Peru’s Castillo shuffles Cabinet again; replaces mining minister

LIMA (Reuters) – Peru’s President Pedro Castillo shuffled his Cabinet on Sunday, including replacing the interior minister and the important mining minister amid rising tensions over protests in the world’s second largest copper producing country.

Castillo has shuffled his ministerial team multiple times since coming into office in the middle of last year as he has battled against falling popularity, a hostile Congress, corruption probes and community tensions hitting mining.

He appointed as energy and mines minister Alessandra Herrera, who had briefly held the position in February.

(Reporting by Marco Aquino; Writing by Adam Jourdan)

Work suspended at Botswana’s Khoemacau copper mine after accident kills two

GABORONE (Reuters) – Operations have been suspended at Khoemacau Zone 5 copper and silver mine in Botswana after an underground accident killed two people on Friday, the company said on Saturday.

Situated in the Kalahari Copperbelt, which stretches from north east Botswana to western Namibia, the Khoemacau mine is the only operational copper mine in the diamond-rich country after two others were placed under liquidation.

The two were employees of an Australian-based contractor to the mine, Barminco, a subsidiary of Perenti Global.

“Investigations into the cause of the accident are ongoing. It appears that the two, both blasting crew members, had proceeded underground to perform tasks at the Tshukudu section 140 metres below surface,” said Khoemacau Chief Executive Officer Johan Ferreira.

Khoemacau produced its first copper-silver concentrate in June last year and the mine has been gradually ramping up output with a target to reach full production of between 60,000 and 65,000 tonnes per annum (tpa) copper and 1.8 to 2 million ounces per annum (ozpa) of silver by the fourth quarter of 2022.

“Operations at the Zone 5 have been temporarily suspended. We will provide further updates as appropriate,” Perenti Managing Director, Mark Norwell said.

In February, Khoemacau said it was pleased with its safety performance having recoded a total recordable injury frequency rate of 0.39 per 200,000-man hours from the commencement of construction at the start of January 2019 through the end of January 2022.

(Reporting by Brian Benza; editing by David Evans)

Putin tells government to ‘optimise’ taxes for steel makers and coal miners

(Reuters) – Russian President Vladimir Putin has ordered the government to ‘optimise’ taxes for steel makers and coal miners, the Kremlin said on Friday.

Last month, Putin called for structural changes to Russia’s metallurgical industry to counter Western sanctions, which he said were starving it of some components and restricting its ability to sell some goods abroad.

(Reporting by Reuters; Editing by Kevin Liffey)

Putin instructs government to assess actions taken against Russia in WTO

(Reuters) – Russian President Vladimir Putin has instructed the government to assess measures taken by countries in the World Trade Organisation (WTO) that restrict trade with Moscow, a document published on the Kremlin’s website said.

Putin said in April that “illegal” restrictions on Russian companies by Western states ran counter to World Trade Organisation rules and told his government to update its strategy in the WTO by June 1.

(Reporting by Reuters)

China’s Sinosteel signs $680 million iron ore mine deal with Cameroon

By Amindeh Blaise Atabong

YAOUNDE (Reuters) – Cameroon’s government has signed a 420 billion CFA franc ($675.96 million) high-grade iron ore mining deal with a subsidiary of Sinosteel Corporation Limited, as China seeks new sources of the steel-making ingredient.

Sinosteel Cam S.A., the Cameroonian subsidiary of the state-owned Chinese miner, will develop the Lobe iron ore mine in the central African nation, helping China to diversify its sources of iron ore beyond Australia, with which it is in a trade war, and Brazil.

Under an initial 20-year mining convention, concluded on May 6 in the capital Yaounde and seen by Reuters on Thursday, Sinosteel Cam aims to mine 10 million tonnes of ore with 33% iron content annually.

It would enrich this to produce 4 million tonnes of ore with 60% iron content, which would then be shipped. High-grade iron ore is particularly valued in making steel because it results in lower carbon emissions than lower grade ore.

The project will be 30% self-funded, with 70% of the financing coming from bank loans, the convention said.

The Lobe mine, 200 kilometres (124 miles) southeast of the economic capital Douala and 40 km from the port town of Kribi, holds 632.8 million tonnes of iron ore.

Sinosteel will build a beneficiation plant, a pipeline to move the ore to the port, a mineral terminal at the port, and a power plant, the convention said, without specifying what type of power plant.

Sinosteel officials have yet to say when they aim to start mining, but under Cameroon’s mining code the company must begin within five years from the mining permit being granted.

The convention allows for 15% of the iron ore to be supplied to the local market, but Cameroon could authorise Sinosteel to export it if local demand is too weak.

The project is expected to generate at least 600 direct jobs and 1,000 indirect jobs, Cameroon’s mines minister Dodo Ndoke Gabriel said.

