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In This List

Rio moves 700 workers; ArcelorMittal South Africa declares force majeure

State of the Market: Mining Q1-2020

Mining Exploration Insights - April 2020

Mining Exploration Insights December

Mining Exploration Insights: Dip in gold drilling weighs on results


Rio moves 700 workers; ArcelorMittal South Africa declares force majeure

TOP NEWS

Rio moves 700 workers to Western Australia amid state lockdown – The Australian

Mining giant Rio Tinto moved 700 workers from other states and countries to its iron ore operations in Western Australia to avoid workforce disruptions amid a statewide lockdown to contain the spread of the novel coronavirus, The Australian reported. As required by the government, the workers will remain on-site for at least 14 days at a time and will be paid a daily allowance to find their own accommodation while being required to comply with the state's quarantine measures. BHP Group is also supporting the government's decision to require all fly-in, fly-out workers to quarantine for 14 days.

ArcelorMittal South Africa declares force majeure, cuts employee salaries

ArcelorMittal unit ArcelorMittal South Africa Ltd. issued force majeure notices to its customers and suppliers due to the closure of all of its offices and operations in South Africa during the 21-day countrywide lockdown. The company has curtailed spending on noncritical goods and services, and salary reductions for all employees will go into effect in April for a likely period of three months. Only essential operational staff will remain at the South African operations, required for care and maintenance to avoid damage to plant and equipment.

Antofagasta suspends Los Pelambres copper mine expansion for up to 4 months

Copper miner Antofagasta PLC has placed the incremental expansion project at its Los Pelambres copper mine in Chile on care and maintenance until further notice. Company unit Antofagasta Minerals SA suspended the contracts with most of the companies building the project due to the coronavirus pandemic. The suspension will be periodically reviewed and stay in place for a maximum of up to 120 days and will not lead to the termination of contracts in most cases.

DIVERSIFIED

* BHP Group said in an internal memo that should its workers contract the new coronavirus, they will be eligible for compensation, though this would "depend on the circumstances" under which it happened, the Australian Financial Review reported.

* Anglo American PLC said it is spending about US$125 million weekly on wages and procuring goods and services in South Africa despite reduced operations in the country resulting from an ongoing nationwide lockdown.

* Fortescue Metals Group Ltd. and ATCO Australia Pty. Ltd. agreed to jointly build and operate a combined hydrogen production and refueling facility at ATCO's existing facility in Jandakot in the Perth metropolitan area, with the possibility of wider deployment across the state.

BASE METALS

* Philippines-based Nickel Asia Corp. plans to resume mining operations and nickel ore shipments at its Taganito Mining Corp. and Hinatuan Mining Corp. operations in the province of Surigao del Norte. The Surigao del Norte government lifted a suspension on mining operations in an April 3 notification, the company said in a news release, with the new guidelines modifying an order published March 28 that aimed to contain the spread of the new coronavirus.

* Blackstone Minerals Ltd. entered a binding agreement with Ecopro Co. Ltd. to form a joint venture to develop a downstream processing facility for the former’s Ta Khoa deposit, within the Ban Phuc nickel mine in Vietnam. Additionally, Blackstone will issue 40 million shares at 17 Australian cents apiece to raise A$6.8 million, as per the deal.

* PJSC Norilsk Nickel Co. plans to return the minimum to investors in 2020 after shareholder United Co. Rusal PLC rejected CEO Vladimir Potanin's proposal to suspend payments and build cash reserves while the coronavirus pandemic assails metal demand. The downturn triggered by the virus does not present any significant risks to Norilsk, but the one thing it will affect is dividends, Potanin said in an interview with Russian daily tabloid Komsomolskaya Pravda.

* Pembridge Resources PLC will reduce its ownership in the Minto copper mine in Canada's Yukon territory to 11% from 33% amid current market conditions caused by the COVID-19 crisis and the potential for material cash calls on Pembridge.

* The Chilean Copper Commission lowered its copper price forecast for 2020 to US$2.40 per pound from the previous estimate of US$2.85 per pound, Reuters reported. The reduction is a result of a significant downturn in copper demand principally from China, Chile's main buyer of the metal, due to the COVID-19 pandemic.

* Nevada Copper Corp. will suspend copper production at its Pumpkin Hollow project in Nevada for at least six weeks due to the impact of the coronavirus pandemic and restrictions imposed by the government.

* Grupo México SAB de CV has started ramping down mining operations in compliance with the Mexican government's order to close nonessential activities to curb the spread of the coronavirus, Reuters reported.

* Dubai-based Shalina Resources Ltd.'s Chemaf SPRL unit in the Democratic Republic of Congo will stop copper and cobalt processing operations at its Usoke plant and suspend construction of its Mutoshi plant, Reuters reported, citing CFO Nico de Lange. "It's an operational decision, not a COVID decision, but COVID was the last push," said de Lange.

* Atalaya Mining PLC resumed operations at its Proyecto de Rio Tinto copper mine in Spain as the government declared mining an essential industry during the nationwide lockdown.

