Maple Gold Mines consolidates Quebec projects from Agnico

Maple Gold Mines (TSXV: MGM) (OTCQB: MGMLF) has consolidated ownership of the Douay and Joutel gold projects in Quebec after restructuring its 50:50

By Mining.com Staff June 20, 2024

The Douay gold project is a 50:50 joint venture of Maple Gold and Agnico Eagle. 

Credit: Maple Gold Mines

Maple Gold Mines (TSXV: MGM) (OTCQB: MGMLF) has consolidated ownership of the Douay and Joutel gold projects in Quebec after restructuring its 50:50 joint venture with Agnico Eagle Mines (TSX: AEM; NYSE: AEM).

On Thursday, the parties agreed to mutually terminate the JV, first established in 2021, and transfer the legal title to the properties to Maple. In return, Agnico will retain a 1% net smelter return royalty on the JV assets.

The Canadian gold producer will also have the option to buy a 50% interest in the properties if Maple decides to develop a mine complex that is supported by a pre-feasibility or feasibility study demonstrating a $300 million net present value of the projects.

Should Agnico exercise that option, it will be required to make a cash payment equal to the sum of 200% of the amount of specified expenditures incurred by Maple in respect of the projects, plus an additional $12 million.

In the event that construction of the project is suspended, Agnico also has the option to buy 50% of the assets upon its restart for a similar payment structure amount plus half of the project expenditures incurred following the date of the construction decision until the date of option exercise.

Maple Gold's CEO Kiran Patankar calls the JV restructuring a "transformative, value-unlocking transaction" that resulted from teamwork between the companies, and it represents a "win-win for both parties" for the continued advancement of the two projects.

To fund its work on the project, Maple has also announced a flow-through share offering priced at $0.12 each for gross proceeds north of $4 million. At market open, the stock traded at $0.06, giving the gold explorer a market capitalization of $20.5 million.

Douay is a district-scale 357 km2 property with an established mineral resource of 10 million tonnes grading 1.59 g/t gold for 511,000 contained ounces in the indicated category and 76.7 million tonnes grading 1.02 g/t gold for 2.5 million contained ounces in the inferred category.

The Joutel project located south of the Douay property is host to Agnico’s past-producing mine complex, with total historical gold production of 1.1 million oz. at an average grade of 6.5 g/t gold from 1974 to 1993,

Both projects are situated along the Casa Berardi-Douay gold trend in Quebec, a structure within the prolific Abitibi greenstone belt that is known to host world-class gold deposits such as Beatty and the Canadian Malartic.

South Star eyes production start at Brazil graphite mine in Q3

Santa Cruz mine is poised to become the first new graphite production

facility in the Americas since 1996.

Mining Technology· Enrique from Pixabay.

GlobalData
Thu, Jun 20, 2024

South Star Mining plans to commission the Santa Cruz graphite mine's Phase 1 plant in Brazil in the coming weeks.

The construction of the 1,000t per month capacity plant is due to conclude this month, initiating an estimated six-week commissioning and ramp-up period.

Additionally, the company secured a Brazilian Ministry of Mines and Energy (MME) approved definitive mining licence for five areas totalling 4,431 hectares for South Star’s Santa Cruz Mine. Three additional claims are in the final stages of evaluation.

These licences are crucial for the mining operations planned in Phases 1, 2 and 3.

South Star Mining said the Santa Cruz mine is poised to become the first new graphite production facility in the Americas since 1996.

The project's Phase 1 commercial production is anticipated to begin in the third quarter of this year.

Subsequent expansions – Phase 2, with an annual production capacity of 25,000 tonnes per annum (tpa), and Phase 3, aiming for 50,000tpa – are scheduled for 2026 and 2028, respectively.

Phase 2 has already secured partial funding.

South Star CEO Richard Pearce said: “The company now owns the land where our Phase 1 installations and operations are located, and the purchase further strengthens our balance sheet.

“With the approval of the definitive mining licences, Phases 2 and 3 of Santa Cruz are now derisked from a permitting and licensing standpoint, and we have a clear path to scaling production as the markets and our clients ask for additional high-quality Brazilian graphite concentrates.

