abmec€¦ · • africa –ghana, guinea, morocco, ... continue to work closely with fco at home...

ABMEC

Ros Lund

10th November 2016

2

Agenda

1. Introduction

2. HMG Drivers and DIT

3. Mining High Value Campaigns

• Latin America

• Africa – Ghana, Guinea, Morocco, West African power for mines

• Central Asia – Kazakhstan and Mongolia

• Horizon scanning – Ethiopia, Central Europe, Iran, Russia

• Western Balkans focus

4. UKEF

5. Contacts

3

Department for International Trade

Designed to unite UK suppliers with overseas opportunities.

DIT team focus on campaigns in different geographies where a number

of high value mining developments are occurring.

Change of PM in Summer has resulted in a higher profile for trade.

Now a full government department with a Secretary of State Dr Liam Fox

and 3 under Secretaries - Greg Hands, Michael Garnier and Lord Price.

Continue to work closely with FCO at home and in Embassies.

Support has widened recently to also support:

•Overseas Direct Investment

•Inward investment

High Value Campaigns

DIT has the task of promoting exports. Mining has been

selected as a valuable sector for export opportunities.

Within mining the most prospective regions are identified as

campaigns and given specialist resource to realise

opportunities. DIT helps with:

Political support – IGCs, MOUs, Support Letters

Orientation – OMIS (Overseas market intro), intelligence

Commercial – Missions, Export Opportunities, Events

Awareness – Marketing, Local Events

Finance – Direct lending, debt export finance, guarantees and

insurance

Structure of the UK’s Mining Supply Chain

*Infrastructure*Finance

*Energy *Water

Professional

ServicesEducation

Environment

&

Society

Equipment

VPs

CSR

EITI

Mining Supply Chain

Port

Road

Rail

LocalPolitical

Regional

R&D

Policy

Whilst not forming an exhaustive list of

all the component parts and of the

Mining Supply Chain and their

relationships to each other, this diagram

seeks to demonstrate the complexity and

diversity of sub-sectors which form the

basis of the majority of mining projects.

Extraction industries create infrastructure

requirements for the transport of product,

provision of reliable power, housing of

workers, etc, primarily funded by private

sector equity investors. Of note are the 4

core pillars of Finance, Infrastructure,

Water and Energy, all of which are

required for all mining projects.

Mining development is much wider that building a pit in the ground.

DIT supports all elements of mining development

and mineral processing and refining

Mineral

processing/

refining

Chile, the world’s largest copper producer is

planning to invest over £50 billion in mines and

infrastructure projects in the 10 years

• 52 projects tracked by Embassy

• Chile Government, UK plc in and mining

majors have close relationships

Contract Opportunities:

• Copper concentrate facilities worth £2bn

• Water desalination and pumping plants

• Conveyor facilities capable of up to 100kt/day

• Requirements from geoscience to rehabilitation

Peru - 17 mining and infrastructure projects

worth £15bn scheduled in 10 years including:

• Copper, gold and phosphate projects

• Greenfield, brownfield and expansion projects

• Copper smelter and gold refinery upgrades


• Los Calatos (Moquegua) copper /molybdenum

• Toquepala copper mine expansion

• Requirement across multiple metals

Chile, Peru and ColombiaColombia is planning to invest £7 billion in coal

and gold mining and infrastructure projects, to

include:

• Anglo Gold Ashanti’s £2bn gold projects

• Expansion of Cerrejon and Drummond coal

• Long distance coal freight and port facilities


• Gramalote and La Colosa gold project tenders

• Mining supply chain for thermal and metallurgical

(coking) coal

• Gold mines and infrastructure projects

• Environmental impact assessments

Guinea and Morocco

Guinea is considered the best untapped

natural resources in Africa with $45bn of mine

related investment by 2025 reported to the

World Bank.