* Three Chinese nationals were killed in a gun attack at a mine in the Democratic Republic of Congo, Reuters reported citing Xinhua, China's official news agency.

PRECIOUS METALS

* Gold prices rose by more than 3% to a three-week high of US$1,665.93 per ounce on the back of global economic stimulus measures to curb the economic impact of the coronavirus pandemic, CNBC reported.

* India's gold imports in March plummeted about 73% yearly to 25 tonnes, the lowest in 6.5 years, from 93.24 tonnes in March 2019 as record domestic prices and a lockdown to fight the coronavirus pandemic impacted retail demand, Reuters reported, citing an unnamed government source.

* Three Swiss gold refiners, Valcambi SA, Argor-Heraeus SA and Produits Artistiques Métaux Précieux, are set to partially resume their operations after shutting down for two weeks, Reuters reported. The refiners process a total of 1,500 tonnes of gold annually, equivalent to one-third of the world's supply of the metal. Valcambi and Produits Artistiques Métaux Précieux will operate at less than 50% capacity, while Argor will split its staff into three groups working separate shifts.

* Yamana Gold Inc. will resume full operations at its Cerro Moro gold mine in Argentina after the government declared the mining sector an essential service. Argentina started its lockdown to curb the spread of the new coronavirus March 20 and extended it until April 12, according to BBC News.

* A pre-feasibility study for Marathon Gold Corp.'s Valentine Lake gold project in Newfoundland generated a posttax net present value, discounted at 5%, of C$472 million, with a 36.2% internal rate of return and a 1.8-year payback over a 12-year mine life.

* Resolute Mining Ltd.'s gold production for the March quarter increased by 5,470 ounces over the December 2019 quarter to 110,763 ounces.

* Newcrest Mining Ltd. formed a A$20 million "Community Support Fund" to assist host communities with coronavirus-related challenges. The company said half of the fund will be allocated to Papua New Guinea for managing the coronavirus pandemic.

* Centamin PLC is donating 10 million Egyptian pounds to support the Egyptian government's efforts to contain the coronavirus pandemic. As of April 5, the company's operations, supply chain or gold shipments remain largely unaffected by the virus.

* Novo Resources Corp. completed its subscription for 9,090,909 GBM Resources Ltd. units, each comprising one common share and half ordinary share purchase warrant, in exchange for 197,907 Novo shares. Novo Resources was also granted an option and additional earn-in right to acquire up to a 60% interest in GBM's Malmsbury gold project in Australia, with the possibility of it being increased to 75%.

* An estimated 100 people, comprising 29 community leaders and members of peasant groups, barricaded OceanaGold Corp. unit Oceanagold (Philippines) Inc.'s Didipio gold project in the Philippines after the country's president, Rodrigo Duterte, authorized the entry of 63,000 liters of fuel to the mine site, Mongabay News reported.

* An employee at Northern Star Resources Ltd.'s Pogo gold mine in Alaska tested positive for the new coronavirus while at home on leave, four days after completing his 12-day roster. Operations at the mine are continuing as planned.

BULK COMMODITIES

* Indonesian Mining Institute Chairman Irwandy Arif said coal prices will be under pressure in 2020, after the Indonesian benchmark coal price declined to US$65.77 per tonne in April, the lowest level this year, Bisnis Indonesia reported. The benchmark coal price was US$67.08 per tonne in March. IMI expects the benchmark coal price to drop to US$60 per tonne in 2020.

* South African collieries are all not equally prepared to impose safety measures to prevent the spread of the novel coronavirus, Fin24.com, reported, citing Minister of Mineral Resources and Energy Gwede Mantashe, who made surprise visits to Exxaro Resources Ltd.'s Matla operation, Glencore PLCs Impunzi mine and Seriti Resources Pty. Ltd.'s Kriel colliery.

* Brazilian steelmaker Gerdau SA will close its 1.5 million-tonne-per-annum blast furnace No. 2 in Ouro Branco in the state of Minas Gerais as well as various electric melt shops and long-steel rolling mills due to weak demand from the industrial and construction sectors. Meanwhile, ArcelorMittal suspended the 2.8-mtpa blast furnace No. 3 at its Tubarao facility in Brazil until further notice, Fastmarkets MB reported.

* Mechel PAO lost its licenses for the Pionerskoye and Sivaglinsky iron ore deposits in Yakutia, Russia, which hosts total reserves of over 160 million tonnes, due to high borrowing and lack of funds for project development. The company has not complied with a number of licensing requirements, Kommersant reported. Meanwhile, the company is supplying steel rolls for new hospitals being built for COVID-19 patients in Russia. Supplies mainly include beams, rebar and flats produced from the Chelyabinsk metallurgical plant.

* All 12 of Labrador Iron Ore Royalty Corp.'s mining leases were renewed for an additional 30 years.