($1 = 621.3400 CFA francs)

(Reporting by Amindeh Blaise Atabong; Editing by Helen Reid and Barbara Lewis)

Factbox-Europe seeks to restart magnesium output after two decades

(Reuters) – The European Union has targeted magnesium as a priority critical mineral to cut dependence on China and three firms are gearing up to produce it in Europe for the first time since 2001.

Below are facts about magnesium and the three potential projects.

MAGNESIUM

Magnesium is a shiny grey, very light metal that provides strength as an ingredient in aluminium and steel alloys used in aluminium cans, car wheels and airplane wings.

The mineral is abundant in the earth’s crust and also can be produced from seawater, but smelting is more complicated and is very energy-intensive.

China dominates production, accounting for 88% of the world’s supply. Other producers include Brazil, Russia and the United States.

Europe accounts for about 20% of global magnesium demand at around 200,000 tonnes a year, but the last European magnesium production sites – in Norway and France – closed in 2001.

Magnesium prices in China hit record highs last year and are still double the level seen 12 months ago.

The EU-funded organisation EIT Raw Materials has identified three potential projects that could allow a restart of magnesium production in Europe, two in Romania and one in Bosnia.

VERDE MAGNESIUM https://www.verdemg.com

Verde is working on reviving an old mine in western Romania and plans to build an integrated processing plant. The company, supported by private equity group Amerocap, is seeking a mining licence from the government and hopes to launch production in 2025.

“Verde Magnesium is aiming to offer a consistent supply of processed magnesium from Romania amounting to approximately 30,000 tonnes a year – or 15% of EU demand – by 2030,” said Chairman Bernd Martens.

WASTES ECOTECH

The company aims to process waste from a former state-own chemical site in central Romania to extract magnesium and other minerals. The firm did not respond to enquiries, but EIT Raw Materials said the company is feasibility studies for operations that could produce 22,000 tonnes of magnesium a year.

BOSNIA PROJECT

The owners of the project have declined to be identified, but EIT Raw Materials said the firm plans to build a mine and processing facility that could initially produce 15,000 tonnes of magnesium a year, with potential to expand to 50,000 tonnes.

(Reporting by Eric Onstad; editing by Barbara Lewis)

Exclusive-Europe aims to revive magnesium output by 2025 to cut China reliance

By Eric Onstad

LONDON (Reuters) – EU policymakers have launched a drive to restart domestic output of magnesium, used in aluminium and steel products, with at least three firms working on projects, according to documents and officials.

A European Commission staff working document made available to Reuters places a new emphasis on magnesium and a target of cutting dependence on major producer China, saying investment of up to 2 billion euros ($2.12 billion) will be needed to restart smelting activity in Europe by 2025.

The issue has gained importance for Europe, which consumes a fifth of the global magnesium supply, since the West imposed sanctions on Russia following its invasion of Ukraine on Feb. 24.

Russia was the world’s fourth biggest magnesium producer last year, with an estimated 21,000 tonnes of output.

Europe’s imports from Russia have been modest and magnesium is not sanctioned, but Russia’s isolation rules it out as a potential fallback should Chinese supplies be cut.

The Commission, the EU executive, is worried that any fall in shipments from China, which supplies over 90% of magnesium to the bloc, could curb production of autos, airplane parts and other products that depend on the mineral.

Supplies from China fell late last year, igniting prices in Europe and focusing the EU on efforts to secure home-grown supplies.

As a result, policymakers, who had last year given top ranking to rare earth magnets used in electric vehicles and wind turbines, made magnesium equal priority in its action plan to secure supplies of critical minerals.

China, which dominates both, supplies 93% of the bloc’s magnesium needs.

“Magnesium has been consistently flagged as one of the critical raw materials with the highest supply risk but with no improvement over time,” the EU document said.

“The magnesium case is a clear example of the risk the EU is taking by making its domestic economy dependent on Chinese imports,” Paul Voss, director general of the European Aluminium Association, said.

The document says the EU should aim to source 15% of its magnesium needs domestically by 2030.

“During the first months of work of the ad hoc working group on magnesium, we have identified… several projects at different stages of development,” Joaquim Nunes de Almeida, head of the European Commission’s Internal Market and Industry directorate, told Reuters in an email.

VITAL COMPONENT

The magnesium market is relatively small, with about 1 million tonnes of annual production, according to figures from CM Business Consulting, compared to 67 million tonnes of aluminium, but it plays a vital role in giving compressed strength to a wide range of products.

“The aluminium can as we know it and the wings of a modern Airbus airliner wouldn’t exist without magnesium,” said Alan Clark of CM Business Consulting.

“The aluminium industry has been riding its luck because there’s no substitute for magnesium.”

Magnesium prices skyrocketed late last year after the Chinese government’s efforts to curb power consumption reduced the output of a range of metals, including magnesium.

