British Columbia creates new mining ministry to tackle critical minerals amid doubts over capacity

me-metals: British Columbia Premier David Eby on Monday split the Ministry of Energy, Mines and Low Carbon Innovation into two: Mining and Critical Minerals and Energy and Climate Solutions, to fast-track projects and tackle regulatory and social challenges.

According to me-metals cited from mining.com, Jagrup Brar, appointed as the first Minister of Mining and Critical Minerals, will oversee 17 projects advancing toward construction. He will also lead reforms to the Mineral Tenure Act (MTA), the government said in a media briefing late Monday. The government sees these tasks as steps to streamline permits, attract investment, and modernize old regulations.

Brar, an MLA for Surrey-Fleetwood since 2017, has no known mining background. However, his appointment was well received by local mining associations.

Eby said the restructuring positions BC to leverage its copper, lithium, and rare earth reserves, materials that are critical for electric vehicles, batteries, and renewable energy.

“The transition to a low-carbon future represents a generational opportunity we must seize, not abandon,” he said during the new cabinet’s swearing-in ceremony Monday in Victoria, just weeks after his NDP party won a tight provincial election.

Keerit Jutla, president and CEO of the Association of Mineral Exploration, told The Northern Miner that the new ministry’s creation is “a significant and important step by the government.”

“I see this government beginning to implement some of the recommendations industry has made,” he said in response to questions.

The new cabinet includes notable appointments such as Brenda Bailey as Finance Minister, Adrian Dix leading the Energy and Climate Solutions portfolio, Ravi Parmar as Minister of Forests, and Christine Boyle overseeing Indigenous Relations and Reconciliation.

“In order for BC to realize its full potential as a natural resource leader, a whole-of-government approach will be needed to ensure it is built holistically, and representative of all of BC, urban and rural,” Jutla said.

Critical vision questioned

Critical minerals are central to BC’s economic vision, with demand for lithium expected to grow sixfold by 2030 and copper demand projected to double by 2050, according to government data. The province’s mineral base could attract billions in investment and create thousands of jobs, particularly in rural areas, industry advocates say.

Yet, the industry remains skeptical. Mining companies cite permitting delays and regulatory uncertainty as major barriers. Approvals often take years. Reforming the MTA to meet Supreme Court-mandated Indigenous consultation requirements will test Brar’s leadership. The government has offered few details on how to fast-track these projects while maintaining environmental standards and honouring Indigenous rights.

Much of the proposed development of mineral resources overlaps with Indigenous land claims. Unresolved issues over sovereignty and benefit-sharing could cause delays. The government has pledged to strengthen partnerships with Indigenous groups. It will include traditional Indigenous knowledge in project planning. However, industry and First Nations question the potential to turn promises into real collaboration.

Environmental concerns further complicate the push for critical minerals. The province touts these resources as vital to the clean energy shift. Yet, mining risks habitat destruction, water contamination, and greenhouse gas emissions, critics like the BC Mining Law Reform network said in its ‘Dirty Dozen 2023’ report.

Others such as the Business Council of BC has said that framing mining as a climate solution oversimplified its impacts. It also doubts the province’s ability to cut emissions 40% below 2007 levels by 2030.

source: mining.com

NEO Battery Materials Awarded as Consortium Partner in $20M Recycled Silicon Battery Project by South Korean Government

November 20, 2024 

Awarded as Consortium Partner in CAD$20M Recycled Silicon Battery Project Organized by the South Korean Ministry of Trade, Industry, and Energy

Major South Korean Battery Value Chain Companies and Universities as Consortium PartnersHansol Chemical as Head Project Organization along with South Korea’s Largest Cathode Materials Producer, INNOX eco-M, LiBEST, etc.

Project Focus: Developing High-Performance, Low-Cost Silicon Anode Materials Based on Silicon Waste from Semiconductor and Photovoltaic Wafer Manufacturing
NEO Battery Materials Acting as Downstream Participant to Jointly Develop High-Performance Silicon Anode Materials with Consortium Partners

TORONTO, Nov. 20, 2024 (GLOBE NEWSWIRE) -- NEO Battery Materials Ltd. (“NEO” or the “Company”) (TSXV: NBM) (OTC: NBMFF), a low-cost silicon anode materials developer that enables longer-running, rapid-charging lithium-ion batteries, is pleased to announce that the Company has been awarded as a consortium partner along with major battery value chain companies and universities in a CAD$20M recycled silicon battery project organized by the South Korean Ministry of Trade, Industry, and Energy.

In a project titled “Recycled Silicon-Based High Energy Density Electrode Manufacturing Technology Development,” the South Korean Ministry of Trade, Industry, and Energy (MOTIE) and the Korea Evaluation Institute of Industrial Technology (KEIT) will invest approximately CAD$20M in government contributions for the next 5 years in consortium partners.

With Hansol Chemical, a leading South Korean chemical materials company, as the head project organization, several major battery and chemicals companies are participating as consortium partners, including South Korea’s largest cathode materials producer, INNOX eco-M (NEO’s recycled silicon collaborator), and LiBEST.

The project will focus on developing high-performance silicon anode materials based on recycled silicon scrap from semiconductor and photovoltaic wafer manufacturing. Consortium partners recognize that solving the limitations of waste materials is critical to achieving price and technological competitiveness for silicon anodes and strengthening sustainability in the lithium-ion battery industry.

NEO Battery Materials will act as a downstream value chain participant. Using recycled silicon inputs optimized with low-cost technologies, NEO will jointly develop silicon anode materials with consortium partners to manufacture high-content silicon anode batteries. This project directly advances the Company’s strategic plan to secure low-cost, high-performance silicon feedstock.

Mr. Spencer Huh, Director, President, and CEO of NEO, commented, “NEO Battery Materials is highly pleased to be a consortium partner in this key project organized by the South Korean federal government. Along with major battery industry players, we are confident in developing low-cost silicon anode materials to attain material circularity and supply chain resiliency. With approximately 900 tons of waste silicon produced annually in South Korea, all consortium partners are motivated to develop effective technologies to recycle and reuse all waste generated moving forward.”

About NEO Battery Materials Ltd.
NEO Battery Materials is a Canadian battery materials technology company focused on developing silicon anode materials for lithium-ion batteries in electric vehicles, electronics, and energy storage systems. With a patent-protected, low-cost manufacturing process, NEO Battery enables longer-running and ultra-fast charging batteries compared to existing state-of-the-art technologies. The Company aims to be a globally-leading producer of silicon anode materials for the electric vehicle and energy storage industries. For more information, please visit the Company’s website at: https://www.neobatterymaterials.com/.

