Skillings Mining Review January 2020

2020 JANUARY IN REVIEW

109/01

08

IRON ORE SUPPLY to STABILIZE

Iron ore shortage looming large, may push prices from April 2020

27

US Steel working on makeover to remain relevant

32

Mineral Resources from the Ocean

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Contents AMERICA

trade in 2020 22

Blackhawk shut down Coal Mines 6

Coal mining: what's needed to promote community confidence 24

As The Great Lakes Freeze Up Starts Great Lakes Freeze Up Starts 14

Rio Tinto to extend Kennecott copper operations 36

Steel slowdown to further hurt iron ore demand 16

MAN Supplying Gas Engines to Power Iron Mine 37

State receives mining proposal from Twin Metals Minnesota 17

How the IOT is changing Australian mining 40

Tunnel safety technique for nonhazardous working practices 18 U.S. coal mining industry continues to suffer job loss 21 Copper tapped as the next big metals

GOAU - US Global GO Gold & Precious Metal Miners ETF 41 Iron Mining Association Board New Members 44 Congress Approve New Great Lakes Icebreaker 45

Iron ore Supply to Stabilize 8 Mining companies to gain from investing in digital solutions in 2020 12 US Steel working on makeover to remain relevant 27

EQUIPMENT

GLOBAL

Nel to provide electrolyser for Anglo American hydrogen-powered haul truck 6

Mining panel looks to improve accountability after Brazil disaster 20

ISO Announces New Drone Safety Standard 7 Two workers injured after rock falls 16 feet, striking crane at Clermont County mine 11

IronRidges Resources declares exploration update on Chad gold project 31 Mineral Resources from the Ocean 33

Aton abandons bid for control of Murray Roberts 30

Coal Min to establish sustainable development cell to promote clean mining 38

Mining tech starting to shape mid-term explosives result 36

It’s time to get tough on all safety offenders 39

US Nuclear, uranium mining industries wait for Trump bailout 42

STATISTICS October 2019 crude steel production 46 www.skillings.net | 3

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AMERICA

EQUIPMENT

Blackhawk Mining says it's closing two preparation plants and three mines in West Virginia amid weak international coal markets.

The coal business on Tuesday declared the idling of its facilities in Logan and Mingo counties. 342 Employees will be affected by this development.

Furthermore, Blackhawk says employees will be encouraged to apply for jobs that are open everywhere. A Blackhawk news release blamed a weak coal market and price devaluation for its decision to close the facilities.

Blackhawk filed for bankruptcy in July, saying the restructuring would allow it to drop greater than 60 percent of its debt.

Many famous U.S. coal producers have filed for bankruptcy protection in recent times.

Image: Anglo American

Blackhawk Mining shut down 3 West Virginia Coal Mines

Nel to provide electrolyser for Anglo American hydrogenpowered haul truck Nel Hydrogen Electrolyser AS, a subsidiary of Nel ASA, is to supply a 3.5 MW electrolyzer to ENGIE as part of a project to deliver the world's most massive fuel cell haul truck for Anglo American. The Electrolyser, which breaks water into hydrogen and oxygen using electrical energy, is planned to be set up in 2020, matching up with Anglo American's plan to complete "first motion" of their haul truck next year.

Earlier this month, Plug Power Inc verified it would provide a custom refueling system for the hydrogen-powered mine haul truck, after a deal signed with ENGIE. Henning LangĂĽs, Sales Director of Nel Hydrogen Electrolysers, said: "We are thrilled that ENGIE has selected our Electrolyser to integrate the renewable hydrogen solution, which will fuel the truck. When scaled up, over 100 MW of electrolyzer capacity will be needed for this mine alone, representing a better market opportunity."

The ENGIE-Anglo American project involves retrofitting a mining haul truck operating at Anglo American's Mogalakwena platinum group mine in South Africa, to become a 100% zero-emission fuel cell electric truck, Nel said.

Blackhawk Mining says it’s closing three mines and two preparation plants in West Virginia amid weak global coal markets. (Photo: MGN Online)

"Electricity for hydrogen generation will partly come from local solar power and the grid, and the electrolyzer capacity exceeds the daily requirement of the truck, allowing storage for fueling during night time or moments when solar radiation is poor, maximizing the renewable share of the hydrogen," it said. "If effective, the long-term goal is to convert the whole fleet of haul trucks at the mine to hydrogen, in addition to other mining operations of Anglo American around the globe."

6 | SKILLINGS MINING REVIEW January 2020

Construction worker piloting drone at building site.

EQUIPMENT

ISO Announces New Drone Safety Standard The International Organisation for Standardisation (ISO) announced the release of a new set of international standards that ensures the quality, safety, security, and etiquette for the smooth operation of commercial drones. ISO 21384-3, Unmanned aircraft systems – Part 3: Operational procedures, is the first global standard for UAS and specifies internationally agreed and approved requirements for safe commercial operations.

C

hair of the ISO subcommittee that developed the standard, John Walker, stated that there are hundreds of applications for small UAS alone that will gain from this standard, including building, safety, security, mining, maritime operations, and much more.

"The range of applications is growing fast.

Meanwhile, the industry is quite much in its early stage, and there are some key barriers to overcome before largescale commercialization is reached," he explained. "ISO 21384-3 will help solve those challenges by providing an airworthiness framework for the

international UAS industry, allowing for safer and more global use."

The committee is also working on many complementary standards that will address different aspects, such as safety and quality. These include ISO 21384-2, Unmanned aircraft systems – Part 2: product systems, ISO 21384-4, Unmanned aircraft systems – Part 4: Vocabulary, and ISO 23665, Unmanned aircraft systems – Training for personnel involved in UAS operations.

ISO 21384-3 was developed by ISO technical committee ISO/TC 20, Aircraft and space vehicles, subcommittee SC 16, Unmanned aircraft systems, whose secretariat is held by ANSI, ISO's member for the USA. It can be purchased through the ISO Store. www.skillings.net | 7

AMERICA

Iron ore Supply to Stabilize

C

O

V

E

R

S

T

O

R

Y

Iron ore shortage looming large, may push prices from April 2020

8 | SKILLINGS MINING REVIEW January 2020

Iron ore supply should stabilize in 2020 after an outstanding performance in 2019. It was one of the commodity outperformers due to supply interruption and relatively healthy demand.

T

he Vale dam incident at the beginning of the year, together with a train derailment in Australia, sent iron ore prices soaring. At one stage, they went greater than US$120/t, which made the mining operations marginally rewarding. Iron ore prices did soften in the second half of the year as Vale restarted mine operations and increased distribution faster than anticipated. That said, prices are still up approximately 16% YTD. The Vale incident raised regulatory and political risks surrounding iron ore mining, and new projects could face increased scrutiny from both authorities and local communities over the next few years. Vale reports that approximately 48 million tpa of capacity has restarted or has been approved to begin again from the 90 million tpa of capacity that ceased following the dam incident; the remainder of the 42 million tpa capacity will restart by 2021.

Meanwhile, the company continued to increase output in the giant S11D mine, with production up 28.3% YoY to 54.1 million tonnes over the first three quarters of 2019. It might boost production and reach full capacity of 90 million tpa in 2020. The Samarco mine closed since 2015 following an incident, has received all approvals to restart operations, and production could well resume later next year with approximately 8-10 million tpa of capacity.

www.skillings.net | 9

In Australia, ore exports dropped approximately 1 percent YoY to 828 million tonnes in 2019, mainly because of disruptions in the first quarter of 2019.

They are expected to recover next year on the back of increased production at some new and current mines. Australia's Department of Industry, Innovation, and Science forecasts Australian iron ore exports to grow more than 4% year-onyear to 862 million tonnes in 2020.

BIG FOUR IRON ORE SUPPLY CHANGES (million tonnes)

In preparation for this new forecast, we expect the iron ore supply to stabilize in 2020. Presently, we anticipate production from the big four to rise by approximately 9 percent YoY in the subsequent twelve months. Consequently, seaborn supply to China is likely to continue improving.

And you can already see that reflected in the total China ports' stock, which has grown by more than 12 percent since

In preparation for this new forecast, we expect the iron ore supply to stabilize in 2020. Presently, we anticipate production from the big four to rise by approximately 9 percent YoY in the subsequent twelve months. Consequently, seaborn supply to China is likely to continue improving.

DEMAND EXPANSION MISMATCH

If this supply picture should hold, there is a mismatch in the outlook for demand growth in 2020, which may have trouble competing with the speed of supply development. Information from the World Steel Association demonstrates that international steel production increased 3.9% YoY to 1,391 million tonnes over the first nine months of 2019, which has kept iron ore demand steady during the year.

the lows in June. China's domestic iron ore production is also contributing to the distribution side; it has increased quite strongly, by 6.5percent YoY, to 712 million tonnes in the first ten months of the year.

However, the prognosis for 2020 is not as optimistic with all the Association estimating global steel demand to slow down to 1.7percent YoY. Chinese demand growth is set to slow from 7.8percent in 2019 to just 1% in 2020. Nevertheless,

10 | SKILLINGS MINING REVIEW January 2020

over the coming year, we anticipate a relatively firmer 1H plus a softer 2H in Chinese iron ore demand, taking steel need prospects from infrastructure and construction industries under consideration.

Steel production exports are expected to continue their descending trend, and this could eventually feed through to iron ore demand by the mills.

China's total steel production exports fell by around 5 percent YoY in the first nine months of 2019. Nevertheless, we expect average prices to be weaker next year with intra-year prices' formation becoming softer towards US75/t by the end of 2020.

EQUIPMENT

Two workers injured after rock falls 16 feet, striking crane at Clermont County mine, says report The men were loading the explosive ANFO into holes in the wall face when the rock hit the cage and smashed it.

W

Two men were pinned down by a slab of rock in a steel cage on a lift. The Ohio Department of Natural Resources has released some of its initial findings.

Photos released by investigators reveal the pickup truck-mounted lift that two men were in when a rock broke loose more than 15 feet above them.

www.wlwt.com

e are learning more about a mining accident in Clermont County earlier this month that left two men with serious injuries. It occurred when a rock fell on the workers as they were loading explosives.

Both men were pulled out of the mine by their colleagues before being flown to UC Med Center. There is little mentioned in the preliminary reports about a possible

cause of this accident. However, it does note that the area had already been checked for any unstable regions, a common practice.

The men were loading the explosive ANFO into holes in the wall face when the rock hit the cage and smashed it. The Reports from the Ohio Department of Natural Resources Division of Mineral Resources Management states that the rock slab measured about 5 ft, 2 1/2 feet wide and almost a foot thick.

