Andrada Mining acquisition elevates the miner to emerging mid-tier status. Watch the video here.
2 big market moves that *should/could* send ZIOC higher:
The FT Aim Index has just recovered all the ground lost post 'Gaza' - it fell from 694.71 on the Friday before to below 670.00 last week.
As of now it has rallied to 695.30+, and has climbed for 6 straight days.
Propelling it higher are lower interest rates where the yield on the benchmark 10-year US bonds has fallen sharply from 5.00%+ to 4.55%.
> Pro-rata ZIOC could and should be trading back at 10.0p. Perhaps next week. We shall see.
Go back to the other board jiving which appreciates people of your calibre.
I chuckled my way through that hackneyed piece of dross at the weekend and decided it wasn't up to the standards set on this board. Never mind.
Of interest is this review of the same author's, Ben Judah, 2013 book on Putin and Russia:
The author explores both Putin’s successes and his failed promises, taking into account the impact of a new middle class and a new generation, the Internet, social activism, and globalization on the president’s impending leadership crisis. Can Russia avoid the crisis of Putinism? Judah offers original and up-to-the-minute answers.
“[A] dynamic account of the rise (and fall-in-progress) of Russian President Vladimir Putin.” —Publishers Weekly
https://www.amazon.co.uk/Ben-Judah/e/B00B29M7EK/ref=aufs_dp_fta_an_dsk
There are numerous nuances that that analysis neither considers nor addresses - one of which, and not even a central one, is that us pesky PIs also now include the BoD and managers (senior and junior) and regular employees.
...but our 'selected partner' (Clifford's description) are unlikely to buy us, per se.
The race to 'carbon neutrality' is on as now Porsche source green(er) steel:
https://newsroom.porsche.com/en/2023/sustainability/porsche-co2-reduced-steel-in-sports-cars-34225.html
By my reckoning they now join Volvo, Mercedes and (I think) BMW. The key point being is that, in an age of regulatory diktat coupled with cross border CO2-tariffs, if you don't go green you'll be squeezed out of the market;
This is the *HUGE* USP behind the 3 Gulf green steel mega hubs: There they don't have sunk capital in dirty old blast furnaces. They are building out a new green route:
High grade iron ore > pellets/briquettes (ideally cold bonded à la ZIOC) > DRI > EAF.
This route will be driven by their copious (and clean) Natural Gas and then by Hydrogen as it becomes available. The DRI metallics can then be exported to those European car makers free of swingeing carbon taxes.
The only box left to tick? Why, that would be the Gulf securing their own and owned high grade iron ore. And you know what that means....
Mitch - I am very sorry for you loss.
Oh my, that world-renowned Congolese fertiliser producer KP2 continues to implode.
Just as well no sane ZIOC holder fell for the post AD Ports gibberish that a 'rising tide floats all boats'.
That would have been really stoopid, wouldn't it?
Actually....Little Den's sojourn to Venezuela came in the days prior to the Belem conflab. Of serious note is that during the summit a Congolese party doubled back along the coast to Fortaleza and then to the Port of Pecem.
Pecem is along the lines of what AD Ports would produce at Pointe Indienne, along the coast from Pointe Noire, to export iron ore, i.e. long jetty and conveyors etc. You can see the pictures and write up here:
https://www.portofrotterdam.com/en/about-port-authority/partner-ports/pecem
Furthermore Pecem also has a FTZ 6km away at Cearà. It looks very much like the Congolese have been diligent and perhaps have carried their finding across to their deliberations with the UAE for AD Ports and the FTZ at 'Pointe Noire'.
About this event
Join this month’s #HorizonsLIVE as our panel – Wood Mackenzie’s Gavin Thompson, Isha Chaudhary, Mihir Vora and John Atherton Secretary General, International Iron Metallics Association - discuss how decarbonisation is transforming the iron and steel industry.
Decarbonisation will support the emergence of new production, processing and trading hubs for low– carbon iron and steel. Driven by rising demand for green steel, the industry’s push for net zero is set to transform the value chain of a commodity essential to the industrialised world.
Our panel will delve into this topic in-depth and take your questions!
https://www.linkedin.com/events/horizonslive-metalmorphosis7120518203612504064/
> A perfect opportunity should someone with to name drop Zanaga into the conversation, and ensure they keep on message that 'Green Steel' needs high grade iron ore and not just Hydrogen.
Wood Mackenzie @WoodMackenzie
This month’s #HorizonsLIVE is happening this week! Our WoodMac panel are joined by John Atherton, Secretary General, International Iron Metallics Association, to discuss how decarbonisation is transforming the #iron and #steel industry.
https://twitter.com/i/lists/1664531787291271170
https://www.linkedin.com/events/horizonslive-metalmorphosis7120518203612504064/
Revisiting the tweet:
The agreement aimed at the creation of a free trade zone between the Congo and the United Arab Emirates was also on the agenda of the discussions. Strongly desired by the UAE party, its signature should take place during the next COP.