British government finds Glencore UK violated business guidelines at its oil operation in Chad

Posted on 21 November 2024

Local communities were harmed by toxic spill in Chad after oversight failures at Glencore’s London headquarters

The British government has today found that Glencore UK failed to take appropriate measures to prevent and mitigate a 2018 toxic spill at its Badila oilfield in Chad, breaching the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct. An estimated 18,000 people live in the vicinity of the Badila oilfield.

Glencore is listed on the London Stock Exchange and is one of the world’s largest natural resource companies. Its oil business is managed by Glencore UK Ltd out of its London headquarters.

The findings were made by the UK National Contact Point (NCP) at the Department for Business and Trade, which implements the Guidelines for responsible business conduct of UK-based companies. The Guidelines set standards for issues including human rights, labour rights and environmental practices.

In its statement published today, the NCP publicly criticised Glencore UK for failing to adequately identify, prevent and mitigate the human rights and environmental risks at the Badila oilfield operated by its then wholly owned subsidiary PetroChad Mangara Ltd (PCM). It found that Glencore UK had a business relationship with PCM, and that although Glencore UK was not directly responsible for the spill, it breached its due diligence responsibilities.

Civil society complaint highlights harms caused

The long-overdue NCP findings were in response to a detailed complaint on behalf of local communities filed in 2020 by UK-based corporate watchdog RAID, the Public Interest Law Center (PILC) in Chad and the Association of Young Chadians of the Petroleum Zone (Association des Jeunes Tchadiens de la Zone Petroliere – AJTZP).

The complaint set out the effects of a toxic wastewater spill on 10 September 2018 when a basin holding ‘produced water’ – a by-product of crude oil production – collapsed at the Badila oilfield. Eighty-five million litres of wastewater (the equivalent of 34 Olympic-sized swimming pools) flooded agricultural fields before pouring into the Nya Pende River. Local residents rely on the river for drinking, bathing, washing clothes and watering livestock. A few weeks later, residents also reported an oil pipe leak, an incident contested by the company.

At least 50 local residents living near Glencore UK’s oil operations reported burns, skin lesions, sickness and diarrhoea after bathing in or using the contaminated river water in the weeks following the incidents. Many of those harmed were children, some of whom were hospitalised. Livestock drinking from the river also died.

Anneke Van Woudenberg, RAID’s Executive Director, stated:
“Glencore UK’s failure to conduct proper human rights due diligence has had devastating consequences for communities living near the Badila oil field. While we welcome the NCP’s findings that Glencore UK failed to prevent these harms, it is troubling that the company is not being held accountable for remedying the damage caused.

Not only does the NCP’s decision contradict UK legal precedent, which establishes that parent companies may owe a duty of care to individuals and communities harmed by their subsidiaries’ actions, it also severely fails local communities impacted by the company breaching its responsibilities.

The UK NCP has missed a crucial opportunity to reinforce to UK companies the importance of upholding responsible business practices and the necessity to provide remedies when their actions cause harm.”

According to residents, the basin had been leaking weeks before it collapsed, but Glencore UK failed to properly address the problem or to warn local residents about the impending danger. Residents say the company has still not acknowledged the harm caused or provided remedy, despite the devastating losses.
Frustration with the NCP’s decision

The three groups – RAID, PILC and AJTZP – welcome the NCP’s decision that Glencore UK breached the OECD Guidelines but said they are disappointed the NCP did not consider Glencore UK responsible for remedying the human rights impacts of the Badila spill.

While the NCP viewed the company’s UK headquarters as being at arms-length from the harm caused on the ground, the NGOs argued that, as the 100% owner of PCM, Glencore UK had a greater responsibility for its Chadian operations than the NCP’s characterisation that they held a weaker “business relationship”.

As Glencore sold PCM to the French company Perenco in June 2022, the UK NCP identified four recommendations to strengthen Glencore’s due diligence practices in other and future activities, but did not suggest remedy for the specific case of the Badila spill. The recommendations include: to improve policies on carrying out effective due diligence with regards to its business relationships; to reference due diligence in its environmental policy; to ensure the company’s complaint mechanism is effective and accessible; and to develop and publish due diligence reports regularly.

Aristote Benainou Ngarkaya, President of AJTZP, stated:
“The NCP’s recommendations are insufficient. Although Glencore no longer owns PCM, residents continue to live in a polluted area and suffer from the wastewater spill’s effects. After six years of waiting and an excessively drawn-out UK NCP process, who will provide the remedy they deserve? Glencore UK should own up to its actions and provide full compensation to those affected.”


Glencore UK’s ongoing troubles

The NCP’s decision follows years of international investigations into acts of bribery and corruption by Glencore, including by its UK oil subsidiary. In May 2022, Glencore pled guilty to corruption charges brought against it in the US for widespread bribery in countries across the globe. A month later, in June 2022, its UK subsidiary Glencore UK pled guilty to seven counts of bribery for preferential oil deals in West Africa. A UK court later ordered it to pay £280 million. In August 2024, the UK Serious Fraud Office further charged Alex Beard, who ran Glencore’s oil division from 2007 to 2019 for corruption, alongside others Glencore UK staff. The case is ongoing.

Further background:The UK NCP’s Initial Assessment, the complaint filed to the UK NCP, and RAID’s press release at filing can be found here.
RAID’s 2021 press release can be found here.
RAID’s March 2020 report, Glencore’s Oil Operations in Chad: Local Residents Injured and Ignored, can be found here.
Correspondence between RAID, AJTZP, PILC and Glencore in March 2020 can be found here.

The OECD Guidelines for Multinational Enterprises are the only government-backed international instrument on responsible business conduct with a built-in grievance mechanism. Although the OECD Guidelines are not legally binding on companies, they are binding on signatory governments, such as the UK, which is required to ensure the Guidelines are implemented and observed. The NCP receives complaints against companies that have allegedly failed to adhere to the Guidelines’ standards.


Visit our Chad report here

Timeline:

10 September 2020: The organisations submitted the complaint to the NCP

22 January 2021: The UK NCP issued its Initial Assessment decision accepting the issues for further examination of issues relating to the 2018 wastewater spill and subsequent alleged oil leak. The Initial Assessment does not aim to determine whether the OECD Guidelines were breached.

March 2021: Both parties agreed to enter into mediation.

May 2021: The NCP process was paused, following a mention by Glencore of potential parallel legal proceedings against the company.

March 2022: The NCP proceedings were resumed but Glencore declined to continue mediation citing that the threat of litigation relating to matters being considered within the NCP process meant they could not enter into mediation.

June 2022: Glencore Plc sold PCM to French oil company Perenco.

DIAMONDS

Alrosa plans to scale back production and trim headcount

The company looks to restart production if market conditions improve.