• Chinalco $20bn Simandou iron ore mine

• Guinea Alumina Corporation $1.3bn bauxite

mine and alumina refinery – UKEF issued EOI

for $800m

• UK companies Alufer, Avocet, Stellar

Diamonds (and Tullow Oil), Bellzone

Contract Opportunities

• GAC and other Bauxite

• Energy Projects particularly hydro

OCP the largest phosphate mining company in

the world have a $19bn expansion plan to expand

mining and fertilizer processing plant across the

northern, southern and central region

• Northern Zone development almost complete

• Southern zone to be developed next in Western

Sahara

• Focus on phosphate solutions for leverage


• Ports

• Sulphuric Acid Plant

• Wash Plant

• Slurrified ore pipeline

Forthcoming Events & Missions

• UK Pavillion at Symphos 2017

Africa is Energy Deficient

Energy required for Mining and economic development

Finance is key – developing a supply chain to include finance

WAPP is 30 energy projects across ECOWAS region

• 22 Hydro, 4 solar and 4 thermal with associated transmission lines

• Overall contract value c£11bn

• Contracts need a link to mine development – assists financials


• Aggreko – 10 yr concession for new gas fired power island in Ghana $400m

• Lufubu Power project - $600m hydro in northern Zambia – UKEF discussion

• Konkola Copper Mine, Zambia – large scale solar hybrid (or LNG) 220MW

stable power supply to copper mine/ smelter, with 17MW of standby capacity

• Bumbuna Dam – $640m hydro project in Sierra Leone – UKEF with Dawnus

• OCP/Shell – LNG facility to help power OCP mining and industrial hub - $4bn

• Goldfields, Ghana – CentraxGT gas turbines providing 40MW. Need

additional 20MW, with solar hybrid to reduce capacity need for gas storage

West Africa Power for Mine Development

Horizon scanning - Iran

9

Copper

Iran has significant copper deposits.

Grades are low, compared to South

America – typically less than 0.5% Cu.

The vast majority of the copper mining

and processing in Iran is carried out by

the National Iranian Copper Industries

Companies (NICICO).

Iron Ore

Extensive deposits of Iron Ore and a significant investment in DRI steel making through Midrex

(UK). Iran has a need for pelletizing projects with Kobe Steel.

The Iranian iron ore mines require complex and expensive processing.

Gold

There are a number of small gold opportunities

Coal

Recently completed a new Coal Processing plant in northern Iran. There are a number of

smaller projects which are active and plans to expand the one major coal operation (Tabas) in

the near future.

Currently payment is difficult in

Iran but it is an interesting market

that we monitor.

10

Kazakhstan

KyzlordaPb, Zn, AgShalkiya, NordGold

OskemenPb, Zn, Re, Ti, Mg, FeKazzinc, Polymetal

AktobeK2CO3, MgKazakhstan Potash,Kazax, Arcelor Mittal

PavlodarFeArcelor Mittal

AstanaFe, C, U308, CuArcelor Mittal, Kazatomprom, Kaz Minerals

KaragandaPb, Zn, Ra, MoArcelor Mittal, Dala Mining, Eurasian Copper, ERG

OralK2CO3Kazakh Potash

AlmatyWSyrymbet

Location of

mineral

resources and

projects in

Kazakhstan

Kazakhstan Mining • The IGC Mining Group are focused on expanding opportunities for UK cooperation in Kazakhstan

• A British Business Chamber recently established with a mining subgroup

• EBRD are very actively working in the country, funding a consultant to implement the new mining code

and Shalkiya Zinc

• Expression of Interest letters for $1.75m were given by UKEF to support UK supply chain exports

• DIT have taken two sets of companies to visit companies and government during 2016

• The Kazakhstan Ministry of Investment development, KazGeology and Almaty Tech Garden are actively

looking to work with UK companies

Contract opportunities

• Copper smelter

• Mineral resource availability mapping

• Coal mine & power project

• Jorc resource & feasibility reports

• CHPP upgrade

• Tailings management

• UCG & coal methane management


• IGC meeting in London 22nd November 2016.

• Minex Forum London 28th November 2016.

