MINEX Forum

Tag: investment

  • Newmont Expands Stake in Ariana Resources to Strengthen European Exploration

    Newmont Expands Stake in Ariana Resources to Strengthen European Exploration

    Newmont (TSX: NGT) (NYSE, ASX: NEM), the world’s largest gold miner, has increased its stake in UK-based Ariana Resources (AIM: AAU) by acquiring an additional 28.88 million shares for $871,000. This follows a $2.5 million investment in 2022, forming an alliance to advance copper and gold exploration in southeastern Europe.

    The alliance, now in its third year, is managed by Western Tethyan Resources (WTR), a Kosovo-based company in which Ariana holds a 76% interest, with technical support from Newmont. WTR has secured multiple exploration licenses across Kosovo, North Macedonia, Bosnia and Herzegovina, Bulgaria, Greece, and Serbia.

    Ariana’s managing director, Kerim Sener, stated that Newmont’s increased investment demonstrates a firm commitment to advancing projects in the region. The alliance has already conducted geological, geochemical, and geophysical surveys, leading to new exploration license applications and the identification of promising targets. Initial drill testing at the Hertica project has confirmed a copper-gold-molybdenum mineralized system.

    Under the alliance agreement, Newmont has the option to further invest $1 million over the next two years to acquire a 60% stake in any new WTR project. An additional $15 million investment in a pre-feasibility study could raise its stake to 75%. If Newmont proceeds with full-scale development, it can secure up to 85% ownership, with WTR retaining a 2% net smelter return if its interest falls below 10%.

    Beyond its interest in WTR, Ariana also holds gold assets in Zimbabwe, including the 1.83-million-ounce Dokwe project, and a 23.5% stake in a Turkish joint venture with the Kiziltepe mine and Tavsan and Salinbas projects. Additionally, it owns 61% of Venus Minerals, which operates copper exploration projects in Cyprus.

  • Key Barriers in Kazakhstan’s Mining Sector Hinder Investment Climate

    Key Barriers in Kazakhstan’s Mining Sector Hinder Investment Climate

    Barriers within Kazakhstan’s mining sector have been identified as a major hurdle for investment in the country. A recent consultation document on proposed legal amendments highlighted concerns about access to mineral rights, including convoluted regulations and a lack of automation in government services.

    Further issues stem from inconsistencies between mining regulations and other areas of law, such as tax, water, land and environmental legislation. These inconsistencies create uncertainty for mining companies and hinder their ability to meet their licence obligations.

    Regulatory and Procedural Barriers

    • The current regulatory framework for mining lacks clear and efficient procedures, leading to complexities in obtaining and exercising mining rights. This includes inadequate automation of state services, insufficient regulation of state information resources, and overlapping legislation in areas such as ecology, land use, and taxation.

    Legislative Inconsistencies

    • There are inconsistencies between the mining code and other related legislation, such as water, land, and environmental laws. For example, the mining code prohibits operations on certain territories, including those within water fund lands, which contradicts previous legislation and restricts activities like sand extraction from river beds.

    Specific Issues

    • Unclear regulations on the reclamation of mining sites, conflicting provisions with the Civil Code regarding contract and license obligations, and the lack of clear guidelines on servitude payments and compensation for land use are significant issues.
    • The prohibition on mining in certain areas, such as those with high natural methane content without prior degasification, creates operational challenges due to the absence of specific norms and authorities to set these standards.

    Institutional and Administrative Challenges

    • The process of forming the State Fund for Mineral Resources Management is marred by lack of transparency and coordination between state bodies. This leads to inefficiencies in the allocation of mining rights and the management of mineral resources.
    • The requirement for exclusive rights to specific territories is not adequately ensured, leading to conflicts between different mining users.

    Practical Challenges

    • The use of experimental-industrial mining is often abused, hiding industrial-scale extraction under the guise of exploration. This practice undermines the integrity of the exploration phase.
    • The high cost of acquiring machinery for small-scale mining operations is a significant financial burden, suggesting the need for more flexible arrangements such as equipment rental.

    International Comparisons and Recommendations

    • Kazakhstan ranks 56th out of 84 countries in the Investment Attractiveness Index by the Fraser Institute, with negative evaluations in legal, tax, and labor legislation, as well as in geological data quality. To improve, Kazakhstan should analyze and adopt best practices from other countries, engage in consultations with stakeholders, and streamline regulatory processes to enhance transparency and efficiency.

