Just noticed that Blackrock World Mining (LON:BRWM) issued their interim results yesterday. Though one could argue "they would say that", their view on the outlook is worth a read IMO. Here are some choice quotes:
During 2008, the Australian Government started a review process on the domestic tax system...
...If introduced, the RSPT would have made Australia one of the least attractive places in the world for mining companies to operate and invest; the irony is that it has one of the greatest mineral endowments!
The prospect of this tax coming into effect caused massive falls in the valuation of all mining assets....
...The process has concluded with a new tax proposal called the Mineral Resources Rent Tax ("MRRT"). The new tax overcomes most of the controversial aspects of the RSPT and results in a more manageable increase in taxation. To date, mining company valuations have not recovered the lost ground owing to the other headwind of fiscal tightening in China.
...To date the Chinese Government has succeeded in cooling economic activity; the latest data for June showed that loan and construction growth rates are falling towards the targeted levels. Most importantly for the mining sector, the level of commodity imports (although now lower than first forecast) is holding up relative to expectations. It is too early to tell, but should economic activity continue to cool then it is feasible that the Government might start to loosen policy later in the year and this should ease investor fears of a hard landing for Chinese commodity demand.
BlackRock's thoughts about the DRC:
In September 2009, First Quantum's 65% owned Kolwezi project, partnered with the International Finance Corporation (part of the World Bank) and Industrial Development Corporation of South Africa, was confiscated by the DRC Government. In February 2010 the company, along with its partners, commenced international arbitration proceedings over this confiscation, subsequent to which the DRC Government has threatened to expropriate the company's other two producing mines in the country.
As ee has suggested (IIRC), if Soco is successful in DRC, it will undoubtedly wish to sell up ASAP, despite being on good terms with the current DRC govt!
Gold:
It might be too early to call this a change in trend, but if Central Banks have truly reversed strategy and are now buyers,…
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