Mongolia Mining

• The new Mongolian Government are committed to supporting mining project development

• UKEF are interested in looking at opportunities in Mongolia to support UK supply chain exports

• Rio Tinto are developing the Oyu Tolgoi underground mine at a cost of $6bn

• Two majority state-owned coal mines – Shivee Ovoo and Baganuur have ambitious expansion

plans

• UK company IM Power are looking at a coal mine and generation project to supply power CHP

• EBRD are very actively working in the country

Contract opportunities

• Rail infrastructure projects

• Mineral mapping

• Copper mine expansion

• Coal mining processing and transportation

• Power station development opportunities


• Minex Forum London 28th November 2016.

Horizon Scanning - Russia and Ukraine

13

Russia

• Although UKEF is not proactively marketing in Russia, DIT is still able to

support inbound enquiries for finance and support

• Can support non-state companies

• Already working with Amec Foster Wheeler, Joy Global, Leapfrog on Russian

opportunities

• Have relationships with several mining companies already – Polymetal,

Nordgold, Petropavlovsk, Suek

• Working with UKEF to build relationships with financial institutions who invest in

Central Asia and Russia including ING, VTB Capital, Rothschild etc

• Minex forum includes Russian company presentations

• Talking with Embassy about a scoping visit and Embassy reception in Moscow

Ukraine

• More difficult but Mariya in the Embassy in Kiev is very helpful and ready to

answer questions and give direction

• Have supported a couple of inbound enquiries recently

• North is a no-go area

Horizon Scanning – Ethiopia and East Africa

The Ethiopian economy has been one of the best performing in Africa in the past

decade. Since 2004 Ethiopia has more than doubled per capita income.

• The Danakil Depression in Ethiopia and Eritrea is one of the richest sources of Sulphate

of Potash in the world

• Circum Minerals and Yara Resources are spending almost $4bn developing their potash

projects

• Kefi Minerals have a $130m gold development project and Newmont are amongst

explorers


•Build of Potash projects

•Gold processing

•Road, rail and power to support mine development

Wider regional infrastructure and mining projects

Tanzania gold etc

Eritrea potash - Danakali

Horizon Scanning – Central Europe metals

Across the region there are a number of opportunities in metallic mines

•Serbia has the highest number of opportunities, we have good contacts and supply-chain led

interest

•Bulgaria & Bosnia Herzegovina have significant resources and are open to UK suppliers

•Romania, Austria, Hungary and Albania provide opportunity, as yet unexplored by UKTI

Project opportunities:

Bulgaria - Dundee Precious Metals – Krumovgrad $6.2bn gold development project

•Planning construction to start production in 2018, open pit gold with Crushing, Flotation, Grinding

Macedonia - Euromax Resources – Ilovitza $198m

•Construction to start production in 2018, Open pit gold with Ball, Carbon-In-Leach, Crushing, Desorption,

Electro-winning, Flotation, Semi-Autogenous Grinding, Smelting

Albania – Arian Resources – Perlat Copper

Macedonia – Genesis Resources – Plavica Gold?

Montenegro – Centurian Capital – Monty Zinc?

Serbia – Rio Tinto – Jadar Lithium underground mine; Victoria Group – Lisina Phosphate

Romania – Eldorado Gold – Certej – 2017; Romania - Carpathian Gold at Pre-Feasibility

{Romania – Gabriel Resources – Rosia Montana – open pit gold $215m – ceased due to dispute with

government}

Central and Eastern Europe coal

• Poland is the 9th largest producer of coal in the world, producing 137mt in 2014, 1.7% of

the total global supply.

• It is also a significant consumer, with 77.5mt it is again the 9th largest in the world.