Jonathan Stivers, 23, was among those injured, based on the report – back and rib fractures and a cut above his eye.

Brennen Boyd, 20, suffered similar injuries. The report states his dad was among those who rushed to assist him, cutting off his harness and getting him into a pickup. Boyd suffered fractures to his back, foot, and ribs. www.skillings.net | 11

EQUIPMENT

Mining companies to gain from investing in digital solutions in 2020 MINING firms have started experimenting with digital solutions such as the internet of things (IoT), drones, artificial intelligence, and much more. In spite of this, the majority of these technology use cases have not moved beyond the preliminary stage. According to IDC, that is going to change very shortly.

I

n 2020, IDC predicts that IT-related spending will increase by over 50 percent, signaling a change from 'perceived value' into 'real value.'

the mining industry is helping in the completion of tasks to ensure they are being done safely," said Benjamin.

To further understand the upcoming technology investment trends in the mining industry, Tech Wire Asia caught up with IDC APAC Energy and Worldwide Mining Head Emilie Ditton and IDC Energy Insights Senior Research Manager Benjamin Kirkwood.

According to Emily and Benjamin, technology is helping to protect employees from the line of fire and toxic environments through remotely operated and autonomous equipment while placing safe working procedures and safety information sheets directly at the hands of operators and maintenance personnel.

"Whether it is mining, exploration, processing, refining, or supply, technology within the entire distribution chain of

Emilie stated that "through combinations of applications, mobility, IoT and cloud capacities, insight and productivity are

12 | SKILLINGS MINING REVIEW January 2020

improved across maintenance, asset operations, and mine operations, for instance."Productivity, efficiency, and production results ultimately help make better decisions throughout the operation.

To that end, IDC sees IT-related spends growing in operations where cloud-based data systems and time-series data and analytics are prioritized.

The Analysts believe that many midand - top-tier mining organizations are dedicating resources to the implementation and development of technology.

In fact, some have started developing new mines that fully incorporate modern mining design, technology, and techniques.Technology investments include detectors monitoring the rock movement within the mine and knowing the location of personnel and equipment on the mining lease, for instance, and then integrating digital twins for generation and maintenance advantages.

Technology vendors often realize that they're the first trainers to make sure that new-age equipment and solutions are being used efficiently and adequately. This initial training can be utilized to create other training packages inside a company.

Mining companies also have a long history of providing support to tertiary education institutions to facilitate training programs.

demands as it evolves." Even though technology will require employees to be upskilled, experts believe that technologies like augmented reality and virtual reality will be tools that will accelerate learning, particularly in these areas.

In the coming months, the mining sector is undoubtedly going to use far more technology than before. Doing this won't only create new opportunities to reduce costs and increase profits but will also undoubtedly make operations safer for employees.

Clearly, Investment priorities are determined by the amount of capital the mining industry can devote to the technology projects and the technical expertise within the company.

EMPLOYEES IN THE MINING SECTOR NEED TO BE EQUIPPED WITH THE RIGHT SKILLS.

"New Investments tend to be costly and require skills that companies don't have [...] Skills is a big issue mining companies are facing," said Emilie and Benjamin.

"Incorporating new technologies into the industry will require training to be sure the technology is accepted and used. This is a continuous management priority.

Therefore, Technology vendors often realize that they're the first trainers to make sure that new-age equipment and solutions are being used efficiently and adequately. This initial training can be utilized to create other training packages inside a company.

Mining companies also have a long history of providing support to tertiary education institutions to facilitate training programs.

"Recently, a nationally recognized certificate in automation was licensed by Western Australia's Training Accreditation Council and was designed by the Western Australian resource industry, the government, along with the South Metropolitan TAFE," Emilie noted. "This is why the industry is addressing the training www.skillings.net | 13

AS THE GRE AT L A K ES FREEZ E UP STA RTS

Serious Concerns Raised Over Inadequate Icebreaking from both Coast Guards

PHOTO CREDIT NOAA

14 | SKILLINGS MINING REVIEW January 2020

AMERICA

Together with the Lake Temperatures falling and important ice formation impending, the U.S. economy is facing potential job losses and serious financial consequences with binational icebreaking assets that continue to age and appear frozen in time. "The country's economy relies on reliable and predictable icebreaking on the Great Lakes.

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ast year, when cargoes carried on U.S. Great Lakes ships were canceled or postponed due to insufficient icebreaking, 5,000 jobs were lost, and the economy suffered a $1 billion hit," explained Jim Weakley, President of U.S.-based Lake Carriers' Association (LCA).

The reliability and number of U.S. and Canadian icebreaking resources on the Great Lakes are essential for the flow of cargoes to freshwater ports during the winter and spring commercial shipping seasons.

"Aggravating the recurring serious ice conditions are record high water levels across the Great Lakes and connecting channels. Annual ice jams at locations like Algonac, East China, and Marine City in the St Clair River, trigger flooding of properties and harm to sea walls. Icebreaking is vital to minimizing detrimental impacts to shoreline communities from ice," said Justin Westmiller, Director of Homeland Security and Emergency Management for St. Clair County, Michigan.

Regrettably, the outlook is terrible for dependable icebreaking on the Great Lakes. Actually, the amount of U.S. and Canadian Coast Guard icebreakers today is just 60 percent of what they had been in the 1980s and 1990s for a system which has more shoreline than the entire U.S. east coast.

The U.S. Coast Guard has only 11

icebreakers functioning, down from 19.

Throughout the ice season, approximately five have been sidelined with engine failures and other age-related problems.

The Canadian Coast Guard has only two icebreakers, down from seven. Six of the U.S. Great Lakes icebreakers are 40 years old, and the Canadian's two icebreakers are 50 and 35 years-old.

"We continue to express our concerns that both the U.S. and Canadian Coast Guards should take this seriously and place more icebreaking resources in the Great Lakes and repower the existing aging assets to make sure they can continue to break the ice. On the other hand, the response has been slow as molasses in the winter are inadequate for the old fleet of icebreakers.

We are at a critical point, just to keep the small number of icebreaking ships operating is a continuous challenge," said Weakley.

In the previous year, three Icebreakers were inactive throughout the ice season with critical engine problems. The Canadians also suffered engine failures, which kept them from joining the effort in eastern Lake Superior and the St. Mary's River, where many idled commercial ships were stranded for days.

Insufficient Icebreaking on the Lakes continues to have far-reaching national consequences. Jobs across the nation are being dropped as Great Lakes shipping companies struggle to move the vital building blocks of America during the ice season. "Our industries necessitates

efficient deliveries this winter which Clients depend on to keep their operations uninterrupted," said Mark Dave Groh, President of VanEnkevort Tug and Barge added, "We're optimistic that cargo will move this winter, it is important to Keeping the steel mills and power stations active and people employed."

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AMERICA

Steel slowdown to further hurt iron ore demand Steel prices recover, but demand slowdown will continue to test nerves The positive recovery in steel prices in November might not reverse the fortunes of the sector.

However, the stock market appears to be pricing in a quick recovery as steel stocks witness decent gains in the past one month. Domestic prices of steel have also increased following a rise in global rates. In fact, hot-rolled coil steel prices have risen by roughly 3 percent in the previous two months. Prices of bars have also increased as much.

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ut demand requirements must be viewed with a steely eye. Rating agency Icra Ltd said demand expansion for steel slid into negative territory in the first two months of Q3 FY20, recording a drop of approximately 1.8% year-onyear. "Domestic steel demand growth has steadily gone slower throughout the current fiscal, declining from 6.9percent YoY in Q1 FY20 to 3.1percent YoY in Q2 FY20."

expected to derail the steel market anytime soon. "Expectations of steady market equilibrium and expansion in China is a major positive factor," said Edelweiss Securities Ltd in a client note.

Furthermore, steel consumers like auto and infrastructure continue to reel under a slowdown. "There are no observable signs yet of demand revival in automobile and capital goods sectors and expectations are pegged on building requirement from the infrastructure industry as the peak season has started," said SBI Capital Markets Ltd.

Furthermore, some of the domestic steel production that is surplus is being redirected to the export market, which has recently posted a year-on-year expansion since August. Although export volumes, at about one million tonnes per month, were not much to highlight, this is helping relieve pressure on the domestic steel market.

However, input costs are decreasing in the steel industry. Prices of raw materials iron and coking coal has slipped. While coal prices dropped about 32% in the last six months, iron ore, for example, dropped over the previous four months, while coking coal prices fell approximately 32% over the last six months. This should help alleviate the pressure on operating margins.

Note that the delay in sales of iron ore mines in Odisha can lead to a spike in iron ore prices, and that might be a sore point for the industry. "A delay in the auction method is a major threat to an adequate supply of iron ore in the market, despite few mitigating measures, such as allowing warehouses for miners and permitting SAIL (Steel Authority of India Ltd) to sell low-grade ore," said IIFL Securities Ltd in a client note. Another reason that weighs on an international steel demand revival is the China factor. China has been slow in capacity expansion in the steel sector; hence, Chinese steel is not 16 | SKILLINGS MINING REVIEW January 2020

A big push is necessary for the domestic market, especially from the infrastructure and Automobile industry. So, even while the rise in share prices of steel producers indicates an improvement in the steel market, ground conditions point to the contrary. A recovery, in this case, can be slow and gradual.

DNR – State receives mining proposal from Twin Metals Minnesota and launches website DNR – State receives mining proposal from Twin Metals Minnesota and releases website with project information

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win Metals Minnesota (TMM) has submitted a project proposal to the DNR for a new exploration project in Lake County in northeastern Minnesota. TMM's proposed project would involve the construction of an underground mining operation, processing facility, and dry stack tailings facility. Per the Minnesota Environmental

Policy Act, the TMM proposal requires preparation of an Environmental Impact Statement (EIS), together with the DNR as the designated responsible governmental

unit. To ensure transparency and accessibility to information, the DNR has released a website to provide people with easy access to information and documents associated with the review of TMM's proposed mining project.

The website will offer access to basic information about the project, EIS status upgrades and reports, fact sheets to help clarify the process and summarize complex problems, and proposerdeveloped information and studies.

We thrive on challenges golder.com

www.skillings.net | 17

AMERICA

Tunnel safety technique for non-hazardous working practices Tunnels are a vital part of many transportation networks, and extending their life span can be a difficult task faced by infrastructure owners. Afterward, the implementation of fire safety and ventilation security systems can guarantee personnel while reducing life risks and costs and improving sustainability.

