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BHP expands South Australia copper operation with Fluor Hatch
BHP Group, the largest listed mining company in the world, announced on Friday that it had contracted two engineering firms to expand copper smelters and refineries, including Olympic Dam, which is one of its largest copper projects. BHP has contracted with a joint venture consisting of Fluor Australia Pty and Hatch Pty for the proposed expansion to be carried out in stages. The first stage will involve an investment in excess of A$40million ($25million) and is devoted to strategy and planning. BHP stated that phase one of the expansion will involve upgrading the existing Olympic Dam smelter to a 2-stage smelter, and extending refinery facilities to have a capacity of more than 500,000 tons per year. BHP stated that the final investment decision for phase one of the expansion of the smelter refinery is scheduled to be made in the first half fiscal 2027. Fluor Australia, a subsidiary company of Fluor Corp, a Texas-based firm, has been involved with the design and construction of many projects around the world. This includes expanding a BHP Iron Ore Mine in Western Australia, in 2007. Hatch, an engineering firm in Australia, has previously designed an electric smelting facility for a miner.
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DeepOcean Lines Up Subsea Survey Work for Polish Offshore Wind Farms
Ocean services provider DeepOcean has secured a subsea survey contract on the Bałtyk 2 and 3 offshore wind developments in Poland which are jointly developed by Equinor and Polenergia.Under the contract, DeepOcean will conduct geophysical seabed surveys of the export and inter-array cable seabed corridors, utilizing a dedicated survey remotely operated vehicle (SROV).The work scope also includes surveys to map the seabed for potential unexploded ordnances (UXO). Polish company MEWO will serve as a subcontractor to DeepOcean for the UXO scope, using the vessel Amber Cecilia.The survey campaigns will be executed during early 2025.DeepOcean’s flagship survey vessel, Edda Flora, will be mobilized for the main scope, as well as the Superior SROV.The Bałtyk 2 and 3 offshore wind developments are a joint venture (JV) between Equinor and Polenergia, and will have a total combined capacity of 1.44 GW enough to power more than two million households.“A dedicated survey ROV will have significant efficiency gains when compared with the alternative of using slower work class ROVs configured with a survey sensor payload. We look forward to supporting Equinor and Polenergia on these important offshore wind projects,” said Øyvind Mikaelsen, CEO of DeepOcean.
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Gold reaches record highs as Trump tariff fears mount
The gold price hit a new record on Friday, and was set to gain for the fifth consecutive week, as investors sought out the metal for its safe haven value due to increased U.S. trade concerns. As of 0216 GMT spot gold was up 0.1% to $2,797.48 an ounce. This represents a 1% increase for the week. Prices reached an all-time peak of $2,799.71 earlier in the session. Donald Trump announced on Thursday that the United States will impose a 25 percent tariff on imports coming from Mexico and Canada. He repeated his warning to both countries. Gold is a good investment in times of geopolitical or economic turmoil. It also tends to do well when interest rates are low. "Repeated threats of tariffs have fueled safe-haven flows to gold... Any downside surprise in inflation could suggest greater flexibility for the Fed and potentially bring forward expectations for rate cuts, providing further support for Gold," IG Market Strategist Yeap Jun Rong stated. Further clues about the future of interest rates will be sought from the December U.S. Personal Consumption Expenditures (PCE) Report, which is due at 1330 GMT. Jerome Powell, the chair of the Federal Reserve, said that inflation and job data will determine when another rate cut is to come. In response to concerns over Trump's tariff plans 12.9 million troy-ounces of gold were delivered to COMEX approved warehouses Since late November, stocks have increased by 73.5%, to 30.4 millions ounces, their highest level since July 2022. Gold prices may rise to new heights if tariff threats become more than just a concept for bargaining. Tim Waterer is the chief market analyst of KCM Trade. Spot silver fell by 0.7%, to $31.45 an ounce. Platinum remained at $967.22 and palladium dropped 0.5%, to $983.92. Silver and platinum are expected to gain in value this week, while palladium is set to lose.
