Hard numbers out of Zambia. For full story go to Zambian web site, then go to Financial Times, Zambia (Not FT London).
ZCCM Cu 6/99 down 516 T to 20,322 attributable to low target tonnage of Nchanga head grade. Co pdt 187 T-4% below target; constrained by low grades of Nchanga concentrate.
Nkana reported contained Cu in ore of 3348 T, 270 T below estimate; because of poor availability of Cubex DTH machine @ all slopes and poor availability of developmental loaders at Mindola shaft (but Co increased to 24T in ore)
Mafarlia: 3159 T Cu (contained in ore), 271 T below target, production affected by insufficient stop break from hi grade ores because of limited drilled reserves.
Concentrator: Cu in concentrate 3005 T-275 T below target. Production decreased secondary to lower than expected target head grades.
Smelter: lower than expected target head rates. Production of ZCCM primary Cu: 2095 T, 3326 T below target of 5241.
Some analysts contend performance will continue to be subdued secondary to high indebtedness to local and foreign creditors.
Demand side: Rolls Royce shipped 441 aeroengines in 1/99 to 6/99, equal to the total number shipped in 98. Let's see, that's approx 441,000 lbs of cobalt or 200 tonnes.
Comment: Increasing demand, decreasing supply. Looks like, under the best of circumstances, Zambian Co pdt will be 2 kt this year, and I don't see how they get any out of GECA. All of us have been weaned on "just in time" inventory, the post-industrial economy, and a nonsensical view of the world that we are all friends, and not competing for resources.
Call me paranoid if you wish, and you may be correct. Our high tech world needs specialty metals. People are fighting and dying every day in Africa [and Indonesia too] to control these resources. If Kabila and the Zimbabweans are willing to send their young men to die, is INCO above spreading rumors that CMR is a joke? Draw your own conclusions.
Dave, you've been a mining consultant for 20 years. When you broke into the field, did all the other consultants welcome you with open arms, recommend you to their clients, spread your business cards and resume around? Or did they go around behind your back, say you were no good, that you couldn't produce, that you didn't know what you were talking about?
Eventually, the cream rises to the top. It's easy to be critical of INCO when Ni is at 1.75. Now that it's $3, I'll ask the question again:
1) are their old mines getting deep and low grade
2) are their Indonesian operations fraught with political risk [go to the Oz papers to read about E. Timor, you won't see much on CNBC]
3) What the hell is going on at VB? Did they really buy it in 1994? What sort of payout will they need to have it make sense if production starts at the earliest in 2005?
4) Do they want a CMR/Anglo hybrid mining ore in Manitoba?
Is this question just not on their radar screen [if so why did they stake around BINCO?] Or do they not care [there is plenty of milk in the bowel, so one more kitten doesn't matter].
Or is there competition for resources? Is Ni and Co becoming more plentiful (a la the laterite story)? Or are we entering a phase of shortage (a la the ZCCM story)?
And would they benefit from any legal actions which would let them get CMR's resources at a discount? |