 Credit: Bjoern Wylezich/Shutterstock. · 

GlobalData

Fri, November 22, 2024 


Russian diamond mining company Alrosa could halt some of its production and reduce its workforce size in 2025, reports Reuters citing the company's CEO Pavel Marinychev.

Marinychev said the move comes as a result of "deep crisis" in the global diamond industry and the impact of Western sanctions on Russian diamond sales.

Following Russia’s invasion of Ukraine, sanctions were imposed by Western nations on several Russian companies, including Alrosa.

Marinychev highlighted that for the second consecutive year, diamond prices have been in decline.

The crisis facing Alrosa is intensified by the G7 and EU's ban on Russian diamond purchases, which forms part of the broader sanctions regime.

Marinychev was quoted by the news agency as saying in a local television station in the Yakutia region of Russia's Far East that: "Certain areas that are less profitable, which are at the borderline of profitability, may be subject to suspension during this crisis period."

Despite the potential production halt, the CEO mentioned that operations could be reactivated should market conditions improve.

Marinychev added: “We are currently in a rather difficult situation. Our task is to endure and wait out this period, to wait for prices to start rising again.”

The Russian government has occasionally stepped in to purchase diamonds from Alrosa via a state fund.

To manage costs amidst these challenges, Marinychev looks to reduce labour expenses by 10% in 2025.

This strategy will involve cutting some of the company's 35,000 workforce, though the exact number of staff reductions was not disclosed.

"Alrosa plans to scale back production and trim headcount" was originally created and published by Mining Technology, a GlobalData owned brand.

Russian war machine funded by illicit gold trading, WGC report states


Photo by Reuters

18th November 2024
By: Darren Parker
Creamer Media Senior Contributing Editor Online


Russian State-funded private military company (PMC) Wagner Group is one of the greatest beneficiaries of illicit gold trading, a new report published by the World Gold Council (WGC) shows.

According to the report, penned by former UK Deputy Prime Minister Dominic Raab, estimates suggest the PMC earned more than $2.5-billion from illicit gold mining since the invasion of Ukraine alone, which has been funnelled back into the Russian war machine.


Although artisanal and small-scale gold mining (ASGM) provides income for millions of people in more than 80 countries, some estimates indicate that 80% of ASGM takes place in the shadow economy. The ASGM industry is responsible for an estimated 20% of global yearly gold supply and about 80% of overall gold mining employment.

The report, titled ‘Silence is Golden’, states that ASGM communities are preyed upon by criminal gangs, armed groups and corrupt officials and exploited by intermediaries who launder gold out of countries clandestinely.


“Increasingly, there is evidence of the growing contribution of illegal mining to international crime, corruption and conflict,” Extractive Industries Transparency Initiative board chair Helen Clark says in the report foreword.

However, there are plenty of international and domestic instruments intended to protect ASGM, including the UN Guiding Principles on Business and Human Rights 2011, the EU’s Conflict Minerals legislation and the US Dodd-Frank Act.

Nonetheless, the report states that there is a “striking lack of transparency” across businesses and governments in relation to the implementation of these legal standards, coupled with a dangerous inertia in enforcing the law against the most nefarious criminals involved.

As such, the violence artisanal gold miners suffer ranges from attacks by governments and mercenaries to exploitation from criminal gangs. The illicit profits they make and launder – sometimes through the main international gold hubs, including Hong Kong, India, Miami, Switzerland, Türkiye, and the United Arab Emirates – now present a real and present danger to international security.

Aside from the illicit gold trade funding Russia’s assault on the Ukraine, the trade also fuels civil wars, while funding terrorist groups and organised crime.

The extortion from ASGM communities has been an integral part of the expansion strategy of affiliates of the Islamic State and Al-Qaeda operating in the Sahel. Meanwhile, in Colombia, the Clan del Golfo and former paramilitary groups, the National Liberation Army (ELN) and dissident Revolutionary Armed Forces of Columbia (FARC), finance their activities from illegal mining.

The plunder of ASGM communities also robs the countries affected of a significant amount of income and revenue. In one year, this cost Sudan almost $2-billion.

The report states that there is no panacea to remove these threats. Rather, governments, international organisations and the gold sector must coordinate sustained action to prosecute the criminal perpetrators, prevent illicit profiteering, integrate responsible ASGM into legal and viable supply chains, cut off the profits of criminal actors, and nurture the livelihoods of responsible ASGM communities.

The report outlines several strategic objectives with 24 practical actions for governments, international organisations, non-governmental organisations, mining companies and economic development organisations to combat the illicit gold trade.

The report calls for the International Criminal Court to consider, as part of its investigation in Ukraine, the potential criminal responsibility of those who facilitate illegal refining, laundering and transfer of the profits of the Wagner Group back into the Russian war machine.

Further, the report suggests that governments should implement all of the UN Office on Drugs and Crime’s recommendations to make greater use of UN Conventions to promote better judicial cooperation and more prosecutions.

Donor countries should also provide greater support for regional judicial cooperation with international destinations for gold from ASGM communities under UN Conventions to prosecute illegal gold traffickers on a greater scale.

The report further calls for Interpol to be mandated to deliver a step-change in the use of its data, border controls and operational support to national authorities, including the Red Notice system, to prevent those engaged in the illicit gold trade from slipping through borders.

Another step towards tackling the illicit gold trade would be for members of the World Customs Organisation to expand the international anti-money laundering and terrorist financing initiative Project Tentacle with a properly funded five-year mandate to seize assets from the illicit trade in gold.

The report also calls for governments to enact sanctions under the Magnitsky Law model of visa bans and asset freezes against government leaders and officials who partner or collude with the Wagner Group or any equivalent organisation.

Governments should implement sanctions against high-level individuals and companies involved in the smuggling and laundering of gold.

The report further suggests that governments should review implementation of the Organisation for Economic Cooperation and Development’s (OECD’s) ‘Due Diligence Guidance for Responsible Supply Chains’ in the gold sector, with a renewed focus on refineries and trading hubs.

The Financial Action Task Force should be mandated to renew its 2015 thematic report into the gold sector, make further recommendations and develop a specific framework with key performance indicators that need to be satisfied for any international hub in the gold trade to avoid the ‘black list’ and ‘grey list’.

The report also suggests that governments should require international hubs and major refineries to collate country-level data to build up a clearer picture of ASGM imports and exports, and its corresponding financial flows.

Meanwhile, donor countries should focus aid and development policy to prevent governments from contracting private military groups to maintain security in return for access to natural resources.

With the support of donor countries, the report states that governments of ASGM communities should adopt national legal frameworks that ASGM communities can realistically engage with, and uphold the rule of law applicable to them proportionately.

