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Gold dealer loses US$70 000 to fraudsters

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TWO brothers allegedly connived and defrauded a gold dealer of US$70 000 after selling him a bag full of sand under the guise that it was gold powder.

Kudakwashe Pfavai (28) and Daniel Pfavai (29) lured the complainant Mr Phinias Munda to accompany them to Shangani River purportedly to process the sand using mercury resulting in 7kg of amalgam.

Kudakwashe and Daniel were released on $3 000 bail each by Bulawayo High Court judge Justice Martin Makonese.

Kudakwashe was ordered to report once a week at Chakari Police Station while Daniel will report at Norton CID once a week until the matter is finalised.

They were also ordered to continue residing at their given addresses and not interfere with State witnesses.

According to court papers, it was stated that on November 14 last year at around 8AM, the two brothers connived and lured Mr Munda from his house in Parklands suburb in Bulawayo to Shangani.

While in Shangani, the two men connived to defraud the complainant. They showed him a bag full of sand which was stashed inside the boot of their car, a Mercedes Benz C200. They made the complainant believe that the bag contained gold in the form of powder.

They asked Mr Munda to accompany them to Shangani River under the guise of processing the sand using mercury to produce gold.

The sand, they claimed, produced 7kg of amalgam. They test smelted a sample of 42,3 grammes of amalgam and got 14,1grames of gold. Mr Munda failed to notice that the sample which they had taken was switched by one of the accused persons with real gold amalgam from his pocket.

From this sampling it was concluded that 7kg of amalgam would produce 2kgs of gold after smelting.

Mr Munda paid the two men US$70 000 and left for his office to smelt the gold concentrate.

Upon smelting the 7kg of amalgam, Mr Munda discovered that he had been duped as the mixture didn’t contain any gold.

He reported the matter to the police leading to the two brothers’ arrest but the money was not recovered.

 

The Chronicle

Petra Diamonds’ investors back restructuring

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Struggling Petra Diamonds (LON: PDL) said on Wednesday its investors have approved plans to restructure the business, a move that aims to provide the miner with a more stable, deleveraged capital structure to ensure its short and long-term viability.

Over 95% of shareholders voted in favour of a resolution that includes reducing authorized share capital of the company by cutting the nominal value of all ordinary shares from 10p to 0.001p.

It also involves an increase to Petra’s authorized share capital through the creation of 8.5-million ordinary shares and the authorization for directors to allot ordinary shares up to £88,447 ( just over 8.8-million ordinary shares).

Hefty debt

Petra Diamonds’ weak financial position, a product of stagnant demand and heavy borrowing to expand its mines, particularly the iconic Cullinan, pushed it to put itself up for sale in June. Petra reversed the decision in October, opting instead for the debt-for-equity restructuring approved Wednesday.

The company noted it expected to complete the reorganization in the first quarter of 2021.

Petra’s shares slumped by more than 80% last year as the covid-19 pandemic battered the global diamond sector, with mines forced to shut down while consumer demand continued to fall.

The diamond miner, which has three operations in South Africa and one in Tanzania, is also dealing with allegations of human rights abuses at its Williamson mine in Tanzania, resulting from the actions of its security guards.

Mining.com

Gem Diamonds to keep Letšeng running amid Lesotho lockdown

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Africa-focused Gem Diamonds (LON:GEMD) said on Wednesday its iconic Letšeng mine in Lesotho will remain fully operational during a 14-day lockdown that comes into effect from midnight on Thursday.

The new restrictions follow reports accusing the government of the small southern African country of having released “several” people who had tested positive for the coronavirus from quarantine.

They also coincide with Lesotho’s alarming number of covid-19 cases and deaths in recent weeks after high numbers of workers travelled home to South Africa for the Christmas holidays.

RESTRICTIONS COME AMID AN ALARMING NUMBER OF COVID-19 CASES AND DEATHS IN RECENT WEEKS

According to the latest figures from the National covid-19 Secretariat (Nacosec), Lesotho had 6,241 cases as of Wednesday, up from 2,137 on December 1. The country has a population of about 2 million.

Gem Diamonds noted it will continue to implement measures for the regular testing and protection of all of its mining staff and contractors, as required by law and strict health and safety measures put in place at the beginning of pandemic.

Lesotho’s measures include banning all outbound international travel for Basotho except for those who have visas for the countries they were travelling to, as well as negative covid-19 certificates. Inbound international travel by foreign nationals would also be banned.

Most businesses would be closed, except those considered to be in the essential services category.

