Challender signs option agreements to purchase four coal projects in Indonesia

Wednesday, 30 March 11

Challenger Signs Three Exclusive Option Agreements to Purchase Four Coal Projects in East Kalimantan, Indonesia

Challenger Deep Resources Corp.has announced that it has, through its wholly-owned subsidiary, PT Bestindo Energy, (“Bestindo”) entered into three separate Memorandums of Understanding ("MOU’s") which give Bestindo the exclusive right, for a period of thirty days, to purchase the shares of three separate private Indonesian companies which hold various coal rights related to four separate coal projects, according to news that posted in its web site.

Each of the coal projects is 100% owned by the respective private company and all of the projects are located in the Regency of Kutai, East Kalimantan. Each of the MOU’s provide for the subsequent execution of a Conditional Share Purchase Agreement (“CSPA”), which provides for staged payments of the purchase price over a period of four months in respect of one MOU and over a period of 24 months for the other two MOU’s.

Arni Bersaudara Coal Project
Pt Arni Bersaudara (“Arni”) is the holder of two contiguous IUP Exploration permits covering 3,039 and 2,874 hectares in the District of Muara Kaman. The IUP’s are approximately 40km north of the Mahakam River The Arni MOU provides that, if Challenger elects to enter into a CSPA, it can acquire 100% of Arni for payments totaling $2,414,181 CAD. Terms of the payment include $84,215 CAD upon signing, $308,790 CAD within 6 months of signing the CSPA and the balance of $2,021,176 CAD after all the essential permits to bring the project into production are in place, or a maximum of 24 months from initial CSPA signing.

The target calorific value of coal is in this concession is around GCV 6,300 – 7,000 and 5,600 – 6,000 respectively.

Apriadi Bersaudara Coal Projects
Pt Apriadi Bersaudara (“Apriadi”) is holder of a KP PU (Mining Authorization for General Survey) covering an area of 930 hectares, which is currently being converted to IUP Exploration in the District of Samboja (AP1) and a SKIP (Exploration Permit Application) covering an area of 3,086 hectares in the District of Muara Kaman (AP2). The AP1 project is 10km from the coast and close to an independent haul road and port loading facilities which are under construction. The AP2 project is approximately 45km north of the Mahakam River and in close proximity to the Arni Bersaudara projects. The Apriadi MOU provides that, if Challenger elects to enter into a CSPA, it can acquire 100% of Apriadi for payments totalling $2,077,318 CAD. Terms of the payment include $56,143 CAD upon signing of the CSPA , $112,287 CAD upon receiving IUP exploration permits for both projects, $224,575 CAD within 12 months of CSPA and the balance of $1,684,313 CAD due on the 24 month anniversary of the CSPA signing.

The target calorific value of coal ranging from 5000 GAD to 7000.

Putri Etam Coal Project
CV Putri Etam (“Putri”) is a private Indonesian company which is in the process of applying for an IUP Exploration and has successfully secured a Local Announcement letter from authorities. The application covers 100 hectares and is located in the Muara Badak district. The Putri MOU provides that, if Challenger elects to enter into a CSPA, it can acquire 100% of Putri for payments totaling $84,215 CAD. Terms of the payment include $28,071 CAD upon signing and $56,144 CAD upon completion of the deed of shares transfer.

An additional agreement also provides that a royalty of US$4.50 be paid to the former Putri shareholders for every ton of coal produced and sold.

The target calorific value of coal in this concession is ranging from 5,600 – 7,000.

The press report says, a program of due diligence on all of the projects is to commence as soon as possible to verify the data provided and to confirm Challenger’s exploration target parameters.

Challenger’s execution of the CSPA’s to acquire these projects will depend upon the results of the initial due diligence program in respect of each. A more detailed technical description of the properties will be made available if and when a CSPA is signed.

“The signing of these latest MOU’s, reflects the culmination of many months of excellent work by our acquisition team”, stated Ranjeet Sundher, President of Challenger, as quoted in press release.

“We are very pleased with the execution to date of our plan to assemble and advance a strong portfolio of coal exploration and development projects in East Kalimantan. Our team remains focused on the exploration of our current projects and the acquisition of new projects.”

Visit Challender Deep website for more details.

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Japan orders immediate safety upgrade at nuclear plants

Wed Mar 30, 2011 3:52pm BST
By Risa Maeda and Yoko Kubota

TOKYO(Reuters) - Japan ordered an immediate safety upgrade at its 55 nuclear power plants on Wednesday in its first acknowledgment that standards were inadequate when an earthquake and tsunami wrecked a facility nearly three weeks ago, sparking the worst nuclear crisis since Chernobyl in 1986.

As operators struggle to regain control of the damaged Daiichi nuclear reactors 240 km (150 miles) north of Tokyo, radiation leakage continued, with radioactive iodine in the sea off the damaged plant at record levels. The state nuclear safety agency said the amounts were 3,355 times the legal limit.

Smoke was reported coming from a second damaged nuclear plant site in Fukushima on Wednesday, with authorities citing an electric distribution board as the problem.

It is not known how serious the problem was at the Daini plant, which has been put into cold shutdown and is several miles from the stricken Daiichi power facility.

Anger at Japan's nuclear crisis saw more than 100 people, chanting "stop nuclear power", protest outside the Tokyo headquarters of nuclear plant operator Tokyo Electric Power (TEPCO) on Wednesday.