S

pecialized Engineers can measure the ventilation requirements of different types of tunnel networks through the development and adaptation of a series of evaluation and design methods and tools, which improve and measure aerodynamic and thermodynamic performance.

Furthermore, experts play a key role in the design, construction, supervision, and performance of fire security solutions within an infrastructure.

ANEMOMETERS AS AN INSTRUMENT FOR TUBE SECURITY SYSTEMS

An Anemometer is one of the simplest methods to check mine or tunnel air quality and can be used to indicate suitable ventilation apparatus and enhance worker safety.

Along with quantifying airflow, multifunctional anemometers can determine factors such as temperature and humidity. Heat control in a tunnel has to be observed and maintained at all times to prevent temperature damage to equipment and discomfort to personnel.

The instrument is suited for fast adhoc checks, in addition to long-term monitoring of airspaces, and requires minimal technical knowledge.

Superior Technologies supply different companies, such as Carroll Technologies Group, with the portable ST-1000 Vane anemometers, which are most favorable

18 | SKILLINGS MINING REVIEW January 2020

Companies Such as Carroll offer belt tracking software, such as the Pyott Boone Electronics' (PBE) Belt Boss series, in various models and configurations for handling fire suppression. Tracking straps will also be effective at handling of dust suppression, conveyor sequencing and other sensor devices.

Mining operations run on a 'safety first' ideology. Because of this, Carroll offers some of the most comprehensive safety products to mining and tunnel firms in North America. Over 800 mines across North America trust the firm for service demands and their tunnel safety product.

Carroll's Products are supported by MinerCare 24/7 service and include safety Products from leading firms in tunnel safety, such as Davis Inotek Instruments, Task Force Tips, and Onenco.

for carrying to observe air quality between tunnel sites. Such models are available in high-speed and low formats, boasting a + / – precision of 2% and also can provide readings between 40-8000 FPM. FIRE SUPPRESSION OPTIONS FOR TUNNEL WELFARE

NORTH AMERICAN MARKET (LTU) Company

IRON ORE PRICE REPORT

Ore Type

Pellets, FOB Michigan Mines Pellets, FOB Cleveland-Cliffs Inc. Minnesota Upper Lakes Port Source: CLEVELAND-CLIFFS INC. Cleveland-Cliffs Inc.

Per Iron Unit

Per Gross Ton at 64%

Per Ton at 64% Reporting Date

$1.28

$81.92

12/31/17

$1.42

$90.88

12/31/17

There is a developing global interest concerning fire suppression in tunnel systems, as a way of controlling the dangers posed by fire to lives and tunnel infrastructure.

The First method of caution by standardsetting bodies like the World Road Organisation (PIARC) and NFPA has given way to understanding that fire suppression systems may provide welfare advantages under certain conditions, such as responsive/accurate fire detection methods and provision of sufficient water density.

Different types of fire suppression systems are available for specification, including heating systems and lowpressure douse. www.skillings.net | 19

GLOBAL

Mining panel looks to improve accountability after Brazil disaster New Security standards being set up by an international mining Industry Panel will include regulations to further define management accountability after Vale SA's (VALE3.SA) January tailings dam disaster, a top industry official said.

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anel members visited Brazil in July and, more lately, British Columbia, the site of a 2014 breach at Imperial Metals Corp (III.TO) Mount Polley Mine, which delivered billions of gallons of wastewater and sludge into waterways.

President of the International Council on Mining and Metals, Tom Butler, stated that government standards would help ensure independent reviews of dams and adequate disclosure of risks.

"The engineers understand what they are doing with these things, but the execution and the management and the change management involves humans," Butler told Reuters in a meeting in Brazil.

"Therefore, it requires governance, and that is where it is possible for things to go wrong if governance is weak."

A draft version is expected by late September or early October, Butler had earlier told a mining conference in

Members of a rescue team search for victims after a tailings dam owned by Brazilian mining company Vale SA collapsed in Brumadinho, Brazil, on January 28, 2019. www.nationalgeographic.com

Belo Horizonte, about 20 miles (30 kilometers ) from the site of January's disaster. The dam rupture in the town of Brumadinho killed almost 250 people, sparking a push to establish international regulations for building and inspection of such facilities, which include the muddy detritus from mining iron ore, copper, gold and other minerals.

The dam collapse came less than four years after another at a joint venture of Vale and BHP Group (BHP.AX), which are both Council members, Butler explained. An investigation showed one factor behind the collapse was a loss of know-how over the structure's lifespan of more than four decades, he added.

"You've got to make sure you share that knowledge, and I feel the industry recognizes that's a vital part of it we haven't been getting correctly," Butler said. Even though the cause of the Brumadinho disaster is still under review, some experts have blamed governance failings at the mine. In February, Vale's chief financial officer said senior executives had never been shown internal security documents indicating the dam was in danger of collapse.

The ICMM represents roughly a third of the mining industry, but Butler said the standards, being set up by a board of eight members with expertise on tailings, wellness, risk, and law, could affect the broader industry. A public discussion session will follow the release of the draft, together with the newest standards likely to be finalized and circulated in the first quarter of 2020, he said.

20 | SKILLINGS MINING REVIEW January 2020

AMERICA

Report: U.S. coal mining industry continues to suffer job loss U.S. coal mining Job has dropped 42% since 2011, most dramatically in Pennsylvania and elsewhere in the Appalachian region, according to the U.S. Energy Information Administration.

This year, a report by the Pennsylvania Coal Alliance noted that coal mining still accounts for nearly $7 billion in economic activity from the state, including $4.6 billion directly from mining and $2.27 billion from indirect and induced donations.

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he Agency's 2018 Annual Coal Report, released Wednesday, said U.S. coal production increased in 2008 but that mining jobs peaked in 2011. Since then, coal production has dropped, and lots of mines have shut down. Employment dropped to 54,000 Workers in 2018 from a high of 92,000 Workers in 2011, according to EIA. In Pennsylvania, the number dropped from 8,665 employees in 2011 to 5,385 in 2018 — a 38 percent decrease.

In 2008, The USA produced 1.2 billion tons of coal from 1,458 mines. In 2018, U.S. coal production was 756 million tons from 679 mines, EIA said. As was the situation with employment, a lot of coal's production decline was concentrated in the Appalachian area. Since 2008, more than half of the area's mines have closed down, and production has dropped from 390 million tons in 2008 to 200 million tons in 2018.

According to EIA, coal production dropped to 49.8 million tons from 151 mines in 2018 to 65.4 million tons from 266 mines in 2008 in Pennsylvania. The significant declines in employment and production are attributed to a fall in demand because of competition from natural gas and renewable energy sources for electric power generation, EIA said.

The decline in operating mines has been steeper compared to changes in production and employment. EIA's review of working mines showed that smaller mines have had greater difficulty competing in the present market and are the first to close down. www.skillings.net | 21

AMERICA

COPPER tapped as the next big metals trade in 2020

Copper, popularly called "Dr. Copper" due to its significance with the economic cycle, could be the trade of 2020, as most industry analysts anticipate a "lift-off" for the metal as international demand recovers.

G

old miners had a successful year in 2019 owing to expectations of U.S. Federal Reserve rate reductions and as geopolitical tension mounted between the U.S.-China. But concern about lower global demand as a result of trade threats left base metal miners limping into the new year, reports Bloomberg.

However, demand is expected to increase next year owing to current improved demand, making copper "poised for lift-off," according to Jefferies analyst Christopher LaFemina. Low copper stocks, high short positions, supply constraints, and better demand are creating requirements for the metal to rally, he wrote in a note to customers.

Joining LaFemina in his optimism is Goldman Sach's Jeffrey Currie, who believes copper is "set to inflect" in 2020 because of strong growth out of China.

Morgan Stanley, Bank of America and Citi also have positive expectations for copper and an improving global market.

History displays that base metal miners have regularly caught up with gold equities after precious metals outperformed. The S&P/TSX Equal Weight Global Base Metals Index (TXBE) underperformed the S&P/TSX Equal Weight Global Gold Index (TXGE) in 2016 but caught up by the end of 2017. If analysts are right about the prognosis for copper in 2020, the same trend may be coming shortly.

22 | SKILLINGS MINING REVIEW January 2020

HERE'S WHAT THE ANALYSTS ARE SAYING ABOUT WHAT TO EXPECT FOR METALS AND EXPLORATION IN 2020:

Goldman Sachs

"Copper is our most optimistic view," for 2020, based on the commodity team.

Copper demand in China has been specifically restrained by "disappointing performance in the grid, property, and transportation sectors," and that's probably going to change in 2020.

"We anticipate strong completion growth in the next two years, continuing a positive trend in the property sector since August," and grid investment is very likely to pick up sharply in the first quarter of 2020 thanks to the government infrastructure stimulation. In the meantime, the "strategic case for gold" is still powerful.

Jefferies

The company is most bullish on copper miners for 2020 as present supplies won't be able to meet "a modest cyclical recovery in demand," LaFemina wrote.

Freeport-McMoRan Inc., First Quantum

Minerals Ltd., and Glencore PLC are expected to benefit most from the copper price recovery.

Also, iron ore miners like Anglo American PLC, Vale SA, and Rio Tinto PLC are expected to outperform as prices are expected to remain high, peaking at more than $100 per ton in the near-term. The company is least bullish on gold.

Morgan Stanley

The bank's commodities team anticipates a moderate rise in demand in 2020, driven by a "mini-cycle recovery" through year-end. Remains constructive on the North American mining sector and particularly favors copper exposure.

Freeport-McMoRan and Teck Resources are seen as the very best method to gain exposure to bullish copper impression.

Citi

History displays that base metal miners have regularly caught up with gold equities after precious metals outperformed.

Most bullish on alumina, copper and coking coal in 2020, while bearish on iron ore and zinc. Commodities are expected to benefit from higher global growth, with much of the progress coming from emerging markets. The commodities team is bullish on gold in the medium-term.

The bank's equity analyst upgraded Teck Resources Ltd. to buy on better a coking coal outlook and valuation.

Bank of America

Commodities team is bearish about the aluminum and alumina outlook, but the equity analysts still find some upside down in 2020 for Alcoa Corp. The team also expects higher satisfied coal prices as ex-China demand should tighten the market. Bank's top commodity selections are cobalt and copper, while the least favorite is iron ore, zinc, and lithium.

Cyclical raw materials are expected to benefit in 2020 from a potential Inventory restocking cycle, better Fed policy, and an interim China trade deal, providing an attractive inflation hedge. Copper and nickel are expected to recover in 2020, while the outlook for gold and precious metals is more cautious.