Letšeng is the world’s highest dollar per carat kimberlite diamond mine. It is also one of the world’s highest diamond mines, as it is located an average elevation of 3,100 metres (10,000 feet) above sea level.

Mining.com

Indebted Zambia pays $400m in VAT refunds to mining firms

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Zambia paid 8.5 billion kwacha ($400 million) in value-added tax refunds to mining companies last year, the head of the tax authority said on Wednesday, equal to about 3.5% of the external debt that the southern African country is struggling to repay.

Zambia, Africa’s second-largest copper producer, is negotiating with creditors to try to get debt relief, after it defaulted on a $42.5 million coupon in November.

The economy was already struggling even before the coronavirus pandemic owing to low prices for copper, its main export, and the IMF had classified it as in debt distress.

The VAT refunds to the mining sector represent 67% of the total such refunds made, Zambia Revenue Authority (ZRA) Commissioner-General Kingsley Chanda said at a media briefing, adding it was “in line with our desire to dismantle all outstanding refunds.”

Zambia’s Chamber of Mines President Goodwell Mateyo said the government still owed around $1.6 billion in VAT refunds to mining companies as of the end of 2020.

“It is encouraging that the government is paying VAT refunds as and when they arise, but there’s still the matter of (the VAT) … backlogs,” he said.

Mining companies operating in Zambia include Barrick Gold , First Quantum Minerals, Eurasian Resources Group, and Glencore, which is in the process of selling its majority stake in the Mopani copper mine to Zambia’s state mining investment arm.

Reuters

Rhodium price roars above $20,000 in precious metals’ biggest rally

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Rhodium’s rally to record highs shows no sign of stopping, with prices up 19% this month as auto makers that need the metal to meet tightening emissions regulations run into limited supply.

Used in engine exhausts to neutralize harmful nitrous oxides, rhodium reached $20,190 an ounce on Wednesday, up from $16,990 on Dec. 31 and as low as $615 in 2016.

Prices have risen by 3000% in five years and just 1.5 kilograms of rhodium now costs almost $1 million.

CLICK HERE FOR AN INTERACTIVE CHART OF RHODIUM PRICES.

Auto makers consume around 85% of rhodium. Sales in China, the biggest market, are forecast to grow this year after only a slight dip in 2020, and emissions regulations tighten again in 2023.

“There’s been a load of buying in advance (of that deadline),” said StoneX analyst Rhona O’Connell.

Reuters Graphic

The covid-19 pandemic, meanwhile, tightened the market, with lockdowns and outbreaks disrupting mining and transport in South Africa, the top producer.

This, along with outages at processing facilities run by Anglo American Platinum (Amplats), reduced total rhodium supply by 16% last year, said Wilma Swarts at specialist consultancy Metals Focus.

That compares with a 10% fall in demand, creating a shortfall in the roughly 1 million ounce a year market that will continue in 2021 and is likely to drive prices higher, Swarts said.

Amplats has repaired its operations, but rising coronavirus cases in South Africa threaten further supply disruption, said Heraeus, a major producer and trader.

Reuters Graphic

Rhodium has been in deficit for most of the last decade, driving down inventories and allowing periods of strong buying to tighten the market and drive up prices, said Rohit Savant at consultants CPM Group.

On an annual basis, the market saw a small surplus last year and will again in 2021, he said, predicting that prices would dip when the traditionally strong start-of-year demand period slackens.

“But going forward, you are likely to see a continued narrowing of surplus and potentially deficits again.”

Use of rhodium may eventually decline as combustion engines are replaced by batteries to power vehicles, but analysts expect this process to take many years.

Reuters Graphic

 

Reuters

BREAKING: Rushwaya finally granted bail

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Zimbabwe Miners Federation (ZMF) President Miss Henrietta Rushwaya has been finally granted bail. Madam President as she’s popularly known has been granted $100 000 bail.

Rushwaya has been languishing in prison since the 26th of October 2020.

Terms of the bail are

  1. Reside at given address

2. Report thrice a week Mon, Wed & Fri

3. Not to interfere with evidence

4. Surrender all travel docs

5. Not leave her house btw 8 pm to 6 am

6. Not to go within 80km radius from any border

This is a developing story more to follow…

Official gold buying prices Wednesday 13 January 2021

Fidelity Printers and Refiners (FPR) official gold buying prices Wednesday 13 January 2021

  • SG 90% AND ABOVE $52.98/g
  • SG ABOVE 85% BUT BELOW 90% $52.09/g
  • SG ABOVE 80% BUT BELOW 85% $50.90/g
  • SG ABOVE 75% BUT BELOW 80% $50.31/g
  • SAMPLE BELOW 10g BUT ABOVE 5g $51.50/g
  • FIRE ASSAY CASH $53.27/g

 

Cash available. Fidelity Printers and Refiners prices will be changing daily in relation to world market prices.