"We don't want to use electric power that can kill people," said Waseda University student Mina Umeda.

A Reuters investigation showed Japan and TEPCO repeatedly played down dangers at its nuclear plants and ignored warnings, including a 2007 tsunami study from the utility's senior safety engineer.

The research paper concluded there was a roughly 10 percent chance that a tsunami could test or overrun the defences of the Fukushima Daiichi nuclear power plant within a 50-year span based on the most conservative assumptions.

The new safety steps, to be completed by the end of April, include preparing back-up power in case of loss of power supply, and having fire trucks with hoses ready at all times to intervene and ensure cooling systems for both reactors and pools of used fuel are maintained, the Trade Ministry said.

Other measures such as building higher protective sea walls would be studied after a full assessment of the Fukushima disaster, officials said.

The immediate measures do not necessarily require nuclear plant operations to be halted, Minister of Economy, Trade and Industry Banri Kaieda told a news conference.

"These are the minimum steps we can think of right now that should be done immediately," said Kaieda.

"We shouldn't wait until a so-called overhaul or a comprehensive revision -- something major that would take a long time -- is prepared. We should do whatever we can if and when there is something (which safety authorities agree is) viable and necessary," he said.

Before the disaster, Japan's nuclear reactors had provided about 30 percent of the nation's electric power. The percentage had been expected to rise to 50 percent by 2030, among the highest in the world.

NO END IN SIGHT

The government and TEPCO conceded there was no end in sight to Japan's nuclear crisis.

"We are not in a situation where we can say we will have this under control by a certain period," Chief Cabinet Secretary Yukio Edano told a news briefing.

The discovery of highly toxic plutonium in soil at Daiichi had raised alarm over the disaster, which has overshadowed the humanitarian calamity triggered by the earthquake and tsunami, which left 27,500 people dead or missing.

TEPCO will test sprinkling synthetic resin in some areas of the Daiichi complex to prevent radioactive dust from flying into the air or being washed into the ocean by rain. The resin is water-soluble, but when the water evaporates, it becomes sticky and contains the dust.

Pollution of the ocean is a serious concern for a country where fish is central to the diet. Experts say the vastness of the ocean and a powerful current should dilute high levels of radiation, limiting the danger of marine contamination.

However, just how radiation is spilling into the ocean is unclear and controlling leakage from the plant could take weeks or months, making precise risk assessments difficult.

Tokyo Electric said it would take a "fairly long time" to stabilise overheating reactors, adding four of the six reactors would need to be decommissioned. Meanwhile, the head of the company was in hospital due to high blood pressure, adding to the disarray at Asia's largest utility.

Prime Minister Naoto Kan, whose government faces mounting criticism for its handling of the crisis, won assurances of American support in a telephone conversation on Wednesday with President Barack Obama.

The United States has already agreed to send some radiation-detecting robots to Japan to help explore the reactor cores and spent fuel pools at the stricken nuclear plant.

French President Nicolas Sarkozy, who chairs the G20 and G8 blocs of nations, is due to visit Tokyo on Thursday. He will be the first foreign leader in Japan since the disaster.

In further support, France flew in two experts from its state-owned nuclear reactor maker Areva and its CEA nuclear research body to assist TEPCO.

DRAG ON ECONOMY

Hundreds of engineers have been toiling for nearly three weeks to cool the plant's reactors and avert a catastrophic meltdown of fuel rods, although the situation appears to have moved back from that nightmare scenario.

Jesper Koll, director of equity research at JPMorgan Securities in Tokyo, said a drawn-out battle to bring the plant under control and manage the radioactivity being released would perpetuate the uncertainty and act as a drag on the economy.

"The worst-case scenario is that this drags on not one month or two months or six months, but for two years, or indefinitely," he said. "Japan will be bypassed. That is the real nightmare scenario."

Japan's main stock index has fallen about 9 percent since the tsunami while TEPCO shares have fallen almost 80 percent. The government is considering a tax increase to pay for the damage it estimates at $300 billion in what could be the world's costliest natural disaster.

Already criticised for weak leadership during Japan's worst crisis since World War Two, Kan has been blasted by the opposition for his handling of the disaster and for not widening the exclusion zone beyond 20 km (12 miles) around Fukushima.

Kan said he was considering that step, which would force 130,000 people to move, in addition to 70,000 already displaced.

Hundreds of thousands whose homes and livelihoods were wiped away by the tsunami that obliterated cities on the northeast coast have heard next to nothing from the government about whether it will help them to rebuild.

About 175,000 were living in shelters on high ground above the vast plains of mud-covered debris with temporary housing for only a few hundred currently under construction.

(Additional reporting by Jon Herskowitz, Elaine Lies, Mayumi Negishi, Leika Kihara and Yoko Nishikawa in Tokyo, Roberta Rampton , Ayesha Rascoe and Deborah Zabarenko in Washington, Eileen O'Grady in Houston; Writing by Jon Herskovitz; Editing by John Chalmers and Alan Raybould, Reuters)

ANALYSIS - Should the world be more like Belgium ?

On Wednesday 30 March 2011, 12:32 PM

By Philip Blenkinsop

BRUSSELS (Reuters) - This is a European country riven by ethnic tensions. Its public debt is almost as big as its total annual output and it's in the middle of a political crisis so deep that this week it passes Iraq as the modern-day state whose politicians have taken the longest to form a government.

