentarians also set out a series of requirements for the Bulgarian side in the negotiations, according to the Bulgarian News Agency (BTA).

These included:

• the requirement to be offered a fixed price
• construction of the first block within 60 months
• construction of the second block within 54 months
• 30% of the project to be taken by Bulgarian contractors

Last week Kozloduy NPP - New Builds announced that South Korea's Hyundai Engineering & Construction (Hyundai E&C) was deemed, by a commission reviewing the expressions of interest, to have been the only one of the five candidates to have met the requirements for the construction and commissioning of the two new Westinghouse AP1000s.

The others to have been interested in the project were Fluor BV, Bechtel Nuclear Power Company Limited, a consortium led by China National Nuclear Corporation Overseas and partner China Energy Engineering Group Tianjin Electric Power Construction Co, as well as China Energy Engineering Corporation Limited.

According to BTA there was more than three hours of debate, including at least one vote where a call for at least one other bidder - Bechtel - to be reinstated to the process was rejected.

Hyundai E&C said, following the parliamentary approval, that its return to the overseas market after 15 years was a visible reflection of the South Korean government's support for the restoration of the nuclear industry.

A spokesperson said: "The selection as the preferred bidder for the Kozloduy nuclear power plant in Bulgaria will be a signal for the resurgence of the Korean nuclear industry, which has been somewhat stagnant due to the nuclear phase-out policy.” They noted the European Union green taxonomy and said that "as the positive atmosphere toward nuclear energy spreads ... large-scale orders are expected, and we will strive to deliver more orders through multilateral channels as well as participation in Team Korea."

The Bulgarian Parliament has set 15 April as the date by which negotiations on the specific clauses of the contract must have taken place, with the chairman of the Energy Committee looking for a final investment decision to be taken by the middle of 2025. The aim is for the first new unit - unit 7 at Kozloduy - to be operational in 2035 and the second one - unit 8 - to be operational in 2037.

Kozloduy units 1-4 were VVER-440 models which the European Commission had classified as non-upgradeable and Bulgaria agreed to close them during negotiations to join the European Union in 2007. Units 5 and 6 feature VVER-1000 reactors that were connected to the grid in 1987 and 1991, respectively. Both units have been through refurbishment and life extension programmes to enable extension of operation from 30 to 60 years. The 2300 MWe capacity of the two new units would exceed the 1760 MWe capacity of the closed first four units. The Bulgarian government has also said that further units will be needed to replace units 5 and 6 by 2050.

Westinghouse will hold overall Design Authority responsibility for the AP1000 plant, the expression of interest document said.

South Korea has 26 reactors providing about a third of the country's electricity and has long been one of the world's most prominent nuclear energy countries, but in 2017 then President Moon Jae-in introduced a policy of phasing out nuclear power over a period of 45 years. However President Yoon Suk-yeol, elected March 2022, scrapped this policy, and laid out a new energy policy supporting reactor construction and a renewed export push.

India's newest nuclear unit connected to grid

26 February 2024

Nuclear Power Corporation of India Ltd has announced that Kakrapar 4 was connected to the grid on 20 February. The 700 MWe unit reached first criticality on 17 December.

The Kakrapar site is also home to two operating 202 MWe PWHR, seen here on the right (Image: DAE GODL-India)

The company announced the grid connection following Prime Minister Narendra Modi's 22 February visit to the plant in Gujarat, during which he formally dedicated the first Indian-designed 700 MWe pressurised heavy water reactors (PHWRs) to the nation.

"These reactors have been designed, constructed, commissioned and operated by Nuclear Power Corporation Of India Limited (NPCIL) with the supply of equipment and execution of contracts by Indian industries/companies reflecting the true spirit of Atma Nirbhar Bharat," the company said. (Atma Nirbhar Bharat translates to "self-reliant India".)

Modi said during his visit that "the role of nuclear power in electricity generation is going to increase in 21st century India and it is a matter of pride that India is Atma Nirbhar in this advanced technology", the company added.

"Two days earlier on February 20, 2024, KAPS-4 (700 MW) was connected to the western grid for the first time."

A further eight reactors with a total capacity of 6800 MW are under construction by NPCIL, the company said, while pre-project activities are under way for 10 reactors with a total capacity of 7000 MWe for completion "by 2031-32" to enable India to reach an installed nuclear power capacity of 22,480 MWe.

Reactors under construction at NPCIL's sites include the next two 700 MW PHWRs which are being built as Rajasthan units 7 and 8 at Rawatbhata in Rajasthan, and four Russian-supplied VVER pressurised water reactors at Kudankulam in Tamil Nadu. Site works are also under way for the construction of two 700 MW units Gorakhpur in Haryana. In addition to these, a 500 MWe Prototype Fast Breeder Reactor is being built by BHAVINI at Kalpakkam in Madras.

Ten further 700 MW PHWRs have received administrative approval and financial sanction: Kaiga units 5 and 6 in Karnataka; Gorakhpur units 3 and 4 in Haryana; Chutka units 1 and 2 in Madhya Pradesh; and Mahi Banswara units 1 and 2 and units 3 and 4 in Rajasthan.