    Addressing these issues is crucial for improving Kazakhstan’s investment climate, particularly in the mining sector, and aligning it with international standards to attract more foreign and domestic investment.

  • KAZ Minerals Extends Artemyevsky Mine Operations Until 2034

    KAZ Minerals Extends Artemyevsky Mine Operations Until 2034

    KAZ Minerals has announced the extension of operations at the Artemyevsky Mine, initially launched 19 years ago, until 2034. The second phase of the mine’s development, which involved an investment of approximately $500 million, was revealed through the company’s Telegram channel. The Artemyevsky Mine produces 1.2 million tons of polymetallic ores annually, and to maintain production capacity, the company plans to explore and develop new mining horizons.

    Ildur Dautov, head of Vostoktsvetmet LLP, highlighted that although this is an expansion project, its scale and complexity are comparable to building a new mine. “By extending the life of the mine, we are ensuring social stability in the region,” Dautov stated.

    Geological exploration at the site began in 2012, and by 2018, the company had recalculated the reserves and developed a new mining project. As part of the second phase of the mine’s expansion, specialists have completed 18 kilometers of mine workings, upgraded the main ventilation system, and replaced key equipment. Additionally, they built a new air heating system, waste treatment facilities, and a tailings storage facility in the disused Nikolaevsky quarry.

    A new 742-meter air-supply shaft, equipped with an elevator and access points at two levels, has also been constructed. KAZ Minerals has added other infrastructure, including an explosives warehouse and a three-conveyor transport system. Further plans include the installation of a repair facility for equipment and other auxiliary structures.

  • EBRD Makes First Direct Investment in Central Asia’s Graphite Sector

    EBRD Makes First Direct Investment in Central Asia’s Graphite Sector

    The European Bank for Reconstruction and Development (EBRD) has made its first direct equity investment in the graphite and critical raw materials sector in Central Asia by acquiring a stake in Sarytogan Graphite Limited. This Australian Securities Exchange-listed company is engaged in the exploration of the Sarytogan graphite depositlocated in the Karaganda region of central Kazakhstan.

    The EBRD’s investment of AUD 5 million (€3 million), representing a 17.36 per cent shareholding in Sarytogan Graphite, will fund the company’s development programme. This includes the preparation of a feasibility study and meeting its working capital needs. Through this investment, the EBRD continues its support for Kazakhstan’s mining sector and its junior mining companies.

    Graphite, classified as a critical raw material (CRM) by the EU, has a wide range of applications, including in the production of electric vehicle batteries, the electric power industry, and metallurgy. The Sarytogan graphite depositis one of the largest known graphite deposits globally, with the potential to become a major supplier of natural graphitein the region and beyond.

    This project aligns with the EBRD’s new mining sector strategy, which emphasizes the importance of the mining industry in fostering greener economies. The strategy supports the exploration, development, production, and processing of metals and minerals essential for the green and digital transition and new technologies.

    Additionally, the project is consistent with the EU-Kazakhstan strategic partnership on raw materials, batteries, and renewable hydrogen. The EBRD’s investment is a continuation of its policy work with Kazakhstan authorities, which has already led to the adoption of the new Subsoil Use Law.

    To date, the EBRD has invested €10.2 billion in 324 projects in Kazakhstan, primarily supporting private entrepreneurship.

  • Zijin Mining Group Discusses Major Mining Projects in Kazakhstan

    Zijin Mining Group Discusses Major Mining Projects in Kazakhstan

    Zijin Mining Group Co., Ltd recently held discussions with Kazakhstan’s Deputy Foreign Minister and representatives from Kazakh Invest regarding potential projects in the mining and metallurgical industry. The foreign investor plans to open a processing plant in the republic, according to a report from the Kazakh Ministry of Foreign Affairs.

    The new facility is expected to produce concentrates of precious and non-ferrous metals. However, this project is likely to be a long-term endeavor, as Zijin Mining is still in the process of identifying a suitable mineral resource basefor the plant.

    The company has expressed its readiness to develop Kazakhstan’s gold, copper, and polymetallic deposits. The specific region for the project has yet to be determined.

