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Wednesday, 10 August 11
RESOURCE NATIONALISM IS MAIN BUSINESS RISK FOR MINING SECTORS, E&Y SURVEY
Resource nationalism is top of the business risk list for mining and metals companies around the world, while supply capacity constraint issues continue to dominate the top 10 rankings in Ernst & Young’s annual Business risks facing mining & metals 2011-2012 report, released today.
Ernst & Young Global Mining & Metals Leader Mike Elliot says in the past 12-18 months at least 25 countries have increased or announced intentions to increase their government take via taxes or royalties. “Resource nationalism is taking other forms as well, including greater controls on foreign participation mandated beneficiation, use it or lose it demands and mandated government participation,” says Elliott.
Vietnam, for example, yesterday announced that export taxes on all kinds of coal would be increased from the current 15 percent to 20 percent as of September 2011, to limit the outflow of the natural resource, according to a new circular issued by Vietnam’s Ministry of Finance. Meanwhile, Indonesia is currently in the process of drafting a new regulation that could ban the export of low-grade coal (below 5100 Kcal/kg) by 2014.
“Resource nationalism reflects the expectation among governments that the sector should be contributing more for the right to exploit natural resources,” he says.
According Ernst & Young, the global skills shortage remains in second spot. Infrastructure access jump from the sixth position last year to the third position this year. The other risks are social license to operate (last year in the 5th position), capital project execution (new), price and currency volatility (9), capital allocation (1), cost management (3), interruptions to supply (new), and the last position fraud and corruption (new).
However, Elliot says it’s the myriad of supply capacity constraints that continue to dominate the risk list, accounting for six of the top 10-including the global skills shortage, capital allocation, infrastructure access, capital project execution, cost management, and interruptions to supply.
“The market is probably excessively optimistic about how much and how quickly new production is going to come on. All these supply capacity risks mean companies are unlikely to be able to capture the premium pricing as quickly. It also impacts the cost profile of projects, so there will need to be a higher rate of return to attract new investment and as a result commodity prices will need to be higher,” Elliot said.
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Monday, 17 July 23
APPROVED AMMONIA-FUELED CONTAINERSHIP - BENEFITS AND RISKS: REED SMITH
Following the news in Offshore Energy that Korea Maritime Consultants has secured approval in principle from the American Bureau of Shipping for it ...
Friday, 14 July 23
CLEAN COAL USE KEY TO DEEP CUTS IN EMISSIONS, STABLE ELECTRICITY SUPPLY - CHINA DAILY
China must push for the clean use of coal and step up integration of the dirty fuel with carbon capture, utilization and storage to achieve sustain ...
Thursday, 13 July 23
VIETNAM'S COAL EMISSIONS PRIMED FOR SURGE AFTER IMPORTS JUMP - REUTERS
Vietnam’s thermal power emissions are primed for a steep climb this summer after the country’s imports of thermal coal soared to their ...
Monday, 26 June 23
COAL PRODUCTION AND CONSUMPTION UP IN 2022 - EUROSTAT
In 2022, EU coal production and consumption continued to increase, reaching 349 million tonnes (+5% compared with the previous year) and 454 millio ...
Wednesday, 21 June 23
QATAR STRIKES SECOND BIG LNG SUPPLY DEAL WITH CHINA - REUTERS
Qatar on Tuesday secured its second large gas supply deal with a Chinese state-controlled company in less than a year, putting Asia clearly ahead i ...
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- Australian Commodity Traders Exchange
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- Australian Coal Association
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- Ministry of Transport, Egypt
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- White Energy Company Limited
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