As pointed out by Mineweb (18 May 2012), this means that “U.S. mining and exploration companies can now officially join their Australian, Canadian, Chinese, European, French, Thai and Korean counterparts in the rush to develop Burma’s mineral riches”:

http://www.mineweb.com/mineweb/view/mineweb/en/page72068?oid=151650&sn=Detail&pid=92730

On 17 May, US Secretary of State, Hillary Clinton,announced that: “The presumption is that our oil and gas companies, our mining companies, our financial services companies are all now free to look for investments that can [bring] mutual benefits to Burma and them.”

However, civil society organisations, and others, are by no means united in believing the time is yet right to “open the door” to such investors.

The US government maintains that its new policy will include safeguards preventing US companies from doing business with individuals who have engaged in human rights abuses and with companies with ties to Burma’s military.

But, at present, virtually all extractive projects (except those in territory controlled by the Karen National Union) derive income for the armed forces.

According to the Financial Times (cited by Mineweb), Caterpillar and other US companies are, in fact already doing business in Burma – through third parties – while France, South Korea, Thailand and China have all invested in extractive industries in Burma.

Burma’s largest mining project is the Tagaung Taung Nickel Mine, owned by the China Nonferrous Metal Mining Company and the State of Myanmar.

Actually these are the names of three venture capitalists who have diversified from oil exploitation in Alberta, Canada, into hard rock mining ventures in the south Pacific, under the title Morumbi Resources.

What’s controversial about their initiative is that they have managed to secure deals with indigenous landowners on Bougainville, which give them a 15% share in potentially highly lucrative mining plays on the island.

Bougainville was the site of the bloodiest mining-related conflict ever in the region, which started in 1988 when a landowner sabotaged part of the Panguna copper-gold operations managed by Rio Tinto, and it lasted a decade.

The war and accompanying blockade by Papua New Guinean forces cost the lives of around 20,000 people – mainly children and women.

Although relative peace has returned to the island, which is ruled by an interim autonomous government, Rio Tinto has so far not returned to Bougainville.

However, five landowner groups are now working with Morumbi Resources, envisaging a start-up for other mines.

The move is controversial, not only because there is still heated disagreement between the landowners over whether the country should return to reliance on mineral extraction, but because Bougainville is by no means bereft in agricultural resources.

For further details of Morumbi, see:

http://moneytometal.org/index.php/Morumbi_Resources

According to London’s citaym (8 May 2012), this year the HKx has suffered its “worst ever” start for IPOs (Initial Public Offerings).

Overall equity activity is said to be “down by about a fifth” on what it was in 2011.

The latest mining outfit, planning to list on the HKx is Graff Diamonds, which is betting on a price rise for the glittering prizes “in the coming years”.

Although based in London, Graff has apparently decided not to list in the UK capital.

That’s one more “bitter blow (as cityam describes it) for the world’s leading mining stock exchange.

The LSE has itself failed to attract anything like the number of new mining IPOs it hoped for a year ago.

The report looks at the stated policies for “mountaintop removal” and coal financing from each of the largest US Banks and assigns a letter grade to how well they uphold these policies, based on investments, transactions and ownership of coal mining and coal burning utility companies.

In addition, this year’s report debuts the “Filthy Five” – the top 5 largest financiers of the US Coal industry. The list counts the number of transactions each company had with the dirtiest coal-burning utility companies, and the largest mountaintop removal mining companies between January 2010 and March 2012.

Bank of America was found to be the number one worst bank for financing of coal, with 44 transactions. JP Morgan Chase was number 2 with 42 transactions; followed by Citi with 40 transactions, Morgan Stanley with 33 transactions; and Wells Fargo with 26 transactions.

The report claims that: “Mountaintop removal mining is a destructive process where mining companies blow the tops off mountains to reach a thin seam of coal. This practice has damaged or destroyed nearly 2,000 miles of streams and threatens to destroy 1.4 million acres of mountaintops and forests by 2020. In addition, the mining practice destroys Appalachian communities, the health of coalfield residents and any hope for positive economic growth.

“Meanwhile, not only is coal burning responsible for one third of US carbon emissions — the main contributor to climate disruption — but it is also making us sick. Coal pollution is responsible for 13,000 premature deaths every year, more than $100 billion in annual health costs and over 200,000 asthma attacks annually.