In October, European industry groups warned that plant shutdowns could hit millions of jobs if magnesium shortages persisted.

Chinese shipments to Europe resumed, but EU policy-makers had realised the need to revive production.

The last two European sites for magnesium production – in Norway and France – closed in 2001, in part because of competition from cheap imports from China.

There are now three potential European projects that could produce magnesium in the coming years, two in Romania and one is Bosnia, said Krzysztof Kubacki, an official with EIT Raw Materials.

EIT is an EU-funded organisation implementing an EU action plan drawn up in 2020 to secure critical minerals for the bloc.

Verde Magnesium, backed by private equity firm Amerocap, is seeking to revive a brownfield mine in Western Romania and is seeking permitting from the government.

Its chairman is Bernd Martens, former head of purchasing at automaker Audi, the premium brand owned by Volkswagen.

Verde hopes to launch production by 2025.

($1 = 0.9443 euros)

(Reporting by Eric Onstad; Editing by Veronica Brown and Barbara Lewis)

Woodside’s ‘crown jewel’ Scarborough gas lures buyers to fill Russia gap

By Sonali Paul

MELBOURNE (Reuters) – Woodside Petroleum has received strong interest from companies for a stake in the Scarborough natural gas project it is developing off Western Australia in the wake of the Ukraine conflict, Chief Executive Meg O’Neill said on Friday.

Woodside is set to become 100% owner of the $5.7 billion Scarborough project following its merger with BHP Group’s petroleum arm, approved by Woodside investors on Thursday.

Australia’s largest independent gas producer has long flagged it wanted to sell down its interest, but has been waiting to acquire BHP’s stake to be able to provide certainty on the size of its sell-down.

“Scarborough is going to be a crown jewel for Woodside. What’s important for us is finding the right partner at the right price,” O’Neill told Reuters, adding there could be more than one partner.

Woodside wants to maintain a majority stake, but has not specified what percentage.

“We have had strong interest post-Ukraine, as many customers around the world realise the importance of energy security,” O’Neill said, adding that there was interest in both LNG supply and an equity stake in the project.

Following Russia’s invasion of Ukraine, sanctions have resulted in an indefinite delay to the 20 million tonnes a year Arctic LNG 2 project. LNG buyers and investors are now seeking alternatives.

“They look at Scarborough as a project … that will be producing in the second-half of the 2020s, filling a gap that is expected to arise in the market at that point in time,” O’Neill said.

Scarborough gas will feed Woodside’s $6.3 billion Pluto LNG expansion. Its first cargo is expected in 2026.

LNG projects typically seal long-term sales before a final investment decision, but Woodside lined up contracts for only about half its volumes ahead of the Scarborough/Pluto go-ahead last November, positioning it to take advantage of a jump in prices, Wood Mackenzie analyst Dan Toleman said.

(Reporting by Sonali Paul; editing by Richard Pullin)

Indian police charge 30 anti-Vedanta protesters over deadly 2018 demonstration

By Sudarshan Varadhan

NEW DELHI (Reuters) – Indian federal police have charged 30 people with rioting and other offences after an environmental protest at Vedanta Ltd’s copper mine in 2018 turned deadly, with police shooting dead 12 protesters.

The incident, the deadliest environmental protest in India in a decade, was condemned by a working group of United Nations’ human rights experts for the “excessive and disproportionate use of lethal force by police.”

Six of the protesters who were killed were shot from behind.

No policeman or government official who oversaw the firing was charged, the chargesheet reviewed by Reuters showed. The Central Bureau of Investigation (CBI) said police had “little choice other than resorting to firing,” as protesters outnumbered police.

Witnesses had said after the incident that police opened fire without warning in violation of the police manual, prompting demands from political parties in Tamil Nadu that police officers be held accountable. (reut.rs/395sC5a)

“The government of Tamil Nadu has already been requested to take appropriate action against those whose performance of duty was not found in commensuration with the position they held,” the chargesheet read.

The CBI, which had also charged 71 protesters over the last year, did not respond to a request seeking additional comment.

Indian police rules allow the use of live ammunition to quell civil unrest, but stipulate the response should be proportionate and officers should not shoot to kill.

The CBI has charged the 30 protesters on 17 counts including rioting, obstructing public service, causing voluntary hurt and damage to public property. These charges carry a maximum penalty of up to seven years in prison.

“Only a handful of rioters whose identity could be established beyond doubt were identified and chargesheeted,” the CBI said.

The Tamil Nadu state government ordered the permanent closure of the Vedanta copper smelter a week after the shooting. Vedanta has denied any breach of environmental laws.

In addition to the federal police, the shootings are also being investigated by a court-mandated commission. The commission is yet to submit its final report.

