By Henning Gloystein

SINGAPORE (Reuters) – Oil prices fell on Monday, adding to Friday’s steep losses as doubts re-emerged over the ability of major producers to agree output cuts at a planned meeting on Wednesday aimed at reining in global oversupply.

Brent crude futures fell 2 percent at one point but regained ground to be trading down 24 cents, or half a percentage point, at $47 per barrel at 0439 GMT.

U.S. West Texas Intermediate (WTI) crude futures also retraced early loses to be down 26 cents, or 0.6 percent, at $45.80 a barrel.

Monday’s falls came after prices tumbled more than 3 percent on Friday on disagreement between OPEC and non-OPEC crude exporters like Russia over who should cut production by how much in order to curb a global supply overhang that has more than halved prices since 2014. [nL4N1DQ1SV]

Despite the wrangling, traders said they still expected some form of an output restriction to be agreed this week.

“I hold a very strong view, that the fiscal imperative of the budget and income/expenditure situation of the Saudis together with many other OPEC and non-OPEC nations means a deal will get done,” said Greg McKenna, chief market strategist at Australian brokerage AxiTrader.

The Organization of the Petroleum Exporting Countries (OPEC) will meet in Vienna on Wednesday to decide on the details of a cut, potentially including non-OPEC members like Russia. A meeting between OPEC and non-OPEC producers that was to be held on Monday was called off after Saudi Arabia declined to attend.

Saudi Arabia’s energy minister Khalid al-Falih said on Sunday that Saudi representatives would not attend the talks originally scheduled for Monday because no agreement within OPEC had been reached so far.

Falih said that the oil market would balance itself in 2017 even if producers did not intervene, and that keeping output at current levels could therefore be justified. [nL8N1DS0IC]

Despite the disagreements among producers, Morgan Stanley said it still expected “at least a paper deal agreement”.

Even if a cut is agreed, oversupply may not end soon.

In the United States, the oil rig count exploring for new production rose by three last week, and Goldman Sachs said that “since its trough on May 27, 2016, producers have added 158 oil rigs (+50 percent) in the U.S.”

Eiichiro Kitahara, Executive Officer of Japanese refiner TonenGeneral Sekiyu K.K said that “once oil prices reach above $60/barrel, (U.S.) shale oil producers are likely to resume operations, which will weigh on the market.”

(Reporting by Henning Gloystein in SINGAPORE; Additional reporting by Yuka Obayashi in TOKYO; Editing by Kenneth Maxwell and Richard Pullin)

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By Loucoumane Coulibaly

ABIDJAN (Reuters) – French oil major Total , the Ivorian state oil company and four other partners have formally established a consortium to build a liquid natural gas (LNG) import terminal meant to feed the country’s growing electricity consumption.

Demand for electricity is rising in Ivory Coast – which is Francophone West Africa’s largest economy – by some 10 percent a year, and the energy minister said last year that $20 billion of investment is needed in the industry over the next 15 years.

According to the agreement – first announced on Nov. 24 – the new Cote d’Ivoire-GNL company is 34 percent owned by Total while the State Oil Company of Azerbaijan Republic (SOCAR) controls 26 percent and Ivorian state oil company Petroci has 11 percent.

Royal Dutch Shell will hold a 13 percent stake, while Houston-based Endeavor Energy and Golar LNG will have minority stakes.

“This project illustrates Total’s strategy to develop new gas markets by unlocking access to LNG for fast-growing economies,” said Philippe Sauquet, head of Total’s Gas, Renewables and Power division in a statement on Friday.

Total added that the terminal is expected to become operational by mid 2018, and that it will use the terminal to supply LNG volumes from its global portfolio.

The company hopes the Ivory Coast LNG hub will help unlock LNG demand in the West Africa region.

The project aims to build and operate a floating storage regasification unit (FSRU) with an initial capacity of 100 million cubic feet that would gradually be brought up to 400 million cubic feet.

“Many electricity-producing projects are awaiting a gas supply to really kick off,” Ibrahima Diaby, the director general of Petroci, said at the signing ceremony in Abidjan on Thursday.

The cost of the project, expected to take about 18 months to complete, has also been reduced to $100 million from an earlier estimate of $200 million, he added.

Total will make a final investment decision on the project in the first quarter of 2017, a spokeswoman added.

Ivory Coast has the region’s most reliable power production sector and exports electricity to its neighbours. Petroci said in July that it hopes to double oil and gas output by 2020 by developing offshore reserves in the oil-rich Gulf of Guinea.

(Additional reporting by Bate Felix in Paris; Writing By Aaron Ross; Editing by Sudip Kar-Gupta)

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By Melanie Burton

MELBOURNE (Reuters) – A plan by Zambia to put a duty on copper concentrates imports could put a kink in the global supply chain for the metal, industry sources said, by forcing neighbouring Democratic Republic of Congo (DRC) to send surplus mine output elsewhere.

The 7.5 percent duty announced earlier this month and due to come into force at the start of 2017, is likely to disrupt supply of refined metal in the early part of the year, just as the global market moves away from surplus, helping to support prices.

Zambia, Africa’s second-largest copper producer, will produce about 425,000 tonnes of copper metal this year, according to consultancy GFMS, accounting for about 2 percent of global output.

The country’s smelters, including those run by privately held Eurasian Resources Group (ERG) and India’s Vedanta Resources, currently source some 500,000 tonnes of concentrate from the DRC, according to consultants Wood Mackenzie.