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Asia stocks decline; dollar and gold firm as tariff threat lingers
Asian shares were impacted by the return from holiday of South Korean tech stocks, but the relatively high earnings of U.S. technology giants maintained risk sentiment, while tariff fears pushed up the dollar and gold. Investors also considered central bank actions in this week. The Federal Reserve kept rates unchanged on Wednesday in line with expectations. Fed Chair Jerome Powell said that there was no rush to reduce them again. On the other hand, the European Central Bank cut interest rates on Friday. South Korea's return to the Asian spotlight was a big deal, as markets in China, Hong Kong, and Taiwan were still closed due to the Lunar New Year. The benchmark KOSPI fell 1% after China's DeepSeek announced earlier this week that it had developed cheap AI models, which triggered a global stock market crash. Samsung Electronics shares fell 3% after the company announced a limited growth in first-quarter earnings on Friday. SK Hynix shares, a major supplier to Nvidia also dropped 8%. The MSCI broadest Asia-Pacific share index outside Japan was down by 0.3%, but is still on track to gain 1% this month and end its three-month losing streak. Nasdaq Futures rose 0.6% during Asian hours, after Apple executives predicted relatively strong growth in sales. This is a sign that the company will recover as it introduces artificial intelligence to its iPhones. Investors weighed in the implications of the low-cost Chinese AI models, and shares of high profile tech names like Nvidia Broadcom, Oracle, and Broadcom were all hammered. Microsoft and Meta CEOs defended massive spending by saying that it was essential to stay competitive in this new field. Vasu Menon is the managing director for investment strategy at OCBC. He said that the DeepSeek project may cause some uncertainty in the short-term and pressure the valuations of AI companies, but will not change the outlook on the medium- to long-term. "The need for an increased AI infrastructure is likely to continue, and any additional computing capacity will be absorbed by the increased AI demand that could grow substantially in the coming year." THREAT OF TARIFF The data released on Thursday indicated that the U.S. economy slowed down in the fourth-quarter, but was still robust enough to allow investors to expect that the Fed will only lower rates gradually this year. LSEG data shows that traders are comfortable with the idea of two rates cuts this year. The focus of investors will now shift to the U.S. Personal Consumption Expenditures (PCE) Price Index Report, the Fed's preferred gauge of inflation. This report is due later that day. The Fed's outlook is still at risk from President Donald Trump's policies. New tariffs are likely to be imposed on Canada, Mexico, and perhaps China this Saturday. The Mexican peso remained cautious ahead of Trump's deadline on Saturday to impose 25% tariffs for imports from Mexico or Canada. The yen in Japan was last slightly stronger at 154.19 to the dollar. It has already gained more than 1% this week. It is expected to rise by 1.9% in January, marking its best performance since 2007. The BOJ is expected to increase rates this year. Ryozo Himino, the deputy governor of the central bank, said on Thursday that they will do so if prices and the economy continue to move in the direction predicted by the bank. Gold rose to record levels of $2,799.71 per ounce in commodities. It was also on track for a 6.5% increase in January. This would be its best monthly performance since March. Early Asian trading on Friday saw oil prices rise as investors assessed the possibility of U.S. Tariffs on Canadian crude imports and Mexican crude exports, which could come into effect this weekend. Brent crude futures were 0.4% higher, at $77.21 per barrel. U.S. crude oil futures increased 0.5% to $73.13 per barrel.
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Oil prices continue to fall despite US tariff threats
The oil prices increased on Friday, as the markets weighed the threat of tariffs that U.S. president Donald Trump could impose on Mexico and Canada - the two biggest crude exporters into the U.S. - this weekend. Brent crude futures, which expire on Friday, rose 38 cents to $77.25 per barrel at 0110 GMT. The April contract, which is more active, was up 34 cents at $76.23 per barrel. U.S. West Texas Intermediate crude oil (WTI), which is also known as WTI, gained 49 cents and reached $73.22. Brent will fall by 1.6% this week while WTI is down 2%. Brent will gain 3.6% in January, the best month since June. WTI is expected to rise 2%. Trump has threatened to impose 25% tariffs on Canadian and Mexican exports if they do not stop shipments of fentanyl through U.S. border. Uncertainty exists as to whether the tariffs will include crude oil. Trump announced on Thursday that he will decide soon whether or not to exclude Canadian oil and Mexican oil imports. Daniel Hynes, an analyst at ANZ Bank, said that crude oil prices fluctuated due to investors' concern about the possibility of US tariffs and a flurry executive orders and announcements. According to the Energy Information Administration (the statistical arm of Department of Energy), in 2023, Canada exported 3.9 millions barrels of crude per day to the U.S. out of 6.5million bpd of imports. Mexico exported 733,000 barrels per daily. Hynes stated that the increased risk of disruptions in supply due to the foreign policy of the Trump administration have kept prices high. Hynes said that sanctions on Russia and the stopping of purchases of Venezuelan crude oil, as well as maximum pressure against Iran would increase the geopolitical premium on oil. He said that the oil demand could be exacerbated by the replenishment of the Strategic Petroleum Reserve.