Tractebel to assist Thorizon in MSR development

26 February 2024

Following the signing of a strategic three-year partnership with Thorizon of the Netherlands, Belgian engineering firm Tractebel - a subsidiary of France's Engie - will provide engineering services including support on the conceptual design, computational modelling, cost estimates and design reviews of the Thorizon One molten salt reactor.

The signing of the agreement (Image: Thorizon)

Thorizon - a spin-off from NRG, which operates the High Flux Reactor in Petten - is developing a 250 MWt/100 MWe molten salt reactor (MSR), targeted at large industrial customers and utilities. Thorizon aims to construct a pilot reactor system before 2035.

MSRs use molten fluoride salts as primary coolant, at low pressure. They may operate with epithermal or fast neutron spectrums, and with a variety of fuels. Much of the interest today in reviving the MSR concept relates to using thorium (to breed fissile uranium-233), where an initial source of fissile material such as plutonium-239 needs to be provided. There are a number of different MSR design concepts, and a number of interesting challenges in the commercialisation of many, especially with thorium.

The molten salt fuel adopted by Thorizon uses a combination of long-lived elements from reprocessed used nuclear fuel and thorium. The reactor will be able to recycle long-lived waste from existing nuclear facilities.

The Thorizon One concept is unique in that the core is composed of a set of cartridges that is replaced every five to ten years.

Thorizon's molten salt reactor design (Image: Thorizon)

According to Thorizon, its concept offers additional advantages in terms of safety, time to market and costs. Firstly, the reactor only generates energy when salt is circulated through the cartridges. If the pump stops, the reactor shuts down. Secondly, the cartridge design enables the use of existing and proven materials and components, minimising development and licensing timelines. Thirdly, cartridges are efficiently produced in series off-site. They contain all primary systems, together with low-pressure operations, which results in a lean reactor building.

"For several years, Tractebel has been a frontrunner in the deployment of SMRs, which we believe will contribute to achieving carbon neutrality by 2050," said Vincent Schryvers, Business Manager of the Netherlands, Tractebel. "We are now proud to support Thorizon for the development of a Generation IV reactor. This ground-breaking technology will close the fuel cycle and make the circular economy a reality in the nuclear sector. Thanks to its flexibility, this advanced nuclear reactor concept could contribute to addressing the challenges both of industry decarbonisation by providing heat for industrial processes and of energy security by producing electricity for households."

"The expertise Tractebel has built while supporting operating nuclear power plants across Europe for decades, and more recently working on multiple small modular and innovative reactor concepts is invaluable for a start-up like ours," added Thorizon CEO Kiki Lauwers. "The large and experienced team in Belgium is ideally suited to help us make the connection between the Netherlands and France. We very much look forward to working together with the Tractebel team in our offices in Amsterdam and Lyon."

Thorizon said in August 2022 that it will collaborate closely with several parties on the development of its reactor concept, such as France's Orano and NRG, the Dutch producer of medical isotopes and operator of nuclear research infrastructure. Together with EPZ, operator of the Borssele nuclear power plant, Thorizon will investigate the possibility of building the first reactor on the plant site. A broader consortium of research institutions including TU Delft and DIFFER, component suppliers and industrial service providers are supporting this development.

Earlier this month, Thorizon announced it had signed a strategic partnership agreement with French ultra-compact molten salt fast neutron reactor developer Naarea to advance the development of MSRs in Europe. That partnership aims to create the best conditions to: pool resources for safety and security demonstrations and chemical, industrial and strategic knowledge in molten salt technology; develop shared laboratories and test facilities; secure access to reprocessed fuel materials needed for molten salt fuel synthesis; provide the market with a range of complementary energy solutions with a common technology basis; and increase political and public support for MSR technology.

Researched and written by World Nuclear News

Mexico nationalizes salt producer ESSA, buys Mitsubishi’s stake

Bloomberg News | February 24, 2024 | 


Mexico’s government has nationalized Exportadora de Sal SA after buying 49% of the salt producer from Mitsubishi Corp. for 1.5 billion pesos ($87.6 million).


The Guerrero Negro-based salt producer also known as ESSA was already 51% owned by the state. Mining Development Trust contributed 75% of the purchase, with the remaining 25% funded by the Mexican Geological Service, according to a statement on Saturday from the Economy Ministry.

The deal is part of a drive by outgoing President Andres Manuel Lopez Obrador to secure the country’s national resources by placing much of them in state hands. His government has railed against the previous administration’s “neoliberal” model of opening nationalized industries such as oil to private investment.

ESSA owns the world’s largest salt mine and is one of the biggest producers of salt in Latin America alongside Chile, with production of more than 8 million tons per year, said Economy Minister Raquel Buenrostro at an event marking the occasion together with AMLO, as the president is known.

State ownership will guarantee jobs for ESSA’s workers, Buenrostro said.

(By Amy Stillman)

BMO bankers sent each other crude memes before they were fired

Bloomberg News | February 26, 2024 | 

Stock image.