With the support of donor countries, governments where ASGM exists could provide wider support for the integration of ASGM communities, including with respect to land rights, licensing fees, taxation and geological exploration.

Donor countries’ support for regional cooperation, through organisations such as the Economic Community of West African States, should focus on prevention, including developing an early warning system for vulnerable ASGM communities, to safely alert authorities to early security threats.

Further, the report says Group of Seven (G7) and Group of 20 (G20) governments, alongside the World Bank, should support the expansion of central bank gold-buying schemes to integrate ASGM communities into national legal frameworks, and sign up to the WGC’s London Principles.

Large-scale gold mining companies should adopt and publish a policy for implementing and supporting sustainable supply chains with responsible ASGM communities, in accordance with the WGC’s Responsible Mining Principles.

Further, the report suggests that, where the legal framework and local conditions allow, large-scale gold mining companies should seek to support local ASGM integration. Options might include identifying land for ASGM activities; exploring the potential for tributer, subcontractor and buyback arrangements; and technical support.

Also, governments with significant gold refining and smelting sectors should encourage sourcing from such ASGM communities and incentivise them with targeted tax breaks.

The report says that, where the legal framework and local conditions allow, refiner and smelter businesses should seek to proactively source gold from responsible ASGM communities, and large-scale mining companies should prioritise refiners and smelters which do.

Raab suggests that the London Bullion Market Association implement an ASGM Good Delivery List within two years and publish a plan with milestones and key performance indicators.

This plan should focus on intermediate refiners and aggregators who work with responsible ASGM actors, central banks, large-scale miners who support local ASGM due diligence efforts and mercury-free processing plants that adhere to international standards.

Meanwhile, governments in the major gold-consuming countries should promote awareness among consumers about the source of gold bought in their shops.

Further, G7 and G20 governments should formally recognise that the illicit financial flows from illegal gold mining represent a “systemic threat” to international security.

The G7 and G20 governments should keep the exploitation of ASGM and the related security threats as a standing item on their yearly agenda to focus on the implementation gap.

Raab also suggests that the members of the OECD should expand the organisation’s mandate to make it the central forum on ASGM, with a standalone yearly meeting to coordinate efforts to bridge the implementation gap.

Finally, the WGC should continue to act as a champion and industry leader for innovative collaborations, and a critical adviser to help drive change and expand good practice.

“Without viable economic alternatives, the poorest and most marginalised of our world’s citizens are forced into artisanal gold mining, taking place within hazardous conditions and of little economic gain for their families.

“Our partnership with . . . Raab is a call to action to both redirect illicit gold away from the world’s bad actors and improve the lives of those working in the sector, offering actionable ways that governments and international agencies can contribute to positive change, both environmental and economic for the millions impacted globally,” WGC CEO David Tait says.

Edited by Chanel de Bruyn

ECOCIDE

Chile’s rare salt flat fish face threat from lithium mining project

Reuters | November 20, 2024 | 

Salt flat of Maricunga at sunrise. (Stock image)

At more than 3,700 meters (12,000 feet) above sea level, the “karachi” swims happily in dense salt flat waters, but locals worry a future lithium project will endanger this extreme-environment fish.


The Orestias ascotanensis is a small ray-finned fish that grows to just 7.5 centimeters (3 inches), but has adapted to the Ascotan salt flat’s high concentrations of heavy metals and variable salinity.

The salt flat also sees high solar radiation and temperature variations that reach 26 Celsius (79 Fahrenheit) during the day and below freezing at night, according to Marco Mendez, a professor at the University of Chile who studies evolutionary biology.

Scientists at the Millennium Institute’s genome center have been studying the fish and found genes that allow it to resist each element of its hostile environment, from solar radiation to heavy metals to low oxygen levels.

The fish has also evolved to do it quickly.

“We’ve seen how they’ve done this in a short evolutionary time because there are other variants of this fish in less hostile environments,” said Miguel Allende, director of the institute.

“They’ve taken these genes and exacerbated them.”

While the fish can survive extreme environments, it still needs an environment to live in and residents say copper mining has reduced the fish population due to water extraction.

“That’s what’s hurting them, when they take the water, the fish die,” said Mauricio Anza, a local resident, who said people in the area are working to preserve the areas flora and fauna.

But Ascotan is also one of the salt flats where the government plans to launch a private lithium mining project, something locals and experts say must come with guarantees to safeguard the ecosystem.

“Mining activity, while important from an economic point of view, must be carried out with the aim of ensuring that this very particular environment is not lost forever,” Allende said.

(By Rodrigo Gutierrez and Fabian Cambero; Editing by Alexander Villegas and Sandra Maler)

Congo’s Gecamines offers $1 million to block Chinese deal with Chemaf

Reuters | November 22, 2024 | 

(Image courtesy of Chemaf)

The Democratic Republic of Congo’s state miner Gecamines is offering $1 million to buy cobalt and copper assets of indebted mining firm Chemaf to prevent China from increasing its control of critical metals in the country, two sources familiar with the details told Reuters.


Chemaf, a partner of commodities trader Trafigura, agreed to sell its copper and cobalt assets to Chinese defence and industrial giant, China North Industries Corp, or Norinco, in June.

Gecamines, which owns the lease to Chemaf’s mines, whose copper and cobalt are used in electric vehicles and clean energy infrastructure, was asked by Chemaf to approve the sale, but declined.

Gecamines later submitted an unsolicited bid for the Chemaf assets, deepening a standoff that has been complicated by US officials lobbying against China’s grip on the mineral-rich central African Copperbelt.

Chinese companies are major investors in Congo’s mining sector. CMOC Group is now the world’s biggest cobalt miner as it boosts output at Tenke Fungurume mine it bought from US-based Freeport-McMoRan just four years ago.


Gecamines offered to pay just under $1 million for the mines and processing plant, and wants to conduct an audit of Chemaf’s debts before structuring a payment plan to settle the borrowing, said the sources, who cannot be named because of the sensitivity of the matter.

Chemaf, whose debts have ballooned to $900 million to $1 billion, needs an additional $300 million to expand output and operate profitably, the sources said.

Norinco has offered between $900 million and $1 billion, including settling Chemaf’s debts and outstanding taxes, one of the sources said.

The Chinese miner also pledged to advance Chemaf’s plans to raise copper and cobalt output to about 75,000 metric tons and 25,000 tons, respectively, the source added.

Chemaf, which has been operating for the past 20 years, said on its website it has invested more than $610 million developing the second phase of Etoile and Mutoshi mines.

“I can confirm we made a better offer than Norinco did, subject to us conducting due diligence of the debt,” Gecamines chairman Robert Lukama told Reuters.