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AMERICA

Strategic approaches for coal mining are largely left to the free market and multinational business strategies. The advocates have to justify how they will operate a mine to minimize impacts, but the timing and location of suggestions being lodged are largely left to mining businesses and global markets.

COAL MINING

C

urrently, Planning Approvals and Exploration Licences for coal mines do not make for proper planning. Coal is frequently region-wide, unlike base metal resources, so potential mines cover a large section of the exploration region with relatively more straightforward geological sequences and structures.

Awaiting the market to determine when and where proposals will be submitted for assessment has resulted in the vast regions of distressed or poorly rehabilitated land and troublesome voids in the Hunter Region.

Currently, there are over 40 coal mines allowed to operate in NSW. Seventeen mines are in the densely populated area of the Hunter Region. Project proposals and evaluation processes make many assumptions. Assumed benefits, such as local jobs, economic multipliers, and royalty returns to the government, are usually based on maximum potential, or approved production.

Benefits are only realized with real production, which, Year-on-year, is dependent on global markets and corporate business strategies. Existing mines have been approved to make hundreds of million tonnes of coal each

24 | SKILLINGS MINING REVIEW January 2020

?

what's needed to promote community confidence in the planning system

year. The level of 'insufficient production' isn't easily tracked in the public domain; however, when totaled, it can amount to many tens of millions of tonnes less than the possible production on which costs and benefits were estimated at the time of approval.

The gap is particularly significant when a new proposal is for a relatively small amount of coal that may arguably be supplied by existing mines and gives rise to major environmental issues or a substantial expansion of the regional disturbance footprint.

In the case of the Bylong Valley, I think It is hard to envision a compelling public interest rationale for an extension of the already vast regional footprint of mining impacts given Kepco's modest degree of projected production if there is a massive gap between authorized production and actual production at the area's existing mines.

presumption that the public interest is a beneficiary of a clean NSW Treasury balance sheet and mining firms' business plans. The regional community could have accepted the total collapse of villages such as Warkworth and Camberwell as unavoidable; local collateral damage for benefits should be delivered to the state or region.

Meanwhile, a growing number of those 13,000 odd residents of Muswellbrook appear to be expressing alarm at deteriorating air quality. Shift-change peak hour traffic on the New England Highway and Hunter Expressway indicates a disproportionate amount of touted employment, and contractor income is providing benefits mostly beyond their local community and economy. Finally, credible strategic planning more clearly focused on the general Public interest ultimately would improve community confidence in the preparation system.

Currently, there are over 40 coal mines allowed to operate in NSW. Seventeen mines are in the densely populated area of the Hunter Region.

Let’s show the world

New mine proposals should be considered only in exceptional circumstances, especially If there is a major distinction between approved production level and actual output, set against the projected life of existing mines and their available reserves. The government would need to control the timing of any proposal being approved for assessment and establish a commitment to prioritize the public interest through credible strategic planning.

what we can do together.

Day by day. Project by project.

Together we’re engineering what’s possible and moving the world forward.

Public health and local environmental values need to be prioritized in planning. The adoption of a more strategic role for government is crucial if health concerns about deteriorating air quality in the Upper Hunter continue to rise. An agreement might be made that no new open-cut mines should be approved in the Muswellbrook airshed until one or more of the present mines are shut and adequately rehabilitated to curb dust.

Harmful air quality incidents often contribute to community expectations that a mine should be penalized. In fact, all mines may be applying best practice controls individually; however, under adverse weather conditions, with so many mines in one place and so much disturbed land, the significant cumulative impact might be unavoidable. There seems to be an implicit

Building a Better World for All of Us Engineers | Architects | Planners | Scientists

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AMERICA

26 | SKILLINGS MINING REVIEW January 2020

makeover US Steel Working On

to remain relevant

Integrated steelmaker US Steel is working to transform itself as it requires the plunge into scrap-fueled electrical arc furnace (EAF) steel manufacturing, at a time when the steel market is slowing along with the global economy in the face of trade-war headwinds.

www.skillings.net | 27

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he $700mn purchase of almost half of Big River Steel comes as US Steel struggles with a more competitive steel market where investors have soured on the firm's stock and its basic oxygen furnace (BOF)-based resources have failed to compete in the low price market environment.

US hot-rolled coil (HRC) prices have been unstable in the past two years, with prices rising in 2018 because of the US imposition of 25pc steel tariffs. Since China and the international economy have since slowed and steel prices have fallen, US HRC costs had also dropped to levels lower before the tariffs were imposed.

US Steel's purchase of Big River marks a significant change in the steelmaker's strategy to diversify itself into the more cost-effective EAF space, with Big River a cornerstone of the change. The EAF mill is currently doubling its output into 3.3mn st/yr. However, US Steel is constructing a 1.6mn st/yr EAF at its Fairfield Works near Birmingham, Alabama.

1

US Steel has the option to fully purchase the rest of Big River in the next four years, which chief executive David Burritt said he plans to execute. The two EAF's would boost the US Steel’s demand for metallics and ferrous scrap so as to feed its 5mn st/ yr capacity.A number of those US Steel's pig iron operations, which the firm draws on for its steelmaking mills could provide metallics.

"What the organization is actually doing is upgrading their infrastructure and logistics to be sustainable and relevant to what the future will look like," KeyBanc Capital Markets analyst Phil Gibbs stated.

The move comes following US Steel idled two blast furnaces in July, cutting down production to roughly 225,000st/month.

Nimbler EAFs, supported by the US' reservoir of domestic scrap, have taken considerable market share in recent years from their iron BOF counterparts. EAFs make up the majority of US steelmaking capacity at 68pc, in comparison to 32pc for the BOFs used in integrated mills,

2

according to the American Iron and Steel Institute.

The most recent BOF was constructed at US Steel's Gary Works in 1973, according to the Association for Iron & Steel (AIST). EAFs and BOFs last held roughly equivalent capacity in 2002.

PART OF A BROADER STRATEGY

The move to Purchase Big River is part of a broader strategy by Burritt

28 | SKILLINGS MINING REVIEW January 2020

3

in order to combine the capabilities of integrated mills with the flexibility of EAF steelmaking.

The first of those assets is the 1.65mn st/ yr Big River mill, and its management team, which Burritt expects will provide experience in optimizing the asset.

Big River's growth, when completed, would lift the capacity of the mill beyond some of the other US Steel’s operations.

biggest in US Steel's arsenal with a yearly manufacturing capacity of 7.5mn st, including $500mn dedicated to the hot strip mill at the site.

may be targeting $600/st hot-rolled coil (HRC) prices to be the new standard, she sees pricing between $500-$550/st range soon.

QUESTIONS ABOUT US STEEL'S FINANCIAL STATE

Nonetheless, US Steel's chief financial officer declared plans to leave as the organization is trying to raise the capital for the Big River purchase.

Some have questioned the timing of the purchase, that comes as US Steel spends billions of dollars on upgrades.

Bank of America- Merrill Lynch Analyst, Timna Tanners, wondered why US Steel chose this time when the economy is slowing down, and steel prices are not encouraging.Tanners says While US Steel 1. U S Steel Fairfield Tubular Operations.

2,5. U S Steel Offshore Operations Houston.

3. U S Steel Lorain Tubular Operations.

4. U S Steel Wheeling Machine Products.

4

Domestic US HRC index fell by $4/st to $538/st ex-works Midwest this week because some sources stated that prices could be dipping up to $500/st or lower.

US HRC steel prices have dropped 27pc 6. U S Steel Wheeling Machine Products.

6

5

The next core assets are the integrated steelmaking complex of Mon Valley Works, which is capable of producing up to 2.9mn st/yr of raw steel. US Steel said it would invest $1.2bn on upgrades through 2022 on new infrastructures that the company says will reduce operation costs by $35/st.

The final bit to Burritt's plan is investing $750mn in the integrated steelmaking complex at Gary Works, Indiana, the www.skillings.net | 29

since the start of the year. After 2018 Earnings of $1.115bn, US Steel's highest performance since 2008, the company's earnings throughout the first half of 2019 are $122mn, with US Steel expecting a loss of up to $94mn in the third quarter. The company's stock has fallen by 58pc since its 2019 peak in February.

Gibbs says the big challenge is that US Steel has yet to secure financing for its purchase, and investors are worried over whether or not US Steel can survive the next two and a half years.

WHAT’S NEXT FOR US STEEL'S OTHER RESOURCES?

Assuming Big River completes its expansion and is fully purchased by US Steel, the organization's three core assets would have a yearly production capacity of 13.7mn st. The total size of its active steel mills would climb into 21.9mn st.

That would leave a huge gap between US Steel's production capacity and its real production. Production in 2018 totaled only 11.9mn st - higher compared to 10.7mn st of raw steel produced in 2016, but much below the 17mn st produced in 2014.

THE COMPANY MAY HAVE SOME ANSWERS.

US Steel explained that the Big River purchase could allow it to achieve $1bn capital and operational cash advances by 2022 by reassessing its $2bn asset revitalization program it announced in August 2018.

EQUIPMENT

ATON ABANDONS R7.6BN BID FOR CONTROL OF MURRAY ROBERTS Aton has allowed Its R7.6bn offer for Murray and Roberts (M&R) lapse, referencing the oppositional stance to the deal adopted by the engineering company’s independent board.

There were also notable risks in prolonging the long-stop date; for example, exposure associated with maintaining in place the cash verification connected with the deal, the company said in a statement. Aton, a German family-owned investment company that already owns 44 percent of M&R, originally made a supply of R15 per share in March 2017, increasing this to R17 per share in July 2018.

The M&R independent board and the Public Investment Corporation, which retains 20.15% of M&R has both rejected the deal, both of the group stated that the amount undervalued the firm and its prospects. In June, the Competition Commission advocated prohibiting the Takeover, saying it would bring about a substantial lessening of competition in shaft-sinking, contract mining, mine development, and underground construction.

The Competition Tribunal was set to hear arguments on the commission’s recommendation in December. Meanwhile, M&R’s share price had dropped 4.02% to R12.66 as of 10.20 am on Tuesday.

Questions concerning the role US Steel's Granite City Works, which was restarted in 2018, will play in the company's mix. The mill has a yearly production capacity of 2.8mn st. US Steel's Foray differs from the paths taken by other incorporated US steelmakers.

ArcelorMittal's integrated US steel manufacturers are continuing to function, with the company's chief executive expressing in August that he had no plans to reduce capacity in America.