“Our agreement with Sprott already secures approximately 50% of our Phase 2 capex, and our team is pushing to complete an updated feasibility study on Santa Cruz incorporating Phase 3 production.”

"South Star eyes production start at Brazil graphite mine in Q3" was originally created and published by Mining Technology, a GlobalData owned brand.

Tianqi weighs legal actions after Chile regulator clears SQM-Codelco deal

Reuters | June 21, 2024 | 

Zhangjiagang production plant. (Image courtesy of Tianqi Lithium.)

China’s Tianqi Lithium said on Friday it was evaluating possible legal action against a Chilean regulator’s ruling allowing a tie-up between No. 2 lithium producer SQM, which it owns around a fifth of, and Chile’s state-run copper giant Codelco.


Chile’s financial regulator this week said a planned lithium joint venture between SQM and Codelco can proceed without a vote by SQM shareholders, which would have included Tianqi.

Tianqi has repeatedly pressed for the matter to be put to a shareholders’ vote. It can appeal the regulator’s decision to the courts.

“Our company, in compliance with its fiduciary duty and responsibility to its investors, is evaluating all possible legal actions and will take all pertinent measures in accordance with the law to enforce its rights and interests as a shareholder of SQM and an international investor,” Tianqi said in a statement.

The Codelco-SQM agreement is a major plank of the Chilean government’s aim to take a stronger role in lithium production, in a country that has only two producers, SQM and US-based Albemarle. Chile is the world’s second-largest producer of the metal used in batteries for electric vehicles.

(By Daina Beth Solomon; Editing by Anthony Esposito and Kylie Madry)

SQM and Talga team up on Aero lithium project in Sweden

Cecilia Jamasmie | June 21, 2024 |

Visualization of Talga’s Vittangi graphite mine. (Image courtesy of Talga Group.)

SQM (NYSE: SQM), the world’s second largest lithium producer, has inked an earn-in agreement with battery anode and advanced materials company Talga Group (ASX: TLG) to jointly advance the Aero lithium project in northern Sweden.


The Chilean lithium miner can earn up to a 70% interest in Aero by funding up to $19 million in exploration spending over a seven-year period.

Talga will retain all rights and obligations over graphite minerals at Aero and will receive a management fee for each stage of the earn-in deal. The company will also be awarded a “success fee” if a decision to mine is made.

Mark Thompson, managing director of Talga, believes that collaborating with SQM gives its company an opportunity to build a European lithium supply centre.

“As one of the few potentially large-scale lithium hard rock opportunities in Europe, Aero might be significant to the region’s battery and electric vehicle industry,” Thompson said in the statement.

Once the earn-in period is completed, both parties are required to contribute to further expenditures in proportion to their ownership stakes or face dilution.

SQM International Lithium division CEO, Mark Fones, said the deal with Talga is part of the company’s efforts to build a global and competitive lithium asset portfolio.

“Expanding into new and promising jurisdictions, such as Sweden, has been a strategic goal for us, and partnering with Talga, who has demonstrated expertise in the region, further enhances this achievement,” Fones said.
Far from home

SQM began expanding beyond Chile about three years ago, first targeting Australia. In July, it reached an earn-in deal with Tambourah Metals (ASX: TMB) covering the explorer’s Julimar North project in Western Australia. Three months later, the company agreed to buy a 30% interest in Australia’s Pirra Lithium and has the option of boosting its stake to 40%.

SQM tried, but failed to take over Azure Minerals (ASX: AZS) on its own. It ended up partnering with Australia’s richest person, Gina Rinehart, through her company Hancock Prospecting.

The deal gave the Chilean lithium producer a stake in Azure’s Andover project and a partnership with Hancock, which has rail infrastructure and local experience in developing mines.

SQM also holds a 50/50 interest with Wesfarmers in the Mt. Holland lithium mine, which kicked off operations in March. The Western Australia-based operation is expected to eventually produced enough lithium hydroxide to power close to one million new electric vehicles every year for half a century.