“And more importantly the government declined, and already informed Chemaf by letter that they will not accept the Norinco transaction and we also confirm that we will not give another chance to anyone else other than ourselves,” Lukama added.

Norinco’s move has drawn scrutiny by the US, with State Department officials lobbying Congo to block the deal, three sources told Reuters. The US wants Congo to find an alternative to Norinco, one of the three sources said.
Cash crunch deepens

The stalled deal has worsened Chemaf’s finances and if it fails completely, the Congolese miner’s key backers, including Trafigura, may either lend more or risk a prolonged period of uncertainty recovering their investments, the sources said.

“The lenders and creditors of Chemaf have faced significant financial hardship for more than 12 months as a result of money owing to them not being paid in accordance with the terms of loans, credit provided and invoices submitted for payment,” one of the sources said.

Chemaf is only processing stockpiles from its Etoile mine as expansion work at Mutoshi mine was halted when financing dried up, the sources said. The company is struggling to pay the salaries of its 3,500 workers, its power bills and security guards manning the sites, the sources said.

Chemaf declined to comment.

Chemaf entered into a 24-month creditors’ protection agreement in August 2023 that lapses next year. While the miner could also seek interim financing, its lenders want to see the Norinco deal concluded as soon as possible, one of the sources added.

Trafigura, one of the main creditors, declined to comment.

US officials are also rallying Western companies to consider buying the Chemaf assets, the sources said.

Norinco, which was sanctioned by the US since 2021, did not immediately respond to emailed queries. In Congo, it owns the Comika and Lamikal copper and cobalt mines in partnership with Gecamines.

(By Felix Njini, Pratima Desai, Julian Luk and Ernest Scheyder; Editing by Veronica Brown and Louise Heavens)

US bars more food, metal imports over China’s alleged forced labor

Reuters | November 22, 2024 | 

Uyghur people travel along birch tree lined roads to the weekly market at Yopurga near Kashgar in Xinjiang Uygur Autonomous Region of China. (Stock Image)

Washington – The United States banned food, metals and other imports from about 30 more Chinese companies over alleged forced labor involving the Uyghurs, according to a government notice posted online on Friday.


The new restrictions, covering a range of products from tomato paste and walnuts to gold and iron ore, are part of the federal government’s effort to prevent goods made with forced labor from entering the United States, the Federal Register posting said.

The companies were added to the Uyghur Forced Labor Prevention Act Entity List, which restricts the import of goods tied to what the US describes as China’s human rights abuses and ongoing genocide in the Xinjiang Uyghur Autonomous Region.

US authorities say Chinese authorities have established internment camps for Uyghurs and other religious and ethnic minority groups in China’s western Xinjiang region. Beijing has denied any abuses.

The latest additions bring the total number of companies on the list to more than 100 since the Uyghur Forced Labor Prevention Act was signed into law in December 2021.

Twenty-three of the newly added companies are in the agricultural sector. Others mine, smelt and process metallic materials including copper, lithium, beryllium, nickel, manganese and gold.

“Today’s enforcement actions make it clear — the United States will not tolerate forced labor in the goods entering our markets,” Robert Silvers, U.S. Homeland Security under secretary for policy, said in a statement. “We urge companies to take responsibility, know their supply chains, and act ethically.”

(Reporting by Karen Freifeld; editing by Susan Heavey, Chizu Nomiyama and Jonathan Oatis)

South Africa police standoff with illegal gold miners escalates

Bloomberg News | November 18, 2024 | 

The police sealed off access to the Buffelsfontein gold mine in Stilfontein several weeks ago. Image: Video screenshot via KayaNews

The South African police intensified efforts to force hundreds of illegal gold miners holed up in underground shafts to the surface so they can be arrested.


The police sealed off access to the Buffelsfontein gold mine in Stilfontein, about 156 kilometers (97 miles) southwest of Johannesburg, several weeks ago to deny the miners access to food and other essentials. While more than 1,000 of the miners have surfaced and been detained, many more are still thought to be below ground and there are mounting fears their lives may be at risk.




South African President Cyril Ramaphosa said that while sealing off supplies to the miners “has generated a great deal of public debate” and is “potentially volatile,” he mostly took a hard line against them because they were operating illegally and posed a risk to the economy, nearby communities and personal safety.

“The Stilfontein mine is a crime scene where the offense of illegal mining is being committed,” he said in a statement. “It is standard police practice everywhere to secure a crime scene and to block off escape routes that enable criminals to evade arrest.”

The problem of illegal mining isn’t unique to Stilfontein — there are about 6,000 abandoned mines strewn across the country and a number of them have been accessed by informal miners known locally as zama zamas. South Africa and its mining industry lose about 70 billion rand ($3.9 billion) a year to those who mine gold illegally, according to the government.

Minerals Council South Africa, which represents the nation’s biggest mining companies, declined to comment, deferring to the police and government. The lobby group has said that illegal mining is inter-related with organized crime and that operators have links to global criminal syndicates.

(By Paul Burkhardt)

Mali frees Resolute executives after $160 million deal

Bloomberg News | November 20, 2024 | 

Resolute’s Syama gold mine in Mali. Credit: Resolute Mining

Resolute Mining Ltd. said chief executive officer Terry Holohan and two other employees have been released from detention in Mali, just days after the gold mining company agreed to pay about $160 million to resolve a tax dispute with the government.


The three have now departed the country after being released from the capital, Bamako, where they had been held, the Perth, Australia-based company said in a statement. Holohan and his colleagues were detained more than a week ago after he traveled to the country for meetings with tax and mining authorities.

Their release comes after the company said on Monday it paid an initial settlement of $80 million to the African nation, with an agreement to pay the balance in the coming months from “existing liquidity sources.” The detentions had come as the military rulers of Africa’s third-largest gold producer ratchet up pressure on mining companies to renegotiate contract terms.

The company’s shares closed 5.8% lower in Sydney on Thursday, before it confirmed the release, which was reported earlier by Agence France-Presse.

Mali’s position was that Resolute – which operates the Syama gold mine – should pay the state 100 billion CFA francs ($161 million) to settle a dispute mainly concerning alleged back taxes following a sector-wide audit, people familiar with the matter said last week.

Mali has been under military rule since 2020, when interim leader Colonel Assimi Goita ousted the West African nation’s elected president, citing the previous regime’s failure to repel the Islamist insurgents. Since then, mercenaries from the Kremlin-backed Wagner Group have been deployed to the country, while European forces and a United Nations peacekeeping mission were forced to withdraw.