(Reporting by Sudarshan Varadhan; Editing by Kim Coghill)

GFG to restart Belgian steel operations after winning appeal

LONDON (Reuters) -GFG Alliance’s steel operations in Liege will be restarted shortly, after a Belgian court overturned a ruling they should be put into administration, the company owned by commodities tycoon Sanjeev Gupta said on Thursday.

Gupta has been scrambling to refinance his international network of steel and aluminium and energy businesses following the collapse of supply chain finance firm Greensill Capital last year.

A commercial court in Belgium last month ruled administrators should be appointed to GFG’s Liberty Steel operations in Liege due to negative equity, but that decision was overruled on appeal, GFG said in a statement.

“We’re very pleased that our appeal has succeeded and … we are now looking forward to restarting production as soon as possible,” Liberty Steel official Toker Ozcan said.

GFG has injected more than 28 million euros ($30 million)into the Liege operations since December and aims to ramp up production to 110,000 tonnes per month by October, GFG added.

GFG acquired the Liege operations, which include two sites that employ about 650 people in total, and a third steel plant in Dudelange, Luxembourg, from ArcelorMittal in 2019.

Britain’s Serious Fraud Office (SFO) stepped up a probe into GFG last month as teams of investigators demanded documents such as balance sheets, annual reports and other correspondence.

The SFO last year opened an investigation into suspected fraud, fraudulent trading and money laundering at the Gupta Family Group Alliance (GFG).

A GFG spokesperson declined to comment at the time, but an internal memo seen by Reuters said the company had consistently rejected any wrongdoing and pledged full cooperation.

($1 = 0.9473 euros)

(Reporting by Eric OnstadEditing by Edmund Blair and Mark Potter)

Unions representing miner Samarco employees file competing restructuring plan -source

SAO PAULO (Reuters) -Two unions representing employees of miner Samarco Mineracao SA have filed a restructuring plan for the company, according to a source with knowledge of the matter.

The plan is supported by current shareholders in Samarco – Vale SA and BHP Group – and is similar to the previous plan proposed by Samarco and rejected by bondholders.

Vale confirmed in a statement that it and BHP Brasil support such a plan.

The union group’s plan includes a two-year job stability clause for Samarco employees. The debt-for-equity swap is similar to what Samarco had offered previously to financial creditors. Samarco and BHP will continue to be controlling shareholders.

The source, which asked for anonymity to disclose private talks, said employees were afraid of control changes at Samarco and potential layoffs.

Financial creditors presented their proposal on Wednesday, proposing a debt-for-equity swap that would change Samarco control.

“BHP Brasil and Vale are analyzing the alternative plan proposed by financial creditors, which is focused only on profits rather than on efforts to repair the Fundao dam failure,” Vale said.

The Fundao tailings dam in the city of Mariana collapsed in November 2015, killing 19 people and obliterating villages in what as ranked as Brazil’s worst environmental disaster.

The employees’ proposal also adds the payment of “extraordinary dividends” to financial creditors of a share of additional cash flow generated if the miner can accelerate production ramp-up.

It’s still unclear how the bankruptcy court will proceed after the filing of two different plans, one by the unions and another by bondholders, since Samarco’s last restructuring plan was rejected by creditors. The union plan was filed under seal but will become public on Thursday.

The plan is supported by the employees and by 935 unsecured creditors with a total credit volume of around $5 million.

(Reporting by Tatiana Bautzer; Additional reporting by Roberto Samora; Editing by Tom Hogue and Mark Porter)

Woodside shareholders approve BHP petroleum merger

By Sonali Paul

BRISBANE (Reuters) -Woodside Petroleum’s shareholders on Thursday voted for a merger with BHP Group’s petroleum arm to create a top 10 global independent oil and gas producer worth $40 billion, according to a vote count at the company’s annual meeting.

Of the total final votes, 98.66% were in favour of the deal.

The merger, agreed last August, advances top global miner BHP’s effort to move away from fossil fuels, as it looks to decarbonise, while doubling Woodside’s oil and gas production and beefing up its funding for growth.

“The merger is an opportunity for Woodside to increase its contribution to the world’s growing energy needs and build the scale, resilience and diversity to thrive through the energy transition,” Chief Executive Officer Meg O’Neill told shareholders.

BHP will be paid in Woodside shares, giving BHP investors a 48% stake in the merged group, which will have assets in Australia, the United States, Mexico, Senegal and Trinidad.

While backing the merger, shareholders were disappointed with Woodside’s climate plan, which does not set targets for reducing its customers’ emissions, called Scope 3 emissions.

Nearly 49% of the votes were against the climate plan, which Woodside put to an advisory vote for the first time.

Two proxy advisers recommended voting against the plan.

Woodside Chairman Richard Goyder ordered the microphone to be cut off after one proxy for a shareholder asked whether the company’s plans to invest in fossil fuels were “morally mad, economically mad or both”, to which the chairman replied, “Or neither”.

