Rio Tinto to settle Mozambique coal assets case; BHP to invest C$100M in Filo

TOP NEWS IN METALS & MINING

* Rio Tinto Group will pay a A$750,000 fine for inflating the value of its Mozambique coal assets in 2012 under a settlement with the Australian Securities and Investment Commission, Reuters reported, citing a commission spokesperson. As part of the settlement, the regulator agreed to drop its cases against former Rio Tinto CEO Tom Albanese and former CFO Guy Elliott.

* BHP Group Ltd. will invest C$100 million to acquire about a 5% stake in Filo Mining Corp., Dow Jones Newswires reported. Filo said it will use the investment funds to support the drilling program at the Filo del Sol copper project located in Argentina and Chile, as well as for working capital and general corporate purposes.

➤ Centerra's Nev. gold deal leads metals, mining M&A for week ended Feb. 25

Centerra Gold Inc.'s planned takeover of Gemfield Resources LLC topped metals and mining transactions for the week ended Feb. 25, according to a screener on S&P Capital IQ Pro.

➤ Russian invasion of Ukraine sparks concerns over metals markets

Gold prices spiked during the week ended Feb. 25 as Russia invaded neighboring Ukraine and developments sparked concern over the impact of sanctions against Russia and possible retaliation.

➤ US coal employment rises 5.5% in Q4'21 off Q2'21 low

U.S. coal employment has begun to rise alongside coal volumes as a recent uptick in demand, both at home and abroad, drives production.

EARNINGS SPOTLIGHT

* Rio Tinto subsidiary Energy Resources of Australia Ltd. swung to a full-year 2021 after-tax net loss of A$650 million, from a profit of A$11 million in 2020, due to the adverse impact from the increase in rehabilitation provision for the Ranger uranium mine site in Australia's Northern Territory. Uranium oxide sales revenue declined to A$190 million from A$242 million.

* PJSC Magnitogorsk Iron & Steel Works, or MMK, booked a net profit of US$794 million in the fourth quarter of 2021, jumping year over year from US$313 million as revenue surged to US$3.40 billion from US$1.85 billion.

* Harmony Gold Mining Co. Ltd. recorded a net profit of 1.4 billion South African rand for the first half of its fiscal 2022, dropping 69% year over year due to lower gold prices and higher costs brought by disruptions, geotechnical issues and unplanned labor stoppages at some of its mines.

* OM Holdings Ltd. booked an attributable net profit of A$81.9 million in 2021, surging from A$5.4 million in the prior year, as EBITDA increased 161.5% to A$204.0 million from A$78.0 million.

* Yancoal Australia Ltd. swung to a net profit of A$791 million in 2021, from a loss of A$1.04 billion in the previous year, as revenue from continuing operations rose 56% to A$5.40 billion from A$3.47 billion.

DIVERSIFIED

* Shareholder activist group Market Forces withdrew resolutions requesting Rio Tinto to disclose its risk threshold to its Scope 3 client and customer emissions as well as the measures the company will take to reduce its exposure.

* Fortescue Metals Group Ltd. completed the acquisition of Williams Advanced Engineering Ltd. for £164 million, and commenced the development of the world's first zero-emission Infinity Train.

BASE METALS

* The London Metal Exchange three-month nickel price increased from US$22,764 per tonne at the start of the month to an 11-year high of US$25,575/t as Russia launched large-scale invasion of Ukraine, according to S&P Global Market Intelligence's Metals and Mining Research team.

* Morocco plans to exploit its cobalt reserves to boost production of the metal used in rechargeable batteries, Reuters reported, citing Abdellah Mouttaqui, secretary general of Morocco's hydrocarbons and mining agency.

* Queensland Pacific Metals Ltd. agreed to supply Eramet SA subsidiary Société Le Nickel-SLN with up to 1 million wet tonnes of nickel ore per year.

* Trigon Metals Inc. delivered the first shipments of copper concentrate from the Kombat copper mine in Namibia.

PRECIOUS METAL

* A scoping study on Nova Minerals Ltd. Korbel Main gold project in Alaska outlined a pre-tax net present value of A$381 million, discounted at 5%, with an internal rate of return of 20.4%.

* The Australian Foreign Investment Review Board approved Alien Metals Ltd.'s proposed acquisition of the Munni Munni platinum group metals and gold project in Western Australia. The project is currently a joint venture of Artemis Resources Ltd. and Platina Resources Ltd.

BULK COMMODITIES

* India approved the offering of non-linkage coal by producers to both power and non-regulated sectors through a common electronic auction window instead of the sector-specific window used currently, S&P Global Platts reported, citing a coal ministry statement.

* Steel Dynamics Inc.'s board raised the company’s quarterly dividend by 31% to 34 U.S. cents per share and authorized an additional share buyback of US$1.25 billion of common stock, Dow Jones Newswires reported.

* TerraCom Ltd. inked a US$60 million prepayment term sheet with a major customer for an offtake of 600,000 tonnes of coal from the Blair Athol project in Queensland, Australia, for delivery within June 1 to May 31, 2023.

SPECIALTY

* The lithium carbonate CIF Asia price rose an unprecedented 42.9% to US$30,000 per tonne in January, from consumer restocking ahead of the Lunar New Year holiday and lithium refinery maintenance closures, according to S&P Global Market Intelligence's Metals and Mining Research team.

* Arafura Resources Ltd. and Korean government agency Komir signed a joint statement of cooperation to support the development of the Nolans rare earths project in Australia's Northern Territory, and to assist in the export of product from Nolans to South Korea.

* A preliminary economic assessment for NextSource Materials Inc.'s Phase 2 expansion of the Molo graphite project in Madagascar outlined a posttax and royalty net present value of US$612.6 million, discounted at 8%, with an internal rate of return of 32% and a life of mine of 26 years.

INDUSTRY NEWS

* The European Union ramped up sanctions on Russia over its invasion of Ukraine, targeting more government officials and some of the country’s most powerful and well-known oligarchs, including PJSC Rosneft Oil Co.'s CEO Igor Sechin and PJSC Severstal's majority owner Alexey Mordashov, The Wall Street Journal reported.

* Human-caused climate change has already led to irreversible impacts on the planet, with additional severe risks to human and natural systems if the world overshoots a 1.5 degrees Celsius temperature rise, according to a new report from the Intergovernmental Panel on Climate Change, S&P Global Platts reported.

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