SQM has also expanded lithium carbonate capacity at home. It expects to produce 210,000 tonnes this year and 240,000 tonnes by 2025. By then, it said it should be totalling 305,000 tonnes of lithium carbonate equivalent.

The company recently signed an agreement with copper giant Codelco, which gives the state-run miner a majority share in the new partnership while extending SQM’s lease in the Atacama salt flats through 2060.

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Vale expects deal to bring Onca Puma nickel mine back online soon

Reuters | June 20, 2024 |

Onca Puma mine. Credit: Vale

Brazilian miner Vale expects to reach a deal in the coming days with northern Para state to resume activities at its Onca Puma nickel mine, the firm said in a statement on Thursday.


The mine had its operating license suspended earlier this year after Para’s environment department flagged irregularities in an annual environmental report.

Vale “hopes to conclude a deal in the coming days,” Vale told Reuters in a statement.

The Onca Puma mine accounted for around 10% of Vale’s total nickel production last year.

(By Ricardo Brito, Marta Nogueira and Luana Maria Benedito; Editing by Anthony Esposito)

MONOPOLY CAPITALI$M

Mining M&A stokes coal race against cleaner power

Reuters | June 20, 2024 |

Glencore currently operates 26 mines in 21 thermal and coking coal mining complexes across Australia, Colombia and South Africa. (Image courtesy of Glencore.)

Coal is doomed, or so the energy thesis goes. Many banks, insurers and investors have backpedalled from or abandoned the carbon-belching fossil fuel, prompting companies that excavate it to complain they cannot get mainstream or affordable financing. One corner of the industry, however, is burning strongly: the coking, or metallurgical, variety used to make steel. For sellers, it’s a diamond underneath the growing pile of mining M&A. Buyers, however, are in a race against low-emissions alternatives to justify their strategies.


The black rock’s lingering sparkle is good news for Anglo American boss Duncan Wanbland. His company’s Australian coal operation probably will be offloaded soon as part of the overhaul designed to help thwart rival BHP’s unsolicited $49 billion takeover attempt last month. Recent transactions suggest there will be no shortage of suitors.

Glencore is in the process of acquiring 77% of Teck Resources’ coal business in a deal that values the enterprise at $9 billion, or more than 4 times next year’s estimated EBITDA, according to LSEG data. In Australia, which accounts for roughly half of all coking coal exports, there is more activity. A BHP-Mitsubishi Corp joint venture, for example, just sold two mines for about 3 times EBITDA, or $3.2 billion, to Whitehaven Coal, which may flog a minority stake to a steelmaker.

Coking coal has what for now is a unique pitch. It provides the heat and carbon necessary for blast furnaces to turn iron ore into molten iron, used to produce about 70% of the world’s 1.8 billion tons of steel each year. The rest comes from scrap metal refashioned in electric-arc furnaces, like ones at the heart of Nippon Steel’s fraught plan to buy United States Steel. This lower-energy process, whose furnaces use less if any coal, is projected to become as much as half the market by 2050. The dirtier method is set to keep growing in India and other parts of Southeast Asia, where production could jump 50% over the same span, according to Wood Mackenzie analysts.


The open secret, however, is that coking coal is more toxic than what gets shovelled into power plants. Thermal coal accounts for about a fifth of the world’s greenhouse gas emissions, double what steelmaking spews. But coking coal, which is responsible for most of the metal’s pollution, does so with just a fifth of the tonnage mined. Its significant methane content means toxins emitted from pits alone are almost three times higher than from thermal coal, Wood Mackenzie has estimated.

There are also no functional alternatives in the same way that solar, wind and other renewable sources are supplanting fossil-fuel power stations. Plenty are in the works, however. Green hydrogen is one, heavily funded by Andrew Forrest’s iron ore miner Fortescue and others. Rival Rio Tinto is also working on using biomass and microwave energy. Boston Metal – backed, among others, by BHP, steelmaker ArcelorMittal and German carmaker BMW – aims to commercialize the molten oxide electrolysis process.

These options may not be ready to compete at a significant level for a decade. This helps explain the reduced stigma attached to unearthing coking coal compared to its electricity-generating thermal cousin.