* Shareholders of indebted Aluminij d.d. Mostar approved an improved offer from an Israeli-Chinese consortium to lease its foundry, Reuters reported April 6, noting that the new bid does not ask for subsidies from the government. The smelter ceased operations in July 2019 after facing debts caused by high prices of power and alumina.

* An explosion due to the accumulation of gases killed 11 miners at the Veracruz coal mine in Colombia's municipality of Cucunubá, Mining Technology reported, citing Cundinamarca Governor Nicolas Garcia. Colombia's National Mining Agency suspended all underground coal mining operations in Cucunubá following the fatal accident.

* Coal miner Foresight Energy LP swung to a net loss of US$235.8 million, or a loss of US$1.62 per common unit and subordinated unit, in the fourth quarter of 2019, compared to a net income of US$16.9 million, or 14 cents per common unit and 8 cents per subordinated unit, in the year-ago period.

* Pure Minerals Ltd.’s updated pre-feasibility study for its Townsville Energy Chemicals Hub in Queensland, Australia, outlined a posttax net present value of A$1.47 billion and a 30.7% internal rate of return, with a 4.3-year payback period, increasing from the previous estimate of A$568 million and a 20.1% IRR. The updated results incorporated a high-purity alumina refinery.

* U.S.-based coal producer Peabody Energy Corp. borrowed US$300.0 million from a US$565.0 million revolving credit facility, aiming to maintain financial flexibility as it adjusts to the global COVID-19 outbreak.

* Contura Energy Inc. is idling a majority of its operations for about 30 days in response to market conditions, existing coal inventory levels and recent customer deferrals that it said were in response to the economic fallout from the COVID-19 pandemic.

* Six Murray Energy Corp. subsidiaries issued notices flagging possible terminations covering 508 employees in eastern Ohio as the companies seek buyers for their assets, in line with bankruptcy filings in 2019.

* A Rio Tinto employee tested positive for COVID-19 after visiting the Weipa bauxite operation in Queensland, Australia, the Australasian Mine Safety Journal wrote. The employee became unwell five days after returning to Brisbane, the report said.

SPECIALTY

* Livent Corp. pulled its full-year 2020 guidance due uncertain market conditions amid the coronavirus pandemic. The company resumed operations at its Argentinian lithium-potash project after receiving authorization from the government.

* Gemfields Group Ltd. suspended all capital expenditure as it expects its May and June ruby auctions in Singapore to be deferred to the fourth quarter of 2020 amid restrictions to contain the spread of the coronavirus. The company swung to an attributable profit of US$28.4 million, or 2 US cents per share, in 2019 from a loss of US$62.2 million, or 5 cents per share, in the previous year. Revenue in the year climbed to US$216.2 million on higher emerald sales and prices, from US$206.1 million in 2018, while EBITDA in the year grew 37% year over year to US$80.9 million. The results were attributed to a US$21.6 million impairment reversal on the company's Zambian unit Kagem Mining Ltd. and higher ruby sales and prices.

* The second round of Gem Diamonds Ltd.'s Letseng flexible tender sales process raised US$6.7 million for a selection of large, high-quality diamonds from the mine. The company achieved an average value of US$1,615 per carat for the first quarter.

* Neometals Ltd. executed a collaboration agreement with Critical Metals Ltd. to jointly evaluate the feasibility of building a recycling facility to recover and process high-grade vanadium products from vanadium-bearing steel byproduct in Scandinavia.

* Peninsula Energy Ltd. suspended nonessential activities at its Lance uranium project in Wyoming, including well completion work and commencement of a field demonstration, until further notice due to the coronavirus outbreak.

INDUSTRY NEWS

* Equities in the Asia Pacific lost more than a fifth of their value in the worst quarter since the global financial crisis as markets braced for a looming economic downturn brought by the coronavirus pandemic. Philippine equities led the quarterly rout with a 32% decline in the PSE Composite Index as the national government joined a global push to ask citizens to hunker down insider their homes.

* Minister for Resources, Water and Northern Australia Keith Pitt said the coronavirus pandemic will engender a permanent reduction in mining and energy companies' reliance on fly-in fly-out employees, Australian Financial Review reported.

* Minerals Council South Africa said the country's mining industry must resume operations at the end of the 21-day lockdown on April 17 to prevent "permanent damage" to the sector, which is already expected to lose a fifth of April output and 7 billion South African rand in wages during the period, Business Day wrote.

* South African state-owned logistics company Transnet has lifted restrictions on export of minerals from ports after services were reduced following the country's lockdown to prevent the spread of COVID-19. In addition to essential services, priority will be given to domestic and export of coal and other general freight cargo through the Port of Richards Bay.

* China has slowly started reopening its businesses, but its factories may face a shortage of material as African countries, which supply metals and minerals used in many industries, have started going on lockdown, Bloomberg News reported. Trucks carrying copper and cobalt from Congo through Zambia to South African and Tanzanian ports have to go through new sanitation measures, leading to backups extending 25 miles from the border.

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