Yet the buses run more or less on time, the garbage is collected twice a week, exports of pharmaceuticals, steel cord, chocolate and beer are uninterrupted -- and it can still take about a month to get a new telephone line.

Governing is never easy. In the past year or so, it has sometimes seemed impossible. Just ask North Africa's rulers who, after a long period of stability, not to mention repression and abuses, have faced popular uprisings demanding their ousters. In the United States, the big two parties have fallen victims in different ways to the upstart populist Tea Party movement. In Europe, governments in Britain and Ireland have been kicked out in the aftermath of the financial crisis. This month, the government in Portugal collapsed.

Meantime in Belgium, whose Dutch- and French-speaking parties can't agree on what powers should be devolved from the centre to the regions, the absence of government is hardly commented on. More than nine months after a June 2010 election, talk in bars and cafes strays only occasionally to the country's political predicament. "We're not really following it anymore," says a bartender in the Flemish town of Mechelen with a shrug.

"It's a crisis without an audience," says Carl Devos, politics professor at the University of Ghent. "It's a bit absurd."

In a world of upheaval, the fact that one of its oldest democracies has kept ticking over without validated political leadership is remarkable, even if its citizens don't see it.

Belgium managed the whole of its six-month presidency of the European Union last year with a caretaker government. That same government has laid out a 2011 budget and dispatched fighter jets to play their part in guaranteeing the no-fly zone over Libya. In the first three months of 2011 it's reached almost half its target for this year's bond issues.

Would some countries work better without a government?

Could the world learn something from Belgium's experience?

READ MY LIPS

One thing's for sure, having no government can be cheaper. New administrations bring new projects -- and new costs.

"One consequence of not having a working government is that the cost of public spending is not so high," says Philippe Ledent, economist at financial services company ING Belgium. "In the short-term, there is no real negative effect. I thought there would be on confidence, but in the end it's been rather limited."

Financial markets were rattled by Belgium's political paralysis at the end of November and early January, but since the start of February they seem to have calmed. Government 10-year bond yields are a little above 4 percent, about 1 percentage point more than benchmark German equivalents.

That compares with spreads of nearly 7 percent and over 9 percent respectively for EU bailout recipients Ireland and Greece. This year could have been a challenge with around 26 billion euros of Belgian bonds due to mature, but heavy issuance in 2010 allowed the debt agency to buy back a third of the maturing paper ahead of time.

Even though Belgium's public debt is well above the euro zone average, it has not carried out austerity measures like those seen in other European countries, because there's no fully fledged government empowered to enact them.

"I have heard it said that a caretaker government is the best you can have, as it is most unlikely to raise taxes," says Rudy Andeweg, political science professor at Leiden University.

Business confidence is at its highest level since July 2007. In February, consumer confidence too was also also at a 3-1/2 year high, although surging oil prices dragged it down a little in March.

There have been hiccups: Belgium's business federation says some IT companies reliant on public sector contracts have been hit by the fact that the government can only roll over small payments, and can't launch new tenders. Smaller banks would likely have benefited from an adjustment to banking taxation, which the financial community backs, but which cannot be enacted until a government is in place.

But being in the euro has sheltered the country from the most dramatic consequences. Since 1999, Belgium's monetary policy has been determined by central bankers in Frankfurt.

OLD DIVISIONS

One of the secrets to Belgium's stability is force of habit. Like the Netherlands next door, the country of nearly 11 million is used to having caretaker governments for extended periods.

Proportional representation -- which gives parties parliamentary seats based on their share of the vote rather than handing all power to the overall winner -- makes it usual for governments to rule in coalitions, and coalitions take time to form.

It's not an uncommon set-up in Europe: Austrians, Italians, Finns or Germans are pretty sanguine about a gap between an election and a new government taking power. In Germany, a "grand coalition" of the main centre-left and centre-right parties took two months to form in 2005 and in Austria four months were needed in 1999-2000 for the Christian Democrats and the far-right Freedom Party to forge an alliance.

In countries with a winner-takes-all system, single-party rule is the norm and the prospect of a coalition can be more alarming. Britain is a good example: last year, the threat of protracted wrangling between the three main parties rattled financial markets before May's election, causing a sell-off of government bonds, or gilts.

In the end, the Conservatives and the Liberal Democrats forged a coalition just five days after the vote, but not before the pound had slid, British shares had fallen and gilts had underperformed their German counterparts.

Belgians are used to long drawn-out discussions. The cause of the latest political row dates back decades, to the creation of separate linguistic areas in 1962 which laid the ground for the country's current structure.

That in itself was years in the making. Now, despite fresh suggestions that the country should split itself in two along ethnic lines, Belgian leaders seem happy to keep talking.

"As complex as the situation is at the moment, it is still much simpler than the problems that would arise if we decided that the Belgian state must be dissolved," says Karl-Heinz Lambertz, premier of Belgium's small group of German speakers, who are mostly viewed as neutral in the stand-off between Dutch- and French-speakers.

HELD TOGETHER BY RED TAPE

One requirement for any country considering a spell without an elected government is a functioning bureaucracy. Belgians like to carp about the size and cost of theirs -- the business federation says it has 7 more civil servants per 1,000 citizens than its nearest neighbours, at an extra cost of 5 to 6 billion euros a year -- but it keeps things working, which may be a cost worth paying for now.

"It may have faced criticism, but our government administration is certainly functioning," said Ghent University's Devos.