It’s also why the recent increase in deals does not seem to be particularly contentious. Even BHP boss Mike Henry touted coal mines as one of Anglo American’s main attractions after having spent four years as CEO pivoting to “future facing commodities” such as copper. The basic idea is that Anglo’s mines mostly hold the same premium-grade hard coking coal as BHP’s remaining pits just down the road. The variety has fewer impurities and usually lower emissions.

Profitability helps, too. Premium hard coking coal sells for around $250 a metric ton, with BHP spending roughly $100 and Anglo $115 to dig it up. Soft coking coal sells for around a third less. Thermal coal, meanwhile, fetches less than $140 a ton, with costs ranging from $50 to more than $100.


Small wonder that thermal coal producers were the buyers in the two largest coking coal deals. Of the 113 million tons of coal Glencore excavated last year, less than a tenth was destined for blast furnaces. Teck’s met coal unit will double that proportion and contribute a third of revenue, based on last year’s figures. The idea is that combined, the business will be worth more in a spinoff planned by Glencore CEO Gary Nagle.

With BHP-Mitsubishi’s volume, Whitehaven will more than double its overall production and catapult the top-line contribution from met coal to about 70% from less than 10%. The merger also should boost its EBITDA margin and eventually inspire investors to value the enterprise at more than just 3 times those expected earnings over the next 12 months, per LSEG data. The deal also takes the company tantalizingly close to the threshold – 25% of revenue from thermal coal – that can make it easier to tap mainstream banks and insurers.


Some of the deals look like steals, at least on paper. Glencore’s return on its mooted Teck investment could be as high as 19%, based on last year’s showing. And if BHP were to pay, say, $5 billion to buy Anglo’s coal mines, or around 4 times 2025 EBITDA per Visible Alpha data, and then cut its target’s costs by a tenth, it might generate 14% on its capital, Breakingviews calculates.

All else being equal, Glencore might recoup its outlay in just five years, far sooner than even the chirpiest projections for green hydrogen and other technology to compete. A putative BHP acquisition of Anglo’s metallurgical assets would take seven years to pay off.

If coal prices drop by a third to their pre-Ukraine war band, though, a crude calculation indicates the deal payback timeline would roughly double. That’s assuming costs don’t rise. Many mines in Australia’s chief coking coal region already have been hurt directly or indirectly from flooding worsened by climate change. Such events will increase as more fossil fuel emissions are pumped into the atmosphere.

The more such disasters, the greater impetus there may be to curb pollution, putting a bigger target on steelmaking. BHP and others anticipating that premium coal will be more durable sound optimistic: Teck has pointed out that increasing hard coking coal’s volume in the furnace to 70% from 50% reduces carbon emissions by less than 7%.

Moreover, climate-linked import duties, including Europe’s carbon border adjustment mechanism, will be fully up and running before long. Dealmaking is stoking the embers of coking coal, but also the chase against cleaner replacements.

(By Antony Currie; Editing by Jeffrey Goldfarb and Aditya Srivastav)

De Beers Canada JV partner says diamond miner in no rush to sell

Reuters | June 21, 2024 | 

Mountain Province’s flagship operation is its 49%-owned Gahcho Kué mine, in Canada’s Northwest Territories. The remainder is held by De Beers, the mine operator. (Credit: MPD)

The proposed spin off of Anglo American’s De Beers diamond unit will take ‘some time’ and the miner is not rushing to complete the split, Mark Wall, CEO of Mountain Province Diamonds, the Canadian joint venture partner of De Beers’s Gahchu Kue mine, said this week.


After Anglo American rejected a $42.7 billion buyout offer from Australian miner BHP in May, it announced plans to sell its copper, iron ore, diamond and platinum businesses.

Yet the more than 100-year-old diamond miner is seeking options for its spin off from parent Anglo American at a time of depressed diamond prices, which analysts have said may make any transaction tougher. A public listing or sale to a sovereign wealth fund or other strategic investor are two possible options for the company, according to two people aware of the development.

De Beers did not respond to an email query by Reuters. Anglo said it plans to divest De Beers during the next 18 to 24 months.