For AK Steel, which includes a mix of integrated and EAF mills, it has turned its focus on steel for the electrical and automotive industries, with most of its production going toward the automotive industry.

30 | SKILLINGS MINING REVIEW January 2020

M&R’s new oil and gas focus Wheatstone project Onslow Western Australia Picture MURRAY ROBERTS.

GLOBAL

IronRidges Resources declares exploration update on Chad gold project IronRidge Resources Ltd, an African focused mineral exploration company, has announced the beneficial effects of an average polarisation ground geophysics survey completed over the 200 km2 Dorothe Gold Project located approximately 180 km north of Abeché in Eastern Chad, Central Africa.

HIGHLIGHTS:

• Ground-based induced polarisation checks, including Gradient Array and Dipole-Dipole completed by Terratec Geophysical Services concerning the Dorothe prospect.

• Additional flat bending coincident resistivity anomalies with weaker chargeability anomalies connected with shallow west-dipping sheeted vein systems.

• Multiple coincident resistivities and chargeability anomalies characterized that match with the high-grade gold trenching anomalies; translated to be associated with quartz veining or silica change; typical host for gold mineralization and possibly disseminated sulfides respectively.

• Maximum priority geophysical anomaly associated with the main vein zone, 1 km long low resistivity mineralized vein zone with coincident chargeability anomaly dipping steeply to the east.

• Favorable meetings held with Chad's new Mining and Finance Ministers. Mahamat Hamid Koua and Tahir Hamid Nguilin.

Remarking on the organization's latest development, Vincent Mascolo, CEO of IronRidge, said: "We are pleased with the results of the IP survey over the Dorothe gold project with a coincident 1 km long low resistivity and chargeability anomaly defined over the Dorothe Main Vein target.

"Outcomes have confirmed and enhanced our geological understanding of the central vein zone goal, with the geophysical interpretation providing greater assurance in target depth continuation and dip direction. The coincident resistivity and chargeability anomalies widely occur along with gold mineralized targets within trenching periods, providing further confidence in gold targets to date and their general structural settings.

"Additionally, The company had a positive meeting with Chad's new Mining and Finance Ministers, the Honourable Mahamat Hamid Koua along with the Honourable Tahir Hamid Nguilin, this past week. We continue to have a strong working relationship with The Chadian government and are working closely together to further the project and future work programs, which we will update the market in due course." www.skillings.net | 31

32 | SKILLINGS MINING REVIEW January 2020

GLOBAL

Mineral Resources from the Ocean As whoever has replaced a cell phone or computer lately knows that the world is embracing more advanced technologies, all of which are produced and powered by different types of minerals. At the same time, the price of mining is increasing as operations must dig deeper or search for deposits in more distant areas.

www.skillings.net | 33

T

The forum featured presenters from India, Gabon, Germany, South Africa, Japan, the United Kingdom, and the United States. Some discussed issues particular to certain kinds of mining, and many others addressed the consequences an underwater mining industry might have on specific places around the world.

he quest from both additional need and higher costs means new sources for these minerals might need to be discovered, and there's a growing interest in looking for one possible untapped source: beneath the sea and other waters.

Experts in the University of Delaware have acknowledged the promise and potential challenges in this emerging industry early on, and they are working to become leaders in a field linking political, academic and business partners to establish the most effective ways to understand and regulate this exploration.

The strategy is for the presenters to write chapters on their subjects that will be compiled into a book based on this new and emerging sector. This type of publication would permit the MMS program and UD to keep advancing the conversation on underwater mining in the larger academic community.

Beforehand, the Minerals, Materials, and Society (MMS) program hosted a public forum on the environmental and social impacts and benefits of mining and other extractive sectors underwater on Wednesday, Aug. 28 at UD's Virden Retreat Center on the Hugh R. Sharp Campus in Lewes.

COMPOSING THE RULEBOOK

Among the subjects covered with regards to mining minerals underwater was how to go about establishing rules and regulations to ensure environmental quality within the industry.

The "Minerals Under Water: The Science and Politics of Extractive Industries in the Ocean and Beyond" forum featured an international group of presenters on topics ranging from establishing environmental policy and governing this new sector to the technologies used in submerged mineral extraction and how mineral contractors can work with the academic community.

This event was coordinated by Saleem Ali, Blue and Gold Distinguished Professor of Energy and the Environment; Andrew Thaler, an affiliated faculty member at the School of Marine Science and Policy in UD's College of Earth, Ocean and Environment; and Patricia Syvrud, MMS program development manager.

The MMS program is one of the earliest of its type in the USA. It provides for-credit graduate certificate aimed at industry, government, and civil society professionals working across mineral and extractive distribution chains.

"Mineral extraction beneath the water is the next frontier in our Quest for sustaining technological advancement," explained Ali. "UD is ahead of the curve in creating capacity for training and research in determining whether or not to take part in extraction in fragile aquatic ecosystems and exploiting these resources responsibly where appropriate."

34 | SKILLINGS MINING REVIEW January 2020

Keynote speaker Conn Nugent, project manager of the Seabed Mining Project at the Pew Charitable Trust, spoke about the value of executing Regional Environmental Management Plans for deep-sea mineral extraction, saying that there is an unprecedented environmental opportunity to write the rulebook prior to the procedure for deep-sea mineral extraction starts on a big scale.

THE "MINERALS UNDER WATER: THE SCIENCE AND POLITICS OF EXTRACTIVE INDUSTRIES IN THE OCEAN AND BEYOND" FORUM FEATURED AN INTERNATIONAL GROUP OF PRESENTERS ON TOPICS RANGING FROM ESTABLISHING ENVIRONMENTAL POLICY AND GOVERNING THIS NEW SECTOR TO THE TECHNOLOGIES USED IN SUBMERGED MINERAL EXTRACTION AND HOW MINERAL CONTRACTORS CAN WORK WITH THE ACADEMIC COMMUNITY.

Samantha Smith, the second keynote speaker and the head of Sustainability and external relations at Global Sea Mineral Resources, spoke about how seabed mineral builders can interact favorably with all the academic community. She also agreed with Nugent's rulebook evaluation, saying that never before in history has so much thought gone into regulating an industry before it exists.

MINING THE DEEP-SEA

Also at the forum, Thaler presented a topic on "Emerging Technologies for Exploration and Independent Monitoring of Seafloor Extraction in Areas Beyond National Jurisdiction."

The area of ocean that lies beyond national jurisdictions covers roughly 64% of the ocean and is the region where most important deepsea mining ventures plans to operate.

One of the possibilities this is changing is by the evolving Micro Remotely Operated Vehicle (ROV) technology, which can be ROVs capable of tracking and measuring the ocean far below the depths available to scuba divers and are enabling deep-sea exploration to be completed much faster and cheaper than some years ago.

Thaler noted that regulations need to be put in place that accurately shows how people and private institutions have the ability to reach the bottom of the sea on their own as technological development from the ocean is moving considerably faster than the policy regime, which shapes who can get access to the ocean.

Andrew Thaler, affiliated faculty member in the School of Marine Science and Policy, holds a “potato sized� polymetallic nodule that can be found under water.

There are three similar but different opportunities that countries and private industries are looking to exploit through deep-sea mining operations: seafloor massive sulfides, or deep-sea hydrothermal vents, which can be small distinct ore bodies rich in metals like copper, gold and silver; cobalt-rich crusts that form on seamounts; and polymetallic nodule areas where metals forms into potato-sized accretions of cobalt, manganese, and nickel.

ACCESSIBLE TECHNOLOGIES

Looking toward the future of exploration and monitoring in the Deep seas, Thaler stated that "ocean and conservation

"We are coming to a point in time where the factors that prevent most people, organizations, and stakeholders from accessing the deep ocean are no longer technological or financial. Where a small, creative team with a relatively moderate budget and access to the ideal vessel can have access to the entire deep ocean for exploration," He said.

Countries have already begun the initial steps towards developing some of the deep-sea mining companies geared towards these three areas.

Two years back, a Japanese team successfully examined a mining tool made to extract ore from a hydrothermal vent. Thaler also stated that both India and China had made vital investments into developing their ability to mine the seafloor.

The Minerals, Materials and Society (MMS) program at UD hosted a public symposium on the environmental and social impacts and benefits of mining and other extractive industries under water on Wednesday, August 28 at UD’s Virden Retreat Center on the Hugh R. Sharp Campus in Lewes.

www.skillings.net | 35

Photos by Adam Thomas, courtesy of Andrew Thaler and George Luther UD/NSF/HOV Alvin, Woods Hole Oceanographic Institution and the Advanced Imaging and Visualization Lab

technology is in the midst of an evolutionary shift in who has access to the tools required to observe the deep ocean."

AMERICA

EQUIPMENT

Rio Tinto to extend Kennecott copper operations to 2032

Incitec Pivot says mining technology starting to shape mid-term explosives result

UK-based global miner Rio Tinto has declared a $1.5bn investment, which will extend its US copper operations to 2032.

R

io Tinto's investment at its Kennecott facility in Utah will begin in 2020 and extend strip waste rock mining and provide infrastructure to allow mining into a new area of the ore body, which is forecast to deliver approximately 1mn tonnes of refined copper from 2026 to 2032.

"That is an attractive, high value and low-risk investment which will guarantee Kennecott produces copper and other major materials to 2032," Rio Tinto chief executive J-S Jacques stated.

Incitec Pivot CEO Jeanne Johns told the organization's annual general meeting on Friday in Melbourne the "accelerating adoption of high-technology by the mining industry is driving strong demand for our electronic detonators and unique emulsion delivery systems."

C

ore business unit Dyno Nobel, which generates about 54 million pounds of packaged explosives and over 1.2 million tonnes of ammonium nitrate annually, increased electronic detonator sales in Australia by 54% in 2019. In the Americas, it expanded premium emulsion earnings by 34% year-on-year. Dyno Nobel claims the combination of its own Delta E emulsion shipping system and DigiShot electronic detonators is an "unrivaled premium tech product in the marketplace" that would finally "link to a full technology solution utilizing digital control and automation."

Johns stated that a single-shot blast fired last week with more than 8,100 detonators was believed to be a world record. Dyno Nobel Asia Pacific and Dyno Nobel Americas generated A$2.56 billion of Incitec Pivot's total $3.92 billion sales in FY19. "The principles underpinning the Australian explosives market remain strong," she said.

"The accelerating adoption of superior technology from the mining companies is driving strong demand for our electronic detonators and unique emulsion delivery methods.