This is made up of 400,000 tonnes from ERG’s Frontier mine and around 100,000 tonnes from La Sino-Congolaise Des Mines S.A. (Sicomines), a joint venture between DRC’s Gecamines, China Railway Construction Corp. and Sinohydro Corp.

“It will not be viable for smelters to buy concentrates from the DRC,” said an industry source working in Zambia. “This change will upset the supply chain for the first six months of 2017.”

Miners in the DRC would be forced to look for other ways to process their concentrate, such as sending it some 3,000 km (1,860 miles) overland to Durban in South Africa for shipping to China, a two-month trip, three industry sources said.

This would take the supplies out of circulation for several months and delay production of up to 150,000 tonnes of copper metal.

SMELTERS UNDER STRESS

Smelters in Zambia, where capacity far outstrips current mine supply, are already struggling with low feed stocks after miners including Glencore closed copper shafts as prices fell to six-year lows.

The duty could mean they have even less concentrate to process, at least in the short term, raising costs per unit.

“People are well aware that Zambian smelters are under considerable stress to which this will add significantly,” said a source familiar with the matter.

The sources said the most affected smelters would be ERG’s Chambishi Smelter and Vedanta’s Konkola Copper Mine which source a significant part of their concentrate needs from DRC.

Officials at ERG did not reply to an emailed request for comment. Konkola declined to comment.

The new duty was likely aimed at boosting Zambian refined metal production from local concentrate supplies, but the move could backfire and instead benefit smelters in other countries such as China and India, Wood Mackenzie said.

Companies with local mines including First Quantum Minerals and Barrick Gold could increase output, traders said. Officials from both companies did not respond to requests for comment.

The Zambian government was also coming under sustained lobbying from smelters to reverse its proposal, industry sources said.

“Some are already threatening to close down,” said a Swiss trader active in the region. “I believe that the duty is not a definitive decision”.

(Reporting by Melanie Burton. Additional reporting by Nicole Mordant in Vancouver and David Stanway in Shanghai; Editing by Richard Pullin)

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JOHANNESBURG (Reuters) – South Africa’s Treasury said on Wednesday it supported the report by a government-appointed advisory panel that suggested a national minimum wage of 3,500 rand ($245) per month, throwing its political weight behind the policy initiative.

“The report represents … an important milestone in our government’s efforts over the years in this regard,” Finance Minister Pravin Gordhan was quoted as saying in a statement.

Supporters of a minimum wage say it can stimulate growth as workers can spend more while reducing inequality. Critics say it could lead to increased unemployment as employers will be unable to afford higher wage bills.

($1 = 14.2299 rand)

(Reporting by Ed Stoddard; Editing by Alison Williams)

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BRAZZAVILLE (Reuters) – Africa-focused Australian mining company Equatorial Resources Ltd will aim to invest around $1.2 billion to develop its Badondo iron ore project in Republic of Congo, the company said.

John Welborn, a non-executive director of Equatorial Resources and chief executive of its Congolese unit Congo Mining Exploration Ltd, met Prime Minister Clement Mouamba on Tuesday and submitted an application for a mining license.

“The recent improvement in the price of iron ore makes Equatorial confident that it will find the necessary financing to develop the mine,” the company said in a statement distributed late on Tuesday after the meeting.

African mining, particularly large iron ore projects, has been hit hard by the global commodities crash.

However, the S&P 1500 composite steel index has surged since the U.S. election, bolstered by U.S. president-elect Donald Trump’s perceived support for the steel industry.

Chinese iron ore futures are also rising amid news that production at steel mills in northern Hebei province will be curbed or even shut for as long as four months in an effort to combat pollution.

Equatorial Resources estimates annual iron ore production of 40 million tonnes at the Badondo mine and its feasibility study foresees construction beginning next year, the statement said.

Plans for the building of new infrastructure, including construction of a rail line and port to facilitate exports, must be finalised before the project can be developed, it said.

(Reporting by Christian Elion; Writing by Joe Bavier; Editing by Dale Hudson)

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By Camillus Eboh

ABUJA (Reuters) – Nigeria’s parliament summoned the country’s oil minister on Tuesday to clarify details of oil and gas infrastructure agreements worth $80 billion with Chinese companies and a $15 billion deal with India.

Nigeria, which relies on crude sales for around 70 percent of its national income, is in recession for the first time in 25 years largely due to low global oil prices.

The country’s oil and gas infrastructure needs updating. Its four refineries have never reached full production due to poor maintenance, causing the OPEC member to rely on expensive imported fuel for 80 percent of its energy needs.

Oil Minister Emmanuel Ibe Kachikwu was in China in June for a roadshow aimed at raising investment. Nigeria’s state oil company said memorandums of understanding (MoUs) worth over $80 billion – to be spent on investments in energy infrastructure – were signed with Chinese companies. [nL8N19M2HO]

On a trip to India last month, Kachikwu said a $15 billion cash-for-oil pact with that country was likely to be signed by the end of this year.

The Senate, the upper house of parliament, passed a motion on “the need for a detailed explanation” of the deals and said Kachikwu would appear before a committee on petroleum upstream, gas and foreign affairs at a date to be arranged.

“The essence of the motion was to ensure transparency in a matter that involves future investment in the oil and gas sector of the country,” said Senate President Bukola Saraki.

(Writing by Alexis Akwagyiram; Editing by Tom Heneghan)

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