Prices of rough diamonds have slumped by 15% to 20% since early 2023, according to the Zimnisky Global Rough Diamond Price Index, due to the rising popularity of lab grown diamonds and a shift by younger consumers away from diamonds.

Mountain Province Diamonds and De Beers own the Gahcho Kue diamond mine in Canada’s Northwest Territories (NWT). De Beers owns two other diamond mines in Canada.

“I have had many discussions (with De Beers Canada). What I am getting is no one is rushing into anything. There is a acceptance that this is going to take some time,” Wall told Reuters on Thursday.

He added that the joint venture is focused on daily operations, including maintaining safety and environmental standards.

Earlier this month De Beers said it was prioritizing investments in high return major projects and would pause exploration at the Gahchu Kue and Chidliak underground mines.

(By Divya Rajagopal; Editing by Chizu Nomiyama)

Nations Royalty listing marks Indigenous milestone

June 21; Canada’s National Indigenous People’s Day.

Henry Lazenby - The Northern Miner | June 21, 2024 | 

Nation Royalty owns a net smelter return royalty on Newmont’s Brucejack gold-silver mine in B.C., Canada. (Image courtesy of Newcrest Mining.)

The Frank Giustra-backed Nations Royalty (TSXV: NRC), which may be the country’s first Indigenous company to focus on production contracts like net smelter returns, joined the Toronto Venture exchange on Friday, Canada’s National Indigenous People’s Day.


Nations Royalty stock closed at C$0.83 apiece, down 8% from the 90¢ listing price. The company floated 144.7 million shares with 132.9 million held in escrow.

The Nisga’a, based in northwest British Columbia near the Alaskan panhandle, hold a 77% stake in the company based on a portfolio of royalty agreements. Nisga’a Lisims government president Eva Clayton said in a statement that the listing represents a milestone for Indigenous groups.

“Nations Royalty’s vision presents a unique opportunity for the Nisga’a Nation, other First Nations and Indigenous groups, and investors to access a portfolio encompassing precious and critical metal mines, oil and gas ventures, and renewable energy projects,” Clayton said.

The company’s initial public offering comes amid ongoing reconciliation efforts between First Nations and the Canadian government as well as rising interest in mining. In BC, the Tahltan Nation and Williams Lake First Nation have reached participation agreements in projects.

In March, BC recognized the Haida Nation’s Aboriginal title on its lands, but the major step raises constitutional questions. The Northern Miner is due to report more on it next week.
Industry expertise

Giustra, who founded Lions Gate Entertainment (Fahrenheit 9/11, The Hunger Games) and helped start Wheaton Precious Metals (TSX: WPM, NYSE: WPM; LSE: WPM) and Endeavour Mining (TSX: EDV; LSE: EDV), is helping Nations Royalty expand its investments.

The company acquired royalty rights on Newmont’s (TSX: NGT; NYSE: NEM) Brucejack gold mine and Seabridge Gold‘s (TSX: SEA; NYSE: SA) KSM copper-gold-silver-molybdenum deposit in BC’s Golden Triangle.

Rob McLeod, the interim CEO of Nations Royalty and a technical adviser to Giustra’s mining investments, praised the Nisga’a Nation’s legal advocacy and economic development leadership. The community is a pioneer as the largest majority Indigenous-owned public company in Canada, he said.

The company’s strategy involves merging royalties and incomes from various resource projects to attract external investors, promoting economic growth and reconciliation. It said it aims to capitalize on economic growth, diversification and the empowerment of Indigenous communities in the public and capital markets.

Tsingshan’s $1 billion steel plant in Zimbabwe starts production

Reuters | June 20, 2024 | 

Credit: Dinson Iron & Steel Company Zimbabwe

China’s nickel giant Tsingshan Holding Group has started production at its $1 billion steel plant in central Zimbabwe, a company official said on Thursday.


Tsingshan’s Dinson Iron and Steel Company will produce 600,000 metric tons of carbon steel annually during the first phase of its operations, project director Wilfred Motsi told reporters during a tour of the plant.


