NSW risks 29,000 mining jobs
The NSW Minerals Council has warned that the state risks 29,000 jobs and $10.3 billion in lost investments over the next 20 years if resources projects continue to be hit with approval delays of 12 months or more, according to The Australian.
New research commissioned by the council highlights the repeated concerns voiced by the sector that the planning system is denting investments and creating a level of uncertainty that is likely to result in mass job cuts.
China’s lower energy use bad for coal
As China shifts from industry to services, power usage may steady, and if the country’s slowdown accelerates, energy demand may even fall, according to the Australian Financial Review.
Moreover, China keeps adding to coal production capacity, while transport efficiencies may bring down its own coal prices further.
Bernstein Research warns that China may be in a position to export coal within the next few years.
This will impact the seaborne market that the big miners depend on to drive coal mining earnings. Anglo is most exposed, expected to derive over a fifth of its operating profit from coal in 2014.
Xstrata’s merger with Glencore reduces its dependence, but coal will still be one-sixth of profits, estimates Deutsche Bank. And even though Anglo is at the bottom of the cost curve relative to peers, a 10% adjustment in prices will impact earnings by over one-tenth.
More cost cutting, especially in Australia where expenses have more than doubled during the past seven years, and production curbs are needed.
Rio still waiting for Mongolian go-ahead
Rio Tinto is still waiting for government approval to begin shipping from its $6 billion Mongolian copper mine despite the re-election of the incumbent president and ongoing production at the facility, according to the Australian Financial Review.
Canada-based Turquoise Hill Resources, which manages the Oyu Tolgoi project and is majority owned by Rio, announced it had produced more than 40,000 tonnes of concentrate, but exports had not started.
“All necessary permits have been received and the mine is ready to commence concentrate shipments. Shipping will begin as soon as the Mongolian government indicates its support for Oyu Tolgoi to do so,” said Turquoise Hill in a statement.