What's the definition of a 'free trade zone'?:
'A free-trade zone (FTZ) is a class of special economic zone.[1][2] It is a geographic area where goods may be imported, stored, handled, manufactured, or reconfigured and re-exported under specific customs regulation and generally not subject to customs duty. Free trade zones are generally organized around major seaports, international airports, and national frontiers—areas with many geographic advantages for trade.[3]'
That pretty much defines beneficiation, pelletisation and even a steel works at the Pointe Noire SEZ - and the UAE are pressing for it by COP28 at the end of November.
Incidentally Little Den signed the 3 tax and trade treaties between the UAE and C-B back in March - (which foreshadowed the AD Ports concession).
Of note now is that Little D was last spotted in Beijing at the BRI forum, since when both his personal and twitter accounts have fallen silent. The Congolese jet stopped over in Dubai on the return and it is understood that Little D is in the Emirates working on...
(BTW the Congolese party day-tripped from Beijing to Incheon, Seoul during the forum and met with POSCO. POSCO are heavily involved with green hydrogen for DRI steel and have been doing steel deals in Saudi Arabia since then. Just saying).
Alwayshoping - the thing with Essar is that they intend to source their high grade pellets/briquettes from within the Gulf (Vale and Bahrain). 2 things of note: firstly this is new demand over and above the pellet plants' existing orders and, secondly, the owners of the green steel hubs (Saudi Arabia, UAE, and Oman) want to secure their own high grade feedstocks to both capture the value add along the chain and to have security of owned supply, i.e. their own Zanaga(s).
To this end, and as far as I can see, since the 3 green steel mega hubs were announced at the end of 2022, the Middle East hasn't secured a single ton of new high grade supply. That's what the PIF-Ma'aden JV (Manara Minerals) was publicly tasked with doing in January and we haven't seen any deal - YET.
I'm sitting on a dynamite quote that dovetails *exactly* with that Essar timeline.
Alwayshoping - Bullseye, Nice one!!
Coming up at the end of November, the UAE are hosting COP28. The hosts have been under sustained pressure to show their Net Zero credentials (or Net Lunacy, but that's another story) given their supply of petrochemicals to the world - plus the COP chairman is also head of the ADNOC.
Googling around the subject I found this from COP27 last year:
COUNTRIES TO REPORT ON GREEN STEEL AND HYDROGEN AT COP28
By Dominic Ellis on Nov 18, 2022
News Hydrogen: Governments attending COP27 have agreed on a package of actions focusing on sectors that account for more than 50% of total global greenhouse gas emissions including power, road transport, steel, hydrogen and agriculture sectors.
Areas for particular priority included the ramping-up of hydrogen production for clean energy purposes, and increasing the procurement of low-carbon material for public infrastructure projects.
https://www.gasworld.com/story/countries-to-report-on-green-steel-and-hydrogen-at-cop28/
Since then Saudi Arabia, the UAE, and Oman have committed to their green steel mega hubs, and signed numerous MoU's to develop green Hydrogen production using renewable energy (solar).
As ever the missing link and elephant in the room remains the supply (or lack of) of high grade iron ore to pair with the hydrogen. Then I recalled this :
(Translated)October 6, at #Dubai Expo City, Minister Denis @ChristelSassou
Nguesso had a working meeting with HE Reem Ebrahim Al Hashimy, UAE Minister of State in charge of #Coopération International..
The two ministers also discussed the ongoing collaboration between Congo and @ADPortsGroup regarding the construction project of a state-of-the-art multipurpose terminal within the autonomous port of Pointe-Noire. After reviewing the progress of the said project, Minister Denis @ChristelSassou Nguesso requested support from the UAE government to guarantee its success.
The agreement aimed at the creation of a free trade zone between the Congo and the United Arab Emirates was also on the agenda of the discussions. Strongly desired by the UAE party, its signature should take place during the next COP.
https://twitter.com/CooperationCG/status/1710358575908786349
The UAE 'strongly desire' a free trade zone between Congo and the UAE and intend signing at COP28. The beauty of a free trade zone would mean the tariff-free export of high grade iron ore from Congo to the UAE, validating AD Ports at Pointe Noire *AND* heading off Net Zero criticism for the hosts at COP28.
Could it be that we see a Zanaga acceleration at COP28? We shall see.....
Another home run today for Zanaga, this time as the South China Morning Post analyses Chinese imperatives in developing Simandou. Every factor similarly underlines the extraordinary business case for Zanaga. Sooner or later the media will join the dots and Zanaga will be mentioned in the same breath as Simandou.
'...Liz Gao, senior analyst in iron ore at commodities consultancy CRU Group, said the Simandou iron ore project’s capital expenditure is estimated at more than US$20 billion, and the break-even price for the mine would be US$70 per tonne during ramp up, and US$60 per tonne when producing at full capacity.