Junior bankers who were recently fired from Bank of Montreal’s metals and mining group used work-sharing platforms to circulate crude jokes and at least one obscene image, which were discovered during an internal investigation after another employee complained, according to people with knowledge of the matter.


One of the photos that was distributed, known as the “Wood” meme, depicts a man sitting naked on a bed and became a popular internet meme during the pandemic. The investigation, which resulted in six bankers leaving the firm, also uncovered homophobic language used by employees.



A spokesperson for Bank of Montreal described the incident as “completely unacceptable,” adding that the bank takes matters of misconduct very seriously and immediately began probing the matter after the employee escalated it.

But multiple former Bank of Montreal employees who spoke with Bloomberg said it wasn’t the first case of crude jokes being circulated, and that in some respects, the junior bankers’ actions were in keeping with a culture that has existed in BMO’s high-pressure mining banking unit.


Bankers at competing firms in Toronto’s financial district, some of whom previously worked for Bank of Montreal, described its mining and metals group as extremely demanding — sometimes asking more of junior analysts and associates than other banks do. Employees have pulled all-night sessions to finalize deal documents and will work through weekends to meet deadlines. In recent years, the bank has explicitly encouraged entry-level analysts to take at least one day off on the weekends, to manage concerns about overwork.

The mining and metals group has previously faced at least one other similar workplace investigation that was sparked by internal complaints and resulted in employee departures, according to people familiar with the matter.

BMO ranks among the top banks for deals within the global mining industry, advising on high-profile transactions including Teck Resources Ltd.’s pending $9 billion coal-unit divestiture and Newmont Corp.’s $15 billion takeover of Newcrest Mining Ltd. last year.

At the foundation of those deals, which can net millions of dollars in fees, are young, mostly male graduates from business and engineering schools in Canada who work long hours on financial projections, presentations and deal documents in support of senior investment bankers.

In investment banking in general, “hours are long, tensions are high and egos and management oversight is thin,” said Bill Vlaad, a former investment banker and chief executive officer of Vlaad and Co., a recruitment agency.

“Understanding acceptable professional behavior seems to be another organizational tool that firms are struggling to manage when employees are only in the office two or three days a week,” he said.

One person who previously worked in BMO’s mining and metals group said that while the experience young bankers receive is top-notch and there’s a prestige to working in the group, it can be an intimidating environment, and junior bankers tend to adopt a work-hard, play-hard culture in the group to fit in.

People familiar with the recent incident said the bankers who circulated those jokes and memes claim that they didn’t intend their comments or actions to be malicious, and were falling in line with the group’s pre-existing culture and style of communicating. One director-level banker left as a result of the complaint, but several people said they were surprised someone more senior wasn’t let go, given the apparent lapse in supervision of the junior employees.

Bank of Montreal didn’t respond to specific questions about the situation. Spokesperson Kelly Hechler said employees who fail to meet “our standard of respect, inclusivity and professionalism” are subject to “disciplinary actions up to and including termination of employment.”

(By Christine Dobby and Jacob Lorinc)

Brazil, France partner to tackle illegal mining in French Guiana

Reuters | February 26, 2024 |


Brazil and France are set to sign an international cooperation agreement that would allow police from both countries to launch joint operations aimed at tackling illegal mining in French Guiana, four sources familiar with the matter told Reuters.


The countries have expressed concern about increased wildcat mining activities and environmental crimes near the border between Brazil’s northern state of Amapa and French Guiana, an overseas administrative region of France, where the Oiapoque river is located.

The deal is expected to be signed when French President Emmanuel Macron visits his Brazilian counterpart Luiz Inacio Lula da Silva in Brasilia in late March, according to three of the sources.

The agreement would allow Brazil and France to launch joint operations, train police officers and share results obtained from the analysis of the composition of illegal gold extracted in both countries, according to Brazilian sources.

The deal expands a similar one signed by Lula and former French President Nicolas Sarkozy in 2008, during the Brazilian leader’s first stint as president.

“The French expressed their intention to deepen ties with Brazil,” a source at Brazil’s Justice Ministry said, adding that the new agreement would be more focused on operations than the previous one.

Brazil’s Justice Ministry did not immediately respond to a request for comment. Neither did the French embassy in Brasilia.

(By Ricardo Brito and Gabriel Araujo; Editing by David Evans)

Column: Metallurgical coal is the commodity world’s quiet performer

Reuters | February 25, 2024

Mount Owen thermal and coking coal mine in Australia. Image: Glencore

When looking at the commodities used to make steel, iron ore gathers the bulk of headlines given its strong link to the perceived health of China’s economy.


But metallurgical coal is also a key input, and this fuel has quietly been a top performer in the energy commodity space in recent months.

Australia dominates the seaborne market for metallurgical coal, accounting for more than half of global volumes, and about three times the shipments of the next biggest exporter, the United States.

The price of Australian metallurgical coal, also known as coking coal, on the Singapore Exchange ended at $315 a metric ton on Wednesday.

The contracts, which are linked to the free-on-board price in Australia, have risen 40.3% since the 2023 low of $224.50 a ton on July 6.

