Archive for the ‘ENERGY FUELS’ Category


Wednesday, July 9th, 2014


Once the darling of mining investors venturing in Latin America, world’s top copper producer Chile is becoming one of the most expensive countries to explore and mine.

While less costly than Mexico, the cost of producing a pound of copper went —according to data from the country’s copper commission—from US$0.63 per pound in 2004, which was half of Africa and well below the world average at the time, to US$2.50 last year.  It means it now costs about 3.5 times more (350%) to produce a pound of the red metal in Chile, compared to a decade ago, and the figure is also higher than global average of $2.38 per pound registered last year.

The same study shows that only two mining jurisdictions last year were more expensive than Chile: Europe and Asia.

The same study shows that only two mining jurisdictions last year were more expensive than Chile: Europe and Asia.

Between 2004 and 2013, production costs in Chile — measured in dollars per year— went up by 295%, representing an annual average of 30%. Measured in dollar value for 2012, cost jumped by 186%. In comparison, global average production cost increase went up by 267%.

The problem of rising costs is not limited to Chile; it is a trend affecting the mining industry worldwide.


However, the South American country is also struggling with high cost of energy, which threatens the competitiveness of the country’s copper industry and poses a major challenge for new developments.

Electricity costs in Latin America’s wealthiest economy have climbed 11% per year since 2000, making it one of the most expensive places in the world to secure energy for mining projects.

And while the nation has the world’s richest reserves of copper, grades are falling at its massive but aging copper mines, making it difficult to maintain output and putting pressure on costs.

High wages don’t help the situation. Chilean mine workers produce less than half of their North American counterparts, while getting paid more, told Bloomberg in April Peter Beaven, BHP Billiton (ASX:BHP) base metals head in the country.

Chilean mines’ production costs could come down, however, if miners scale back planned expansions because of falling copper prices and energy suppliers are forced to offer more competitive prices.

Henry Sapiecha


Wednesday, March 23rd, 2011

Japan fuel demand to surge amid nuclear crisis

ALEX KENNEDY – Associated Press – Associated Press | Tuesday, March 22, 2011

Japan’s nuclear crisis could reverberate through global energy markets for years to come, pushing up prices as suppliers look to take advantage of a surge in demand for non-nuclear fuels from the world’s third-largest economy.

The 9.0-magnitude earthquake and tsunami that likely killed more than 18,000 people earlier this month shut down 11 of Japan’s 54 nuclear power plants — a source that provided 30 percent of the country’s power. That means producers of natural gas, coal and oil — particularly in Asia — will be called on to help fuel conventional sources of power generation in Japan.

The government is still struggling to contain radiation leaks at the crippled Fukushima Dai-ichi nuclear power plant in the devastated northeast. Damage from the tsunami and attempts to cool reactor cores by dumping sea water by helicopter almost certainly mean the plant is out of action permanently. The future of some of the other plants is also in doubt.

“It appears that the shutdown nuclear plants will be out of action for at least three years, if not forever,” said Ravi Krishnaswamy, energy analyst with consultancy Frost & Sullivan, referring to half a dozen plants. “We’re likely to see prices for both coal and natural gas increasing in the short and longer term.”

Analysts expect regional energy exporters such as Indonesia, Malaysia, Australia and Vietnam to benefit most from Japan’s sudden thirst for fuel as the country tries to overcome its power crunch. Ending rolling blackouts and shortages will be crucial to Japan’s economic recovery and restoring normal production at manufacturers like Toyota Motor Corp. and Panasonic Corp.

Australian oil and gas producer Woodside Petroleum, Indonesian thermal-coal miner Adaro, South Korean refiner SK Innovation, and Thai petrochemical firm PTT Chemical are among the Asian energy companies best positioned to satisfy Japan’s energy gap, said Renee Lam, an analyst with Moody’s Investors Service.

“These firms and others in the region can capitalize on near- and longer-term displaced demand as Japan must now rely more on non-nuclear fuel,” Lam said.

Energy prices — and how much consumers pay for daily necessities like fuel for cars, heating and cooking — would be pushed even higher if other countries decide to turn away from nuclear power. Heightened concerns about the safety of nuclear plants have triggered policy reviews across the world. China has halted approval for new nuclear projects while Germany shut down several older plants.

“Longer-term demand for fossil fuels could remain high as other nations revisit plans for their nuclear electricity production,” the World Bank said in a report.

The price of benchmark U.S. crude fell during the first few days after the March 11 disaster on concern Japan’s economy could slip into recession, which would reduce demand for oil.

But analysts say the amount of fuel Japan must import to make up for shutdown nuclear generation will greatly outstrip the immediate drop in consumer demand. Goldman Sachs estimates Japan must import 247,000 barrels a day of oil to compensate for the country’s lost nuclear capacity while demand will drop only 16,000 barrels a day due to an expected economic slowdown in the first half.

