May 17, 2020

South Korean mine construction company takes a step back after A$1bn loss

Samsung C&T
Western Australian mining
South Korean constru
Dale Benton
2 min
South Korean mine construction company takes a step back after court A$1bn loss
Samsung C&Twill be taking a step back in its mine construction projects, as the company lost A$1bn on a recent Western Australian project.

The Sout...

Samsung C&T will be taking a step back in its mine construction projects, as the company lost A$1bn on a recent Western Australian project.

The South Korean company had completed work on the Roy Hill iron ore mine but is plagued with court battles including a lawsuit for A$65m in unpaid subcontracting work to the Spanish company Duro Felguera.

Samsung C&T stated that there is little market demand for mine construction projects, citing the current difficult climate in the commodities market.

The company won a US$5.6bn contract to build the Roy Hill mine in 2013.

Samsung C&T developed a processing plant to export iron ore produced from the Roy Hill mine, railroads and harbour infrastructure. The project ran over schedule and over budget, and in January Samsung C&T revealed that it would book a A$1bn loss on the contract.

In a number of court cases that the company is battling, Duro Felguera filed a lawsuit seeking A$65m payment for unpaid work at the iron ore mine.

“In total, Duro Felguera is owed well in excess of $100m by Samsung in relation to a $500m subcontract for work on Roy Hill,” said Raul Serrano, Duro Felguera operations director.

Samsung C&T said a judicial review on the payment disputes with Duro Felguera is pending and that it is taking all proper steps to resolve them in accordance with the law.

Analysts say the Roy Hill experience has eroded Samsung C&T’s appetite for mining projects.

“In the beginning, Samsung C&T was ambitious,” said Lee Kwang-soo at Mirae Asset Securities. “However in the course of working on the project, uncontrollable risks happened. So it seems difficult for Samsung C&T to expand further into mining in the future.”

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Jun 29, 2021

Vale invests $150mn to extend life of Manitoba operations

Vale
Nickel
Manitoba
battery metals
2 min
Vale’s $150mn investment in operations at Thompson, Manitoba will extend mine life by 10 years

Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.

Global energy transition is boosting the market for nickel

The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.

“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.

“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”

Vale continues drilling program at Manitoba

Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.

“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.

“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”

The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history.  Mining of the Thompson orebody began in 1961.

“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.

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