After a series of battles with Newmont, Indonesian officials and NGOs keep up the anti-mine fight, this time targeting the Toka Tindung gold project.

Author: John Helmer
Posted: Monday , 31 Mar 2008

LONDON –

The boomerang is an Australian aboriginal word for a throwing stick; but the weapon itself isn’t indigenous to Australia. Its killer edge and return trajectory have been exploited on most shores of the Indian Ocean from East Africa to India and Australia.

On Indonesian islands like Sulawesi, game and trouble abound, but the rain forest is too thick for the boomerang to be a practical weapon. Single and double-edged knives and spears are the preferred type of throwing stick. When it comes to catching the underwater Hairy Octopus, the boomerang is useless.

The Hairy Octopus is one of dozens of creatures, which live on the sea bottom of the Lembeh Strait, at the northeastern tip of the Indonesian province of North Sulawesi. The seafloor is unique for “muck divers” from around the world. Their name distinguishes them from coral-reef divers.
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by John Helmer - Monday, March 31st, 2008
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By John Helmer in Moscow

Russian multi-mineral fertilizer group calls for investor upgrade ahead of IPO.

Traced on the map, Verkhnekamskoye (“Upper Kama”) looks like a molar tooth, with an unusually deep root. On the ground, in the Perm region of central Russia, it is the second largest deposit of potash known in the world.

About 3.8 billion tonnes of potash ore are estimated to lie at relatively shallow depth of less than 400 metres. Verkhnekamskoye is thus not only the largest undeveloped source of potash in the world; but it is also potentially the cheapest to mine, and bring to market.

Digging into this deposit is an opportunity that third-ranked listed Russian producer Acron acquired at a state auction on March 12, bidding Rb16.8 billion ($704 million). Crossing the Verkhnekamskoye threshold marks Acron’s biggest market move ahead of it’s plans for international public placement later this year.

It also marks a milestone in Acron’s five-year strategy to become vertically integrated upstream for raw materials, and to establish the independence of its complex fertilizer business of rival phosphate and potash mining companies. In October 2006, Acron bought licences for two apatite-nepheline deposits in the Murmansk region of northwestern Russia. In five years’ time, and with an investment of about $300 million, Acron’s North-Western Phosphorus Company (NWPC) is expected to produce 1 million tonnes of phosphates; and another 1 million tonnes of nepheline (for processing into alumina).
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by John Helmer - Friday, March 28th, 2008
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By John Helmer in Moscow

Deripaska and Prokhorov holding companies trade claims over Norilsk Nickel deal contract.

Onexim, the Moscow holding unit for Mikhail Prokhorov, has broken its silence on the troubled sale of a 25% stake in Norilsk Nickel — in a manner of speaking.

Terms for the deal between Prokhorov and Oleg Deripaska, controlling shareholder of United Company Rusal, were first negotiated last August and September; the deal was announced in November. If fully consummated, it represents the largest corporate takeover in Russian history, and the most expensive hostile bid on the Russian record.

Mineweb reported yesterday on evidence of the apparent breakdown in the six-month old bid by Deripaska to take control of Norilsk Nickel from Vladimir Potanin and the Interros group, formerly Prokhorov’s partner:

http://www.mineweb.com/mineweb/view/mineweb/en/page67?oid=49850&sn=Detail
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by John Helmer - Thursday, March 27th, 2008
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By John Helmer in Moscow

When T.S. Eliot was summing up what he knew of hollow men, he concluded: “this is the way the world ends/not with a bang but a whimper”. This is also the way Russia’s biggest-ever hostile takeover, Oleg Deripaska’s bid to take control of Norilsk Nickel, is ending.

The contract deadline for deal closing, according to insiders, is next Monday, March 31.

It won’t be clear until then whether it’s Deripaska, or Norilsk Nickel seller, Mikhail Prokhorov, who is doing more of the whimpering. If Deripaska fails to deliver on the terms of their agreement – an 11% shareholding in United Company Rusal, $4.438 billion in cash, and $2.7 billion in deferred cash – then Prokhorov will get to keep his 25% plus one share in Norilsk Nickel. Also, he will not be obligated to pay Deripaska the $300 million break-fee the two had agreed on, if Prokhorov developed cold feet.

Mineweb reported the transaction details last December: http://www.mineweb.com/mineweb/view/mineweb/en/page36?oid=41934&sn=Detail
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by John Helmer - Wednesday, March 26th, 2008
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By John Helmer in Moscow

The wind-chill factor this winter in Tajikistan has produced record low temperatures and uncounted miseries for a population struggling with inadequate electricity supply and failing heat. Tajik newborns have been reported as having died from hypothermia while in hospital wards.

But on March 5, a single whistle-blow from the International Monetary Fund (IMF) sent a chill through the one well-heated residence in the country. That’s the presidential palace of Emomali Rakhmonov (aka Rahmon), the head of the land-locked Central Asian country since 1992.

For the IMF revealed publicly for the first time, and at the level of the fund’s board of directors, that the National Bank of Tajikistan (NBT) and the Finance Ministry in Dushanbe have been fiddling the country’s accounts for several years, falsifying the flow of funds and concealing the disappearance of as yet uncounted millions of dollars of international loan funds.

On March 5, the “Executive Board of the International Monetary Fund (IMF) met today to review a report from the Managing Director on noncomplying disbursements to the Republic of Tajikistan and a breach of obligations under Article VIII, Section 5 of the IMF’s Articles of Agreement”.
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by John Helmer - Tuesday, March 25th, 2008
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By John Helmer in Moscow

PR spin battles US recession to hype Russian steel deal

Taylor Rafferty is an international public relations company which works for Alexei Mordashov, the controlling shareholder of Severstal, third ranked Russian steelmaker. Its job is to help Mordashov extricate his foot from his mouth, and his hand from public shareholder pockets.