Observers say the Guinean iron ore will help China diversify its suppliers to avoid excessive dependence on Australia amid strained ties in recent years, as well as its drive to achieve resource security and to decarbonise the steel value chain since Simandou offers higher-grade ore.'
There's also this:
'“[Chinese] President Xi Jinping launched a plan [on the Brics summit margins] in Johannesburg in August to foster African industrialisation – perhaps the plan is also to use Simandou’s ore for this plan too,” Johnston said.
She said because Zimbabwe is about to inaugurate Africa’s largest steel mill, perhaps some of the ore from Simandou will go there as well. Chinese steel giant Tsingshan Holding Group is building a US$1 billion iron and steel plant in Zimbabwe through subsidiary firm Dinson Iron and Steel.
Gao of CRU Group highlighted China’s aim to diversify its iron ore suppliers to avoid dependence on Australia and Brazil, which account for 82 per cent of global seaborne iron ore exports.
She said though low-grade ores are in high demand now, the steel industry’s aim to decarbonise the sector will lead to a growing demand for higher-grade ores.'
https://www.scmp.com/news/china/diplomacy/article/3239571/why-chinese-interest-soaring-west-african-guineas-simandou-iron-ore-reserves
Zanaga is cheaper, likely quicker, has less political risk (we hope!) while having similar grades to Simandou. Furthermore Pointe Noire could be the optimal spot to build out a low-to-zero green steel complex. Huge quantities of natural gas already come ashore there.
When the wider market gets to figure out all Zanaga's positives the re-rate could be truly spectacular.
We've been bouncing around here on AIM, largely because the wider market hasn't got the essential proposition:
That in a world of 'Net Zero' the ONLY PRACTICAL SOLUTION to make green steel is high grade iron ore and hydrogen.
Analysts and commentators have been very slow to join the obvious and logical dots, and hence the amazing Zanaga proposition hasn't been recognised by the wider market. When the penny finally drops our re-rate will be stratospheric.
Anyway, here's a Bloomberg re-print from yesterday that gets very close to the final message. Essentially the Pilbara risks being stranded, beneficiation tech for low-to-medium grade ores is making very slow progress, and the solution lies in the likes of Simandou. Here're some filleted highlights. Enjoy.
FOR THE FIRST TIME IN A GENERATION, THE SPECTRE OF DISRUPTION LOOMS OVER MINING’S MOST RELIABLE PROFIT GENERATOR.
'....steel producers are under pressure to clean up a sector that accounts for at least 7% of global greenhouse gas emissions, a change that will require new methods and higher-quality raw materials. Much of the dry, dusty Pilbara region’s gargantuan resource base may no longer make the grade.
( )
“Australia’s ore industry is now at the start of a long-term structural decline,” said Tom Price, a London-based analyst at Liberum Capital Ltd. “It’s a fundamental shift that will resonate across the Australian economy.”
( )
But Australia’s typical iron ore has a grade of between 56% and 62%, making it largely unsuitable for DRI production — or only with additional processing that could add as much as 25% to costs, according to Wood Mackenzie Ltd.
( )
“The premium for higher grade material is going to increase significantly,” said David Cataford, chief executive officer of Champion Iron Ltd., a competitor to Australian producers which supplies higher-grade iron ore from Canada. “If you’re producing lower grade, we do feel it’s going to be more complicated in the medium term.”
( )
The biggest miners say they already produce the better stuff. Vale SA, which ships higher-quality raw material from Brazil and expects to command a green premium in future, is among those eager to forecast a world that favours richer ores. But higher-grade production — with an iron content of 66% or more — currently makes up only about 3% of global supply, so the race is on to crank up output from projects like the expansive (and expensive) Simandou development in Guinea, in which Rio is an investor.
“There’s an obvious shortage if demand ramps up during the course of decarbonization,” said Liu Yinghao, technical director at the low-carbon metallurgy innovation center of China Baowu Steel Group Corp., one of the world’s top steelmakers.
6:30 AM · Oct 29, 2023 916 Views
https://twitter.com/mining/status/1718500453993021872
This is very useful in promoting the green steel narrative, demand for high grade iron ore feedstock, and hence the focus onto Zanaga.
Additional detail here that WM could have/should have emphasised in last week's 'Metalmorphosis' report.
'The share of DRI and scrap in the global market, now 36%, is expected to rise to 54% by 2050, with a projected need for $80 billion in DRI investment within the next 30 years. DRI, made from high-grade iron ore pellets, significantly reduces emissions caused by steel production, especially when processed using EAFs powered by renewable energy sources. The report predicts a rise in scrap and DRI imports will also shift supply chains away from importing already completed steel products.'
https://www.environmentenergyleader.com/2023/10/report-steel-decarbonization-to-transform-supply-chain/
There's a resource statement somewhere for Mayoko, I think from the Exarro (?) days. However I really cannot be tossed to find it.