(By Sybilla Gross)

Mali junta sacks Prime Minister Maiga and his government

KRIMINAL KAPITALI$M

Australian pension group rejects Mineral Resources pay proposal

Bloomberg News | November 20, 2024 | 

Mt Marion lithium operation. Credit: Mineral Resources

A group representing Australia’s A$3.9 trillion ($2.5 trillion) pension industry has recommended its members vote against the remuneration plan of scandal-hit Mineral Resources Ltd. at the company’s annual general meeting on Thursday.


The Australian Council of Superannuation Investors wants to clarify what directors knew about Mineral Resources’ investment in industrial property that was part-owned by managing director Chris Ellison. The Perth-based miner bought 49% of a company linked to Ellison that owned the property, the Australian Financial Review reported last week, the latest in a series of scandals that has seen the company lose more than half its value from a peak in May.

“Investors want to know who signed off on that transaction,” ASCI’s executive manager of stewardship Ed John said in an emailed statement. “The board must respond on this issue before the AGM.”

Ellison has been under scrutiny after the company that he founded launched an internal inquiry into what the board described as “profoundly disappointing” conduct. Separate investigations were launched by the Australian Securities and Investments Commission, the corporate watchdog, as well as the Australian Securities Exchange.

One of Australia’s largest pension funds, A$88 billion HESTA, has put the company on its watch list, which means it is subject to closer monitoring, and has been engaging directly with it regarding its recent governance failures, chief executive officer Debby Blakey said earlier this month.

(By Amy Bainbridge)

Beleaguered Ellison faces MinRes shareholders

Kristie Batten | November 21, 2024 

Chris Ellison. (Image courtesy of Macquarie Australia | MinRes.)

Chris Ellison, founder and CEO of the embattled mining and contractor Mineral Resources (ASX: MIN), broke his silence Thursday following a governance scandal that erupted last month.


Earlier this month, MinRes announced that Ellison would step down within 12–18 months. This decision followed an investigation that uncovered tax evasion and other misconduct, including allegations that he used company resources for personal gain and leased properties to the company in which he had a financial interest.

The company’s annual general meeting (AGM) in Perth on Thursday drew significant anticipation. Television crews and photographers gathered outside the venue hours before its scheduled start, aiming to capture Ellison’s arrival.

More than 300 people attended the meeting, with some relegated to an overflow area outside the main room.

Following an address by MinRes chairman James McClements—who is also set to leave the company—Ellison spoke for about four minutes, addressing the scandal.

He admitted to an “error of judgment” in relation to tax evasion and assured shareholders that all personal expenses had always been reimbursed promptly.

“I deeply regret the impact this has had on the business and our people,” Ellison said.
“I can’t stress enough how much I hate what I’ve done, and there’s a dark cloud in my life that I’ll live with forever.”

Ellison highlighted his 32-year tenure with MinRes, during which he had focused on building a successful Australian company.

“My focus has been on building a great Australian company, and I’m proud of the value we’ve created,” he said.

Ellison followed his apology with a 30-minute presentation detailing the company’s operations, which include iron ore and lithium mines, as well as its status as the world’s largest crushing contractor.

He emphasized future growth opportunities and MinRes’ contributions to the Western Australian resources sector, including its covid-19 testing efforts, initiatives to boost female and Indigenous employment, and a strong track record of shareholder returns.
Tension builds

When the meeting turned to formal business, the atmosphere grew tense.

Before shareholder questions began, McClements urged attendees to remain respectful during a time of “heightened emotions.”

Over the next hour, more than 40 questions were posed, primarily focusing on the timing and disclosure of the governance issues. Topics like the company’s growth outlook and balance sheet took a backseat.

MinRes had previously admitted it was aware of some of the issues as early as 2022 but considered them immaterial to the company’s share price at the time.

Several shareholders expressed frustration that allegations first surfaced in the media instead of being disclosed by the company.

“Investigations have evolved over time to address allegations in the media and from other sources,” McClements said.

“We’ve had processes in place to disclose material information as it emerged. However, recent media reports didn’t necessarily align with our understanding of these matters.”

Despite many questions being directed at Ellison, McClements fielded all inquiries, often referring shareholders back to the company’s November 4 statement.

Ellison declined to speak to the media after the AGM, a departure from his usual practice.
Unexpected support

The company’s remuneration report received only 25.4% shareholder support, resulting in a first “strike.” A second strike at next year’s AGM could trigger a board spill resolution.

However, it became evident that many shareholders opposed Ellison’s impending departure.

Numerous attendees voiced their support for Ellison, receiving enthusiastic applause.

Long-time shareholder David Bowden lauded MinRes’ “impeccable financial performance” since its 2006 listing and criticized the “trial by media” that he said led to Ellison’s downfall.

Shareholder Jan Ford described Ellison as an inspiration, arguing he was the right person to lead the company.

Even prominent activist shareholder Stephen Mayne praised Ellison for retaining his significant stake in MinRes. Ellison remains the company’s largest shareholder, holding over 11% of the company—valued at nearly A$800 million ($521m).

Australian Shareholders Association representative John Campbell. (Image by Kristie Batten)

McClements acknowledged the diverse views among shareholders.

“We’ve engaged extensively with shareholders over the past four weeks,” he said.
“There’s clearly a diversity of opinions, and we’ve had to make a very difficult decision under complex circumstances.”

McClements confirmed that an immediate departure for Ellison was deemed not in the best interests of the company or its shareholders.
Looking forward

Following the 2.5-hour meeting, Australian Shareholders Association representative John Campbell commented on the mixed reactions:

“I think Western Australians tend to be forgiving of situations that may not necessarily serve their best interests,” he said.

MinRes announced plans to engage Elizabeth Broderick, Australia’s former sex discrimination commissioner who led the review into Rio Tinto’s workplace culture, to conduct a confidential culture assessment.

McClements said the company was also reviewing transactions involving key management personnel and related parties. Steps would be taken to exit or unwind arrangements that no longer provided a compelling commercial benefit to the company.

KAPITAL STRIKE

Mexico’s proposed higher mining royalties could block nearly $7bn in investments

Reuters | November 21, 2024 |

Newmont’s Peñasquito mine in Mexico, one of the biggest silver mines in the world. (Image: Newmont Goldcorp via Flickr)

A proposed increase in mining royalties in Mexico could block more than $6.9 billion in investments over the next two years, the industry’s local chamber said on Thursday.


As part of its budget proposal published last week, the Mexican government proposed raising mining royalties under the argument that metal prices have risen in recent years.

The government plans to bump up two separate royalties from 7.5% to 8.5% and 0.5% to 1.0%, respectively.

“The measure… would have an impact on a sector that has already seen its contributions and investments reduced due to paralyzation (of the sector),” the chamber said in a statement responding to questions sent by Reuters.

The proposed hike comes after Congress last year shortened concessions from 50 years to 30 years and tightened water-extraction permits. Another reform aimed at banning open-pit mining remains in the legislature.

