JOGMEC's approach for critical metals and efforts for stable supply - - PowerPoint PPT Presentation

JOGMEC's approach for critical metals and efforts for stable supply

Yoshihiro Kojima JOGMEC

Oct 9, 2018

1

Today’s Presentation

• 1. JOGMEC’s Activity/ Function for

Stable Supply on Metals

• 2. China’s Influence on Global Metal

Market from the view point of Japanese Economy

2

Today’s Presentation

• 1. JOGMEC’s Activity/ Function for

Stable Supply on Metals

• 2. China’s Influence on Global Metal

Market from the View Point of Japanese Ecnomy

3

Natural Resources in Japan Oil Coal Copper Tin 99.3% 100% 99.6% 100%

• Since Japan has few

domestic natural resources, Japan depends on imports for almost all of its crude oil, natural gas, non‐ferrous metals and minerals.

4

The Importance of Metals for Japanese Industry

Percentage of Consumption: Japan/World (2017)

Source: World Metal Statics 2015(WBMS), Mineral Commodity Summaries 2015(USGS), INDUSTRIAL RARE METALS No.130(アルム出版社)

Au, 1.5% TiO2, 1.7% Zr, 2.0% Pb, 2.5% Ag, 3.1% Al, 3.3% Zn, 3.4% Mn, 3.7% Fe, 3.9% Cu, 4.2% Sb, 4.7% Mg, 4.8% Nb, 7.1% W, 7.3% V, 7.5% Sn, 7.6% Ge, 7.7% Ni, 8% Co, 9.9% Ti, 12.1% Pd, 12.8% Pt, 13% Li, 14.0% REE, 14.8% Mo, 16% Ga, 44.9% In, 48.7%

0% 10% 20% 30% 40% 50% 60%

• Japan has high‐tech

industries which utilize many types of metals; especially rare metals and REE.

• GDP of Japan is almost 6% in

the world. Most of rare metals are above the percentage.

Iron, Base metals Rare metals Precious metals Rare earth elements

※ ※ ※ ※ ※

5

JOGMEC, Who We Are

• Japan Oil, Gas and Metals National Corporation (JOGMEC), an

incorporated administrative agency, is established by the Japanese government.

• The principal role of JOGMEC is to seek a stable supply of natural

resources for Japanese industry as an agency implementing natural resource policies under jurisdiction of METI. Japan Oil, Gas and Metals National Corporation (JOGMEC)

Metal Mining Agency of Japan (MMAJ)

Since 1963 Since 1967 February 2004

Japan National Oil Corporation (JNOC)

Coal & Geothermal units added

6 Headquarter: Tokyo

• Metals Strategy & Exploration Unit
• Metals & Coal Financial and Environment Unit
• Stockpile Unit
• Oil & Gas Upstream Business Unit
• Oil & Gas Upstream Technology Unit
• Geothermal Resource Development Dept.

Two research centers in Japan

• Metals Technology Center
• Technology & Research Center (oil and gas)

Worldwide network

• 13 overseas offices gathering relevant information

Organization of JOGMEC

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Early‐Stage Overseas Exploration

• Take early‐stage risks to promote overseas explorations
• Program

– Typical joint venture style exploration

• Farming into an exploration project held by a foreign

company, then transferring JOGMEC’s contractual interest to a Japanese company

• Target commodities

– Base metals (Cu, Zn,...) – Rare metals (Ni, Co, REE, Li, ...)

H He Li Be B C N O F Ne Na Mg Al Si P S Cl Ar K Ca Sc Ti V Cr Mn Fe Co Ni Cu Zn Ga Ge As Se Br Kr Rb Sr Y Zr Nb Mo Tc Ru Rh Pd Ag Cd In Sn Sb Te I Xe Cs Ba La Hf Ta W Re Os Ir Pt Au Hg Tl Pb Bi Po At Rn Fr Ra Ac Rf Db Sg Bh Hs Mt Ds Rg La Ce Pr Nd Pm Sm Eu Gd Tb Dy Ho Er Tm Yb Lu Ac Th Pa U Np Pu Am Cm Bk Cf Es Fm Md No Lr P K

Ｆｅ

Discovery at Waterberg – for safe and low‐cost operation

Waterberg Outline

• Exploration started in 2009, Discovery in 2011
• Impala Platinum participated in the project in 2017
• Resources (cut‐off grade 2.5 g/t):

[Indicated] 24.8 Miloz 3PGMs+Au [Inferred] 10.8 Miloz 3PGMs+Au

• Prill Split : Pd 61%, Pt 30%, Au 8%, Rh 1%+ Cu, Ni

8

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Support Programs for Advanced‐Stage Projects

• Financial assistance to Japanese companies for
• verseas mineral explorations or development

projects

• Programs

– Financing for overseas explorations – Funding part of the equity capital – Guaranteeing the liabilities

10

Financial Assistance

• Sojitz and JOGMEC agreed to provide a total
• f US$ 250M through loan and equity to

Lynas’s Mt. Weld REE mine on March 2011.