    The concentrates produced by the new processing plant are intended to be sent to local metallurgical plants for the extraction of valuable metals. An initial investment of $100 million is planned for the project, which is expected to create at least 1,000 new jobs in the republic.

    Additionally, Zijin Mining plans to engage in geological exploration of new prospective areas. The Kazakh authorities, keen on expanding the country’s mineral resource base, are prepared to offer state-level support to their Chinese partner.

    Zijin Mining is a multinational mining conglomerate that operates over 30 projects in 12 countries. Last year, the company’s assets produced 720,000 tons of copper and 250 tons of refined gold.

  • Qarmet to Invest $1.48 Billion in Iron Ore and Coal Projects by 2025

    Qarmet to Invest $1.48 Billion in Iron Ore and Coal Projects by 2025

    Over the next few years, the company plans to invest $1.48 billion in its iron ore and coal departments. Of this amount, $500 million will be allocated to the development of the iron ore division, and $978 million to the coal division. This was announced following President Kassym-Jomart Tokayev‘s visit to the metallurgical plant.

    The official website of the President of the Republic reported that the plant’s management had already implemented several production upgrades and shared future plans. Since the plant was transferred to a new investor, a series of major projects worth over $3.5 billion have been initiated.

    The 2024 plant renovation program includes more than a hundred facilities and the replacement of 50,000 square meters of roofing. Additionally, sanitary and household facilities will be repaired.

    Kassym-Jomart Tokayev was shown the operation of Converter Shop No. 2 and the Continuous Casting Machines. Qarmet intends to further modernize the control systems and hydraulics in this section.

    The company has launched a “5-9-5” program: 5 million tons of steel, 9 million tons of coal, and 5 million tons of iron ore concentrate annually. As a result, by 2025, the metallurgical plant’s capacity will increase by 66% compared to last year.

    In 2023, coal mining was carried out at only three mines; now, Qarmet operates eight mines in Kazakhstan. Next year, all facilities will be equipped with positioning systems.

    President Tokayev summarized that the authorities made the “right decision” by inviting a Kazakh investor to manage the company. He instructed to “restore the former glory” of the metallurgical plant.

  • Kazakhstan Plans to Boost Investment in Geological Exploration by 2029

    Kazakhstan Plans to Boost Investment in Geological Exploration by 2029

    Kazakhstan’s National Development Plan through 2029 aims to increase investments in geological exploration to $90 per square meter, up from the current $63 per square meter, which is 39.6% below the global average, according to a report by LS. The plan addresses the country’s insufficient reserves of key minerals ready for development, particularly in the areas of chromium, copper, and iron.

    Kazakhstan is rich in nickel, cobalt, and lithium, metals essential for the green economy. However, due to limited investment in geological exploration, the full potential of these resources has not been realized. The same issue affects rare earth metals.

    To improve the situation, the government plans to stimulate investments in junior companies by simplifying their access to the stock exchange and revising tax deduction conditions for investors. Additionally, the taxation system for mining companies will be overhauled, shifting to a model that considers the volume of product sales and profits rather than just the amount of raw materials extracted. This new system will first be tested on several pilot sites.

    Moreover, geological data will be digitized, and administrative barriers to obtaining exploration and mining licenses will be reduced.

  • Kazakhstan’s Ambitious Industrial Expansion: 180 New Projects Set for 2024

    Kazakhstan’s Ambitious Industrial Expansion: 180 New Projects Set for 2024

    Kazakhstan is set to launch 180 new projects by the end of 2024, with an estimated investment of 1.4 trillion tenge (US$2.9 billion), creating approximately 17,400 new jobs, according to the Prime Minister’s press service on July 24. These projects are expected to produce goods valued at nearly 1.8 trillion tenge (US$3.7 billion), including 400 billion tenge (US$843 million) for export and 1.4 trillion tenge (US$2.9 billion) for import substitution.

    Key projects include the EkibastuzFerroAlloys plant in the Pavlodar Region, which will create 800 jobs with a 92.4 billion tenge (US$194 million) investment, producing 240,000 tons of ferrosilicon annually. In the Kostanay Region, a factory will produce cast iron components for trucks, providing 360 jobs with a 78.2 billion tenge (US$164 million)investment and an annual capacity of 45,000 tons.

    The Zhetysu Wolfram company will develop the Boguty tungsten ore deposit in the Almaty Region, investing 135 billion tenge (US$284 million) to create 350 jobs and achieve an annual production of 3.3 million tons of ore and 10,000 tons of concentrate.