"Our technology is helping our mining customers improve their environmental effect, such as reducing greenhouse gas emissions, delivering better safety results, and enhancing productivity."

Mining explosives business earnings are driven by gold, base metals, and coal activity, although the latter is predicted to be flat in the US in 2020. Incitec Pivot trading climbed up to A$3.70 in November but finishes this week at $3.25, similar to where it started in 2019. The organization's market value is $5.22 billion.

Kennecott also produces silver, gold, platinum, and molybdenum, and is a potential source of rhenium and tellurium.

Early in 2019, Rio Tinto also declared it would cut the carbon footprint at Kennecott together with the closing of its coal-fired power plant. Rio Tinto has invested more than $5bn since it acquired Kennecott in 1989. Rio Tinto will finish the preliminary phase of a $1.2bn project in 2021 that extended production from 2019 to 2026.

36 | SKILLINGS MINING REVIEW January 2020

AMERICA

MAN Supplying Gas Engines To Power Iron Ore Mine 10 MAN 20V35/44G gas engines with a combined capacity of over 100 MW was delivered to Bolivia by MAN ENERGY Solutions to provide electricity for steelworks at the El Mutún iron ore mine on the border with Brazil.

reliable, and independent source of electricity all the time," said Martin Höhler, head of Region Asia Pacific at MAN Energy Solutions. "Our 35/44G gas engines are the perfect choice in this case.

T

As a result of their high reaction rate, these engines reach their full potential in less than five minutes and can handle quick load changes smoothly." Bolivia has abundant natural gas deposits and also a fantastic gas infrastructure. This implies there's a secure supply of local natural gas for the power plant.

he El Mutún mine is one of the biggest iron ore mines in the world. It was evaluated that there might be over 40 billion tons of iron ore in an area of 75 km2. The area doesn't just mine iron ore but also processes it directly into steel on-location, which necessitates large-scale industrial machines with high energy needs, such as blast furnaces and rolling mills.

pertains to the processing of steel, big and in particular spontaneous load changes are among the biggest energy source challenges. Due to the remote location of this El Mutún mine, it isn't effortless to guarantee adequate coverage through the national power grid. Instead, our localized power plant solution guarantees the flexible,

The 35/44G is Offered in a V-type variant with 20 cylinders as well as an electric Genset output signal of 10 420 kW (50 Hz), respectively 10 027 kW (60 Hz). The engine has a bore and stroke of 350 X 440 mm. "As it

www.skillings.net | 37

GLOBAL

The Coal Ministry on Sunday said it would launch 'sustainable Development Cell' (SDC) for promoting viable coal mining in the country and address environmental issues in the closure of mines.

T

Coal Min to establish sustainable development cell to promote clean mining

he SDC plans to address environmental mitigation measures systemically and provide a better environment to people working and living in the vicinity of mines, '' the ministry said in a statement.

"The Ministry of Coal has decided to establish a 'Sustainable Development Cell' in order to encourage environmentally sustainable coal mining in the nation and address environmental concerns throughout the decommissioning or closure of mines," it said.

The SDC will counsel, mentor, strategize and track mitigation steps taken by coal firms for sustainably maximizing utilization of available resources, minimizing adverse effects of mining and mitigating it for further ecosystem services, and will act as a nodal point at Ministry of Coal level in this issue. The 'sustainable Development Cell' (SDC) will also develop the future policy framework for environmental mitigation measures, including the Mine closure Fund.

The SDC will adopt a systemic approach, beginning from collection of data, analysis of data, presentation of data, planning based on data by domain experts, adoption of best practices, consultations, innovative thinking, site-specific approaches, knowledge sharing and dissemination with a goal to ease the lives of people and communities generally, the statement said.

The SDC will also do property melioration and afforestation. In India, approximately 2,550 sq km region is under different coal mines, and there are strategies to bring more areas under it. These landmasses need both extensive and intensive improvement measures. The SDC will collect all the baseline data/maps related to distinct coal mines like complete mines/block areas, OB dumps areas, water-filled voids, reclaimed regions, unutilized areas, plantations from various coal companies, it said.All the data/maps will be collated and analyzed on a GIS-based platform, and different thematic information and maps will be prepared. All GIS-based activities will be carried out with the active participation of the Central Mine Planning & Design Institute Ltd. The SDC will even help coal firms identify areas where plantation projects could be planted immediately, along with the identification of different species of plants, suitable for specific regions to provide carbon sinks for climate change management, it stated. It will also identify the actions to be taken up for the provision of additional land suited for plantation, stabilization of slope, soil treatment, production of leveled land, dewatering according to timeline under Mine Closure Plan.

The possibility and plan for productive reuse of these lands for rehabilitation, integrated modern township, agriculture, horticulture, FCA compensatory land, and renewable energy farms would also be considered.Concerning the air quality, emission, and noise management, the SDC will guide coal companies for successful implementation of environmental mitigation measures (water sprinkling, dust suppression techniques, sound barriers, etc.) associated with noise and air pollution generated due to mine activities, heavy earth moving machines and transportation of coal. It will also analyze environmental management plans (EMP) of different firms and advise coal companies to make it more successful. On mine water management, the SDC will collect information regarding current quantity, quality, surface runoff, drainage of mine water, potential access to water accumulated in UG (underground) or OC (open-cast) coal mines, etc.,

38 | SKILLINGS MINING REVIEW January 2020

and analyze it on a GIS-based platform to prepare Coal Mine Water Management Plans. The plan will provide ways and also have innovative planning for storage, treatment, and reuse of this water for drinking, irrigation, fisheries, tourism, industrial, or any other sustainable purpose.

For sustainable overburden management, the SDC will also check feasibility and propose steps to reuse, recycle, and rehabilitate overburdened dumps in a sustainable way. It will analyze and plan out the use of overburdened material for use in different infrastructure projects, earthen bunds, among others.

On the issue of sustainable mine tourism, it will explore and conceptualize a strategy for beautification and creation of eco-parks in distinct areas, which will also include water bodies for recreational purposes. For planning and monitoring, it will analyze Mine Closure Plans of different companies and advise to make it more effective.

The SDC will help coal firms finalize a timeline for implementation of different mitigation activities/projects in all mines in a phased manner, the statement added.

It will also monitor the proper utilization of Mine Closure Fund and Environment Budgets of different coal firms.

The SDC will recruit experts/institutions/ organizations to conduct specific research for establishing a solid knowledge foundation. It will organize consultative meetings, workshops, field visits, exposure study tours to improve the knowledge base, known finest global, and thoughts for ecological mitigation monitoring and planning. Lastly, the SDC will conduct regular workshops and conferences for company level officials to Instruct them on new procedures, technology, approaches, and global Practices, the statement said.

It’s time to get tough on all safety offenders The South African mining industry has pledged to ensure zero injuries in the mining sector by December 2020. It's a commitment that has been adopted by all stakeholders with notable results – as of 23 September, the industry has witnessed the lowest number of fatalities in recorded history, with reported cases of 35 fatalities.

N

evertheless, one life lost is one too many, especially if it is down to questionable safety practices. I say this in light of the death of four miners at Village Main Reef's Tau Lekoa gold mine at Orkney two weeks ago after they became trapped by a rockfall.

Although an official report to the accident is yet to be released, a report on TimesLIVE last week stated that NUM president Joseph Montisetse had gotten information that the workers were mining the support pillars within the mine shaft, and had neglected to run backfilling to make new artificial support pillars out of rocks and cement. "This is quite dangerous, and we realize that the mine had chosen not to do the backfilling because it is too costly," he said. Incidentally, a similar catastrophe happened at Tau Lekoa in 2017, where four miners died after getting trapped in a shaft. The mine was taken over by Chinese-owned Heaven-Sent in 2015.

ZERO INJURIES ARE EVERYONE'S RESPONSIBILITY

With all the talk of a top-notch approach to safety, especially led by the Minerals Council CEO Forum, though indeed, it's proven true that unsafe mining practices have led to the unnecessary loss of lives, people that call the shots at Tau Lekoa have to be held accountable. It's time that mining becomes tough on all security transgressors, no matter their rank and file.

Mining Review Africa salutes the 100-strong team who made the difficult 1350m underground Journey in an attempt to rescue the four men. And to the families of Xolani Meva (42), Lungile Nyawose (32), Katleho Nthibane (47) Karabo Mabuthile (35), we offer our condolences. Let us hope the loss of your loved ones won't be in vain and that no more lives will be lost similarly. www.skillings.net | 39

AMERICA

How the internet of things is changing Australian mining As Competition from the mining industry intensifies, a growing number of companies are trying to find new approaches to making sites more effective, improving personnel safety, and gaining an edge over business opponents. And, as demonstrated by a recent study by market research specialist Vanson Bourne, the majority thinks that the Internet of Things (IoT) is the best way to attain this.

T

he research found that 70% of respondents from 100 big mining firms around the world believe that IoT would give them a substantial advantage against opponents, with 41% indicating it would boost business process automation, and also almost half claiming IoT could be used to identify cost-saving initiatives.

For almost two decades, IoT has been around as a concept, putting a name to the link of equipment, devices, detectors, appliances, and machines to the internet.

But the Australian mining industry has been slow to embrace the technology, frequently deciding to stick with old customs and processes that are manual.

It looks like that is set to change; however, with an increasing number of companies realizing the benefits IoT can have on mine operations. Actually, this technology has the potential to completely change the market, raising safety measures in hazardous environments, helping to improve overall productivity, and positively affecting an organization's bottom line.

INCREASED CONTROL FOR AUSTRALIAN MINING

By tracking, collecting, and assessing the data from pieces of mining equipment, operators are able to take actionable insights in real-time. John Leadbetter, managing director at Australia's top provider of level, switching and pressure measurement equipment Vega, suggests that IoT is important for reducing downtime, also: "IoT is helping operators to know whether there is a breakage or deterioration in operation, giving them the chance to react quickly and appropriately.

"In the mining sector, every rock crushed is money in the bank. Operators can't afford to have systems breakdown for a few hours while they await an engineer to travel to the site as it can result in a substantial loss in production."

While IoT can help to reduce cases of downtime, faults will happen, and when they do, every moment counts in the race to repair. However, IoT can help here, too. Following Leadbetter: "In some situations, Vega engineers can log into an

40 | SKILLINGS MINING REVIEW January 2020

instrument a 100km away using a mobile phone network. "This means that our engineers don't always need to be present on-site to make repairs; with permission from operators, they can log in remotely and help mine employees to fix the fault, saving the site valuable time and money.