In contrast, high-grade Australian thermal coal is only 0.5% higher than its 2023 low, while Brent crude oil has risen 13.4% from its low in December, and spot liquefied natural gas is down 2.2% from the weakest it was in 2023.

While the price is well below the record $635 a ton reached in March 2022 amid fears to global supplies after Russia’s invasion of Ukraine in February of that year, it’s still well above the broad $100-$250 range that prevailed from 2018 to mid-2021.

Unlike iron ore, which is dominated by China gobbling up more than 70% of global seaborne volumes, coking coal is a more evenly-spread market with demand centres in both the developed countries of North Asia and the developing nations of South Asia.

It’s likely that much of the increase in prices in coking coal in recent years is down to increased demand from India, which has seen imports rise from 53.32 million tons in 2020 to 70.49 million in 2023, according to data compiled by commodity analysts Kpler.

Australia remains the biggest supplier to India, with imports in 2023 coming in at 41.0 million tons, down slightly from 43.22 million the prior year.

It’s worth noting that India has turned to Russian coking coal since Moscow’s war on Ukraine, snapping up discounted cargoes that can no longer go to Europe because of sanctions against Russia.

India’s imports of Russian metallurgical coal rose to 11.76 million tons in 2023, almost double the 6.07 million the previous year and four times the 2.63 million from 2021.

China’s imports of seaborne coking coal also rose in 2023, reaching 36.8 million tons, up from 27.05 million the previous year.

This is largely a reflection of the return of Australian coal to China after Beijing lifted its informal ban, imposed in 2020 amid a series of political disputes with Canberra.

Asia coking coal imports vs SGX price

Australia record

Australia’s exports of coking coal have been trending lower in recent years, largely as a result of supply disruptions caused by bad weather in the main producing state of Queensland.

However, they have rebounded in February, with Kpler data showing shipments of 17.86 million tons, the second-highest on record behind the 18.65 million from June 2019.

The strength wasn’t really a China or India story, with Japan leading import growth in February, with Kpler assessing arrivals at a three-month high of 4.56 million tons, of which Australia provided 3.86 million.

South Korea also saw higher imports in February, with arrivals of 3.45 million tons, the most since November 2021, according to Kpler.

The overall picture that emerges for seaborne coking coal is one where demand in Asia is recovering, with Kpler data showing imports by the region rose for a third straight month in February, likely reaching 19.8 million tons, up from 19.46 million in January and the best month since October.

The longer-term outlook is more nuanced, given efforts to reduce carbon emissions in the steel sector.

BHP Group, the world’s largest shipper of metallurgical coal, believes the market has decades of life left in it as the alternatives to using coal to make steel are either not competitive on a cost basis or unlikely to emerge at scale for decades.

However, the company also warned in its results presentation this week that investment in new mines is less attractive, especially in Queensland where the state government imposed sharply higher royalties in July 2022.

While it is to be expected that a company will rail against higher taxes, the trick for BHP is to invest to keep production high enough to meet demand, but low enough to also keep prices strong, but not so low that the Queensland government follows through on its threat to strip the company of its mining licences should it not invest sufficiently.

(The opinions expressed here are those of the author, Clyde Russell, a columnist for Reuters.)

(Editing by Sonali Paul)

Resource upgrades prompt revised Mulga Rock study

26 February 2024

Deep Yellow Ltd is to revise its definitive feasibility study for the Mulga Rock project in Western Australia after a 26% increase in uranium resources and a "substantial uplift" in critical mineral value at Mulga Rock East. The company is planning production in 2028.

The Mulga Rock project in Western Australia (Image: Deep Yellow)

The updated mineral resource estimates for the Ambassador and Princess deposits mean the total contained uranium in Mulga Rock East now stands at 71.2 million pounds U3O8 (27,387 tU), up from 56.7 million pounds, at a cut-off grade of 100 ppm, the company announced today. 86% of the Mulga Rock East uranium resource is now in the Measured and Indicated classification. Total U3O8-only mineral resources for the project, which comprises Mulga Rock East and Mulga Rock West deposits, are 104.8 million pounds U3O8 (measured, indicated and inferred).

The inventory of so-called critical minerals (copper, nickel, cobalt, zinc and rare earth oxides) has also increased by 200% to 400% (for base metals) compared with the previously reported inventory, the company said.

Deep Yellow Managing Director and CEO John Borshoff said the results to date confirm expectations for the project. "When we acquired Mulga Rock through the Vimy Resources merger in August 2022 we identified significant opportunity to uplift the value of the project by considering extracting the critical minerals (Cu, Ni, Co, Zn, Nd, Tb, Dy, Pr) in addition to the uranium associated with the Ambassador and Princess deposits," he said.

"The results to date confirm our positive expectation for this exciting project with results illustrating the potential value uplift that could be captured by the integrated development approach. The updated MRE has delivered an impressive 26% increase in the uranium resource and more than doubled the critical minerals’ inventory. This fully justifies proceeding with the DFS revision, which will kick off in Q2 2024, to determine the overall viability of the polymetallic resource that has been delineated with uranium still remaining the key value driver of the Project," he added.