Unlike in some countries, such as the United States, senior civil servants in Europe are generally not elected or appointed by ruling parties, which makes any period of transition smoother.

On top of that, many players besides politicians have pivotal roles. "The system is less dependent on a dominant leader. You have unions and employer groups, controlling agencies," said Keukeleire, of the University of Leuven and College of Europe.

"The European Union, international organisations and international agreements also determine the limits of government."

In fact, central government in Belgium doesn't actually have all that much power at all. It's restricted to managing public finances, the army, judicial system, foreign affairs and certain other issues such as social security and nuclear power.

That makes leadership a less coveted prize than in more centralised countries.

It's a similar story in the Netherlands, next door.

"In some countries, the president can appoint ministers, judges and people in administrative functions and in the army," says Jan Tuit, a senior adviser at the Netherlands Institute for Multiparty Democracy.

"If you look at for example the power of the Dutch prime minister, it's really very limited. He cannot even reshuffle the cabinet."

And the longer Belgium's caretaker government has been in charge, the more powers it is assuming, or being given.

"Of course it's better to have a government with full competence, but it's possible as a caretaker government to take many decisions and we are doing that," acting Finance Minister Didier Reynders told Reuters.

The country's constitution has nothing to say on caretaker governments. In theory, a stand-in government would just cover a month or two before a new administration is sworn in, but the prolonged deadlock means the unwritten rules are changing.

"As time goes by, the scope of decisions taken by the government is widening. You could not have imagined six months ago that the government would nominate a new director of the national bank. Now they have done so," said Rudi Thomaes, chief executive of the Federation of Enterprises in Belgium.

Having a monarch has also helped. As head of state, King Albert II has been busy appointing mediators, but he has also demanded the caretaker government revise the 2011 budget, a highly unusual intervention.

NOT ONE, BUT MANY GOVERNMENTS

And despite the vacuum at the top, Belgium has plenty of government to keep it ticking over. The country has five federated regional governing bodies, not counting provincial and local authorities. "You cannot say that Belgium is stuck," says Ghent University's Devos. "We have many other governments running the country."

There are separate administrations representing the regions of Wallonia and Brussels, for French speakers and for German-speaking minority and a joint one covering the province of Flanders and Dutch speakers.

In a series of reforms since 1970, the powers of the regions and language communities have grown and those of the federal state shrunk. That's at the heart of the current impasse: Dutch-speaking Flemish people, who make up about 60 percent of the Belgian population, have voted for parties seeking yet more control for the regions and fewer subsidies for French-speaking Wallonia, where the unemployment rate is double that of Flanders.

Yet in some ways it's a boon: already, culture and education are the exclusive preserves of the language communities. The regions control a wide range of policy areas including the economy, employment, agriculture, housing, energy, transport and foreign trade.

Lambertz, premier of Belgium's German speakers, says the federal system has helped in the present crisis. "The current system isn't all that bad. Otherwise, it would have collapsed or the country would have found itself in crisis and that is not the case. Whoever travels through Belgium doesn't notice much of the current difficulties," he said.

DON'T TRY THIS AT HOME

Federal states from Australia to Switzerland might also benefit from their multiple layers of government in the absence of a national administration.

But in most places, and especially in the developing world, strong political leaders are needed to fill the hole created by a lack of bureaucracy.

In Iraq last year, for example, nine months of political limbo delayed investments to rebuild the war-torn country and left people short of basic services such as water and power.

Even in developed democracies, being without political leadership can be crippling. The lack of a plan to manage its debts has sent Portugal's bond yields to new highs this week, inflating the cost of borrowing and increasing the chances the country will need an international bailout.

Portugal faces a political vacuum of at least two months, if a snap election is called, with a caretaker government reduced to basic management of public affairs.

"It's a pretty messy situation," says Ken Wattret, chief euro zone economist at BNP Paribas. "In the Belgian context that may be fine, but Portugal has a pressing need to deliver a credible consolidation programme."

And even Belgium has had to put important decisions on hold. Analysts and economists say it needs to reform its pensions system and its labour market, reduce energy consumption and determine what to do with asylum seekers.

It's muddling along with unresolved questions about the future of nuclear power. These are decisions for the long term that a caretaker government simply cannot take.

"The longer these items are unresolved, the more costly they become. We have a fire brigade to put out fires, but we cannot renovate the building," said Ghent University's Devos.

The business federation says a government is urgently needed to rein in the debt and tackle the rising cost of an ageing population. Its chief, Rudi Thomaes, said the deadlock really began four years ago at the 2007 election, as disputes over the future of the country stalled progress elsewhere.

"If I make the comparison with other countries I see a huge difference," Thomaes says, poring over a chart listing the budgetary efforts of six countries - France, Germany, Italy, the Netherlands, Spain and the United Kingdom.

Yet Devos and others say that Belgium might need a crisis such as this to force through change acceptable to its Dutch and French speakers. It may indeed look back on nine month or even a year of political deadlock as a price worth paying.

(Additional reporting by Robert-Jan Bartunek; Editing by Sara Ledwith and Simon Robinson, Reuters)

Tags : , Greece, Portugal, debt crisis, France, Germany, U.K., Italy, Netherlands, Spain

Iron ore exports down 18.60 pc in Feb to 10.13 MT

Wed, 30 March 2011, 1:33 PM

New Delhi, Mar 30 (PTI) Continuing its declining trend for the eighth consecutive month, India''s iron ore exports in February has gone down by 18.60 per cent to 10.13 million tonnes (MT).