“We have started to produce pig iron, which is a raw material used for the production of steel. By July, that’s when we will start to produce the actual carbon steel,” Motsi said.

He did not say how long the first phase would last.

Tsingshan, one of the world’s leading nickel producers, has made significant investments in Zimbabwe in recent years. Apart from the steel plant, Tsingshan also has ferrochrome, coking coal and lithium mining businesses in the southern African country.

The company has also built a 50 megawatt thermal power plant at Dinson. The steel plant will generate additional power through gas produced by its furnace, to meet 20% of its electricity needs.

The company also plans to build a solar power plant to reduce the impact of Zimbabwe’s electricity shortages on its operations.

(By Philimon Bulawayo and Nelson Banya; Editing by Barbara Lewis)

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Australia to fund road clearing to Porgera mine after PNG landslide

ALL CAPITALI$M IS $TATE CAPITALI$M

Reuters | June 20, 2024 | 

The gold mine is located in the Enga Province of Papua New Guinea. (Image courtesy of Porgera Joint Venture.)

Australia said it would provide A$2 million ($1.33 million) to Papua New Guinea to restore road access to the Porgera gold mine, previously one of the world’s largest, and other support for survivors after a deadly landslide in Enga province in May.


Seven Australian ministers and the country’s police chief are in Papua New Guinea (PNG) to hold security and trade talks amid competition with China for policing ties in the Pacific Islands, and to underscore Australian humanitarian assistance after the disaster last month.

“It was moving to see so many people in such a dire situation,” Australia’s Minister for Pacific, Pat Conroy, said in an ABC Television interview, after visiting the site with PNG Defence Minister Billy Joseph and the delegation.

Australia will provide assistance for health clinics, and education packs for thousands of survivors who must move from villages where mountainsides collapsed.

PNG had requested A$2 million to “start the work to open up the national highway there to the Porgera gold mine, which is obviously an incredibly important source of jobs and revenue for the people of Enga province”, Conroy said.

The Porgera mine, about 30 kilometres (19 miles) from the landslide, is an underground mine jointly run by Canada’s Barrick Gold and China’s Zijin Mining Group, with the Papua New Guinea government holding a 51% share.

The mine was re-started this year after being in dispute for four years as PNG sought to boost returns to tribal landowners, and had been expected to reach full production this year.

Barrick did not immediately respond to a request for comment.

PNG Prime Minister James Marape said in April the reopened mine was expected to return to its status as one of the world’s largest gold mines, becoming a significant contributor to the national treasury and generating income for Enga province. The mine employs about 2,000 local workers.

It remains unclear how many people died in the landslide on May 24, with the national government and a UN estimate putting the death toll at about 670.

Australia’s Foreign Minister, Penny Wong, said in an ABC interview on Thursday that Australia was “in a permanent contest in the Pacific”, referring to its rivalry with China for security ties, and wanted to ensure stability in PNG.

($1 = 1.4984 Australian dollars)

(By Kirsty Needham and Melanie Burton; Editing by Gerry Doyle)

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China to regulate lithium-ion battery industry amid fast expansion

CLOSING BARN DOOR

Reuters | June 19, 2024 | 

Conveyor line for the production of lithium-ion batteries. Stock image.

China’s Ministry of Industry and Information Technology on Wednesday issued new guidelines for its lithium-ion battery industry, aiming to transform, upgrade and promote high-quality development amid rapid expansion in the sector.


The guidelines, following a proposal in May, will help firms scale back manufacturing projects that only expand production capacity, while enhancing technology innovation and product quality and trimming output costs, the ministry said.

Projects built on farmland and ecological zones would be required to be shut down, or strictly reined in and gradually removed.

Rapid expansion of production capacity along the lithium battery supply chain has led to a plunge in prices for products, including battery and raw materials, eroding companies’ profits in the world’s biggest market.

Industry planning and launch of new projects should be in line with national development of resources, ecological protection and energy saving management, the ministry said.

The new guidelines will be effective from Thursday.

(By Farah Master, Ella Cao and Siyi Liu; Editing by Christopher Cushing and Bernadette Baum)