    In the Almaty Region, a factory will produce thermal insulation materials, offering 220 jobs with a 43.9 billion tenge (US$92.6 million) investment, producing 1.4 million cubic meters of rock wool and 400,000 cubic meters of polymer insulation annually. Another facility will manufacture springs for rolling stock, creating 51 jobs with a 1.1 billion tenge (US$2.3 million) investment and an annual capacity of 298,500 springs.

    Kazakhstan’s metallurgical production grew by 54.2% in the first five months of 2024, driven by increased output of ferroalloys, raw aluminum, raw lead, and refined copper. The country remains a major exporter of ferrous and non-ferrous metals, with exports rising by 8.3% to $4.7 billion in the first four months of 2024. The government has introduced new regulations for scrap metal collection and processing, including a ban on exporting ferrous scrap and non-ferrous metal waste.

    The chemical industry saw investments reach 68.4 billion tenge (US$144 million) from January to May 2024, with new projects in technical silicon, hydrogen peroxide, and liquid nitrogen production. Nine new small enterprises opened, focusing on regions like Pavlodar and Zhambyl.

    In the coal industry, a new government decree has granted exclusive licenses to coal mining and processing enterprises, aiming to meet domestic coal needs, particularly for the heating season.

    Kazakhstan’s non-ferrous metallurgy sector has strengthened international cooperation, with agreements signed with China and South Korea. The machinery industry saw significant investment and modernization, with industrial production reaching 814.4 billion tenge (US$1.7 billion) in the first half of 2024.

    The building materials and furniture industries also experienced growth, with regulations supporting local producers. The light industry saw a significant rise in production and exports, with investments in clothing and leather production increasing notably.

  • Glencore Retains 70.2% Stake in Kazakh Mining Business Amid Price Disagreement

    Glencore Retains 70.2% Stake in Kazakh Mining Business Amid Price Disagreement

    Glencore, the global trading company, has decided to retain its 70.2% stake in the Kazakh mining business after failing to agree on a sale price, according to “Kursiv” citing Bloomberg. Glencore has been simplifying its operations by divesting smaller or non-core assets. The decision to sell its Kazakh assets was made in early summer when Chinese buyers showed interest. This included the Vasilkovsky gold mine, managed by KazZinc.

    Potential investors were unable to meet Glencore’s price expectations, which Bloomberg estimates to be several billion dollars. As a result, the company opted not to proceed with the sale. Under existing rules, investors can acquire a part of the enterprise only if the other partner declines the purchase. The co-owner of KazZinc, Tau-Ken Samruk (holding a 29.8% stake), has not commented on the potential deal.

    KazZinc is a major producer of non-ferrous metals. According to Glencore, last year the enterprise produced 173,900 tons of zinc, an increase of 27,500 tons from the previous year. Additionally, in 2023, KazZinc produced 35,600 tons of lead, 14,800 tons of copper, and 598,000 ounces of gold.

  • Deutsche Balaton Increases Stake in Skeena Resources Amid Strong Market Performance

    Deutsche Balaton Increases Stake in Skeena Resources Amid Strong Market Performance

    German investment firm Deutsche Balaton (DB) announced on Tuesday that it has slightly increased its equity stake in Skeena Resources (TSX: SKE) by acquiring 10,500 shares at an average price of C$7.049143 per share. The newly acquired shares represent 0.1% of Skeena’s outstanding shares, raising DB’s total holdings to approximately 10.9 million shares, which equates to 10.25% of the Canadian miner’s share capital.

    Shares of Skeena Resources reached a 52-week high of C$7.67 late in the afternoon, closing 4.2% higher at C$7.65 per share, giving the company a market capitalization of C$694.6 million.

    This development comes on the heels of Skeena’s recent announcement of a $750 million financing package for the Eskay Creek mine project in British Columbia’s Golden Triangle. This funding is set to provide the financial flexibility needed to restart what was once the highest-grade gold mine in the world. The restart is planned for 2027, with an anticipated annual production of 320,000 oz. gold over a 12-year mine life. According to a definitive feasibility study, the open-pit mine has an after-tax net present value (at a 5% discount rate) of C$2 billion and an after-tax internal rate of return of 43%.