The outbound shipment of the vital steel-making raw material during April-February period also declined by 17.98 per cent to 85.43 MT, mainly on account of export ban imposed by Karnataka government.

According to the data compiled by industry body Federation of Indian Mineral Industries (FIMI), the country''s shipment declined by 18.60 per cent in February against the same period last year. Exports were recorded at 12.54 MT in February, 2010.

"The industry has been suffering due to the ban on exports imposed by Karnataka in July. Also, the raise in export duty on iron ore to 20 per cent in the Budget has added salt to the exporters'' injury and its impact will be felt in March exports ," FIMI Secretary General R K Sharma told PTI.

In the Budget, duty on fines was hiked four-fold to 20 per cent while on lumps was upped to 20 per cent from 15 per cent earlier. The country had shipped 117.37 MT of iron ore during the last fiscal.

Also, on account of exports ban imposed by Karnataka shipments declined by 17.98 per cent to 85.43 MT during April-February this fiscal.

In July last year, Karnataka government had slapped the ban in the midst of a controversy generated over illegal mining activities in the state. Karnataka is one of the largest iron ore exporter of the country.

India has been exporting iron ore to China, Japan, South Korea, Europe and other countries.

Spain's Acerinox to raise base prices in U.S.

Wed Mar 30, 2011 7:51am GMT

MADRID, March 30 (Reuters) - Spanish stainless steelmaker Acerinox (ACX.MC: Quote) said on Wednesday is plans to raise base prices between 6 and 9 percent in the United States from April 1.

Iron Ore-Shanghai rebar falls; iron ore heads for flat Q1 end

Wed Mar 30, 2011 8:17am GMT

* Tighter credit weighing on China ore stockpiling
* India Apr-Feb iron ore exports down 18 pct
* India eyes another hike in iron ore freight rates
By Nick Trevethan

SINGAPORE, March 30 (Reuters) - Shanghai steel rebar futures dropped 0.4 percent on Wednesday, snapping a three-day winning streak, while iron ore indexes edged up, heading for a flat end for the first quarter as tighter liquidity hit stockpiling by top buyer China.

The most briskly traded rebar contract for October delivery on the Shanghai Futures Exchange closed down 20 yuan at 4,794 yuan a tonne, after gaining 2 percent in the past three sessions.

"The abundant liquidity of the past two years created a huge build-up in steel inventories, but this year tighter liquidity will mean building additional inventory will be very difficult," said Henry Liu, analyst at Mirae Asset Securities in Hong Kong.

"The cash situation for consumers is still adequate so it is too early to say they will dump inventory," he said.

"In iron ore, the second quarter will be weaker than the first. Prices will fall, with support at $160 to $165 but the downside is limited as Chinese steelmakers are running at full steam."

China's daily output of crude steel rose 2.6 percent to a record 1.945 million tonnes from March 11-20, figures from the China Iron and Steel Association (CISA) showed on Tuesday.

CISA said daily output stood at an average of 1.92 million tonnes in the first 20 days of the month, up from 1.823 million tonnes in February and 1.703 million tonnes in January.

According to Reuters calculations, average daily steel output up to March 20 stands at 1.81 million tonnes, which would amount to 659.5 million tonnes on an annualised basis.

The Shanghai rebar contract remains near an eight-session high, having hit a four-month low of 4,627 yuan on March 22, but is down 1.6 percent this quarter.

INDIA HIKES FREIGHT RATES AGAIN

"Most industrial commodities have recovered from the shock after the Japan earthquake and now are just waiting to see what the impact on Japanese supply will have on demand," said analyst William Adams at FastMarkets.com

"China is also a worry. China is still tightening policy and there is the fear they will overtighten and the economy will slow too quickly."

Key iron ore indexes, based on spot transactions in China, rose on Tuesday.

Platts' 62 percent iron ore index IODBZ00-PLT rose 50 cents to $169.50 a tonne, including freight, and The Steel Index's 62 percent benchmark .IO62-CNI=SI gained $1.10 to $168.50.

Metal Bulletin's 62 percent gauge .IO62-CNO=MB rose $1.12 to $167.97.

In India, iron ore exports from the world's third-largest supplier fell for the eighth straight month in February as its key Karnataka state continued to ban shipments.

India's iron ore exports fell 18 percent to 85.43 million tonnes in April-February from a year ago and shipments are expected to fall again in March.

Iron ore supply from India are bound to get even tighter as it becomes more costly to ship the steelmaking material out of the country.

State-owned Indian Railways said it will impose a "busy season charge" of 7 percent on iron ore freight rates from April 1 to June 30, and from Oct. 1 to March 31.

India had hiked railway freight rates by 100 rupees to 1,600 rupees per tonne from March 3.

India says iron ore rail freight rates to rise

Wed Mar 30, 2011 7:52am GMT

MUMBAI, March 30 (Reuters) - Indian Railways will levy a "busy season charge" of 7 percent on iron ore freight rates from April 1 to June 30, and from Oct. 1 to March 31, the state-owned transporter said in a statement.

India, the third biggest exporter of iron ore, had hiked railway freight rates by 100 rupees to 1,600 rupees per tonne from March 3.

The railways has also levied a busy season charge of 5 percent on coal and coke group.