Mulga Rock is 290km by road east-northeast of Kalgoorlie in the Great Victoria Desert of Western Australia. A definitive feasibility study (DFS) prepared by then-owner Vimy Resources in 2018 - which was refreshed by Vimy in 2020 - showed a strategic long-life uranium project with a contemplated production rate of 3.5 million pounds per year. Existing environmental approvals allow for the recovery of critical minerals. The Government of Western Australia's December 2016 approval of the project stipulated that Vimy must begin substantial commencement within five years, a condition which the company met when work on the excavation of a ramp at the Ambassador North pit began in 2021.

The revised DFS will use the updated mineral resource estimate and previously announced metallurgical testwork on the recovery of critical minerals. It will integrate re-scheduling of the mining, using a less selective approach, and "potentially capturing much greater value presented by the coincident uranium and critical minerals of the Mulga Rock East deposits while operating within the permitting footprint," the company said.

Borshoff reiterated that the company intends to make a final investment decision for its Tumas project in Namibia in the third quarter of this year, with assets planned for production by 2026 at Tumas and 2028 at Mulga Rock.

Researched and written by World Nuclear News

Energy Fuels gearing up two more US uranium mines for production

Staff Writer | February 26, 2024 | 

Image from Energy Fuels.

Energy Fuels (NYSE: UUUU; TSX: EFR) is gearing up two more mines in Colorado and Wyoming for expected production within one year.


If market conditions remain robust, the Whirlwind and Nichols Ranch mines could potentially elevate Energy Fuels’ uranium production to a run-rate of over two million pounds of U3O8 per year as early as 2025, the company said.

In response to the current strength in uranium prices, Energy Fuels plans to conduct exploration drilling on its Nichols Ranch area properties and underground delineation drilling at its Pinyon Plain mine in Arizona.

The company intends to advance permitting on its large-scale Roca Honda, Sheep Mountain and Bullfrog uranium properties for additional uranium production in the future.

The spot price of U3O8 reached a high of $102.00/lb. this month, with the long-term price of U3O8 at $72.00/lb., according to data from TradeTech.

“We hold a bullish long-term view of uranium prices, and we are investing to boost production,” Energy Fuels CEO Mark Chalmers said in a release.

In 2023, the company sold 560,000 lb. of uranium for about $60/lb., yielding total gross profits of $17.96 million and a 54% gross margin.

“As long as market prices remain strong, we will continue to selectively capitalize on spot market sales opportunities as we ramp up our production in 2024 and beyond, all with limited capital,” Chalmers said. “We have become one of the few profitable non-state-owned uranium mining companies globally.”

Shares of Energy Fuels rose 4.4% by 12:00 p.m. EDT. The company has a market capitalization of approximately $1 billion.

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Sweden moves to lift uranium mining ban

26 February 2024

Sweden's Climate and Environment Minister Romina Pourmokhtari has announced the launch of an investigation to abolish the country's ban on uranium mining. The move was welcomed by Australia-based Aura Energy, which hopes to extract uranium as a by-product from its 100%-owned Häggån polymetallic project in Sweden.

(Image: Pixabay)

On 16 May 2018, the Swedish parliament passed an amendment to the Environmental Code banning uranium exploration and mining in the country. As from 1 August that year, no permits for uranium exploration or mining have been issued for any such applications submitted from that date.

There is currently no uranium mining in Sweden, which has six nuclear power reactors providing about one-third of its electricity. Sweden imports most of its nuclear fuel, including all enrichment services.

The investigation - to be carried out by the Ministry of Climate and Enterprise - will determine what rule changes are needed to enable and clarify the conditions for uranium extraction. In addition, it will analyse whether the requirement for the government's admissibility review should be limited to cover uranium mining only when it is a nuclear activity.

The ministry said the purpose of the investigation is "to remove a ban that is not needed". "Extraction of uranium must be handled in the same way as extraction of other metals, where the environmental assessment determines the conditions under which it can be permitted," it noted. "Uranium often occurs together with other metals and today must be sorted out and handled as waste."

"If the European Union is to become the first climate-neutral continent, access to sustainable metals and minerals must be ensured," Pourmokhtari said. "We need to use the uranium we have, instead of sorting it out and considering it as waste, as is the case now - due to the current ban on mining uranium."

The Ministry of Climate and Enterprise noted that more than one-quarter of Europe's known resources of uranium are found in Sweden's bedrock. "Today, it is not possible to grant either an exploration permit, a processing concession or an environmental permit regarding uranium. Uranium mining must in future be tested according to relevant environmental legislation, which means that the current ban on uranium mining must be removed."

The result of the investigation must be reported by 15 May at the latest, at which point the government can choose to proceed with a legislative proposal to parliament to lift the ban on uranium mining.

In November last year, Sweden's parliament approved a bill that cleared the way for new nuclear power in the country by removing the current limit on the number of nuclear reactors in operation, as well as allowing reactors to be built on new sites. The amendment entered into force on 1 January.