However, Goyder said the company clearly needs to engage more with shareholders to explain that its plans are in line with Paris Agreement goals.

O’Neill said Woodside’s strategy on Scope 3 is to come up with clean products, such as hydrogen, for its customers.

(Reporting by Sonali Paul; Editing by Christopher Cushing and Rashmi Aich)

Chile’s top court puts Dominga mining project decision on Boric admin

SANTIAGO (Reuters) – Chile’s top court on Wednesday turned down appeals filed by communities and environmentalists against the controversial Dominga mining project, saying a final decision needs input from President Gabriel Boric’s administration.

Last year, environmentalists and surrounding communities appealed a ruling from a lower court that tossed out a decision by a regulator that denied the company permits.

In its ruling, the Third Chamber of the Supreme Court said that it was turning down the appeals because it “determined that there is no final judgment that can be reviewed by this court,” adding that the final decision on the environmental evaluation is “pending a resolution from the administrative authority.”

That authority is the committee of ministers, made up of the mining, agriculture, energy, economy, health ministers and is chaired environment minister.

In his first speech as president-elect in December, Boric voiced opposition to projects that “destroy” the country, such as Dominga, which seeks to annually produce 12 million tonnes of iron concentrate and 150,000 tonnes of copper concentrate.

An environmental evaluation commission endorsed the $2.5 billion project last year, but it has been delayed for years amid strong opposition from environmental and social groups that say it would cause serious environmental damage to the region.

OceanaChile, an environmental group dedicated to protecting the ocean, has said the project could hurt the Humboldt archipelago off Chile’s coast, endangering its species and biodiversity.

“Our trust is in that the Committee of Ministers will consider all the scientific information that backs why Dominga is unviable and the Humboldt archipelago must be protected permanently,” it said in a tweet responding to the decision.

Andes Iron, the company in charge of the Dominga project, issued a statement saying it welcomed the court’s decision and added that “every time the Dominga project has undergone technical evaluations we have received favorable pronouncements.”

The project has spanned multiple administrations and sparked controversies for former presidents Michelle Bachelet and Sebastian Pinera. Pinera faced and survived an impeachment vote after details of possible irregularities linked to the Dominga project were revealed in the Pandora Papers leak.

(Report by Natalia Ramos; Additional reporting by Fabian Cambero and Alexander Villegas; Editing by Aurora Ellis)

Russia allows 15 companies to remain listed abroad – finance ministry

(Reuters) – Russia has given 15 companies including metals giant Nornickel and liquefied natural gas producer Novatek approval to remain listed on foreign exchanges, the finance ministry said on Wednesday.

Russian President Vladimir Putin signed a bill in April requiring Russian companies to delist their depositary receipts to reduce the influence foreign countries could over them, except if they were granted permission to remain listed.

The finance ministry said that out of the 36 Russian companies with depositary receipts, 19 had requested permission and 15 were successful.

So far, Nornickel, Novatek, Russia’s largest gold producer, Polyus, steel producers NLMK, Severstal and Mechel, as well as oil producer Tatneft have said they have the green light to remain listed.

Russian gas company Gazprom has previously said its request was rejected and it expects its depositary receipts to be delisted on May 31.

It remains unclear which other companies failed to get approval following a request.

Even with permission to remain listed overseas, trade in Russian securities has been stopped by some Western bourses.

The London Stock Exchange, for example, halted trading in the depositary receipts of major Russian companies it lists when their prices crashed following the launch of Moscow’s “special military operation” in Ukraine on Feb. 24.

Depositary receipts are certificates issued by a bank representing shares in a foreign company traded on a local stock exchange. They allow investors to trade in overseas stocks in their own geography and time zone.

Western countries have imposed strict sanctions on Russia since it sent troops into Ukraine and one finance ministry official said Russian companies were looking to shift their foreign listings elsewhere.

“Most of those who plan to continue depository programmes intend to move them to other jurisdictions,” Ivan Chebeskov, head of the financial policy department at the ministry, told a conference on Wednesday.

“Everyone understands that the markets in which foreign investment can be attracted are likely to shift eastwards.”

(Reporting by Reuters; Editing by David Clarke)

Caterpillar eyes energy transition as growth driver for mining business

By Bianca Flowers

DALLAS (Reuters) – Construction equipment maker Caterpillar Inc believes demand for critical minerals as the clean energy transition gathers pace will translate to solid returns for its mining business, CEO Jim Umpleby said in an interview on Tuesday.

The company is aiming at a global market worth about $5 trillion for energy transition infrastructure between 2021 and 2040, Umpleby said.

“Mining capital expenditures have been relatively subdued over the last few years and we believe that will increase,” he told Reuters after the company’s investor day meetings.