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Andy Home: Uranium revival brings it back to the forefront of critical issues
Is Uranium a Critical Mineral? The U.S. Geological Survey has decided that it is not a critical mineral. It was removed from the list of critical minerals in 2022 because it wasn't a "fuel-mineral". Donald Trump, the president of the United States, wants you to reconsider. In one of Trump's "Unleashing America's Energy" directives, the Secretary of Interior is required to instruct the Director of the USGS "to consider updating the survey list of critical mineral including the possibility of including uranium." Included on the list, domestic uranium project funding and approvals would be expedited. It is curious that uranium slipped through the legal loophole in the Energy Act of 2020 which states only "non-fuel minerals" can be classified as critical minerals. Uranium checks off many criticality boxes. Uranium is experiencing a dramatic increase in demand. The global supply is highly concentrated, and the United States imports almost all of its uranium. These changing dynamics are reflected in the uranium prices. The frothy rally of last year to a 16-year peak of $106 per lb is over. At $71 per lb today, the price of uranium remains higher than it was in any decade following the Fukushima nuclear disaster in Japan in 2011. NUCLEAR COMBAT Fukushima forced many countries to reconsider the role nuclear energy plays in their energy mix, but the threat from global warming has brought the nuclear power back into the spotlight. This affirmation was made at the COP28 Summit in December 2023 when more than twenty countries released the "Declaration to Triple Nuclear Power". The official recognition was that "nuclear energy plays a key role in achieving net-zero global greenhouse gas emissions by the year 2050, and maintaining the 1.5 degree goal within reach." Trump's administration may not be impressed by such green credentials, but Republicans see nuclear energy as an important component of national defense, which is why it has bipartisan support, even if for different reasons. The big tech companies are also eager to find more power for their data centers. Microsoft signed an agreement with Constellation Energy to help revive a unit at the Three Mile Island Nuclear Plant in Pennsylvania in September. Re-embrace nuclear power is an international trend. According to the International Energy Agency, the generation from nearly 420 nuclear reactors around the world is set to reach new levels in 2025. The IEA reported that 63 reactors were currently being built, which is the most since 1990. Over 60 reactors' lifetimes will also be extended. SHORTAGE OF SUPPLIES As nuclear power is on the rise, the world will need more uranium. The supply of uranium is not keeping up with demand. According to the IEA, a decade of low oil prices has had a negative impact on production, especially in the United States. Production fell from nearly five million lb per year in 2014 to only 21,000 lb by 2021. The global uranium industry is heavily concentrated. According to the World Nuclear Association, Kazakhstan, Canada, and Australia will account for two-thirds or more of global production in 2022. One of the factors that triggered the price spike in January 2024 was the warning by Kazatomprom of Kazakhstan, the largest producer of sulphuric acids, that it may not be able to meet its production targets because of a lack of sulphuric. Political stress and market stress are often combined. The United States wants to reduce its dependency on Russia in terms of enriched uranium. In 2023, Russian material will account for 27% of enriched uranium supplies to U.S. commercial nuclear reactors. The Joe Biden Administration banned Russian imports. However, there were waivers until 2027. Russia responded by placing restrictions on shipments into the United States. Trump's threats to impose tariffs against Canada, the biggest supplier of uranium for the U.S. Market, further complicates the situation. Going Critical After a decade of hibernation, the uranium markets are re-energized. Last year's price surge was driven by speculative frenzy, with institutional investors like Goldman Sachs as well as retail investment vehicles like Sprott Physical Uranium Trust following the rally. The uranium prices remain historically high. The market has priced in a shortfall of supply relative to the demand from an expanding global fleet nuclear reactors. Many of these projects use leach technology to help fill the gap. The difference between a mineral that is critical and one called a "fuel-mineral" which is becoming increasingly critical will determine how quickly they can activate. The author is a columnist at
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New Zealand aims to reduce emissions by 51-55% by 2035
