[miningmx.com] — DIVERSIFIED miner Anglo American expects demand for metals to remain strong even as a European debt crisis and a sluggish US economy feed concerns that world growth will slow, company CEO Cynthia Carroll said on Thursday.
So far, Carroll said she has received no cancellations of deliveries. Anglo is a major producer of metals such as nickel, iron ore and copper.
Nickel futures prices have fallen 35% since March and iron ore prices are off nearly 10% since February. Copper, a key base metal used extensively in electrical and electronic equipment, fell to a 14-month low this week amid worries weak global economies will hurt demand.
Carroll said prices were less a problem for the mining sector than environmental and regulatory licensing.
“The fundamentals of the industry are exceptional,” she said during a mining conference in Brazil’s mining state of Minas Gerais. “None of our delivery orders have been, nor will be canceled for the next year and a half.”
Carroll said the company has been working with the Brazilian government in an effort to reach a mutually agreeable mining reform, that the government is about the put to Congress in the coming weeks.
The Brazilian government is sending three bills to lawmakers in the coming weeks, which will increase royalties, create a regulatory agency and establish tougher requirements for developing exploratory concessions.
COPPER
Carroll added that one of the company’s copper mining projects in Peru had been temporarily put on hold because of water supplies and community resistance.
The company’s $3bn Quellaveco project and its Michiquillay project have faced periodic setbacks over the years.
The company’s Peru manager, Luis Marchese, said on Thursday the miner was trying to move forward with both projects.
“We are committed to both projects, especially Quellaveco,” Marchese told Reuters, adding that each project had suffered some delays but the company planned to keep working on them.
Mining companies often run into trouble trying to get access to water and win community support for their projects.
Peru’s President, Ollanta Humala, has said communities needs to receive a bigger share of the country’s natural resources boom. He signed three bills into law on Wednesday that expected to levy about $1bn a year of new taxes and royalties on the mining industry.
NIOBIUM
Carroll said that the company had discovered new deposits of the mineral niobium in Brazil’s center-west state of Goias. One of its uses is to strengthen steel for use in aviation.
The new discovery is close to the existing Catalao project, which Anglo plans to expand. Catalao is the world’s third largest Niobium producer and exports to mills in Europe, the United States and Asia. In 2010, it sold 4,000 tonnes.
Anglo has its Barro Alto nickel project in the same state, which is one of the company’s largest in the world. The nickel project entered production in March.
The company is investing $14bn in Brazil in its 2007 to 13 investment plan, Carroll said.
Of this total, $5bn will be allocated to Minas-Rio, the company’s largest iron ore project in the world. Carroll said output should reach 26.5 million tonnes of ore a year by 2014.