Executives reaffirmed the heavy machinery giant’s machinery, energy and transportation services annual revenue targets of $28 billion by 2026.

Increased demand of minerals will expand the total addressable marketing in renewables, Umpleby said. “That requires more mining equipment, which gives us an opportunity,” he said.

Capital expenditures for mining in 2022 have already surpassed those of the previous seven years and the trend is expected to continue, with companies reinvesting in their fleets to replace aging equipment to step up operations.

Caterpillar’s overall cash flow for capex spending increased to $346 million in the first quarter of 2022 from $252 million in the same quarter last year, with the company allocating investments towards scaling tech, artificial intelligence and environment, sustainability and governance services.

On Tuesday the company’s board approved a new stock repurchase of $15 billion. Shares rose 2.1% on the news.

(This story refiles to correct capex period in paragraph seven to quarterly and capex expenditures increase in paragraph six)

(Reporting by Bianca Flowers; Editing by Bradley Perrett)

Burkina Faso rescuers find no survivors in flooded mine’s rescue chamber

By Anne Mimault and Thiam Ndiaga

OUGADOUGOU (Reuters) -Rescue workers have found no survivors in a rescue chamber deep inside a flooded zinc mine in Burkina Faso, the government and the mine owner said on Tuesday, all but extinguishing hope that eight missing miners could still be alive after a month.

The Perkoa mine, owned by Canadian firm Trevali Mining Corp and located about 120km (75 miles) west of the capital Ouagadougou, was abruptly submerged on April 16 after torrential rain fell unexpectedly during the country’s dry season.

There had been faint hope during a month-long search and rescue operation that the missing men might have reached the rescue chamber, which is stocked with food and water and located around 570 metres below ground.

“The rescue teams have opened the refuge chamber, unfortunately it is empty,” the government’s information service said in a statement posted on social media.

Trevali said the refuge chamber had been found intact, and it was now clear none of the eight missing workers had reached it.

“This is devastating news, and we would like to offer our deepest sympathies to our colleagues’ families and friends during this difficult time,” said Ricus Grimbeek, President and CEO of Trevali, in a statement.

“We will continue our search efforts unabated and reaffirm our commitment to work at full-speed to find our colleagues.”

Distraught relatives of the missing men have been gathering every day at the site in the Sanguie province, seeking solace from each other as they faced the agonising wait for news.

Deadly mining accidents are common in Africa. The Perkoa flood garnered more attention than many because of the hope, albeit remote, of an outcome similar to the dramatic 2010 rescue in Chile of 33 miners who had spent 69 days underground — but it was not to be.

COMPLEX OPERATION

Both the company and the government have launched investigations into the causes of the disaster. The prime minister said on May 2 that mine managers had been banned from leaving the country.

The Perkoa mine consists of an open pit with underground shafts and galleries below. Most of the workers who were there at the time of the flash flood were able to escape, but the missing eight were more than 520 metres (1,706 feet) beneath the surface.

Six of the missing men are Burkina Faso nationals, one is from Tanzania and one from Zambia.

With many in Burkina Faso asking why it took so long to reach the rescue chamber and criticism of the company and state emergency services mounting, Trevali said the technical challenges were immense.

The violence of the flood was such that it washed away the road leading down into the mine as well as damaging electricity supply. The road had to be resurfaced and power restored before a full-scale search could begin.

Initially, equipment was being carried down on foot, but vehicles were necessary to install machinery capable of pumping water from depths below 500 metres.

Rescuers have pumped out about 55 million litres of floodwater, out of an estimated total of 165 million litres that swept through the underground portion of the mine.

(Writing and additional reporting by Sofia Christensen and Estelle Shirbon, Editing by James Macharia Chege and Ed Osmond)

Imperial sees duty-free cigarette sales recovery as air travel returns

By Richa Naidu

LONDON (Reuters) – Imperial Brands said on Tuesday it was starting to see some recovery of sales of cigarettes in duty-free shops at airports and in popular European holiday destinations as COVID-19 restrictions ease and people begin to travel more.

Tobacco, alcohol and luxury goods makers were hit hard early on in the pandemic when travel was limited, depriving them of a key chunk of sales.

In its 2021 annual report, Imperial said travel recovery remained “difficult to predict due to varying COVID-19 restrictions across Europe”. Now, months later, the maker of Winston cigarettes and Backwoods cigars said it was seeing a recovery in the market.

“Our global duty-free business and our travel retail sales in the holiday destinations in Southern Europe have begun to recover as cross-border travel resumes,” the company said, adding that it had seen a similar recovery in the Middle East.

Globally, duty free sales accounted for roughly 2% of annual revenue prior to the pandemic, it said. Earlier on Tuesday it said it was on track to meet its 2022 goals helped by strong sales of ecigarettes and heated tobacco in Europe, driving its shares to a more than two-year high.