Contact FPR

No. 1 George Drive, Msasa, Harare, Email: [email protected]Telephone: +263 242-486670, +263 242-486694, +263 242-487131, +263 242-447810-5

No debate required on EPOs

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There must not be a debate on the granting of Exclusive Prospecting Orders (EPOs) because the basic concept of growing the mining industry is through mineral exploration, renowned Geologist Mr Kennedy Mtetwa has said.

Rudairo Dickson Mapuranga

The Greater Centre Geological Services, Managing Director said if EPOs are not granted, there won’t be new minerals for the country to talk about.

Calls have been made by different geologists for the government to grant numerous EPOs that were applied in the last years in order to discover new minerals deposits for example rare earth elements, lithium, copper among others whose popularity in new technology and clean energy is growing significantly.

Mtetwa said pass exploration being passed out to companies now cannot be called exploration per se but a way to see if old mines can be reinvested into.

“If we don’t grant EPOs there simply won’t be any new mineral deposits discovered. Mineral claims are pegged on already known deposits so that is not exploration that is just trying to see if old mines can become bigger.” Mtetwa said.

Dosman-Mangisi
ZMF Spokesperson Mr Dosman Mangisi

Zimbabwe Miners Federation ZMF) Spokesperson, Mr. Dosman Mangisi said the advancement of the tech industry in the world is a major call towards exploration of new mineral deposits because the country might be losing a lot of investment because its minerals are not quantified.

Mangisi further said that EPOs should therefore be classified, as a measure to bring order in the granting of EPOs.

“The advancement of information and technology in the world means metals in line with that area in terms of demand for example copper and lithium. Zimbabwe has one of the largest untapped copper and lithium deposits that need to be explored.

“EPOs are not classified or granted it’s a call that EPOs should be classified, not just to have a number of EPOs.”

Mangisi also said that EPOs were supposed to be given to serious investors in order to speed up exploration and mining investment.

The ZMF Spokesperson also said that the government was supposed to promote the value addition of minerals through establishing smelters for different minerals.

“EPOs should also be given to serious investors who will be able to quantify our resources.

“The government must promote base metals and funding pilot projects, establishing smelters so that we don’t export our minerals raw.” said Mangisi.

EPOs are highly despised mainly by Artisanal and Small-scale Miners in the country as they are reportedly taking too much land yet no visible exploration is taking place. The government has been encouraged to use its “Use it or Lose it” policy to correct the holding of land for speculative processes and also reduce the size of EPO to accommodate small scale miners.

Don’t let a $10 filter bring down a $100,000 machine

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Even the best oil filter is of no use if the gasket/O-ring seal or media is brittle. If you store it at the wrong temperature, the wrong humidity or subject it to airborne dust and contaminants, it could be unfit for use or potentially cause bigger problems if you install it on a machine.

By Preston Ingalls and Wally Wilson

If you are in charge of a shop or maintenance facility, one of your critical duties is to get the right parts at the right price, at the right time and keep them in the right condition. 

A storeroom maintained at constant temperature and humidity provides an excellent environment for storage of MRO parts and provides a favourable workspace for the storeroom staff. (MRO stands for maintenance, repair and operating supplies.) But maximizing lifespan and reliability require planning and preparation.

Parts don’t have a red-light indicator or sensor showing when they have become defective or contaminated from the environment. But put a degraded component on a machine, and after installation, the red lights will glare.

Dust and airborne contamination

Dust particles range from 5 to 500 microns, with atmospheric dust averaging 30 microns. Contrast that with a particle of sand at 100 microns. However, most gearbox and hydraulic-system damage comes from particles in the 2- to 20-micron range, which is the size of lead dust and vehicle combustion-related particles. The human eye can only detect down to 40 microns, which makes many contaminant sources undetectable with the naked eye.

A storeroom next to the shop facility will be exposed to numerous sources of airborne particulate contamination, and they will find their way onto the parts and materials stored there. One solution is to wall off or relocate storage far from the repair facility, which can help control the environment around contamination-sensitive components such as those that go into closed-fluid systems. Other solutions include periodic dust removal and strategic placement of air purifiers with HEPA filters, but isolation and environmental control are recommended for more sensitive components.

