Tag Archives: metals and mining

Hard rock slows gold production in Azerbaijan’s mine

APRIL 13 2016 (The Conway Bulletin) – Azerbaijan’s top gold miner Anglo Asian Mining posted a 17.6% fall in production in Q1 2016, compared to the same period in 2015, mostly due to technical difficulties.

Anglo Asian is listed on London’s Alternative Stock Market (AIM). News of the production slowdown knocked its share price by 6.2%, pushing it to a seven-day low.

Reza Vaziri, Anglo Asian’s CEO, said: “The harder rock that has been encountered together with its lower grade has further lowered production compared to the previous quarter. To combat this harder rock, we have contracted for a second SAG mill to be installed in the agitation leach plant and we expect the SAG mill to be operational in Q3 2016.”

Sales also fell. In Q1 2016, the company sold 12,058 ounces of gold at $1,184/ounce. In Q1 2015, it sold 17,206 ounces at $1,214/ounce.

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(News report from Issue No. 276, published on April 15 2016)

Copper production increases in Kazakh mine

APRIL 7 2016 (The Conway Bulletin) – Kazakhstan-focused miner Central Asia Metals said copper production at its Kounrad project stood at 3,207 tonnes in the first quarter of the year. This is a 36.5% increase compared to the same period last year. The company said this increase was due to the completion of the first expansion of the SX-EW plant last spring.

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(News report from Issue No. 275, published on April 8 2016)

Stock market: Central Asia Metals

APRIL 8 2016 (The Conway Bulletin) – Central Asia Metals continued to rally this week in London, establishing a steady positive trend since an all-time low of 124 pence in mid-January.

Its stock price closed at 171p on Thursday, up over a third for the week.

The company is also preparing for the presentation of the yearly results next Monday, which analysts expect to be positive.

“Central Asia Metals operates at a high margin and is thus less affected by low copper prices,” Martin Potts, mining analyst at FinnCap told The Bulletin. “It is an established business in Kazakhstan and it has already repaid all the money it has raised to its shareholders, something unique in this sector.”

In our chart above, we tracked just how closely Central Asia Metals shares and copper have been linked, but it is also possible to note a recent “decoupling” of the two since mid-March.

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(News report from Issue No. 275, published on April 8 2016)

Russia’s Polymetal buys more Kazakh gold

ALMATY, APRIL 4 2016 (The Conway Bulletin) — Russian miner Polymetal continued its shopping spree in Kazakhstan buying gold miner Orion Metals, a company owned by Glencore’s subsidiary Kazzinc, for an initial $100m.

Orion Metals owns the Komarovskoye Gold Deposit, which lies 150km south of Polymetal’s Varvarinskoye field in north-east Kazakhstan.

“Komarovskoye has long been in our sights as a natural close fit for our Varvara hub,” Vitaly Nesis, CEO of Polymetal, said in a statement.

“We are very excited about the transaction which is expected to strengthen production profile, lower costs, and provide substantial incremental cash flows at Varvara in the near term.”

Varvara is a reference to Polymetal’s Varvarinskoye field.

Polymetal said Komoarovskoye, the gold field that Orion Metals owns, holds 43.5 tonnes of gold.

The deal with Kazzinc could reach $180m through the payment of royalties, if gold prices rise significantly.

In the past six months, Polymetal acquired companies and fields connected or close to its operations in both Kazakhstan and Armenia, in an effort to build production hubs.

Last November, Polymetal upgraded the size of its gold reserves at the Kyzyl project by 8% to 29.2m tonnes.

In 2015, it had bought the Kyzyl project for $620m from Sumeru, a private group owned by Timur Kulibayev, son-in-law of Kazakh President Nursultan Nazarbayev.

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(News report from Issue No. 275, published on April 8 2016)

Kyrgyzstan approves White Cliff plans

MARCH 30 2016 (The Conway Bulletin) – The Kyrgyz government approved exploration plans laid out by Australian miner White Cliff Minerals for its Aucu gold project. The agreement extends the exploration licence for White Cliff to 2020. Aucu, located in west Kyrgyzstan, holds an initial inferred resource of 4.83m tonnes of gold. Despite friction with its biggest foreign investor, Centerra Gold, at the Kumtor gold mine, Kyrgyzstan is still trying to woo foreign companies.