Major tobacco industry rival Philip Morris International also said in April that increased travel supported volume growth in Spain and duty free stores around the world.

Other industries are also benefiting from a return to airport shops.

Drinks group Campari said this month that travel retail had increased by 50.2% while beauty products makers L’Oreal and Estee Lauder also saw a strong recovery in some markets.

“At the beginning of the year, we are seeing a very strong recovery, again, plus 18%, with air traffic resuming gradually,” L’Oreal CEO Nicolas Hieronimus said on an annual general meeting call in April.

To be sure, with restrictions remaining in China, Estee Lauder said “a precipitous decline in Chinese travel in March” held back travel retail sales in Asia.

(Reporting by Richa Naidu; Editing by Emelia Sithole-Matarise)

Peru mining protests risk clogging $53 billion investment pipeline, industry warns

By Marco Aquino

LIMA (Reuters) – Peru, the world’s second-largest copper producer, risks losing out on billions of dollars of mining investment if the government fails to defuse protests that are hitting the industry and denting production, analysts and executives said.

Social conflicts have risen in the Andean nation over the past year since socialist President Pedro Castillo came into office, with a spate of protests against mines, including one that has halted production at the huge Las Bambas copper deposit.

With global prices soaring on high demand, that now threatens a mining investment pipeline of some $53 billion and could stall future projects expected by investment bank RBC to make up 12% of the world’s copper supply in years to come.

“Without any world-class projects on the horizon, the prospects for sustaining production are not good,” said Gonzalo Tamayo, analyst at Macroconsult and a former Peruvian mines and energy minister.

Mining executives and analyst met last week in Peru’s capital Lima, where the main concern was falling investment tied to rising social protests. A central bank report shows investment dipping some 1% this year and 15% in 2023.

The conflicts, mainly in poor Andean areas where communities feel bypassed by the huge mineral wealth beneath their soils, have started to bite, with protesters emboldened under Castillo who won election pledging to redistribute mining wealth.

Southern Copper’s Cuajone mine was paralyzed for almost two months earlier this year.

Las Bambas, owned by China’s MMG Ltd, suspended operations in April after an invasion of the mine by communities demanding what they called ancestral lands. The mine, which produces 2% of the world’s copper output, remains offline.

Las Bambas had received government approval in March to expand the mine, a plan which is now under threat.

Álvaro Ossio, vice president of commercial and finance for ​​Las Bambas, said in a presentation at the Lima event, that the country faces a big task to benefit from high global prices.

“The great challenge that remains for all Peruvians is to take advantage of this great opportunity in these future trends,” he said.

Peru’s last big mining investments were in Anglo American’s Quellaveco and Minsur’s Mina Justa of a combined $6.6 billion. Their operations starting this year will help Peru hit annual output of 3 million tonnes of copper by 2025, experts say.

However, other major projects like Southern Copper’s Tia María, Michiquillay and Los Chancas worth some $6.7 billion, Buenaventura’s near billion dollar Trapiche and Rio Tinto’s $5 billion La Granja remain up in the air.

Not all was downbeat, however.

The world’s largest gold miner, Newmont Mining, said at the event that it was considering expanding into copper production in Peru, with a potential future return to the canceled Conga project.

Analyst Tamayo, though, stressed recent protests against mining had become harder to resolve.

“Now there are protests that stop mines in full operation,” he said. “The mining firms feel that the State does not support them and that the State has ceased to be the arbiter in conflicts.”

(Reporting by Marco Aquino; Editing by Adam Jourdan and Richard Pullin)

Europe’s aluminium deficit triggers further large LME stock draw

By Pratima Desai

LONDON (Reuters) – Aluminium inventories in London Metal Exchange (LME) warehouses, already at their lowest in nearly 17 years, are likely to fall further over coming days and weeks as more metal leaves the LME system and heads for Europe where supplies are scarce.

Record high power prices in Europe have pushed up costs of producing metals such as aluminium used widely in the energy, construction and packaging industries.

Western Europe accounts for about 10% of global consumption estimated around 70 million tonnes this year.

Citi analyst Max Layton said in a recent note that aluminium supply risks remain elevated, with about 1.5 million to two million tonnes of output at risk of closure across Europe and Russia over the next three to 12 months.

Shortages in Europe have resulted in large draws on LME aluminium stocks, which have fallen 72% since March last year to 532,500 tonnes, the lowest since November 2005.

Even more worrying for the aluminium market, on warrant stocks — metal available to the market — at 260,075 tonnes, is the lowest on record and likely to fall further as more metal leaves LME warehouses.

“Aluminium continued its rally from last Friday after on-warrant stocks dropped to a record low, reflecting tightness in the ex-China market,” said ING analyst Wenyu Yao.