"Thanks to asset management, our Engineers are also capable of diagnosing faults that occurred historically. With a lot of our equipment, data is being captured in the background as it runs. For example, once we log into an instrument, we can examine data's history and quickly notice when a fault occurred, but by the time an engineer arrives, the fault has gone.

"By capturing important data, in a lot of instances, we could isolate the fault, diagnose the issue, and gives a solution to avoid potential downtime in the future."

STEP BY STEP

Just like anything, development can take time, and it is crucial for operators to take a gradual approach. "It's important to work with the industry, and we have to be very cautious that we bring developments in step by step," says Leadbetter. "Here at Vega, we work with miners and engineering firms and send improvements back to our R&D staff in Germany."

Basically, Leadbetter advises operators to maintain a close eye on the fundamentals; losing sight of end goals in the quest for transformation may have devastating consequences for a mine. "Australian mining operators should consider the process like a triangle: begin with selecting the right equipment for the task; install it correctly and safely; and then apply it across the site.

"It's crucial not to overlook the Basics; we need to find the ideal instrument for the right application. Eventually, all of these IoT developments are insignificant if the equipment is not appropriate for the job."

GOAU - US GLOBAL GO GOLD AND PRECIOUS METAL MINERS ETF ETF Trends CEO Tom Lydon discussed the US Global GO Gold and Precious (GOAU) on "ETF of the Week" podcast with Chuck Jaffe on the MoneyLife Show.

G

OAU provides investor's access to firms engaged in the production of valuable metals either via active (mining or production) or passive (owning royalties or manufacturing streams) means.

Lydon explains that there is some confusion regarding how gold ETFs operate, with some ETFs holding physical gold, along with others holding mining companies, which can be quite lucrative but tend to be overlooked by shareholders.

"Gold has retained his value so far this year. We just saw gold reach a just sixyear high. So that is exciting. But we have plenty of inquiries from readers at ETF trends and ETF database where people are talking about gold itself as gold miners. And there is a large distinction, as you know. Therefore, there are a lot of ETFs on the market today that signify

specifically gold and spot gold. And there are a lot of alternatives. They are all backed by gold bars, and they're held within vaults in certain areas of the world, and there's an accounting system that makes sure that there is sufficient gold in those vaults to represent the shares of the ETFs, the biggest one being GLD. So we all know that that exists and it is great for people who want to purchase gold, but don't want to keep it, ensure it or transport it; it's a terrific way to buy gold now. On the other hand, the miners that are publicly traded, which get gold from the earth, are extremely profitable during times when the price of gold goes up."

While gold and gold ETFs, in general, have had a successful run lately, the US International GO Gold and Precious ETF have performed exceptionally well in contrast. "So just put things in perspective, so far year-to-date the price of gold and GLD has increased to about

19%. Generally, the gold miners ETFs are about 35 to 40%. GOAU is actually up 52%, outperforming all of them." Lydon points out that one of the benefits of the ETF is that it utilizes consistent royalties in the gold mining companies, which just become more accessible as gold prices rise, and the metal becomes more popular.

"The structure of this ETF not just gold miners, but it has gold realtors in the construction. And these realty companies, what they do is practically rent out mines so that people can pull the gold from the ground. Those rents for those royalty firms that come in pay some amount of money regularly, therefore it provides that consistency over time.

As gold moves up, and the prices go up, the royalty being paid goes upward. To a great extent, it's a key significant part of the mining ecosystem. But we don't spend enough time talking about it, and this actually is the only ETF that is heavily weighted in these royalty companies.

Keeping that in mind, it is a different way to check at minors for sure." www.skillings.net | 41

EQUIPMENT

US Nuclear, uranium mining industries wait for Trump bailout

42 | SKILLINGS MINING REVIEW January 2020

An appeal from uranium mining companies and nuclear power plant operators for tax breaks and other national financial boosts is presented before President Donald Trump, as his administration looks into reviving the U.S. uranium sector in the name of national security. Trump is expected to receive recommendations on Thursday from a task force of national security, army, and other federal agents on ways to revive U.S. Uranium mining, which has fallen back against global competition amid low uranium ore rates.

U

ranium is a vital element for the nation's submarines atomic arsenal and nuclear energy plants. U.S. uranium users get about 10% of their supply from domestic sources, the federal Energy Information Administration has stated. Most of the remainder comes from Australia and Canada, followed by Russia and former Soviet republics.

The U.S. uranium mining Interests have pressured Trump to require uranium users to seek 25 percent of what they use from domestic sources, saying the global economy is vulnerable to economic chaos. Trump refused the quota idea and gave the task force 90 days to look for different approaches.

Recommendation for the Defense Department to procure more national uranium for military needs and also for subsidies for electric utilities or even uranium manufacturers for the production of up to 3 million pounds (1.4 million kilograms) of partially processed uranium annually was laid out as the industry's requests in a letter dated Aug. 18 from the Nuclear Energy Institute industry team.

uranium from close allies, including Canada, means more taxpayer support for the sector is unnecessary. U.S. uranium manufacturers want "the government to prop up their business through huge subsidies and self-serving quotas," plus easing of environmental protections and the opening of additional public land for mining, said Randi Spivak, public lands program manager for the Center for Biological Diversity. "It's not a national security issue," she stated.

"Do we actually want to put our national security and our energy security in the hands of adversaries? That's not a smart move," Moore stated.

Atomic power plants, which have been struggling in the U.S. marketplace against cheaper natural gas and renewables, also are seeking help. Utilities and plant operators had opposed the production quota requested by mining pursuits. If the Trump administration ever imposes sanctions against Russia, that could limit the U.S. uranium users can get from that country, said Curtis Moore, a spokesman for Colorado-based Energy Fuels Inc., a uranium mining company.

"Do we actually want to put our national security and our energy security in the hands of adversaries? That's not a smart move," Moore stated. However, conservation groups said the U.S. has enough uranium stockpiled to provide decades' worth of defense requirements. They assert the availability of imported

Other sector requests to a working group composed of representatives from the Pentagon and agencies, Commerce and Energy departments developing vastly expanding U.S. uranium reserves that could be used in times of supply disruption.

The American Assured Fuel Supply Reserve, founded in 2011, currently has six so-called "reloads" of low enriched uranium. A nuclear plant requires reloading with processed fuel every two years. The U.S. over the next seven to ten years should increase the reserve to 30 reloads, or 25 million tons of partially processed uranium ore.

Some uranium mining companies also said that Trump should rethink his July decision not to restrict imports by reserving 25 percent of U.S. uranium use for domestic manufacturers. The administration has already done enough to ease environmental and other regulations. At this point, only tariffs and quotas would "move the needle" to assist the industry, said Travis Deti, director of the Wyoming Mining Association, which represents the nation's mining industry.

The Uranium Mining process in the U.S., including all of it in Wyoming, is majorly done by pumping a solution of water and chemicals into uranium-bearing deposits underground. The water is then pumped to the surface, and ore is extracted. One of the most abundant known reserves of uranium ore spans parts of northwestern New Mexico. Previous booms in what was www.skillings.net | 43

AMERICA once known as the uranium capital of the world happened during the 1950s and again in the 1970s.

Environmentalists are also trying to prevent future mining in the region and across the Grand Canyon in Arizona.

Amber Reimondo of Flagstaff, Arizonabased Grand Canyon Trust, says the moves to boost domestic uranium mining could end protections put in place during the administration of President Barack Obama for uranium-bearing lands outside Grand Canyon National Park.

During the atomic age, Uranium mining in the Southwest left a legacy of disorder, disease, and death, Reimondo explained.

Hundreds of Uranium mines located

Iron Mining Association Board Induct New Members The Iron Mining Association of Minnesota (IMA) declared the results of its annual board elections this past month at its 27th annual meeting and dinner. Incoming board members include Allyz Kramer of Short, Hendrickson (SEH), Elliot, and Adam Radel of United Taconite – Cleveland Cliffs Inc. Also, Shea & Jim Perry of Furin will be rejoining the board.

T at the Navajo Nation, for example, has not been cleaned up. The race, whose reservation extends into Utah, New Mexico, and Arizona, banned uranium transportation and mining on its lands in 2005.

"When people talk about previous uranium mining, they discussed it as if the challenge is in the past if people aren't still living with the results of uranium contamination and the fact that uranium contamination can be separated in some bubble when it inherently lasts for longer than some of us could fathom," she explained. "We shouldn't be interfering in that."

hey join the following board members: Randy Abernethy (Industrial Weldors & Machinists), Jon Anderson (RMS), Chad Asgaard (United Taconite – Cleveland Cliffs Inc.), Chrissy Bartovich (U.S. Steel – Minnesota Ore Operations), David Bednarz (Steel Dynamics), Patrick Bloom (Cleveland Cliffs Inc.), Paul Carlson (Northshore Mining – Inc.), Deb DeLuca (Duluth Seaway Port Authority), Frank Fredrickson (Minnesota Power), Tim Kalisch (U.S. Steel – Minnesota Ore Operations), Sandy Karnowski (Cleveland Cliffs Inc.), Marci Knight (American Bank of the North), Travis Kolari (U.S. Steel – Minnesota Ore Operations), Jeff Lipovetz (TKDA), Mark Lorenz (Steel Dynamics), Brian Maki (Lakehead Constructors), Bruce Mars (Conveyor Belt Service), Steve Mekkes (ArcelorMittal Minorca Mine), Robb Peterson (ArcelorMittal Minorca Mine), Matt Thibodeau (Thibodeau, Johnson, & Feriancek) and Larry Sutherland (U.S. Steel – Minnesota Ore Operations).

Outgoing board members were also acknowledged, thanking them for their years of service, commitment, and advocacy for the iron mining sector: Ed LaTendresse (Hibbing Taconite – ArcelorMittal), Art Lind (Lind Industrial Supply), John Ward (Komatsu Mining) and Todd Nelson (United Taconite).

The IMA also recognized the outgoing board chairman, Ed wLaTendresse. IMA described him as an invaluable chairman of the board for the past two years, displaying a commitment to the sector as a passionate leader who's driven to promote efforts to encourage our state's economic development.

Robb Peterson of ArcelorMittal Minorca Mine moves into the role of the board chairman.

President Kelsey Johnson directs the trade association. "I am excited to see what is ahead in 2020 and to work with this great group of new and returning members, and business leaders, who represent the many aspects of the largest industry in northeast Minnesota," Johnson remarked.