The royalty increase, “coupled with the lack of permits and exploration restrictions in recent years, could inhibit more than $6.9 billion that the mining sector could invest in new projects in the next two years,” the chamber told Reuters.

Mexico is the world’s leading silver producer and a top producer of copper and gold. The industry contributes around 2.5% to the nation’s gross domestic product (GDP).

But an additional tax burden could make Mexico less attractive compared to other major producers such as Chile, Peru and Canada, the chamber said.

The group represents some of the nation’s largest miners, such as Grupo Mexico, Minera Autlan, Industrias Penoles and Newmont’s Penasquito mine.

(By Noe Torres and Kylie Madry; Editing by Sarah Morland)

Panama’s President blames previous gov’t for First Quantum mine crisis

Staff Writer | November 22, 2024 | 

Panama’s President José Raúl Mulino. (Image: Mulino’s X account.)

Panama’s President José Raúl Mulino has strongly condemned the previous government for its mismanagement of the crisis surrounding First Quantum Minerals’ (TSX: FM) $6.5 billion Cobre Panama copper mine.


The operation, First Quantum’s flagship mine, was shut down a year ago following a Supreme Court ruling that declared its concession contract unconstitutional.

Mulino attributed the closure to widespread public dissatisfaction with former President Laurentino Cortizo’s administration.

“The mine paid the price for accumulated national discontent, under a government with only 25% popularity and overwhelming public rejection,” stated Mulino, who took office in July, according to BNamericas. “They couldn’t manage such a critical issue, let alone in the manner they attempted.”

The decision to invalidate the mine’s permit followed mounting protests. Critics accused the Cortizo government of failing to address long standing legal and environmental concerns tied to the project, which accounted for nearly 5% of Panama’s GDP.

Mulino, now tasked with resolving the fallout, has vowed to take a more transparent approach, promising a comprehensive audit of the mine involving international experts. “This is a government with credibility and national acceptance,” Mulino said, highlighting his administration’s intention to begin addressing the mine’s future in early 2025.

Mulino has said the Cobre Panama project will be addressed as needed, but stressed that issues such as social security have higher priority. A clear timeline for this process, however, has yet to emerge.

Financial shock

As operations at Cobre Panama remain suspended, the mine has transitioned into a preservation phase, incurring significant monthly costs. First Quantum reported spending between $11 million and $13 million per month on labour, maintenance, and environmental stability measures. By the end of October, nearly 121,000 tonnes of copper concentrate remained on-site, as First Quantum continued negotiating a permit to export the stockpiled metal.

“The copper cannot lie sitting there forever. It has to be taken out, and if you are going to take it out, you might as well export it,” Finance Minister Felipe Chapman told Bloomberg earlier this year.

Chapman added that not even Panama’s most radical environmentalists have argued against exporting the copper already mined.

First Quantum has initiated two arbitration proceedings, one under the Canada-Panama Free Trade Agreement and another under the International Chamber of Commerce, citing breaches of contract and treaty obligations. The first hearing is set for September 2025 in Miami.

Cobre Panama was the biggest foreign investment in the Central American nation, supporting over 40,000 jobs. (Image courtesy of Minera Panama.)

Despite these legal actions, First Quantum has emphasized that arbitration is not its preferred path, expressing a commitment to dialogue and finding a resolution beneficial to Panama and its citizens.

Cobre Panamá’s shutdown has had significant economic and social repercussions. First Quantum is said to have asked its employees in Cobre Panama to choose between taking the voluntary retirement offer that would come into effect from January 2025 or work with reduced hours.

The decision may put some strain on the Mulino’s administration, which has suggested the possibility of restarting the mine for an unspecified duration to cover the expense of a permanent shutdown.

 

Hydrogen Combustion Auxiliary Engine to be Tested in 2025 on UK Cargo Ship

Hydrogen combustion auxiliary engine will be tested on a UK cargo ship (Carisbrooke Shipping)

Published Nov 20, 2024 6:42 PM by The Maritime Executive

 

An innovative project designed to validate hydrogen combustion engines for ocean-going vessels and lay the foundation to scale up the technology is set to proceed in March 2025 aboard a cargo ship operated by Carisbrooke Shipping. The partnership led by Carnot Engines and funded as part of the UK government’s initiatives in decarbonization has secured a source for hydrogen from biomass to power the 40-day sea trials.

Waste-to-hydrogen producer Compact Syngas Solutions has joined the effort and will supply 200 kg of hydrogen for the trials. Based in Wales, the company has developed an advanced gasification process that generates electricity, heat, and hydrogen gas from waste products. It employs materials including waste wood and other selected non-recyclable resources in its process. Compact Syngas Solutions was the recipient of a UK grant for £4 million to develop its biomass and waste-to-hydrogen plants including the addition of carbon capture to its hydrogen production.

“Sourcing hydrogen for our trial has proven harder than we expected, and we’re massively grateful to Compact Syngas Solutions for helping out,” said Jeremy Howard-Knight, head of business development at Carnot. “It’s incredible to think that these huge ocean-going vessels are being powered by waste wood that could have ended its days by rotting on a tip.”

Carnot was awarded £2.3 million in February 2023 to deploy a 50kW hydrogen auxiliary engine demonstrator working with Carisbrooke Shipping, Brunel University, and the Manufacturing Technology Centre while involving Bureau Veritas and the UK’s Maritime and Coastguard Agency for regulatory compliance. 

The project is based on the assertion that smaller vessels running shorter ranges would be able to consider electrification or fuel cells, but for long-distance ocean-going cargo vessels this would not be viable. They assert that the cost, weight, and practicalities become prohibitive but their concept for a hydrogen combustion engine would be a compelling solution. 

Carnot reports by pioneering the use of technical ceramics in combustion engines, it has eliminated major limiting factors to engine efficiency. It reports its engines have a break thermal efficiency of 70 percent, nearly double what is achieved by modern state-of-the-art engines. Carnot said the engines will massively reduce fuel consumption and costs. It highlights that above a certain air-to-fuel ratio, hydrogen combustion emits zero emissions with negligible levels of CO2, NOx, and PM.

The demonstration calls for testing of the engine at Brunel University and then it will be placed aboard one of Carisbrooke Shipping’s K-class cargo ships. Built in 2010 in China, the vessels are 6,800 dwt and have a length of 106 meters (348 feet). They operate at speeds of up to 11 knots with a MAK main engine and a Sandfirden diesel auxiliary engine. 

The trial will run for 40 days in the Irish Sea starting in March 2025. The vessel will be operating between Bristol and Belfast. Carnot says the 50kW engine will be a precursor to 200 to 400kW auxiliary engines. Eventually, they expect to produce a 1 to 10MW main engine based on this technology.

