China’s domestic natural gas demand is set to grow faster this year, gaining 10 percent, Argus reports, citing state-owned energy majors PetroChina and Sinopec.

A senior PetroChina gas executive said demand for natural gas will be driven by the utility sector as gas-fired power plants ramp up production to back up intermittent solar and wind capacity.

According to the executive, the country’s demand for natural gas will hit 350-356 billion cubic meters this year. Sinopec has almost identical numbers, expecting gas demand at 350-360 billion cubic meters. According to the major, the demand would come from power utilities and the industrial sector.

In 2020, China consumed 326.2 billion cubic meters of natural gas, of which 192.5 billion cubic meters came from domestic production. This was almost 10% higher than the domestic production figure for 2019. Imports also rose in 2020, by 5.3% to 140.3 billion cubic meters.

LNG imports specifically jumped by 10.3% over the first eight months of the first pandemic year as the Chinese economy rebounded a lot more quickly than others. As with oil, China was the driver of the recovery in gas demand last year.

For this year, domestic production plans are for 202.5 billion cubic meters, which would be 5.2% higher than the 2020 figure. Of this total, PetroChina is seen producing 133.8 billion cubic meters. Sinopec, a much smaller gas producer, plans to extract 34 billion cubic meters of natural gas this year.

Even so, some in the gas industry in China are worried that demand is growing more slowly than it should. A recent poll carried out by Verdict and cited by Offshore Technology showed that for 35% of China’s gas and LNG industry, slow demand growth was the biggest concern. This was followed by LNG import project delays, which were the top concern for 21%.

At its meeting today, the Cabinet decided to downgrade the country’s coronavirus emergency regime level of current Red Level down to Orange Level starting from May 8 until June 5. Under the Orange Level regime, complete or partial heightened state of readiness is declared and operations of public and private organizations and individuals are restricted to a certain extent depending on the situation.

Deputy Prime Minister and Head of the State Emergency Commission S.Amarsaikhan and Minister of Finance B.Javkhlan introduced about the Cabinet’s decision.

Currently, 55 percent of the nationwide vaccination target- 2,067,292 adult populations have gotten the first dose of the COVID-19 vaccine and 26 percent have received the second dose. The Cabinet also resolved to allocate MNT 3.2 billion for the purchase of necessary equipment and maintenance of the National Center for Communicable Diseases. With a view to return to normalcy as quick as possible, the Government is aiming to accelerate the vaccine drive. Therefore, it plans to complete involving the total adult population of Ulaanbaatar city in the first dose of the COVID-19 vaccine within May 8 and rural citizens in the first and second dosage in June. Citizens’ engagement is so vital to complete vaccine drive, said the Deputy PM. “As the number of infection cases has not decreased, it was decided not to open the country’s border until June 1,” he added.

Moreover, Minister of Finance B.Javkhlan informed that social welfare services will not be provided next month unless welfare beneficiaries are vaccinated. There are 211 thousand citizens who receive various welfares in Ulaanbaatar city. As of May 4, 80 thousand of them have not had the first dose. Moreover, 29 thousand out of 47 thousand adult citizens who receive food vouchers have not been involved in vaccination.

Furthermore, the Cabinet decided to provide MNT 50,000 in cash to every citizen, who has been fully vaccinated, to support their health.

Citing that the citizens’ involvement in vaccination has drastically gone down in the capital city, Finance Minister B.Javkhlan said, " A whole society should not be at risk due to unvaccinated citizens, even though the vaccine is given on a voluntary basis. Mongolia’s economy has expanded and reached MNT 40 trillion by manufacturing MNT 100 billion worth gross domestic product in a single day. But, we are losing 50 percent of our opportunity in time of the lockdown and 10-20 percent in normal period. We hope we will complete vaccinating 60 percent of the entire population by the half of this year to recover the country’s economy.”

The world’s top miner BHP (ASX, LON, NYSE: BHP) said a proposed royalty on copper and lithium sales being discussed by lawmakers in Chile risks making international miners wary of investing in new projects or expanding existing mines to meet growing demand for both metals.

A congressional mining committee in the biggest copper-producing nation approved last week a version of a bill that would charge higher rates at times of high prices for copper and lithium.

The proposed law, first introduced in 2018 by opposition lawmakers, originally called for a 3% mining royalty for companies mining and exploring for the two metals. The new version would charge a marginal rate of 15% on sales derived from copper prices of between $2 and $2.50 a pound and as much as 75% on cash generated from prices above $4. At current prices, the effective rate would be 21.5%, although miners could discount refining costs from copper sold as refined cathode.

Ragnar Udd, president of BHP Minerals Americas

The proposed tax, to be applied on the nominal value of extracted metals, would affect copper miners that produce more than 12,000 tonnes of the metal annually and those extracting 50,000 tonnes a year of lithium.

Half the funds obtained from the royalty would go into a regional convergence fund to finance regional and communal development projects. The other half would directly finance projects to mitigate, compensate or repair environmental impacts from mining activity in communities near mining projects.