“Pollution from coal-fired power plants leads to smog, which can cause chest pain, coughing, and breathing difficulties and can make conditions like bronchitis, emphysema, and asthma worse or even fatal. Today 2 out of every 5 U.S. families live in places with unsafe air”.
The report can be accessed at:

http://ran.org/sites/default/files/ran_coal_finance_reportcard_2012_web.pdf

Palmer – whose wealth is estimated at between 3 and 6 billion dollars – intends to run as a candidate for Australia’s conservative Queensland’s Liberal National Party (LNP).

If (or when) “Titanic II” actually gets into the water, the Chinese navy (sic) has apparently been invited to accompany it on the “maiden voyage” from England to New York [Mining.com 30 April 2012].

Perhaps Mr Palmer hadn’t noticed, but Titanic Mark Two has already been launched.

Last month a re-constructed (modernised and securitised) replica of the original vessel set sail from Southampton docks, on the hundredth anniversary of the original launch.

For more on Palmer, go to:

http://moneytometal.org/index.php/Clive_Palmer

Pittsburgh-based American Capital Holdings LLC, established in 2005, describes itself as “a boutique hard money lender for commercial Real Estate”, as well as “a correspondent lender for multi-family transactions nationwide”.

One such transaction involved making funds available to the Massachussetts-based Dominion Christian Church in late 2011 and early 2012 which, says the firm, was to be invested in gold assets in Uganda [Boston Business Journal, 25 April 2012].

American Capital Holdings claims that the church’s pastor, Alexander Hurt, had assured it the money was “safe” because “Uganda [is] one of the most stable countries in Africa”.

However, in January 2012, “Hurt became difficult to locate”, leading the firm to declare the church in default of the investment agreement, and to initiate a US$232,000-plus-damages law suit against the church.

According to the suit, Hurt sent American Capital an email on February 25 2012, stating: “You and I are in the same boat. We are not thieves. We have been trying to do deals to get people their money back and get out of the mess that we are in … That’s why I went to Africa where I lost all the gold, all the money and nearly lost my life …

“I had made more than enough money to replace the fund(s) that belonged to my church that I lost with you … Greed and my desire to assist you cost me dearly. I have lost everything” [Boston Business Journal, ibid].

The fact that an American church makes a “gold play” in an African state, still riven by conflict (and the depredations of the ‘Lord’s Resistance Army’) and ends up losing all its investment, may prove something of a modern parable.

And no doubt there’s more to this story than immediately meets the eye – if not “the eye of the needle” *

* “I tell you, it is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God.” – Gospel of St Matthew Chapter 9, verses:23-24

On 13 April 2012, Tim Treadgold for the Mining Journal (MJ) published a feature article which led with the startling statement that, while “[g]reat fortunes have been made in mining”, these are “all are being eclipsed by the rise of Gina Rinehart…who has embarked on a course that will change the future of mining, and possibly the future of Australia” .

In late March 2012, Rinehart signed a deal with three Asian steel mills that brought them in as partners on the Roy Hill iron-ore project. Then, two Korean companies, POSCO and STX, teamed up with Japan’s Marubeni, to pay US$3.6 billion for a 25% stake in Roy Hill that, says the Mining Journal, “will cost an estimated US$10 billion to develop and include integrated rail and port facilities”.

Despite this expense, according to Treadgold: “Mrs Rinehart’s profit share in the early years of Roy Hill will be around US$866 million annually, and…it all flows into her bank account. As the mine grows to its targeted 55Mt, Mrs Rinehart’s entitlement grows to 41.25Mt which, if iron-ore prices stay around current levels, swells to an annual profit of US$2.88 billion – personally”.

As of today, “Mrs Rinehart enjoys annualised, personal income of around US$2.05 billion. Roy Hill, at full production, will lift her annual income to around US$4.93 billion.

“Interestingly for followers of wealth (and mining) there is more to come for Mrs Rinehart. Her future fortune could grow substantially when she starts more mines with projects such as Rhodes Ridge, East Angelas, Mulga Downs, Wittenoom and perhaps others given that she has a tenement footprint in the iron-rich Pilbara that is roughly the same size as that held by Rio Tinto.