• 8,500 tonnes/year of REE products can be

delivered to Japan.

• First REE products were shipped in March

2013.

• Mt. Weld REE mine

JOGMEC Sojitz Japan Australia Rare Earths B.V. Lynas

Investment Financing (Loan & Equity)

Mount Weld Rare Earths Concentration Plant

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Financial Assistance

• Japanese group (JFE Steel, Nippon Steel, Sojitz

& JOGMEC) acquire 10% stake in CBMM on March 2011 by investing US$ 1.3B.

• CBMM owns Araxá niobium mine, refining

plant & metallurgical facilities.

• CBMM produces over 80% of global supply.
• Reserves of Araxá mine is equivalent to over

200 years of world demand.

Araxá Niobium mine

JOGMEC Sojitz Japanese SPC CBMM

Investment

Aerial View of Araxá mine

JFE NSC

POSCO

Korean SPC

NPS

10% 5%

Re‐evaluation of Criticality Matrix

12

• Refers to EU’s

model

• Adjusts for

Japanese industries

• Data used is

2012.

• Now updating

Supply Risk Economic Importance

13

Today’s Presentation

• 1. JOGMEC’s Activity/ Function for

Stable Supply on Metals

• 2. China’s Influence on Global Metal

Market from the View Point of Japanese Economy

Chinaʼs share in Copper consumption

5,000 10,000 15,000 20,000 25,000 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Others Russia Italy Korea Japan Germany USA China

Refined Cu Consumption

kt

・In last 10 years, Chinese Cu consumption expanded by 8 million ton. ・On the other hand, ex-China shrunk ・Chinaʼs share is about 50%

2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Others Belugium Germany Japan India Korea USA China

Zinc Consumption

kt

Chinaʼs share in Zinc consumption

・In last 10 years, Chinese Zn consumption expanded by 3.5 million ton. ・On the other hand, ex-China shrunk

Chinaʼs share in Lead consumption

2,000 4,000 6,000 8,000 10,000 12,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Others Japan UK Germany Korea India USA China

Lead Consumption

kt

・In last 10 years, Chinese Lead consumption expanded by 2.4 million ton. ・On the other hand, ex-China consumption grew only 800 k ton.

China’s Share of Base Metal Consumption (2017)

Refined Copper

【World】23,460Kt（Cu t）

50.3% Aluminum

【World】59,190Kt

53.9% Lead

【World】11,480Kt（Pb t）

41.3% Zinc

【World】14,213Kt（Zn t）

49.0% Nickel

【World】1,910Kt（Ni t）

40.3%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

‐ 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050

age 15‐59 (working‐age population) age 0‐14 age over 60

Peak of working‐age population

% of working‐age population [RHS]

million people

Maturing China’s Economy and Society Decreasing Working‐age Population

・The peak of total population will come in 2030; 1.4billion people. ・ But that of working-age population already peaked in 2010.

Source: World Population Prospects, UN, 2015

China’s Age Pyramid to 2050

・Ending one-child policy was too late to stop decreasing working-age population. ・Many people hesitate to have the 2nd child because of weak social welfare.

The year

• f birth

Age

1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 11,000 12,000

Cu Refinery Capacity in China

source: CRU

・Cu Refinery capacity in China expands to 11million ton in 2018

kt

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Summary

• JOGMEC is a governmental agency seeking to

stable supplies of natural resources for Japan.

• The impact of China’s growth in metal

consumption affect to metal market.

• Economic tie between Japan and China is very

strong, China’s economic and social change would give effect on Japan’s material industry.

• Mine development takes 10 – 15 years, we should

imagine future economy/society in the world in order to keep stable supply of metals.

26 Thank you for your attention!!

Yoshihiro Kojima Kojima‐yoshihiro@jogmec.go.jp