New Zealand announced late Thursday night that the country will commit to reducing emissions from 2005 levels by 51-55% by 2035. This commitment is part and parcel of the country's Paris Agreement commitment. The initial commitment was to reduce emissions 50% by 2030, and it is part of its pledge to reach net zero emissions by 2050. Climate Change Minister Simon Watts stated in a press release that "we have worked hard to establish a target which is both achievable and ambitious, reinforcing the commitment we feel to the Paris Agreement as well as global climate action." "Meeting the target will mean that we are doing our fair part towards reducing climate change," added he. Watts stated that New Zealand is on track to meet its obligations as early as 2044. Climate Commission, an independent but government-funded expert, called on New Zealand in December to reduce emissions even further than it had planned. Many comparable countries already have higher targets than New Zealand, and the evidence indicates that global action will not be enough to limit global warming below 1.5 degrees Celsius. (Reporting and editing by David Gregorio; Lucy Craymer)
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Infinity Natural Resources, backed by Pearl Energy, raises $265 mln through an IPO in the US
Infinity Natural Resources, a private equity-backed oil-and-natural-gas producer in the U.S. raised $265M in its initial public offer on Thursday. This is the latest energy company to sell shares for the first time in New York. The Morgantown, West Virginia based company was valued at $1.18 billion in the IPO. The company sold 13.5 millions shares for $20 within the range of $18 to $21. The energy industry has been a key theme on the IPO market this year, as companies look to capitalize on investor fervor for the sector. Infinity was founded in 2017 and produces oil, gas, and liquid natural gas. Its operations are located in the Appalachian Basin in the northeastern United States. Infinity goes public after its revenue has more than doubled in the first nine month of 2024. The company's production volume grew as a result of wells it acquired in October from Utica Resources Ventures & PEO Ohio for $279m. Venture Global, a LNG exporter and Flowco, a private equity-backed artificial lifting firm, both went public earlier this month in New York. Other energy-related IPO candidates include drilling equipment and marine transportation services provider HMH Holding. Infinity, which tapped fourteen banks for the IPO is expected to start trading on the New York Stock Exchange on Friday under the symbol "INR". Citigroup, Raymond James, and RBC Capital Markets led the underwriters of the offering. The proceeds of the IPO will be used for Infinity to pay off its outstanding debt as well as other purposes. Pearl and NGP together will hold a significant majority of Infinity’s common stock, and therefore voting power, after the offering. (Reporting from Arasu Kanagi Basil and Jaiveer S. Shekhawat, Bengaluru. Editing by Maju Sam)
Base metals fall as Trump reiterates tariff threat
Following repeated tariff threats by U.S. president Donald Trump, most base metals fell on Friday. Copper prices are on course for their worst two-and half-month period in recent memory.
As of 0259 GMT, the benchmark copper price was down by 0.4% to $9,091.5 per metric tonne. Prices are down 1.6% this week and heading towards their worst week since November 11.
Trump reiterated his warnings to Mexico and Canada on Thursday, saying that the United States will impose a 25% tariff.
Trump said that he is still considering new tariffs against Chinese goods due to its role in the fentanyl traffic.
Natalie Scott-Gray is a senior metals analyst with StoneX. She said, "Base metals prices can be volatile depending on whether Canada or Mexico are able to avoid tariffs coming into play."
She said that if Canadian and Mexican tariffs were avoided but Chinese tariffs persisted, the market would focus on possible global trade reductions, or economic shocks that could cause uncertainty in investment and consumer spending.
China is the largest consumer of industrial metals.
The dollar index increased by 0.3%, making the price of metals in U.S. dollars more expensive for holders of other currencies.
After two consecutive sessions of gains, the price of three-month aluminum fell by 0.5% to $2.613.
In a new package of sanctions against Russia for its invasion of Ukraine, the European Union proposed earlier this week to ban imports of metal from Russia.
LME zinc dropped 0.6% to $2.776 per ton. Lead fell 0.1% to $1.965, tin slipped 0.7% to $30.055 and nickel rose 0.1% to $15.405.
Shanghai Futures Exchange will be closed on February 5th for Lunar New Year. The markets will resume trading on Wednesday, February 5. (Reporting from Anushree mukherjee, Bengaluru; additional reporting by Ashitha sivaprasad. Editing by Subhranshu sahu.
(source: Reuters)