 

Combating heat, humidity

Both heat and humidity accelerate the deterioration of certain parts and materials. 

To reduce degradation, most of these items should be kept at a temperature of less than 80 degrees Fahrenheit and a relative humidity of less than 50 to 60 percent. In storerooms without significant air movement and cooling, the dew point becomes a factor when humidity levels exceed 60 percent.

Although warm air holds more moisture than cold air, it’s important to realize that the humidity of the air changes only as a result of a change in temperature. When air cools it becomes more humid, even though the moisture content in the air remains the same. As warm air cools, humidity rises and eventually reaches a point of condensation buildup on various surfaces like walls or stored items, which impacts component or material reliability.

Using temperature-controlled environments can extend the usable lifespan of compounded chemicals from the normal two years to as many as five years. The solution is to apply air conditioning and humidity control with desiccants or humidifiers, as well as use digital humidity and temperature monitoring tools for heat- and moisture-sensitive items.   

Belt storage

Premature belt failure can often be linked to improper belt storage. By following a few common-sense steps, belts can retain their initial serviceability and reliability by avoiding:

• Hanging on nails or small diameter pins, as the weight of the belt could damage the tensile cord material. (If hanging is necessary, suspend the belts on a wall rack, saddle or large diameter tubular bracket to avoid crimps and deformation.)

• Direct sunlight (UV).

• Heat and humidity. (Store in a cool, dry place with environmental conditions below 80 degrees Fahrenheit and less than 70 percent relative humidity for potential six-year shelf life.)

• Hanging variable-speed belts, as they are more sensitive to distortion.

• The use of ties or tape to pull belt spans tightly together near the end of the belt.

• Storing near radiators or heaters or in the airflow from heating devices.

• Storing where they are exposed to airborne solvents or chemicals.

Electric motor storage

Most electric motors are designed with grease-lubricated, anti-friction, rolling-element bearings. Bearing troubles account for 50 to 60 percent of all-electric motor failures. Poor lubrication practices are the source of most of these bearing troubles; in fact, 80 percent of all bearings will never reach their life expectancy.

Damage to electric motor bearings can occur while a motor is in storage due to static corrosion from inadequate rust and corrosion inhibitors to protect the metal surfaces. Another potential problem is motor vibration that forces out the grease from between the rollers and raceways in the load zone, which also leads to rust formation on the metal surfaces.

False brinelling (a process of wear in which similar marks are pressed into the surface of a moving part) is an additional concern. Vibration of the bearing in a static position (non-rotating) causes the rolling elements to vibrate against the raceway in one place. Over time, the vibration can remove miniscule pieces or particles of metal surfaces. This is evident when wear marks line up with the spacing of the rolling elements.

Initial greasing is good for 12-month storage, but to prevent these other types of damage, you should attach tags to the motors that state, “Grease during installation.” Also, fully grease rebuilt motors or removals arriving into storage and purge motors that have been idle for years of dried grease slugs.

Do not use EP grease in motors. Clean the areas around the relief and fill fittings, then unscrew and remove the grease relief valve or drain plug (grease outlet plug) at the bottom of the motor.

Grease the bearing with a set amount of grease according to the manufacturer’s recommendations. Slowly add grease (10 to 12 seconds for each stroke) to minimize excessive pressure buildup in the grease cavity. Keep in mind that the standard manual grease gun can produce pressures up to 15,000 psi, while most seals can pop at 500 psi.

After excessive grease has been purged, reinstall the drain plug, clean excessive grease from the relief port area and wipe the grease fitting.   

Tag the stored motor with the date of last lubrication and the lubricant type.

Store motors in a clean, dry, vibration-free area. Use pieces of used conveyor belt as isolation padding between the motor and a wood skid or floor. This insulates the motor from the effects of vibration and harmonics from fork lifts and other sources of floor vibration.

Rotate idle motor shafts every other month or quarterly to redistribute grease and maintain a corrosion-preventive film on bearing surfaces and prevent false brinelling. There are visual aids to help with this task, as illustrated in the photo on page 38 from swspitcrew.com. The target aids are stuck to the end of the shaft or fan and rotated two full rotations and set to a color wedge. You can even assign colors to a given month. A PM can be generated to trigger this activity.

Parts that need storage attention

Other parts that need extra care and a scheduled PM program during storage are listed below:

Pneumatic valves. Large pneumatic valves should be cycled at least quarterly to prevent damage to the seals and valve seating surfaces

Rubber components, including V-belts, cog belts, gaskets containing rubber compounds and O-rings. Belts should be managed by the date received, first-in, first-out. Belt replacement on operating equipment should be a scheduled PM activity.

