Australia's junior explorers - The ASIA Miner

AN interesting recent development for the
sluggish nickel industry has come in the form
of the Indonesian gover nment’s new tax on
unprocessed mineral ore exports, which may
boost prices and increase pressure on supply.
The new tax on the export of 14 types of
unprocessed minerals came into ef fect on
May 6 and has been intr oduced in a bid to
boost value-added products.
The minerals affected are gold, silver, platinum,
copper, lead, nickel, zinc, ir on ore
and sand iron, manganese, chromium, molybdenum,
bauxite and antimony. There has
been mixed response within Indonesia and
further afield with concern expressed that it
will affect miners’ revenue and significantly
affect profit margins.
There have certainly been mixed messages
about the impact on nickel with some companies
to benefit and others to be impacted
negatively. The government has made exceptions
for miners that alr eady have or plan to
New Indonesian tax may benefit nickel
build smelters. They will be taxed at an average
of 20% on ore exports.
Companies like Vale Indonesia, the country’s
biggest nickel miner, won’t be affected
because they process ore into refined products.
But other companies will be impacted,
including state-controlled Antam, which
obtains about 30% of its r evenue from ore
shipments. To process raw nickel, Antam
plans to build a $1.6 billion ferronickel smelter
in East Halmahera.
Some companies may end up holding back
ore shipments if the new levy makes mining
unprofitable and might focus on building
smelters instead. This could, in turn, lift nickel
prices and put pressure on supply. Kim Eng
Securities in Jakarta said in a note to clients
that the imposition of an export duty on mineral
ores would curb cheap nickel ore supply
and, in turn, stoke a nickel price rally.
China International Capital Corp also for ecasts
a boost in nickel prices but says large
EPA recommends approval for Wiluna
THE Western Australian Environmental Protection
Authority (EPA) has r ecommended
approval for Toro Energy’s Wiluna Uranium
Project. The EPA has presented a report and
recommendations to Western Australia’s Minister
for Environment. Toro is awaiting the
Minister’s decision following review of any appeals
that are raised.
The project was referred for assessment to
the Western Australian and Federal gover nments
in October 2009. An Environmental Review
and Management Program was exhibited
for public consultation over 14 weeks from July
2011 with 48 submissions made to the EP A.
Toro has provided comprehensive responses
to all submissions to enable the EPA to finalize
its assessment. A Federal Gover nment decision
on its assessment is anticipated after the
Western Australian process is finalized. Toro’s
Board will then target a final investment decision
by the end of 2012, subject to final market
and economic considerations.
“The EPA recommendation is an important
milestone for Toro and for the W estern Australian
uranium industry,” Toro’s managing
director Greg Hall says. “While the Toro team
members have significant experience within
other uranium and mining operations, Wiluna
is Toro’s first project and the first uranium project
to receive a positive EPA recommendation
in Western Australia since the change of
government in 2008. Toro is confident that its
extensive technical and environmental study
work and the rigorous assessment undertaken
by the EPA will ensure a safe and sustainable
mining operation. This project is one of
the few in the world potentially capable of
commencing production in the critical
2014/15 period when the nuclear industry will
be seeking additional supplies.”
Toro’s Wiluna project is about 520km north of Kalgoorlie
in central Western Australia. It comprises uranium in the
Centipede and Lake Way deposits.
Asian Intelligence
By The ASIA Miner editor, John Miller
stockpiles in China will limit short-term impacts
of any supply shortfall. It says the tax
is expected to add 7.5% to average production
costs of nickel pig ir on in China, improving
incentives to use refined nickel at current
price levels. About 60% of China’ s pig iron
output, which accounts for 60% of the nation’s
nickel production, relied on Indonesian
laterite ores last year.
In a research note, analysts at Citi said the
outlook for nickel was ‘significantly mor e
positive’ thanks to Indonesia’s moves. “Expectations
of reductions in exports range
from 20% per cent to 75% by the fourth
quarter of 2012.
The Philippines might also pick up any
slack in shipments caused by the ban. A
Mines and Geosciences Bureau official said
recently that nickel-ore production and exports
from the Philippines may rise this year,
benefiting from Indonesia’s ban. Australia is
another country that could benefit.
Lynas has LAMP appeal dismissed
AN appeal lodged under the Atomic Energy
Licensing Act in relation to the decision
of the Malaysian Atomic Energy
Licensing Board to approve the issuance
of a temporary operating licence (TOL) for
the Lynas Advanced Materials Plant
(LAMP), has been dismissed.
In dismissing the appeal, the Minister of
Innovation, Science and Technology, YB
Dato’ Seri Panglima Dr Maximus Johnity
Ongkil affirmed the February 1, 2012 decision
of the Boar d to appr ove the issuance
of the TOL. L ynas has r eadily
available solutions to satisfy the new conditions
announced by the Minister . The
next step will be the tabling and debate of
the Parliamentary Select Committee’s Report.
Lynas looks forward to completion of
the regulatory and political pr ocesses in
Malaysia as soon as possible.
“The decision by the Minister is the
latest in a long line of rulings and approvals
where Lynas has been assessed
and judged to have complied
with Malaysian and international regulatory
standards,” says Lynas executive
chairman Nicholas Curtis.
July/August 2012 | ASIA Miner | 5