• Across the Central and Eastern Europe region coal is used for power generation in every

country and 6 CEE countries are in the top 30 global producers of coal globally

o Poland-9,

o Czech-16,

o Serbia-18,

o Romania-21,

o Bulgaria-22,

o Bosnia-26*

• The UK delivers world class capabilities to the global coal mining industry, supply chain

companies began exporting after the decline of the domestic industry

• The UK has world leading expertise in mine design, mine methods, equipment and

processes and the development of world class environmental and health and safety

standards

• Coal mines in the region has a high requirement for optimization which UK is a UK supply

chain area of expertise

Coal mining and power

Low Carbon Technologies

•Coal washing technology to reduce ash

•Power plant and mine optimisation

•High Efficiency, Low Emissions (HELE) Coal Technology

• Renovation and modernization technologies for existing

power stations

• Waste heat recovery from power plants

•Coal mine methane usage

•Power station

•Pre-combustion bio-methane production from coal fuel

carbon-dioxide

•Coal gasification/ coal bed methane

•Energy Storage

17

The UK supply chain has adapted to the move away from coal-fired generation

in the developed world with a focus on HELE and carbon reduction technology

Mining Opportunities in Western Balkans

18

• Coal plays a key role in the

regional energy mix (60%

electricity generated from coal)

• More than £100 million of

confirmed investment in 2016-

2018 in coal mine modernisation

in Bosnia and Herzegovina and

Kosovo

• Procurement of equipment and

services

• Other minerals: copper, gold,

zinc in Bulgaria, Serbia

• £200 million worth investment

projects (Rio Tinto, Dundee

Precious Metals, etc.) in open pit

and underground mines

Mining Opportunities in Western Balkans

19

Perspectives

• Mines will invest to develop its capacities what creates

opportunity for companies offering high level of technology

to support development

• Difficult and complicated procedures are making the

business difficult but with local support can be properly

managed

For more details, please contact: [email protected]

mailto:[email protected]

UK Export Finance

20

• UK Export Finance has nearly 100 years’ experience in helping overseas

borrowers, from corporate entities to public bodies and sovereign

governments, to finance purchases from UK suppliers.

• By either lending directly, or guaranteeing a loan from a commercial bank,

UK Export Finance can provide support which could in turn finance up to 85

per cent of the value of your UK export contract.

• UK Export Finance offers competitive foreign content rules, where up to 80

per cent of the supported contract value can originate from another non-UK

country.

• Loan terms and conditions are based on OECD rules and rates.

• Repayment terms can be up to 10 years with a potential to defer interest

payments until project completion.

• UKEF also provide export insurance cover against a variety of risks.

UKEF Process

21

Contact Specialist

Meet UKEFProvide

project infoUnderwriter initial view

Due diligence

completed

Credit committee

review

Letter of interest issued

Agreement signed

UKEF are keen to speak with companies looking to export overseas and buyers

looking to purchase UK equipment.

For the 1st meeting UKEF requires a project description, export company and

purchaser accounts.

IFC and Equator Principle standards must be followed for project finance.

UK Export Finance Mining Examples

22

Exporter: Terex

Equipment: 100 ton Dump truck X 2

Facility amount: 2 million USD

Requested tenor: LC+5 years

Destination: Mongolia

Exporter: Joy Global

Equipment: Longwall system



Destination: Russia

Exporter: FL Smidth

Equipment: 1 million tonnes CHPP



Destination: South Africa

Exporter: Tech Universal

Equipment: Tailings pond



Destination: Kazakhstan

Mark Smith, Head of Mining

T: +44 (0)141 228 3626

E: [email protected]

Joshua King, Project Manager

T: +44 (0)7767 613822


Craig Sillars, Sector Specialist (Africa)

T: +44 (0)7747 622215


Darryn Quayle, Sector Specialist (Latin America)

T: +44 (0)7467 441416


Ros Lund, Sector Specialist (Central Asia)

T: +44 (0)7917 426753


Contact information

www.gov.uk/government/publications/the-

uk-delivering-global-mining-solutions

http://www.gov.uk/government/publications/the-uk-delivering-global-mining-solutions

abmec€¦ · • africa –ghana, guinea, morocco, ... continue to work closely with fco at home...

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