Electronic boards and components. Store in an environmentally controlled space when possible. Drive boards can be damaged by exposure to extreme environmental conditions such as dust, static, heat and humidity. Drive boards should be stored in the appropriate static bags, and anytime the board is removed from the static bag, a new bag should be used if it is put back on the shelf.

Gearboxes and pumps should be under a scheduled PM program that includes lubrication and exercising of the bearings to prevent brinelling and static corrosion. These components should also be stored on vibration dampening pads and large gearboxes blocked to prevent damage to the bearing and raceway. Gearboxes and pumps should be under a 90-day PM schedule.

Pneumatic and hydraulic cylinders should be under scheduled PM with the openings capped to prevent contamination. Large pneumatic and hydraulic cylinders should be stored vertically to prevent damage to the actuator seal. Cylinders should be stored with the base down and the actuator up. Secure to prevent falling.

Inventory shelf life

Establishing a spare parts management policy of first-in, first-out (FIFO) ensures the oldest parts are used first. Include a date received on the inventory tag or write a date on the packaging to ensure the person picking the items can pull the items by received date.

The use of high-density storage cabinets provides additional protection from dust and exposure to UV lights that can accelerate the degradation of many of the parts stored. Component manufacturers and OEMs typically publish their recommended storage procedures.

Source: EW

Gold investors target ‘excessive’ executive payouts amid deals

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Gold investors critical of lavish executive payouts plan to vote down compensation at upcoming annual shareholder meetings, as soaring prices for the precious metal spur dealmaking.

It is the latest knock against an industry that had only recently won back investor favor after being shunned due to disappointing returns.

Miners who overspent on acquisitions in the 2011 gold boom have curbed premiums that led to billions in impairments when prices later crashed.

TERANGA GOLD CORP EXECUTIVES COLLECTIVELY WILL RECEIVE $10 MILLION IN SEVERANCE PAY

But investors say change-of-control provisions allowing for multi-million dollar executive windfalls remain commonplace.

“It’s excessive and it’s something that we don’t like to see as shareholders,” said portfolio manager Joe Foster at Van Eck Associates Corp, which holds shares in Barrick Gold Corp, Newmont Corp and other gold miners.

“These CEOs, they all have nice pay packages as it is,” he said, adding that he plans to use “say on pay” proxy votes, and meetings with management, to express his view.

Teranga Gold Corp executives collectively will receive $10 million in severance pay plus $20.9 million for accelerated vesting of options after agreeing to a $2 billion takeover by Canada’s Endeavour Mining Corp.

The payout is “egregious” given Teranga’s relatively small market cap, said portfolio manager Coille van Alphen at precious metals-focused fund manager Equinox Partners, which owns Endeavour shares.

Liquidating stock options shows executives are not invested in the company’s long-term future, she added.

“The whole point of a no-premium deal is they create value in the new company,” she said. “But if you really believe that, wouldn’t you want the upside? Why would you take the cash?”

Teranga said the change of control severance payment – two times annual salary and bonus – aligns with the industry standard.

“Each of the executive officers have been with the company for the better part of the last decade, and the experience of the senior group has played a significant part in our success,” Teranga President and CEO Richard Young said in a statement.

Equinox is a member of the Shareholders’ Gold Council, launched in 2018 by U.S. hedge fund Paulson & Co. to address high executive pay, cozy board appointments and value-destroying deals.

Endeavour Mining’s own change-of-control rules provide for each of its five executives to receive two years’ worth of salary and bonus upon termination. Van Eck’s Foster said he has previously voted against Endeavour’s executive compensation, saying it is “above average”.

An Endeavour spokesman said: “The Endeavour Board continually reviews its remuneration policy and takes external advice to ensure that it is appropriate to the size and complexity of the business, while being aligned with shareholder interests. We are in regular dialogue with investors who have consistently approved the policy.”

At Kinross Gold Corp, CEO Paul Rollinson and executive vice-president Geoffrey Gold are each entitled to three times their annual salary and bonus, as well as accelerated vesting of equity, if the company is acquired, filings show.

Executives at Canadian miner TMAC Resources Inc will get around C$5.9 million – about 2% of the miner’s market capitalisation – if a takeover by Agnico Eagle Mines Ltd goes through.

That is despite a rough ride for long-term shareholders: TMAC listed at C$5.75 per share in July 2015, and will be bought by Agnico for C$2.20 per share.

TMAC CEO Jason Neal declined comment.

Reuters