“There is, however, one big difference in valuing Rinehart’s iron ore – it is all hers, and not shared in the same way, as Rio Tinto’s assets are co-owned by 211,506 investors…

“Numbers, however, tell only part of the Rinehart story…[Her] ambitions go far beyond mere money. She is determined to change the way Australia functions, economically and politically”.

Concludes Tim Treadgold:

“It is Rinehart’s cash flows that ought to have everyone in mining watching carefully to see what she does because it is possible to argue that her extreme wealth…has already had a profound effect on Australian politics, including the controversial super-tax on iron-ore and coal profits.

“Australia has never seen so much wealth accumulate in one person. It has happened in the US with people such as Bill Gates and Warren Buffett, but they are politically benign. When money has been used to influence politics, such a through the oil baron, John D Rockefeller, government was forced to intervene, breaking up vast fortunes.

“Rinehart is accumulating wealth to rival the richest-ever Americans…” For more on Ms Rinehart, go to:

http://moneytometal.org/index.php/Gina_Rinehart

KKR is said to be leading the bidding for BHP’s Ekati diamond mine in Canada for around $750 million, planning to combine Ekati with Rio Tinto’s $2 billion diamond mining business which is also up for sale.
(Though in fact neither company has yet confirmed that its putting its diamond businesses on the market).

The Sunday Times says thatt he combined businesses would control around 15% of world diamond supply.

The Massachusetts Pension Reserves Investment Trust had claimed on many occasions that its members were misled about Massey’s operations being some of the safest in the industry.

The investor group filed its initial suit against Massey less than a month after the April 5, 2010 explosion that killed 29 miners at the Upper Big Branch underground mine in Raleigh County, West Virginia.

Additionally, the investors claimed Massey’s deception led to falsely inflated stock prices between February 2008 and July 2010.

According to federal records, UBB was shut down by the US Mine Safety and Health Administration 48 times in 2009 alone but abatements of the violations allowed the operation to reopen shortly after.

From the beginning of 2009 until the day of the explosion, MSHA issued 645 violations to Massey, with $US1.2 million in penalties but the investors were not aware of them.

Massey and the UBB mine were both taken over last June by Alpha Natural Resources (ANR) and the mine remains closed.

To date, four investigations into the UBB blast have been released, including reports from MSHA, the West Virginia Office of Miners’ Health, Safety and Training, the United Mine Workers and an independent panel commissioned by former governor Joe Manchin.

All have in some way concurred that Massey was at fault, citing worn and broken equipment that created a spark which subsequently ignited accumulated methane gas and high levels of explosive coal dust.

[Source: International Longwall News, 30 March 2012]

For earlier story, see: “World’s Top Ten most at risk companies”, posted on this blog on March 26 2012.

The report from Zurich-based RepRisk (a “dynamic business information firm” aimed at investors) emphasises that the risks relate to the companies’”access to capital and licenses to operate”.

Top of the list is Alpha Natural Resources, followed by Newmont Mining, and Glencore International.

Alpha Natural Resources qualified for the number one spot after its 2011 purchase of the leading “moutaintop removal” coal producer Massey Energy, based in Virgina.

Massey had already been targeted over its well-documented history of alleged safety issues, fraud, and environmental concerns. It was fined a record US$210 million to settle ongoing criminal and civil cases related to an accident at its Upper Big Branch mine in 2010, which resulted in 29 deaths.

Newmont Mining and Glencore International drew media criticism for mining activities in Africa and South America and their alleged impact on local communities.

A study, commissioned by Swiss non-government organizations Brot fuer Alle and Fastenopfer reported that in the Democratic Republic of Congo, Glencore subsidiary Katanga Mining used contract miners, including children, to work in precarious conditions in its Tilwezembe Mine.

For Newmont and Minas Buenaventura (ranked 7th equal by RepRisk) the opposition expressed by local communities against the Conga Mine in Peru over its potential impacts on water sources led to the project’s suspension in late November.

The other Top Ten companies evaluated by RepRisk are:
BHP Billiton (4th); Freeport McMoran (5th); Rio Tinto (6th); Barrick Gold (7th equal); Anglo American and Vedanta Resources (ranked 9th equal).

According to RepRisk:”There has been a significant impact on companies’ reputations from negative stakeholder sentiment captured throughout 2011…This is made obvious by the fines paid by the industry, increasing regulation, and the risk of loss of license to operate faced by many of the firms mentioned”.