Oil has rebounded above $102 this week as attention returned to political violence in Libya and Bahrain.

Tokyo Electric Power Co., Japan’s biggest electricity utility and operator of the Fukushima Dai-ichi plant, said Tuesday its power generating capacity stands at 35.5 million kilowatts, down from 52.4 million kilowatts before the disaster.

Previous Japanese power crises suggest demand for crude and other fuels will spike.

Analysts estimate demand for crude and fuel oil jumped 25 percent to 50 percent and use of gas and coal rose 8 percent to 12 percent in 2002 after the Tokyo utility was forced to idle 17 nuclear plants following accusations it falsified safety records and again in 2006 when an earthquake damaged a major reactor.

Japan will likely covet low-sulfur crude, especially from Indonesia, which can be more easily processed into gasoline, kerosene and diesel, said John Vautrain, an analyst with energy consultant Purvin & Gertz in Singapore.

“The price of these Asian sweet crudes shoot up relative to other crudes because the Japanese all of a sudden start burning considerable quantities,” Vautrain said. “Every time the Japanese get into a power issue, they buy a bunch more oil.”

Investors also expect Japanese demand for liquefied natural gas to rise as the country favors inexpensive gas-fired power generation. Japan is the world’s biggest importer of LNG and about 70 percent of its LNG imports come from Australia, Indonesia, Malaysia and Brunei.

Natural gas prices in Europe and Asia have jumped since the disaster. Last week, Royal Dutch Shell PLC said it would divert LNG and fuel oil to Japan while Qatar, the world’s largest gas exporter, promised to meet any increased requirements.

“Diversion of gas supplies from regular customers in Europe to Japan is bound to drive up gas prices in Europe,” Krishnaswamy said.

Sourced & published by Henry Sapiecha


Thursday, July 29th, 2010

Chevron signs KOGAS

as new Wheatstone customer

AAP July 20, 2010, 7:42 am

Chevron has found more gas off the WA coast.
Via Bloomberg / SUPPLIED ©

The Korea Gas Corporation has signed a 20-year agreement worth billions of dollars to purchase liquefied natural gas from the $25 billion Wheatstone gas project off the North-West coast.

US oil giant Chevron Corporation, the operator of the project in Ashburton North, said its Australian subsidiaries had signed a Heads of Agreement with KOGAS.

The new agreement will boost the likelihood of the Wheatstone project getting final approval, slated for next year.

KOGAS, the largest LNG buyer in the world, will purchase 1.5 million tonnes per annum of LNG from Wheatstone for 20 years.

The company also signed an agreement to acquire a five per cent stake in Chevron’s Wheatstone field licenses and in the Wheatstone project LNG and domestic gas processing facilities.

KOGAS’ LNG purchase together with its equity participation will see KOGAS take delivery of about 1.95mtpa of Wheatstone LNG.

State One Stockbroking energy analyst Peter Kopetz estimated the deal with KOGAS would be worth about $20 billion over its 20 year life, based on previous deals announced.

He said such a move would boost the chances of the gas project getting final approval.

“I think Wheatstone now has contracted about 80 per cent of its LNG,” Mr Kopetz said.

Tokyo Electric Power Company last year signed Australia’s biggest energy deal, with a deal worth an estimated $90 billion to take 4.1mtpa of Wheatstone gas during the next 20 years.

KOGAS has previously signed a deal with Chevron for 1.5 million tonnes per annum of LNG from the Gorgon gas project offshore from WA.

Chevron has not disclosed the value of the latest deal.
Sourced & published by Henry Sapiecha


Thursday, July 29th, 2010

Nido, Kairiki in trading halt

The West Australian June 4, 2010, 11:41 am

Nido Petroleum is epxected to release positive results from its drill stem testing at Tindalo.BLOOMBERG NEWS / SUZANNE PLUNKETT ©

Nido Petroleum is expected to announce positive results from drill stem testing at its Tindalo-1 well off the coast of the Philippines.

Shares in the company, which operates the broader SC54A project and holds a 42.4 per cent stake, were placed in a trading halt along with those of 30.1 per cent joint venture partner Kaikiki Energy.

The balance of the project is held by commodities trader Trafigura (15 per cent) and TG World (12.5 per cent).

Late last month, Nido reported the first oil flows from Tindalo.

Shares in Nido were up one cent, or 5.41 per cent, to 19.5 cents before the trading halt was called while shares in Kaikiki Energy rose 0.5 cents, or 2.86 per cent, to 18 cents.
Sourced & published by Henry Sapiecha


Friday, February 26th, 2010



The commodity market activity  throughout the world has to keep moving between countries to ensure that all have a share of the global wealth and resources.

There are some who are not ‘pulling their weight whilst others are producing abundantly. These things are like that for different reasons.

Here we will bring them and others, together at a common market place where all can exchange goods and or services or sell for cash to the highest bidder or ready buyer.


Henry Sapiecha