“You can absolutely try and take more from the golden goose but you just need to be very clear on what the implications are on that longer term”, Ragnar Udd, president of BHP Minerals Americas, told the Financial Times. “And the sort of reforms that are being put forward at the moment will be really quite damaging to the industry.”

Likely to get blocked

Even before the modification to the bill, the industry had indicated it would likely stifle investments and make Chile less competitive.

Diego Hernández, president of Chile’s National Mining Society (Sonami) and former CEO of copper giant Codelco, has defended the existing system.

In his first term in office a decade ago, centre-right President Sebastian Piñera introduced a complicated system of payments that now charges large producers a variable rate on operating profit of as much as 14%.

THE PROPOSED TAX WOULD AFFECT COPPER MINERS THAT PRODUCE MORE THAN 12,000 TONNES OF THE METAL ANNUALLY AND THOSE EXTRACTING 50,000 TONNES A YEAR OF LITHIUM

“It brings in the same or more (than a tax on sales) and does not fundamentally affect the less competitive mines,” Hernández told Reuters in March.

Opposition leaders, who are responsible for the bill, believe royalties on copper and lithium produced by companies such as BHP and Albemarle would fund regional development projects, responding to the growing social and environmental push from investors and supply chains.

If the royalty bill gets through senate, Piñera’s administration is likely to block its passage via the constitutional court given it was introduced by the opposition. Ruling coalition lawmakers laid the groundwork for taking the bill to court by presenting a so-called constitutional reservation.

Chile holds about 52% of the world’s known lithium reserves. The nation aims at making the white metal its second-largest mining asset. Lithium is currently the country’s fourth-biggest export.

(With files from Bloomberg)

Ivanhoe Mines (TSX: IVN) announced on Monday it is accelerating the construction and commissioning progress at the Phase 1 Kamoa-Kakula concentrator plant in the Democratic Republic of Congo.

The target date for C4 commissioning (milling of ore and first copper concentrate production) has been advanced to the end of May or early June — several months ahead of schedule.

Overall construction of the Kamoa-Kakula project’s first phase 3.8-Mtpa concentrator plant is essentially complete (98%), the company says, with the majority of the C1 (construction complete) certificates signed off.

The plant is energized with permanent power and C2 commissioning, which involves electrical, control and instrumentation checks, all well advanced. Water is being circulated in certain areas of the plant, marking the beginning of C3 commissioning, Ivanhoe said.

C3 commissioning involves checking for leaks, certain instrument calibration, control loop checks, and is the precursor to C4 commissioning (hot commissioning), which involves processing ore through the plant to produce a copper concentrate.

Ivanhoe co-chair Robert Friedland

Overall plant commissioning is running well ahead of schedule, with the first ore expected to be added to the mill by the end of May. Lower-grade ore will be fed into the plant during the C4 commissioning phase, to ensure plant performance and copper recovery are satisfactory before increasing the head grade.

The 409,000 tonnes mined in April comprised 357,000 tonnes grading 5.70% copper from the Kakula mine, including 121,000 tonnes grading 8.40% copper from the mine’s high-grade centre, and 51,000 tonnes grading 5.85% copper from the Kansoko mine.

The project’s pre-production surface stockpiles now contain approximately 3 million tonnes of high-grade and medium-grade ore at an estimated blended average of 4.74% copper. Kamoa-Kakula now has reached the 3-million-tonne target of mined high-grade and medium-grade ore, several months ahead of the timeline estimated in the 2020 pre-feasibility study.

Contained copper in the stockpiles increased by approximately 23,000 tonnes in April to a cumulative total of more than 140,000 tonnes.

Kamoa-Kakula also set another monthly mine development record in April, with advancement of more than 3,625 metres, bringing total underground development to approximately 42.2 kilometres — more than 15 kilometres ahead of schedule.

Drift-and-fill stoping operations are progressing well at the Kakula mine, with the majority of the ore production coming from stoping operations and the remainder coming from mine development activities.

The backfill plant, which will mix tailings from the processing plant with cement to produce paste backfill, will begin pumping backfill to the underground operations in July.

“The start of production at Kakula marks the beginning of a multi-generational copper mining district, consisting of numerous high-grade mines. We now turn our focus to scaling up this expansive copper region in a manner that is ethically and socially responsible, and setting a new global benchmark for the elimination of greenhouse gases in the production of copper that the world urgently needs,” Ivanhoe co-chair Robert Friedland said in Monday’s press release.

Kakula is projected to be the world’s highest-grade major copper mine, with an initial mining rate of 3.8 million tonnes per annum at an estimated average feed grade of more than 6.0% copper over the first five years of operations. Kakula is the first of multiple high-grade mining areas planned on the 400-square-kilometre Kamoa-Kakula mining licence.

The copper project is a joint venture between Ivanhoe (39.6%), Zijin Mining Group (39.6%), Crystal River Global Limited (0.8%) and the DRC government (20%).