Tags : Indian iron ore prices, raw material, power plant, steel mills

Google may shut Gmail, Maps in China

Mar 30, 2011, 11.33am IST

BEIJING: Google Inc's defiance of China's censorship rules resulted in the world's most popular search engine being pulled out of the country 12 months ago. This year, the dispute may be spilling over to Gmail and maps.

As of yesterday, China's State Bureau of Surveying and Mapping hadn't received an application from Google to keep offering its service, as required under regulations announced in May, according to Kou Jingwei, the bureau's spokesman. Jessica Powell, a Google spokeswoman, declined to comment on whether the company has applied. The deadline is tomorrow.

As Baidu Inc widens its lead in the world's largest Web market, a discontinuation of the mapping service would signal Google's dimming outlook in China, according to analysts, after the company blamed local censors for disruptions in its email service. The latest clash shows the government hasn't forgiven the Google's decision to halt compliance with censorship rules on Internet searches, said Christopher Tang, a professor of business administration at UCLA.

"Google faces major problems within China," Tang said. "Unless Google is going to change the way they operate, unless they are willing to apologise to the Chinese government, unless they are willing to cooperate with the Chinese government to impose censorship according to the wishes of the Chinese government. Otherwise, there's no deal."

Google British East India
A March 4 opinion piece in the official People's Daily, the mouthpiece of China's Communist Party, compared Google with the British East India Company, whose sales of opium in the country was the root of two 19th-century conflicts.

China introduced a new licensing system for Internet mapping services in May to "address illegal practices" and an "inadequate awareness of national security," the official Xinhua News agency reported March 21. Since 2008, online mapping services have committed more than 1,000 violations including unauthorised disclosure of confidential information and mistakes in drawing the country's border, Xinhua reported.

As of mid-February, the bureau had granted licenses to 105 websites for mapping services, including Baidu, Sina Corp, a Nokia Oyj joint venture and China Mobile Ltd, Xinhua said. The bureau has pledged to close unapproved websites.

The Bureau said applications for license must be made by March 31, to avoid "administrative actions" it will take by July 1. The Bureau this month vowed "resolute punishment for serious violations," such as closing websites, Xinhua said.

License renewal

"We are examining the regulations to understand their impact on our maps products in China," Google said in a statement.

Google in July was able to renew its Internet-service license in China through 2012, even after shuttering its Google.cn site in China and redirecting users to a Hong Kong site. The company had said it was no longer willing to comply with online censorship rules on topics such as Tiananmen Square crackdown in 1989 and Tibet independence.

In the latest round of friction, Google accused local censors of disrupting its Gmail email service and disguising the blockage as technical issues on Google's behalf. China's Foreign Ministry spokeswoman Jiang Yu on March 22 called that claim "unacceptable."

"In the 17-19th centuries, the East India Company made their contribution for the development of a British Empire where "the sun never sets" through the monopoly of trade, the opium trade and openly looting," the People's Daily piece said. "Google is essentially similar to the East India Company, but is smarter in its performance than the East India Company. Google does not burn and loot, and they are also good at camouflage."

Opium war
China fought the first Opium War with the British Empire in 1839-42, and a second from 1856-1860.

Beyond Google's own history of conflict with China's censors, the company is now also being perceived as a greater threat to the government in light of popular unrest throughout North Africa and the Middle East that has already brought down regimes in Tunisia and Egypt, said James Lewis, senior fellow at the Center for Strategic and International Studies, a Washington-based policy group.

"Google's caught in some larger political issues," Lewis said. "It's a very big problem, and the events in the Middle East have made it a little bit bigger."

Google executive Wael Ghonim helped set up a website for Egypt opposition leader Mohamed ElBaradei as anti-government protests in the Middle Eastern country toppled President Hosni Mubarak. Ghonim's 11-day detention turned him into a hero for a disaffected Egyptian youth.

Blocking Facebook
China, the world's largest Internet market with 457 million Web users, bans pornography, gambling and content critical of the ruling Communist Party. It already blocks Google's YouTube site as well as social networking websites run by Facebook Inc and Twitter Inc.

The People's Daily piece, which also called Google "a tool of US expansionism and hegemony," ran on other popular websites in China including Tencent Holdings Ltd's QQ.com and Sina Corp.

Without specifically commenting on the People's Daily piece, Mountain View, California-based Google denied that the US government meddles in its affairs.

"Contrary to assertions made by the Chinese media, every decision we have made regarding China has been made by Google alone," the company said March 7 in an emailed reply to Bloomberg News.

Widening gap

Baidu accounted for 75.5 per cent of China's search engine market by revenue in the fourth quarter, rising from 73 per cent in the previous three months, according to research company Analysys International. Google's share dropped to 19.6 per cent from 21.6 per cent, the research firm said.

Google may fall further behind as companies such as Sina, owner of China's third-most-visited website, said it dropped Google's search engine to use its proprietary technology.

Google's China business is "immaterial to the overall financials," so the value of its operations in the country has more to do with the future than the present, said Clay Moran, an analyst at Benchmark Co. who rates the shares "buy" and doesn't own any.
China contributed about 1 per cent of revenue before it changed its approach in the country to search early last year, Moran estimates.

Sina stopped using Google's search service after the expiry of a contract, Liu Qi, a spokesman at Chinese Web portal operator, said in an e-mail today. The Shanghai-based company will instead use its own proprietary technology, he said.