44 | SKILLINGS MINING REVIEW January 2020

AMERICA

Congress and President Approve New Great Lakes Icebreaker The 2020 Federal Appropriations Bills, which the President is prepared to sign today, include important order directing the U.S. Coast Guard to rack up a major acquisition program office to improve icebreaking capability on the Great Lakes. The Lake Carriers' Association commends President Trump and the congress on this significant, formal step for acquiring Great Lakes heavy icebreaker.

T

he Coast Guard has obtained $10 million in appropriations within the previous two years to run design and scope activities for another heavy Great Lakes icebreaker.

Congress has granted the U.S. Coast Guard the mandate, financing, resources, and personnel to stand up the acquisition program office. Now it's time to begin building the boat," said Jim Weakley, President of Lake Carriers' Association.

The heavy Great Lakes icebreaker has been declared an official procurement project by the acquisition program office that will ultimately lead to the delivery of this heavy icebreaker if completely financed. The project will need to move forward efficiently to maintain waterways available on the Great Lakes. Last year jobs were lost, and the market took a

$1 billion hit as a result of insufficient icebreaking on the Great Lakes. The Great Lakes are already starting to freeze this year, and both the U.S. and Canadian Coast Guards have declared they have commenced icebreaking operations for the 2019/2020 winter season.

Great Lakes Congressional members took decisive action to correct the problem, in 2016; the congress authorized the U.S. Coast Guard to build the Great Lakes heavy icebreaker. Last year 17 vessels were trapped in Lake Superior's ice for days on end; however, the U.S. Coast Guard claimed complete success for ensuring shipping moving.

This disconnect is due to incomplete performance measures. The vessels stuck in Superior did not count against the test

of success laid down since they were not stuck in one of those four specific waterways the Coast Guard measures," said Weakley. The U.S. and Canadian icebreakers are still having trouble meeting their required assignments because of maintenance problems and dwindling numbers of ships. Congress understands the critical Great Lakes supply chain and the significance to the economy and employment. Historic high water Levels and ice jams on the area's rivers aggravate an already missionchallenged icebreaking force.

The prolonged atrophy of the Great Lakes Icebreaking mission is also having an adverse effect on the country. A fleet of 19 U.S. and Canadian icebreakers in the 1980s have fallen to 11, and most of these are 40 years old or older.

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STATISTICS United States Exports to World of All Steel Mill Products in Thousands of Metric Tons

November 2019 crude steel production

W

orld crude steel production for the 64 countries reporting to the World Steel Association (worldsteel) was 147.8 million tonnes (Mt) in November 2019, a 1.0% decrease compared to November 2018.

Source: U.S. Department of Commerce, Enforcement and Compliance.

Includes content supplied by IHS Global Ltd.; Copyright © IHS Global, Ltd. All rights reserved. Updated on 12-08-2019.

Raw Steel Production

China’s crude steel production for November 2019 was 80.3 Mt, an increase of 4.0% compared to November 2018.

India produced 8.9 Mt of crude steel in November 2019, down 2.8% on November 2018. Japan produced 7.7 Mt of crude steel in November 2019, down 10.6% on November 2018. South Korea’s crude steel production was 5.9 Mt in November 2019, a decrease of 0.5% on November 2018.

I

n the week ending on January 4, 2020, domestic raw steel production was 1,898,000 net tons while the capability utilization rate was 82.0 percent. Production was 1,861,000 net tons in the week ending January 4, 2019 while the capability utilization then was 79.4 percent. The current week production represents a 2.0 percent increase from the same period in the previous year. Production for the week ending January 4, 2020 is up 1.2 percent from the previous week ending December 28, 2019 when production was 1,876,000 net tons and the rate of capability utilization was 81.1 percent.

Adjusted year-to-date production through January 4, 2020 was 1,898,000 net tons, at a capability utilization rate of 82.0 percent.

That is up 2.0 percent from the 1,861,000 net tons during the same period last year, when the capability utilization rate was 79.4 percent. Broken down by districts, here's production for the week ending January 4, 2020 in thousands of net tons: North East: 232; Great Lakes: 666; Midwest: 209; Southern: 698 and Western: 93 for a total of 1898.

The Raw Steel production tonnage provided in this report is estimated. The figures are compiled from weekly production tonnage provided from 50% of the domestic producers combined with monthly production data for the remainder. Therefore, this report should be used primarily to assess production trends. The AISI production report "AIS 7", published monthly and available by subscription, provides a more detailed summary of steel production based on data supplied by companies representing 75% of U.S. production capacity.

Note: Capability for the Fourth Quarter 2019 is approximately 30.4 million tons compared to 30.8 million tons for the same period last year and 30.6 million tons for the Third Quarter of 2019. + Year-to-date totals adjusted for consistency with monthly data.

46 | SKILLINGS MINING REVIEW January 2020

In the EU, Italy produced 2.0 Mt of crude steel in November 2019, down by 9.8% on November 2018. France produced 1.1 Mt of crude steel in November 2019, an 18.2% decrease compared to November 2018. Spain produced 1.1 Mt of crude steel in November 2019, down by 10.9% on November 2018.

The US produced 7.2 Mt of crude steel in November 2019, a decrease of 2.2% compared to November 2018. Brazil’s crude steel production for November 2019 was 2.6 Mt, down by 10.5% on November 2018. Turkey’s crude steel production for November 2019 was 2.9 Mt, down by 8.1% on November 2018. Crude steel production in Ukraine was 1.3 Mt this month, down 20.1% on November 2018.

The World Steel Association (worldsteel) is one of the largest and most dynamic industry associations in the world, with members in every major steel-producing country. worldsteel represents steel producers, national and regional steel industry associations, and steel research institutes.

Members represent around 85% of global steel production.

CRUDE STEEL PRODUCTION, NOVEMBER 2019. Source – World Steel Association COUNTRY

NOV 2019

NOV % CHANGE 2018 NOV-19/18

2019

% CHANGE

COUNTRY

NOV 2019

NOV % CHANGE 2018 NOV-19/18

2019

% CHANGE

Austria

590 e

673

-12,3

6 931

10,9

Mexico

-7,7

17 101

-8,0

Belgium

682 e

612

11,4

7 308

-1,2

United States 7 233 7 399 -2,2

80 615

1,9

Bulgaria

45 e

55

-17,4

527

-13,8

Croatia

5 e

19

-73,4

67

-45,0

North America 9 693 10 053 -3,6 110 115

-0,6

Czech Republic

260 e

390

-33,4

4 103

-9,5

Argentina

Finland

304

339

-10,5

3 333

-13,0

France

1 105

1 351

-18,2

13 529

-5,1

Chile

Germany

3 215 e

3 689

-12,9

37 090

-5,4

Greece

120 e

129

-7,0

1 261

Hungary

163

166

-1,6

1 971

2 186

Italy

-18,9

4 331

-9,9

2 911

-10,5

29 820

-8,8

110 e

106

3,4

970

-7,7

Colombia

125 e

108

15,7

1 124

0,5

-8,6

Ecuador

45 e

49

-7,9

551

2,9

1 606

-12,2

Paraguay

3 e

3

-12,6

23

1,4

-9,8

21 816

-4,4

100 e

102

-2,0

1 137

1,9

5 e

7

-24,7

55

0,3

Venezuela 1 e 4 -75,0

51

-59,3

South America 3 363 3 747 -10,2

38 062

-8,3

175 e

188

-6,7

2 019

-3,1

Netherlands

545

578

-5,7

6 136

-1,8

Poland

730 e

850

-14,1

8 400

-9,6

51

51

-0,1

589

-3,9

1 070

1 201

-10,9

12 821

-3,4

Sweden

309

333

-7,4

4 344

2,2

United Kingdom

550

567

-3,0

6 676

-2,1

Other E.U. (28) (e) 900 e 941 -4,3

9 895

-1,8

European Union (28) 12 789 14 316 -10,7 148 451

-4,2

Bosnia-Herzegovina

55 e

79

-30,0

717

16,3

Macedonia

25 e

21

20,7

224

-6,3

Norway

53

56

-6,2

581

9,4

Serbia

154

180

-14,6

1 772

-3,0

Turkey 2 885 3 139 -8,1

30 857

-10,4

Other Europe 3 171 3 474 -8,7

34 150

-9,3

Spain

Byelorussia

225 e

220

2,3

2 447

9,2

Kazakhstan

340 e

142

139,4

3 735

-4,4

25 e

38

-34,2

341

-28,2

Russia

5 620 e

5 786

-2,9

65 572

-0,6

Ukraine

1 325

1 658

-20,1

19 288

0,4

Uzbekistan 45 e 52 -13,5

575

-3,8

C.I.S. (6) 7 580 7 896 -4,0

91 958

-0,5

Canada

Moldova

985

1 058

-6,9

11 822

-5,1

Cuba

20 e

22

-10,9

205

0,6

El Salvador

10 e

9

7,9

94

3,5

Guatemala

25 e

27

-5,7

278

1,3

Brazil

Peru Uruguay

Egypt

370 e

1 538

456

Luxembourg

Slovenia

1 420

2 604

674

-25,8

6 545

-8,3

48

38,0

543

59,1

South Africa 385 528 -27,1

5 399

-8,6

Africa 951 1 250 -23,9

12 487

-6,7

Iran

Libya

500 e 66

2 130 e

2 187

-2,6

23 648

5,3

Qatar

174

176

-1,0

2 372

0,0

Saudi Arabia (1)

399

435

-8,3

4 683

-1,9

298

-3,2

3 030

2,5

Middle East 2 992 3 096 -3,4

33 733

3,6

UAE 289 China

80 287

77 213

4,0 904 177

7,0

India

8 934

9 192

-2,8 101 954

2,0

Japan

7 743

8 659

-10,6

91 527

-4,5

South Korea

5 895

5 923

-0,5

66 032

-0,4

255 e

321

-20,6

3 038

-31,5

1 670 e

1 961

-14,8

20 325

-4,1

355 e

485

-26,9

3 926

-34,2

Vietnam 1 607 1 295 24,0

18 606

46,3

Pakistan Taiwan, China Thailand

Asia 106 745 105 049 1,6 1 209 584

5,1

Australia

448

420

6,6

5 044

-3,7

New Zealand 59 54 10,0

610

2,7

5 654

-3,1

Oceania 508 474

7,0

Total 64 countries (2) 147 791 149 356 -1,0 1 684 194

2,7

(1) - HADEED only. (2) - the 64 countries included in this table accounted for approximately 99% of total world crude steel production in 2018. e - estimated

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