 

Australia Bans Cargo Ship for Six Months Citing Unsafe Cargo Operations

Australia banned a cargo ship in an ongoing dispute over stowage of dangerous goods (Spliethoff file photo)

Published Nov 21, 2024 12:36 PM by The Maritime Executive

 

 

The Australia Maritime Safety Authority (AMSA) has issued its fourth ban this year on a cargo ship this time citing “unsafe cargo operations” as the reason for denying entry into Australia’s ports. AMSA said the authority has escalated its enforcement action to send a message to operators that risks to safety and the marine environment would not be tolerated in Australia.

The Dutch-flagged general cargo ship Marsgracht (12,284 dwt) operated by Spliethoff was issued a “refusal of access” banning the ship for 180 days from Australian ports. According to AMSA, the vessel was detained for “improper stowage of dangerous goods,” during a port state inspection on November 14 at Port Alma.

The vessel, which was built in 2011 is 466 feet (142 meters) in length. The spec sheet posted by Spliethoff notes the ships are “fitted for carriage of dangerous goods of all IMO classes.”

AMSA highlights that it was the second time this vessel had been detained in Australia. In February at the same port, AMSA also cited the vessel for the same issue of improper stowage of dangerous goods.

“This recurrence highlights systemic failures in the ship’s safety management system and a serious lack of effective remedial action,” contended AMSA announcing today’s action. 

It however appears to also be part of a broader disagreement between the shipping company and the Australian regulators. AMSA reports this detention was the fourth since July 2022 for a Spliethoff-operated ship for failing to comply with the code for stowage of dangerous goods. 

This reflects a broader pattern of non-compliance and poor performance, undermining the safety of seafarers and the Australian marine environment contends AMSA. Spliethoff they write is considered a poor performing operator, having been placed back on the list on February 8, 2024. As a result, all the company ships are eligible for inspection every three months in Australia as part of ongoing compliance activities with company ships. AMSA reports it will review the performance of Spliethoff's Bevrachtingskantoor after 12 months.

“AMSA takes its role as a maritime safety regulator very seriously and will not hesitate to take swift and appropriate action against unsafe ships, their owners and operators," said Executive Director Operations Michael Drake. "When it comes to loading dangerous cargo, there is no scope for non-compliance. International minimum standards exist to protect the lives of seafarers, and our precious marine and coastal environments.”

In the first half of 2024, AMSA banned three other vessels from Australia’s ports. The issues included maintenance and failure to properly report to the Australian authorities. The rate however is down from 2023 when nine bans were issued from Australian ports.

 

Plan Approved to Save Cal Maritime from Looming Financial Collapse

Cal Maritime has been at its location since 1943 seen with its current training ship Golden Bear (Cal Maritime)

Published Nov 21, 2024 6:05 PM by The Maritime Executive

 

 

The Board of Trustees of California State University approved a plan today designed to preserve and strengthen the California State University Maritime Academy (Cal Maritime), which according to the board was in danger of financial collapse. It is the only U.S. maritime academy in the western United States and just one of six state programs, in addition to the federal U.S. Merchant Marine Academy in Kings Point, New York.

The plan that was approved yesterday in committee and today, November 21, by the full board calls for Cal Maritime to be merged into the larger California Polytechnic State University, San Luis Obispo, which enjoys a strong reputation and is known for its agriculture and engineering programs. The two campuses, which are approximately 250 miles apart, will be administratively merged effective July 1, 2025, and starting with the 2026-2027 academic year the maritime students will be officially enrolled at Cal Poly with the land-based program becoming Cal Poly Solano Campus. The merchant marine licensing program and the training ship will become Cal Poly Maritime Academy.

“This historic action will increase opportunities for current and future students and reinforces support for our critically important educational mission,” said Cal Maritime Interim President Michael J. Dumont.

Presenting the options to the board, the Cal State chancellor’s office painted a bleak picture for the maritime program which is just shy of its 100th anniversary. They said the options were either the integration of what is the smallest university in the state system into a larger institution or initiating immediate steps for the closure of Cal Maritime. 

The report highlighted that enrollment in the maritime program has declined dramatically. Since 2016-2017 they said the program has lost a third of its enrollment dropping from around 1,100 cadets to 761 last fall. The report said that all the state maritime academies around the United States had faced similar challenges in part reflecting the challenges of the U.S. merchant marine. 

The institution was reported to be faced with rising operating costs and a loss of income from fewer enrollments. Earlier this year it instituted a hiring freeze and eliminated some positions while in June the idea of merging Cal Maritime and Cal Poly was first presented. Estimates are that they can realize $30 million a year in financial savings. Reports indicate that the board was told the alternative to save Cal Maritime would require as much as $30 million annually in financial aid representing a nearly 50 percent increase on its current $52 million annual budget.

“Cal Poly and Cal Maritime share an academic grounding in hands-on learning, and the integration of our universities will enhance student success on both of our campuses while helping to grow a diverse pipeline of talent to our nation’s maritime industries,” said Cal Poly President Jeffrey D. Armstrong.

 

Cadets aboard the current training ship Golden Bear -- Cal Maritime is the only maritime academy in the western United States (Cal Maritime)

 

The maritime program was founded in 1929 as the California Nautical School, originally located in Tiburon, California. It was renamed California Maritime Academy in 1939 and enhanced as part of the Merchant Marine Act of 1936 including relocated to San Francisco. The maritime academies took on a new significance during World War II with Cal Maritime’s education accelerated to a 17-month program. It was given a new permanent home in 1943 on a 67-acre site at Morrow Cove in Vallejo.

Cal Maritime will retain its maritime focus within Cal Poly, with the integration of operations, resources, and governance structure. The academy's specialized degree programs, three of which lead to a Merchant Marine license issued by the U.S. Coast Guard, will continue to be offered at the Solano location.

The Maritime Administration has also provided a significant commitment to Cal Maritime. The fifth and final training ship under construction at the Philly Shipyard has been allocated to Cal Maritime and is due for delivery in 2026. New York, Massachusetts, Maine, and Texas are receiving the other training ships from MARAD.

The hope is that the combination will provide a new basis to expand enrollment at Cal Maritime. The enhanced financial position will also permit it to undertake deferred maintenance programs as well as expand the dock to accommodate the new training ship. 

The board of trustees agreed that Cal Maritime continues to be a critical program with the state’s Lt. Governor saying it was an opportunity to elevate both campuses of the state university. The Cal State chancellor’s office also expects to invest $5 million over the next seven years with most of it going to financial aid. They have also hired a specialist firm and are investing $2 million into the consolidation of the two universities.