Sweden currently uses 2.4 million pounds U3O8 annually in its three nuclear power plants and has committed to building two additional nuclear reactors by 2035.

Aura welcomes investigation

In 2019, Aura Energy lodged a claim against the Swedish government for compensation for the financial loss resulting from the ban on uranium exploration and mining, introduced the previous year. The company had planned to extract uranium as a by-product from its 100%-owned Häggån polymetallic project in Sweden.

Häggån, previously known as Storsjon, is located in the municipality of Berg in the county of Jämtland and forms part of a large uranium field in central Sweden. Figures released in mid-2012 estimated resources of 800 million pounds U3O8 (307,718 tU) at Häggån, making the Swedish project the second largest undeveloped uranium resource in the world, Aura says. The uranium occurs with molybdenum, vanadium and zinc in black shales, and Aura has reported yields of up to 85% uranium from bioheap leaching tests.

In February 2013, Aura announced it had accepted Areva Mines as strategic partner in the project and had entered a binding cooperation agreement, but Areva later pulled out of this.

Welcoming the prospect of the uranium mining ban now being lifted, Aura said Häggån has the potential to supply a significant portion of Sweden's nuclear fuel requirements.

"This announcement is a logical step by the Swedish government towards allowing the extraction of uranium domestically to secure its own and others' needs," said Aura Energy CEO Andrew Grove. "It is the start of a process which I hope will result in new legislation that not only makes it legally possible to mine uranium, but also provides a predictable permit process for uranium extraction alongside the mining of other metals.

"The Swedish government's stated aim aligns well with the ability to mine domestic uranium, reducing foreign dependency and strengthening domestic and European energy supply," he added. "It is of course essential that uranium is mined in a way that does not threaten the local environment or water supply, and I am certain that we will be able to demonstrate that within the framework of the Swedish permit process."

The company intends to file for processing concession for Häggån K1 during 2024 with the Swedish Mining Inspectorate. A Swedish processing concession (exploitation permit) is valid for 25 years.

Researched and written by World Nuclear News

Nickel faces existential moment with half of mines unprofitable

Bloomberg News | February 26, 2024 |

A nickel briquette. Image from Sherritt International

Many of the world’s biggest nickel mines are facing an increasingly bleak future as they wake up to an existential threat: a near limitless supply of low-cost metal from Indonesia.


With roughly half of all nickel operations unprofitable at recent prices, the bosses of the largest mining companies last week sounded a warning that there was little prospect of a recovery.



The potential collapse of nickel mining from Australia to New Caledonia comes at a time when western governments are scrambling to secure the supply chains needed to decarbonize the global economy. But in an ironic twist, Indonesia’s coal-fired nickel output is pricing out greener metal that’s so far failed to command a market premium.

Wresting control of strategic metals from China has become a focal point of Joe Biden’s administration. Yet while US officials have dashed around the world looking to strike deals for materials such as cobalt and copper, the heaviest reverse has come in Chinese-backed Indonesian nickel, a key component of electric vehicles.

Indonesia now accounts for more than half of world supply, with the potential to reach three-quarters of all production toward the end of the decade.

“There is a serious structural challenge as a result of Indonesian nickel,” said Duncan Wanblad, chief executive officer of Anglo American Plc, after his company took a $500 million writedown on its nickel business last week. “They don’t seem to be letting up anytime soon.”

Traditionally, nickel has been split into two categories: low grade for making stainless steel and high grade for batteries. A huge Indonesian expansion of low-grade production led to a surplus, and, crucially, processing innovations have allowed that glut to be refined into a high-quality product.

Commodity markets have always been susceptible to cyclical volatility, especially when sudden supply and demand imbalances get a push from wider macro upswings or downturns. But what’s happening in nickel right now is different, with the entire industry undergoing a structural shift that has upended forecasts and models.

For BHP Group, the world’s biggest miner, nickel is a rounding error, contributing mostly losses to profits that routinely break $30 billion a year. Yet in recent years the company has championed the metal, seeing it as a key growth market that will help offset its retreat from fossil fuels.

Instead it’s turned into a disaster.

This week CEO Mike Henry conceded that the company will have to make a decision on whether to shutter its flagship nickel business in Australia within the next few months. Having already written down the business’s value by $2.5 billion, Henry said he expects the market to remain in surplus until at least 2030.

That means the pain is likely just starting.

Macquarie Group Ltd. calculates that about 250,000 tons of annual production — equivalent to about 7% of the total — has been taken out of the market by closures, with another 190,000 of planned output delayed.

Combined with economic slowdowns in China and the US and the choppy adoption of EVs, nickel has been pummeled. The price fell 45% last year, and is currently hovering around $17,000 a ton. According to Macquarie, at $18,000 a ton 35% of production is unprofitable, while at $15,000 a ton that jumps to 75%.

Anglo’s CEO Wanblad, who is reviewing nearly all the company’s mines in bid to cut costs, said that he will give the miner’s nickel business time in the face of the Indonesian threat.