Mongolia has threatened to declare the 2009 Oyu Tolgoi copper/gold mine investment agreement void, unless the international tax arbitration proceedings brought against the government are dismissed in their entirety.

This is according to Canada-based Turquoise Hill, which holds 66% of Oyu Tolgoi LLC (OT) – the Mongolian company owning the mine.

OT in February last year instituted international tax arbitration proceedings against Mongolia and the government has now filed its statement of defence together with a counterclaim.

Although it is not a party to that arbitration, Turquoise Hill said on Monday that it understood that the defence and counterclaim included a request that the arbitral tribunal add both the company and a member of the Rio Tinto Group as parties to the arbitration.

The counterclaim also reportedly made assertions surrounding allegations of historical improper payments to government officials and seeks unquantified damages, the TSX- and NYSE-listed miner stated.

In a statement, Turquoise Hill said it would oppose the request that it be added to the tax arbitration and that it would defend itself against the counterclaim.

“The company understands that the principal thrust of the government defence and counterclaim is to seek the rejection of OT’s tax claim in their entirety.”

"In the event OT's tax claims are not dismissed in their entirety, [the government of Mongolia] is seeking in the counterclaim an alternative declaration that the 2009 investment agreement is void," Turquoise Hill stated.

The project, billed as one of the biggest copper/gold deposits, has been beset by problems, including development struggles, delays and cost blowouts that have led to tensions between the government and Rio Tinto.

Earlier this year, Mongolia threatened to cancel the 2015 Oyu Tolgoi underground mine development and financing plan, which sets out a basis for funding of the project. Mongolia has expressed concern about Rio Tinto’s revised budget of $6.75-billion for the expansion of the Oyu Tolgoi mine, stating that the rising development costs are eroding any economic benefit it would receive from the mine expansion.

Rio Tinto operates the Oyu Tolgoi mine through its majority ownership of Turquoise Hill.

Oyu Tolgoi is expected to produce 480 000 t/y of copper on average from 2028 to 2036 from the openpit and underground, compared with 146 300 t/y in 2019 from the openpit.

Mongolia reported 1,015 new daily coronavirus cases, the Health Ministry reports on May 4.

895 were registered in Ulaanbaatar and 103 in rural areas. 1 case was a hospital-acquired case, 16 imported cases (Indian nationals who arrived on a flight en route Delhi-Ulaanbaatar on April 26 tested positive for coronavirus).

The total of COVID-19 cases in Mongolia now stands at 40,396, with 24,333 recoveries. In the past 24 hours, 1,401 people recovered.

7 patients aged between 57 and 83 died of COVID-19 and the death toll reached 126.

May 4 (Xinhua) -- Mongolia's National Agency for Meteorology and Environmental Monitoring on Tuesday issued a warning of spring floods.

The water levels in major rivers and lakes in the country, including Tuul, Khuvsgul, Ider, Selenge, Beltes and Delgermurun have exceeded the warning levels by 5-60 cm due to the spring floods, the weather monitoring agency said, urging residents living along rivers and lakes to take precautions.

Spring floods usually occur when snow and ice in mountain areas suddenly melt and then run off the surface and flow into lakes and rivers during the spring season, causing excess water to spill over the banks

Mongolia’s Institute of Astronomy and Geophysics reported that on Monday afternoon, May. 3 a quake with a magnitude of 6.3 jolted Khuvsgul province in northern Mongolia.

The earthquake had a magnitude of 6.2, but changed it into 6.3 a couple of minutes later, according to an initial report by the institute.

The institute noted in a report that the earthquake took place around 32 km southwest of Khankh, a district of the province, at approximately 4:46 p.m. local time (0846 GMT).

The sturdy earthquake was sensed in several regions of Mongolia, comprising the capital city Ulan Bator and the provinces of Khuvsgul, Orkhon, Darkgan-Uul, Bulgan and Arkgangai, but no destruction has been announced.

As part of the project on the establishment of Air Rescue Unit at the National Emergency Management Agency of Mongolia and supply of helicopters, two EC-145 helicopters for emergency medical services and search-and-rescue operations were brought into the country through the Zamyn-Uud border checkpoint.

Under the above-mentioned project, an Air Rescue Unit will be newly established at NEMA and three EC-145 T-1 helicopters and one helicopter for flight training and flight simulator will be supplied from France.

The number of people vaccinated against COVID-19 in Mongolia reached 1 million on Monday afternoon, according to the Mongolian government's press office.

Under the motto "For summer without COVID-19, let's get vaccinated," Mongolia launched a national vaccination campaign against COVID-19 in late February with an aim to cover at least 60 percent of its 3.3 million population.

As of Monday, Mongolia has confirmed 39,381 COVID-19 cases, with 128 related deaths.

The number of daily new COVID-19 cases in Mongolia has risen sharply since the beginning of April. The COVID-19 surge continues, and around 1,000 cases have been reported per day in the country, mostly in the capital Ulan Bator, which is home to over half of the country's total population.

The Asian country reported its first imported COVID-19 case in March 2020 and confirmed its first locally transmitted cases in November last year.