Mordashov can be a nervous fellow, if he thinks the Kremlin disapproves of what he is doing. In 2006, when Mordashov applied to President Vladimir Putin for permission to buy other Russian steel companies, he was told no. But he was told he would be allowed to stretch his own neck in Europe. This meant Kremlin approval of Mordashov’s attempt in mid-2006 to take over Arcelor, the leading European steelmaker at the time. Mordashov’s bid failed when it was beaten by Lakshmi Mittal, who mobilized more effective investment banking by Goldman Sachs, more cash, and better PR.

Mordashov learned the PR lesson. The market hasn’t. According to Taylor Rafferty’s mission statement, it promises clients “a reality check and sharp focus to the investor relations program”.
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by John Helmer - Monday, March 24th, 2008
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By John Helmer in Moscow

Polyus public shareholders in the dark about proposed new gold mine asset sale

Sixty years elapsed between the first US patents issued for the yo-yo, and 1928, when the wooden axle on a string became a fad in California, and then spread across the US. By 1965, the yo-yo was so common, manufacturers couldn’t preserve their trademarks, even while they promoted competitions to popularize demand for the toy.

In yo-yo competitions, a standard routine is called sleeping. That’s when the axle is made to spin without rising up the player’s string. Another is called walking the dog. That’s when the axle is made to spin along the ground, also without rising up or down the string.

In innovative Russian business, as Mikhail Prokhorov has been practicing it, the trick is to keep assets in motion, earning their proprietor cash as they spin. It can be difficult to know what trick Prokhorov intends to pull at the end of his string. Two years ago, when he bought gold mines and prospects to add to the Polyus portfolio, the rationale was obvious – and so was the payoff, if only to count Prokhorov’s 25.5% stake in Polyus’s growing capitalization. (Market reports indicate that Prokhorov may hold as much as 28% of Polyus’s stock.)
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by John Helmer - Friday, March 21st, 2008
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By John Helmer in Moscow

Uralkali keeps the initiative as potash breaks $600.

A series of Russian government decisions this month, awarding new mining licences at a premium valuation; imposing export duties; and regulating the domestic price of fertilizers for the next five years has triggered fresh forecasts for the direction of Russian potash producers, now the price-setter for the global commodity trade.

The biggest test of the clout of the potash miners began a week ago, on March 12, when the federal mine licensing agency Rosnedra conducted an auction of licences in the Urals region for the mining of new potash reserves. One week later, and the first impression of decisiveness on the government’s part has begun to dissolve, with a fightback orchestrated by the leading producer and exporter, Uralkali.

The official announcement of the March 12 auction said that three licenses to mine potash reserves at the Verkhnekamskoye deposit, in Perm region, had been sold for a total of $2.35 billion. Global reserves of potash are concentrated in Russia, Belarus, and Canada, but all the Canadian deposits have been allocated long since. The Verkhnekamskoye field is one of the largest unmined sources of potash in the world, and the largest ever to be auctioned internationally. When and if mines open in about a decade, the field represents an estimated increase to global potash supplies of 9 to 10 million tonnes per annum. This is roughly equal to the total volume produced in 2007 by Russia’s lead producers, Uralkali and Silvinit combined
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by John Helmer - Thursday, March 20th, 2008
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IMF joins UK High Court in corruption investigations of Tajik aluminium dealing.

“Now is the winter of our discontent made glorious summer by this sun of York”.

That’s the opening of the most vicious dynastic bloodbath on the English stage, spoken by the nastiest of Shakespeare’s royal villains — the hump-back plotter who becomes Richard III, for a short while.

Landlocked in the Pamir Mountains of Central Asia, the ruler of Tajikistan, Emomali Rakhmonov (aka Rahmon), has been desperately hoping for the sun to relieve the very worst winter in recent history for his country — the poorest of the former Soviet states. Instead, he has run into three international fireballs that have fuelled charges circulating in and outside Tajikistan, that its miseries stem, not from the weather, but from the disappearance of the country’s earnings to a tropical haven in the Caribbean.

Directly substantiating the latter, for the first time, is documentary evidence presented in the UK High Court on February 15, before Justice Tomlinson.

But worse was to come for Rahmon. On March 5, in an unprecedented default announcement, the International Monetary Fund (IMF) disclosed that the Fund board had discovered systematic financial misreporting by the National Bank of Tajikistan, and “noncomplying disbursements”. The IMF said it was ordering an immediate “special audit” of the state bank, and calling in a repayment of $47 million.
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by John Helmer - Thursday, March 20th, 2008
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By John Helmer in Moscow

Russia has been locked out of the largest nuclear power contract ever prepared in Africa, despite two years of promises from the South African government that it would invite Russia’s nuclear industry to join a competitive tender with the French and American companies, Areva and Westinghouse.

The lockoutappears to be regional in scope, blocking a bid by the Russians to build a nuclear reactor in Namibia, that country’s first. It also makes unlikely that ambitious schemes to draw Russian investment into uranium mining, ore concentration, and uranium fuel enrichment will materialize in southern Africa.

According to the SA utility Eskom, the first SA reactor to be commissioned would cost an estimated R120 billion ($15 billion); six power stations to produce an estimated 20,000MW would cost more than R720 billion ($90 billion), Eskom officials have publicly estimated.

The circumstances in which SA officials made their decision to exclude the Russians have been kept secret for weeks, while crisis talks were held by officials of the two governments, first in Moscow on February 12, and then in Pretoria on March 10.
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by John Helmer - Tuesday, March 18th, 2008
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