“Our nickel business will undergo a fulsome review in terms of holding its head above water and making a viable profit,” he said. “I’m not giving up on the guys to come up with a plan that might help them readjust themselves into a position where they can function effectively.”

Glencore Plc, which has already moved to shutter its nickel operations on the islands of New Caledonia, is one of the world’s biggest producers with sprawling businesses in Canada and Australia. At current prices, that business will make just $500 million this year, with CEO Gary Nagle expecting prices to remain depressed.

“We see continuing strong production growth out of Indonesia,” Nagle said. “We do not expect significant price recovery in the short to medium term.”

With more than half a decade of oversupply ahead, more mines are likely to close before things get better. Should the market finally rebalance, that will leave Indonesia and China with even more market share then they already have.

Still, Indonesia’s rapid expansion has drawn criticism. Much of its production comes from coal-powered energy, giving it higher emissions per ton than rival producers, and its rapid expansion is eroding rainforests.

With little prospect of a near term recovery, western miners are pinning their hopes on state aid in the short term and a push toward customers — such as carmakers — demanding “greener” nickel in the future and being willing to pay more for it.

BHP this week called for the London Metal Exchange to expand its responsible sourcing policy to include environmental due diligence, helping to differentiate production from Indonesian and Chinese supply.

Still, as conceded by Glencore, so far buyers of nickel are unwilling to pay more.

“Right now there is not much of a premium in the market,” Nagle said.

(By Thomas Biesheuvel)

Fortescue’s Forrest urges LME to separate ‘clean’ nickel contracts

Reuters | February 26, 2024 

Andrew Forrest. (Image by Mines and Money, Flickr).

The London Metal Exchange (LME) should classify its nickel contracts into “clean” and “dirty” ones to give customers more choice, Australian iron ore magnate Andrew Forrest said on Monday.


The comment by Forrest, chairman and founder of Fortescue Metals Group, is part of a push by miners and Australian lawmakers to save the country’s nickel industry after prices collapsed amid a jump in cheaper supplies from Indonesia.


Nickel, a key ingredient in electric vehicle batteries, is typically produced to higher environmental and regulatory standards in Australia than in Indonesia. That has Australian producers calling for a green premium.

“If you’ve got dirty nickel in your battery systems, then you want to know about that because you don’t want to propagate that and you want the choice to buy clean nickel if you can. So the London Metal Exchange must differentiate between clean and dirty,” Forrest told Australia’s national press club.

In an emailed response to Reuters, an LME spokesperson said the exchange “drives and supports the metals and mining industry on several sustainability measures to ensure transparency throughout the supply chain to consumers”.

The LME, the world’s biggest market for industrial metals, has linked up with German online platform Metalshub, which in 2022 developed a price index for class 1 nickel briquette premiums. Briquettes are solid forms of nickel obtained by compressing the metal’s powder or flakes.

“Low-carbon nickel can already be listed on Metalshub today and the transaction data supports identification of a credible ‘green premium’ to the LME price,” the spokesperson added.

Australia’s nickel industry is shedding hundreds of jobs. Forrest’s private investment arm Wyloo Metals said last month it would put its Western Australian nickel operations on care and maintenance at the end of May due to low prices. It bought those assets last year for $504 million.

(By Melanie Burton; Editing by Edwina Gibbs and Jan Harvey)

 

As Tensions Rise in Horn of Africa, Somalia Signs Defense Pact with Turkey

Somalia and Ethiopia are at loggerheads over a transport deal between the Ethiopian government and quasi-independent Somaliland, home to the Port of Berbera (DP World file image)

PUBLISHED FEB 25, 2024 7:31 PM BY BRIAN GICHERU KINYUA

 

 

As the world watches the Houthi maritime insurgency in the Red Sea, a new geopolitical alignment that could determine the region’s stability is taking shape to the south. Last week, Somalia’s government signed a 10-year defense and economic cooperation pact with Turkey, amidst growing tensions between Mogadishu and Ethiopia on the use of the Port of Berbera.

A month ago, Ethiopia signed an initial agreement with Somalia’s breakaway region of Somaliland to gain rights for access to the Red Sea Port of Berbera. In return, Somaliland would get a stake in state-owned Ethiopian Airlines and recognition of its sovereignty.

However, this deal ignited a stern response from Mogadishu, which accused Ethiopia of interfering with its internal affairs. Although Somaliland has enjoyed autonomy since 1991, Somalia still considers it to be part of its own territory.

In an interview last week, Somali President Hassan Sheikh Mohamud said that his country would defend itself if Ethiopia goes ahead with its deal in Somaliland.

“If Ethiopia insists, Somalia will resist and will refuse. If they come into the country, Somalia will do everything that it can to defend itself,” Mohamud told Reuters, without giving further details.

According to Mohamud, the defense agreement with Turkey is meant for capacity-building purposes for the Somali army.

“We asked for their support, not to fight Ethiopia or invade another country. It is to support us in defending our country. That is the origin of the agreement we have entered with Turkey,” added Mohamud.