"It's a lot less strategic than it was a year or two ago," Moran said. "Investors prefer to see Google maintaining a position in the country so that it can potentially benefit from growth in the future." (sourced :Bloomberg)

Tags : British Empire, China's censors, India, search engine

Libya operation costs Greece 6.5 million euros monthly: official

Wed, March30, 2011 05:51:00

ATHENS, March 29 (Xinhua) -- Greek Defense Minister Evangelos Venizelos said Tuesday that the military operation under way to tackle the crisis in Libya costs Greece some 6.5 million euros ( about 9.15 million U.S. dollars) every month.

Addressing a parliamentary committee over the issue, Venizelos stressed that debt-ridden Greece will continue to undertake its supporting role in the operation which aims to enforce the UN Security Council resolution on the protection of civilians in the war-torn northern African country.

Meanwhile, Greek media reported that aided by the EU's border monitoring agency Frontex, Greece is boosting sea patrols in the Mediterranean Sea in face of a new influx of illegal immigrants from troubled North Africa.

Frontex has been supporting Greek efforts against illegal migration in northern Greece on its border with Turkey since last autumn. Frontex will strengthen its operation around the southern Greek island of Crete and similar operations in Italian waters, according to local media reports.

Over the past few days, at least 5,000 people illegally reached Italy from north Africa and approximately 500 arrived in Malta. (sourced Xinhua)

6.4-magnitude earthquake hits off east coast of Japan's Honshu

Wed Mar30, 2011 14:18:31

BEIJING, March 30 (Xinhua) -- An earthquake measuring 6.4 on the Richter scale jolted the waters off the east coast of Honshu, Japan at 13:29 p.m. Beijing Time Wednesday, according to the China Earthquake Network Center.

The epicenter, with a depth of 30 km, was monitored at 36.2 degrees north latitude and 142.4 degrees east longitude, the center said in a statement.

Greek PM renews attack on credit rating agencies over new downgrade of Greece by Standard and Poor's

Wed March30, 2011 05:42:42
Greek Prime Minister George Papandreou (L) attends a press conference for the meeting of the Progressive Alliance of Socialists and Democrats of the European Parliament in Athens, capital of Greece, March 29, 2011. Papandreou renewed his attack on international credit rating agencies Tuesday after the new downgrade of Greece's credit rating by Standard and Poor's. (Xinhua/Marios Lolos)

ATHENS, March 29 (Xinhua)-- Greek Prime Minister George Papandreou renewed his attack on international credit rating agencies Tuesday after the new downgrade of Greece's credit rating by Standard and Poor's.

The agency slashed once again the country's rating by two notches to BB- from the previous BB+ Tuesday, arguing that Greece will most probably need more foreign aid eventually to overcome an acute debt crisis which led it to the brink of default last spring.

"The decision on Standard and Poor's does not reflect the efforts we make to put our finances in order," said Papandreou during a press conference held in Athens for the meeting of the Progressive Alliance of Socialists and Democrats of the European Parliament.

With the group's head Martin Schulz by his side, the Greek Premier and Socialist International leader repeated strong criticism against rating agencies, "which went from the bubble of euphoria to the panic of risk."

International rating agencies reflect the systemic flaws of the European common currency, Papandreou and Schulz acknowledged. But they also make markets panic without proper justification sometimes, the Greek PM stressed.

"Greece is downgraded not because of its policies, but because EU reaction to the crisis is still considered not bold enough, too little too late," added the Greek leader, noting that a wide gap between markets and politics remains, making people wonder over who governs our world.

Reminding that the same agencies rated positively toxic bonds which created the current international economic crisis, Papandreou raised again the issue of lack of accountability of these agencies and the need that banks bear their burden in the crisis and contribute to efforts to restore growth in Greece, Europe and across the globe.

"Greece aims to fully return to the international markets as early as possible, so we will not have to resort to the new permanent European Stability Mechanism after 2013," he said.

Since last May Greece has not borrowed from international markets on prohibitively high interest rates, but been depending on a multi-billion euro aid package from the European Union and the International Monetary Fund to exit the crisis by 2013 through harsh austerity measures and structural reforms.

Despite progress, skepticism remains amongst foreign analysts in ratings agencies whether Greece will overcome the crisis without further support.

Expressing strong solidarity to Greece over the Herculean task under way, German Socialist Schulz criticized German Chancellor Angela Merkel's stance over the Greek crisis, stressing that "no country within the EU can teach lessons to others and aim development on its own."

Schulz voiced confidence that Greece will exit the crisis, based on the result of the latest EU summit in Brussels last week, "which revealed that more and more conservatives across EU realize that the only way out of the crisis is unity and solidarity."
Editor: Mu Xuequan

Belgian students ask for coalition government

Wed, Mar30, 2011 10:56:01

Belgium(Xinhua) : Protesters shout slogans during a demonstration in Brussels, capital of Belgium, March 29, 2011. Belgium ties with Iraq as the country remains 289 days without government on Tuesday, setting up a world record. Students hit the streets here on Tuesday to ask for a coalition government between Dutch-speaking North and French-speaking South politicians.
Editor: Yang Lina (Xinhua/Wu Wei)

Standard & Poor's downgrades Greece, Portugal

Wed Mar30, 2011

LISBON/ATHENS (Reuters) - Standard & Poor's downgraded Greece and Portugal on Tuesday, citing risks that the countries' debts to a new European bailout fund would be repaid before bond investors, sending their borrowing costs sharply higher.