“However, supply growth has exceeded demand from China’s market…demand (in China) has been in a soft patch due to Covid-related lockdowns.” 

Benchmark aluminium prices on the LME earlier hit a one-week high of $2,865 a tonne. It was last up 1.2% at $2,822.

Worries about availability on the LME has narrowed the discount for the cash over the three-month aluminium contract to $26.5 a tonne from $36 a week ago.

The physical market duty-paid premium that consumers in Europe pay for their aluminium, above the benchmark LME price, is trading at all-time highs of $615 a tonne.

Primary aluminium output in China, the world’s top producer and consumer of the metal, hit a record high of 3.36 million tonnes in April after curbs on power production eased, allowing smelters to expand operations.

(Reporting by Pratima Desai; editing by Emelia Sithole-Matarise)

Russia risks speed up automakers’ switch from palladium to platinum, WPIC says

LONDON (Reuters) – Automakers are accelerating efforts to use less palladium and more platinum due to worries over palladium supply from Russia, the World Platinum Investment Council (WPIC) said on Monday, predicting a large surplus in the platinum market this year.

Automakers were already shifting to platinum, which is cheaper than palladium, to save money, but a faster transition would increase platinum demand and could lift prices while having the opposite effect on palladium.

Russia accounts for around 25-30% of the world’s supply of palladium and around 8-10% of its platinum.

There is no sign that Russian exports have been curtailed by sanctions on the country since it sent troops into Ukraine in February but with the war dragging on, more companies may boycott Russian metal and governments could impose restrictions.

“The substitution effort has gone up hugely,” said Trevor Raymond, the WPIC’s head of research. “The amount of savings an automaker can make are massive. What’s been added on top of that is concerns about availability (of palladium).”

At around $950 an ounce, platinum costs around half as much as palladium. Automakers use around 2.5-3 million ounces of platinum each year and around 8.5 million ounces of palladium.

In its latest quarterly report, the WPIC said the roughly 8 million ounce a year platinum market would be oversupplied by 627,000 ounces this year following a surplus of 1.13 million ounces in 2021.

In March, it forecast a surplus for 2022 of 652,000 ounces.

During the January-March quarter, platinum demand fell 26%year-on-year and supply fell 13%, leaving the market oversupplied by 167,000 ounces, the WPIC said.

It said that for the full year, supply would be 5% less than in 2021 and demand would be 2% greater, with auto industry demand rising 16% due to an increase in light duty vehicle production, higher loadings per vehicle to meet tighter emissions regulation and substitution from palladium.

Following are supply and demand numbers and comparisons.

ANNUAL PLATINUM SUPPLY/DEMAND (‘000 oz)*

2021 2022f 2022f/2021

% change

SUPPLY

Refined Production 6,297 5,872 -7%

Producer Inventory +/- -93 0 -100%

Recycling 1,953 1,909 -2%

TOTAL SUPPLY 8,156 7,781 -5%

DEMAND

Automotive 2,643 3,055 16%

Jewellery 1,923 1,886 -2%

Industrial 2,508 2,109 -16%

– of which chemical 688 613 -11%

– Petroleum 172 193 12%

– Electrical 135 127 -6%

– Glass 715 331 -54%

– Medical 244 257 5%

– Other 555 588 6%

Investment -45 104 -331%

– Bars, Coins 332 254 -23%

– ETF Holdings -238 -50 -79%

– Exchange Stocks -139 -100 -28%

TOTAL DEMAND 7,029 7,155 2%

MARKET BALANCE 1,128 627 -44%

Above Ground Stocks 3,752 4,379 17%

QUARTERLY PLATINUM SUPPLY/DEMAND (‘000 oz)*

Q1 2021 Q4 2021 Q1 2022 Q1/Q1 %

change

SUPPLY

Refined Production 1,465 1,695 1,279 -13%

Producer Inventory +/- -29 -39 0 -100%

Recycling 518 453 415 -20%

TOTAL SUPPLY 1,953 2,109 1,695 -13%

DEMAND

Automotive 724 680 725 0%

Jewellery 479 499 437 -9%

Industrial 707 624 533 -25%

– of which chemical 119 200 111 -7%

– Petroleum 37 57 44 21%

– Electrical 33 32 30 -9%

– Glass 318 121 138 -56%

– Medical 57 67 65 15%

– Other 143 147 144 0%

Investment 159 -108 -167 -205%

– Bars, Coins 21 95 60 192%

– ETF Holdings 105 -155 -169 -261%

– Exchange Stocks 33 -48 -58 -273%

TOTAL DEMAND 2,069 1,695 1,528 -26%

MARKET BALANCE -116 413 167 -244%

* Source: World Platinum Investment Council, Platinum Quarterly Q1 2022

(Reporting by Peter Hobson; Editing by Kirsten Donovan)