The pact was first approved by the Somali Cabinet and later endorsed by the two houses of Somalia’s Parliament in a majority vote. The deal includes a maritime security component as well.

“Turkey will build, train and equip the Somali navy as part of the government’s plan to fight terrorism, piracy, illegal fishing, toxic waste dumping and any external violations or threats to Somalia’s sea coast,” said Somali Prime Minister Hamza Abdi Barre.

Turkey’s Defense Ministry confirmed the cooperation deal with Mogadishu, saying that for almost a decade, Turkey has been providing support to Somalia to reorganize its army and bolster fight against terrorism.

“Upon Somalia’s request, we will provide support in the field of maritime security, as we did in the field of fight against terrorism. Hence, we will help Somalia develop its capacity and capabilities to combat illegal and irregular activities in its territorial waters,” a Turkish Defense Ministry official told reporters.

Somalia has the longest coastline in Africa, covering nearly 1,900 miles Unfortunately, years of civil war in the country have left it with limited capacity to patrol and administer its extensive coastline.

In 2011, Turkey re-established its diplomatic relations with Somalia, and since then the two countries have cooperated on defense and economic matters. This saw Turkey set up its biggest overseas military base in Mogadishu in 2017. The base has a capacity to train 1500 soldiers at a time and its initial goal was to train 10,000 Somali troops.

These initiatives have been interpreted in the light of Turkey’s foreign policy agenda, which includes ambitions of projecting Turkish power in Africa, especially in the Red Sea region. This is consistent with a wider trend by other Middle Eastern powers, which have operational presence in the Red Sea. Israel has a naval base in its Red Sea town of Eilat. Egypt, which has one of the most powerful militaries in the Arab world, maintains four Red Sea bases. The UAE had a naval base in Eritrea until 2021 and still has an operational base in Yemen’s Socotra Archipelago. Saudi Arabia’s King Faisal Naval Base is also found in the country’s Red Sea City of Jeddah.

 

ASC Affiliates Pay $9.5M to Settle "Canadian Rail" Jones Act Case

 

A truck makes a "rail" compliance trip aboard the Bayside Canadian Railroad at Bayside, New Brunswick, 2015 (Brian Golding / U.S. CBP)

PUBLISHED FEB 25, 2024 8:17 PM BY THE MARITIME EXECUTIVE

 

Two affiliates of American Seafood Company (ASC) have paid a near-record $9.5 million fine in connection with the notorious "Bayside Canadian Railway" scheme. The Jones Act compliance scheme was set up to legalize foreign-flag cargo transport from Alaska to the U.S. East Coast, but U.S. Customs and Border Protection (CBP) determined that it was in violation of the law. 

In 2017, CBP began investigating a unique arrangement that American Seafood Company (ASC) created for transporting pollock from Alaska to Maine. An ASC subsidiary, Alaska Reefer Management (ARM), chartered foreign-flag reefer ships to transport fish from Dutch Harbor to New Brunswick, Canada via the Panama Canal. At Bayside, New Brunswick, the fish was offloaded at a terminal operated by ARM subsidiary Kloosterboer International.

The cargo was then loaded into truck trailers and driven onto a two-car, one-track train, the Bayside Canadian Railway (BCR). A mini locomotive pulled each laden truck 100 feet to the south, then 100 feet back north, completing a round-trip "Canadian rail journey." After this brief rail treatment, the truck would drive over the border and deliver the cargo to consumers in New England. 

For years, the "Bayside Canadian Railroad" allowed these shipments to pass through a little-known loophole in the Jones Act. An obscure clause in the Act allows foreign-flag ships to carry U.S. coastwise cargo when the voyage involves "transportation . . . in part over Canadian rail lines."  

However, CBP determined that the Bayside railway was a sham. In 2021, the agency issued penalties totaling about $350 million dollars to the firms involved in this novel supply network, including tens of millions in fines for foreign-flag shipowners. It was the largest package of Jones Act penalties ever issued.

ASC's affiliates immediately sued to block the fines and obtain permission to keep using the route, since there were still millions of dollars' worth of pollock in transit. It succeeded in obtaining a temporary injunction to keep operating the rail line while litigation continued, and it also won part of its financial battle: In May 2022, Judge Sharon Gleason threw out millions of dollars in CBP fines, finding that the agency had not followed proper administrative procedures. 

However, Judge Gleason also agreed with CBP on the merits of the charges, and she ruled that the Bayside Canadian Railroad was not a legitimate Jones Act operation. Since the rail portion of the route started and ended at the same point, it did not result in forward progress and therefore did not meet the statute's standard for "transportation," she ruled.

On Friday, CBP, Kloosterboer and Alaska Reefer Management announced a settlement agreement that ends litigation over the Bayside Canadian Railroad. The firms have agreed to cease using it, and the two ASC affiliate companies will pay a total of $9.5 million in penalties. 

“This is the second largest settlement of a case brought under the Jones Act in the history of our Nation,” said U.S. Attorney S. Lane Tucker for the District of Alaska. “Our prosecutors and law enforcement partners did a tremendous job successfully investigating and litigating this complex case