The downgrades left Portugal one notch above junk and Greece's creditworthiness below that of Egypt, deepening the debt troubles for two of the weakest countries in the euro zone.

The bonds of both countries were hit, with Portuguese 10- and 2-year yields jumping to euro lifetime highs and Greek 2-year yields rising 10 basis points to 15.46 percent.

"Our view is that this really is a game changer," S&P analyst Frank Gill told journalists, referring to the European Stability Mechanism, which European leaders agreed last week will replace the European Union's bailout fund in 2013.

"We do think it is clearly negative for holders of commercial debt, that is our view, that it will weigh on countries' capacity to serve their commercial debt," he said.

The downgrade of Portugal added to Lisbon's woes, coming after the Bank of Portugal warned on Tuesday the country may need substantial new austerity measures to ensure it can meet budget goals.

Lisbon is grappling with how to regain investor confidence following the minority government's resignation last week after the opposition rejected its austerity plan in parliament, prompting many economists to predict the country will need a bailout soon like Greece and Ireland.

"Given Portugal's weakened capital market access and its likely considerable external financing needs in the next few years, it is our view that Portugal will likely access the EFSF and thereafter the ESM," Standard & Poor's said.

European leaders agreed a new package of anti-crisis measures at a two-day summit last week but delayed an increase in the size of the euro zone's rescue fund, known as the European Financial Stability Facility. However, they sealed a deal on funding the ESM, a new, permanent safety net that will become operational in mid-2013.

Silvio Peruzzo, an economist at RBS, said S&P sees a possibility that bond holders could be at risk under the new mechanism.

"If a country defaults, the ESM, as a senior creditor, gets the money before investors and investors may take a loss," he said.

Standard & Poor's downgraded Portugal by one notch to BBB-, adding to a two-notch cut last Thursday. Still, the S&P's Gill said Portugal was still highly creditworthy and the market was exaggerating default concerns.

"The rating cut has been mostly priced in, but it's not just that. I think it's in Portugal's best interests to take a bailout soon rather than continue raising debt at much too high interest rates," said Deutsche Bank economist Gilles Moec.

The agency downgraded Greece by one notch to BB-, deeper into junk territory, and below Turkey and Egypt which are at BB.

"It is not a surprise as Greece was on negative watch," said analyst Ben May at Capital Economics. "Obviously, it is a reminder that Greece has lots of problems. We continue to think that a debt restructuring is likely."

Gill of the S&P said the new bailout mechanism was also likely to impact the rating of Ireland, which has a grade A-, three levels above Portugal.

The Athens bourse's general index fell 0.4 percent, with Greek banks among the worst performers, losing 3.66 percent, after the downgrade. Portuguese stocks fell slightly, with banks falling more than two percent.

The Greek finance ministry said S&P's downgrade was based on an erroneous evaluation of last week's EU summit decisions.

"It does not reflect the effort and success of the Greek economic policy programme or Greece's economic prospects," the ministry said in a statement.

Earlier on Tuesday, in its spring economic report, the Bank of Portugal said there were risks of the country missing budget goals this year, adding that in 2012 the pressure for more measures could be greater, depressing the economy.

"In 2012 the additional, permanent measures necessary to reach the goal promised by the authorities reach a very substantial size," the bank said.

The report forecast economic contraction of 1.4 percent this year and growth of 0.3 percent in 2012 but it said those projections did not include likely additional austerity measures and deleveraging in the economy. Last year the economy grew an estimated 1.4 percent.

Adding to Lisbon's and Athens' troubles, there were further signs pointing to an increase by the European Central Bank in its main interest rate next month from a record low as the rest of Europe's recovery gathers steam and peripheral economies suffer.

"It is highly probable that there will be a change in interest rates in April, but it is not certain," said ECB Governing Council member Jozef Makuch.

S.Africa's RBCT shelves expansion plans-paper

Wed Mar 30, 2011 6:43am GMT
* Says increase in exports dependent to rail expansion
* RBCT's current capacity at 91 mln tonnes

JOHANNESBURG, March 30 (Reuters) - South Africa's Richards Bay Coal Terminal (RBCT) has shelved plans to increase export volumes until 2015 due to the slow pace of rail infrastructure expansion, the Business Report newspaper said on Wednesday.

South Africa is a major exporter of coal to power stations in Europe and Asia, but bottlenecks on the rail line leading to the Indian Ocean terminal are hampering shipments.

RBCT chief executive Raymond Chirwa said efforts to increase exports were frustrated because of limited infrastructure provided by state rail and logistics group Transnet [TRAN.UL].

"It would be irresponsible for RBCT to expand when the other items of the value chain have not expanded," Chirwa was quoted as saying.

"We can extend beyond 100 million tonnes a year but that depends on the performance of Transnet Freight Rail, which has not expanded its infrastructure to our 91 million tonnes capacity. At the moment there is a deficit in the rail."

An RBCT spokeswoman could not immediately be reached for a comment.

Transnet has been investing heavily in new and improved infrastructure, but is still far from meeting annual RBCT capacity of 91 million tonnes.

In 2010, South African coal exports rose to 63.43 million tonnes, boosted by demand from China and India.

Companies in the coal sector include Anglo American (AAL.L: Quote), Xstrata.(sourced:Reuters)