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(News report from Issue No. 274, published on April 1 2016)

Kazakh miner corporation appoints new head

MARCH 24 2016 (The Conway Bulletin) — Bakhtiyar Krykpyshev replaced Eduard Ogai as chairman of Kazakh miner Kazakhmys Corporation. Kazakhmys Corporation is the privately-held offshoot of the now-defunct Kazakhmys and is controlled by Vladimir Kim. KAZ Minerals, the publicly-traded heir of Kazakhmys, is the other offshoot of the corporate reorganisation.

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(News report from Issue No. 273, published on March 25 2016)

Canadian gold miner Alhambra takes Kazakhstan to court

ALMATY, MARCH 21 2016 (The Conway Bulletin) – Canadian gold miner Alhambra Resources said it was seeking damages against Kazakhstan’s government, via the World Bank’s International Centre for Settlement of Investment Disputes, for the bankruptcy of its Kazakh subsidiary.

This is the second major arbitration case against Kazakhstan in the past few months. In January, the Kazakh government had to pay $25m compensation to Estonian builder Windoor after a court in Stockholm ruled it had broken a contract in 2012 to build a conference centre for its foreign ministry.

A sharp economic downturn has hit Kazakhstan hard and forced the government to cut budgets and projects, undermining, to some extent, its credibility as a client.

The company accused the Kazakh government of acting in an “unfair and inequitable” way against both Alhambra and its subsidiary Saga Creek.

Alhambra said the Kazakh government had broken its terms of contract with Saga Creek, imposed excessive fines on it and withheld mining licences.

“This conduct by the Government has frustrated Alhambra’s investment activities in Kazakhstan, drained the Corporation’s resources and culminated in the bankruptcy of Saga Creek,” it said in a statement. Kazakhstan has not commented.

In 2011, a high court in the Akmola region of northwest Kazakhstan cancelled a $1.6m tax bill that local government had sent to Alhambra.

The new arbitration, the company said, had been initiated after a Kazakh court on March 3 upheld the a bankruptcy order imposed on Alhambra’s subsidiary in December.

Saga Creek and Alhambra own a 25-year licence to mine the Uzboy gold field in north Kazakhstan near the border with Russia.

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(News report from Issue No. 273, published on March 25 2016)

Stock market: Roxi Petroleum, KAZ Minerals, Centerra

MARCH 17 2016 (The Conway Bulletin) – Kazakhstan-focused oil company Roxi Petroleum hit the headlines with a daily increase in its share price of over 10%, although the company did not publish updates regarding its operations at the BNG contract area in Western Kazakhstan.

Still rallying on positive results and an uptake in commodity prices, KAZ Minerals also fared well. The Motley Fool financial website said that, together with Glencore and Fresnillo, KAZ Minerals “could be a great long- term play on a mining sector recovery.”

Centerra Gold, a Kyrgyzstan-based Canadian miner, performed poorly again, and the company blames it on the uncertainty regarding negotiations the ownership structure with the Kyrgyz government.

“The uncertainty about renegotiating the future ownership profile of the Kumtor mine with the Kyrgyz government weighed heavily on the stock,” Mining Weekly quoted CEO Scott Perry as saying.

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(News report from Issue No. 272, published on March 18 2016)

Kazakhstan could take back uranium assets

MARCH 15 2016 (The Conway Bulletin) – Kazatomprom, Kazakhstan’s state- owned uranium miner, could take back assets from joint-ventures with some of its foreign partners because they are under performing, Kazakh President Nursultan Nazarbayev said. Kazatomprom’s main partners in the nuclear energy supply chain include France’s Areva, Canada’s Cameco and Japan’s Sumitomo.

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(News report from Issue No. 272, published on March 18 2016)

Stock market: Central Asia Metals

MARCH 11 2016 (The Conway Bulletin) – Kazakhstan-based Central Asia Metals has performed well in the past weeks, after its stock price dipped to 124p on January 20, its lowest level since August 2013.

The stock had suffered from poor market conditions for commodities, but it picked up since it published an upbeat outlook for 2016, after it received government approval at the end of 2015 for the expansion of its Kounrad project in central Kazakhstan.

Analysts, however, remain cautious on the performance of the stock.

Peter Mallin-Jones, mining analyst at Peel Hunt which is a London based brokerage focused on small and medium sized companies, told The Bulletin that his downgraded share target price still held.

“The upward trend is in line with the general moves in the mining sector. KAZ Minerals is also showing a similar trend in the London Stock Exchange,” he said.

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(News report from Issue No. 271, published on March 11 2016)