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FMC returns to profit; Endeavour's Q1 gold output up; early closure for Yancoal's Donaldson mine

Greenhouse gas and gold mines Nearly 1 ton of CO2 emitted per ounce of gold produced in 2019

Essential Metals & Mining Insights - September 2020

Essential Metals & Mining Insights - August 2020

State of the Market: Mining Q2-2020


FMC returns to profit; Endeavour's Q1 gold output up; early closure for Yancoal's Donaldson mine

TOP NEWS

FMC Corp.recorded net income attributable to shareholders in the first quarter of US$48.3million, or 36 cents per share, reversingthe net loss of US$46.8 million, or 35 cents per share, recorded in the year-agoperiod. Guidance for earnings per diluted share was raised by 5 cents to betweenUS$2.55 and US$2.85, compared to the adjusted EPS of US$2.47 for full year 2015.

Endeavour MiningCorp. produced131,567 ounces of gold during the first quarter, compared to 123,744 ounces a yearago. All-in sustaining cost improved to US$900 per ounce from US$946 per ounce.The company is on-track to meet its full-year guidance of 535,000 ounces to 560,000ounces of gold at all-in sustaining costs of US$870 per ounce to US$920 per ounce.

Citing market challenges, Yancoal Australia Ltd. placed its Donaldson coal operations in New South Wales, Australia,on care and maintenance,a month earlier than anticipated. The move follows a halt in mining activities atthe Abel underground mine and the start of new feasibility studies that will considerthe future development of new underground working areas.

BASE METALS

* Boliden ABposted a net profit in the first quarter of 656 million Swedish kronor, or 2.4 kronorper share, down froma year-ago net profit of 896 million kronor, or 3.27 kronor per share. Revenue forthe three months dropped to 8.85 billion kronor, from 10.41 billion kronor a yearago, mainly due to lower metal prices, partially offset by higher production.

* The governor of Catamarca province in Argentina, Lucía Corpacci,said the Alumbreracopper joint venture, owned by GlencorePlc, Goldcorp Inc.and Yamana Gold Inc.,would not be closing for another year. The mine had initially planned to finishoperations by the end of 2017. However, since the federal government eliminatedexport duties for mining and energy companies, Alumbrera decided to continue operating,local daily El Ancasti reported.

* Antofagasta Plcsubsidiary Antofagasta Minerals SA'sLos Pelambres coppermine in Chile submitted an environmental impact report for its US$1.1 billion investmentplan, which is a key to improving the mine's competitiveness and keeping its currentproduction stable at 400,000 tonnes of fine copper per year, daily La Tercera reported,citing Antofagasta CEO Iván Arriagada.

* Meanwhile, Antofagasta Minerals and Marubeni Corp.-owned Antucoya copper mine in northern Chile resumed operationsafter the death of a worker on April 30, daily La Tercera reported.

* Panoro MineralsLtd.'s preliminary economic assessment of its Antilla copper-molybdenum project in Peru estimatedafter-tax net present value, discounted at 7.5%, of US$225 million, a 15.1% internalrate of return and a payback period of 4.1 years. The design throughput is estimatedat 40,000 tonnes per day with an operational life of mine of 24 years. Initial projectcapital costs, including contingencies, are expected to total US$603 million.

* Amur MineralsCorp. said measured, indicated and inferred resources at its Ikenskoe/Sobolevskynickel-copper deposit, part of the Kun-Manieproject in Russia, has increasedto 35.3 million tonnes at 0.51% nickel and 0.13% copper for 180,800 tonnes of containednickel and 47,100 tonnes of contained copper, from a previous 2013 ore tonnage of34.1 million tonnes.

* Tongling NonferrousMetals Group Co. Ltd. swungto a net loss of 87.1 million Chinese yuan, or 1 fen per share, in the first quarter,from a net profit of 52.3 million yuan, or 1 fen per share, posted a year ago. Operatingincome dropped 10.4% to 18.15 billion yuan.

* Copper MountainMining Corp. produced about 19.0million pounds of copper in the first quarter from its mine in BritishColumbia, up from 18.4 million pounds a year ago. Gold and silver production, meanwhile,totaled 7,600 ounces and 64,700 ounces, respectively, down from 7,800 ounces and80,300 ounces recorded last year.

* A preliminary economic assessment on the planned redevelopmentof Ivanhoe Mines Ltd.'sKipushi zinc-coppermine in the Democratic Republic of Congo, peggedan after-tax net present value, at an 8% real discount rate, of US$533 million,a real internal rate of return of 30.9% and a payback period of 2.2 years.

PRECIOUS METALS

* Endeavour MiningCorp. produced131,567 ounces of gold during the first quarter, compared to 123,744 ounces a yearago. All-in sustaining cost improved to US$900 per ounce from US$946 per ounce.The company is on-track to meet its full-year guidance of 535,000 ounces to 560,000ounces of gold at all-in sustaining costs of US$870 per ounce to US$920 per ounce.

* Centamin Plc'sprofit after tax for the first quarter increasedto US$40.9 million, from US$28.6 million in the same prior-year quarter. Revenuewas up to US$148.1 million in the period, from US$135.5 million a year ago on anincrease in production and sales of gold and lower all-in sustaining costs.

* Gold prices have crossed the US$1,300 mark per ounce on speculationthat U.S. central bank will not immediately tighten policy, Bloomberg News reported.Bullion for immediate delivery has risen 22% this year up to US$1,303.82 per ounce.

* Sulliden MiningCapital Inc. secured a two-year option to acquire the past-producing Troilus gold mine in Quebec from The Troilusproperty consists of 81 mineral claims and one surveyed mining lease that collectivelycover about 4,700 hectares.

* Nevada ExplorationInc. added 76 new claims covering 550 hectares to its in Nevada's Kelly Creek basin,through staking. The company's land position now spreads over 3,100 hectares withinthe Kelly Creekbasin.

* Pantoro Ltd.,formerly Pacific Niugini Ltd., has reached an agreement to acquire BulletinResources Ltd.'s 20% interest in the Halls Creek gold project in Western Australia.The project, which includes the high-grade Nicolsons mine and processing plant,is currently 80%-owned by Pantoro.

* Atacama PacificGold Corp. said it is currently reviewing development options for itsCerro Maricungaoxide gold deposit with the goal of reducing capital costs.

* With US$52.1 million cash and only US$1.6 million debt, is looking toacquire quality assets in Australia and North America, withCEO and President Douglas Forster saying the "landscape is still positive …in terms of acquisition, but we are cautious investors. … We're looking for qualityand willing to pay up for that," MiningNews.net reported. "It would benice to pair our Australian gold production with some US gold production. … Thatwould be sort of the natural hedge, if you will, against the strengthening Australiandollar," Forster said.

* Eastern GoldfieldsLtd. signed a binding agreement to acquire more tenements in Western Australia's Eastern Goldfieldsregion from Orion Gold NL'sGoldstar Resources (WA) Pty. Ltd. unit in exchange for A$125,000 in cash and 2 millionunlisted options.

* Northern SphereMining Corp. earned an 80%stake in Trueclaim ExplorationInc.'s Scaddinggold property in Ontario after entering a joint venture deal.

* Havilah ResourcesLtd. has kicked off the processingof high-grade ore at the Portiagold mine in South Australia. Ore is being sourced from the stockpile generatedfrom mining the interim sub-pit, as previously reported, and sufficient materialis available for treatment for several weeks.

* The strong run in OceanaGoldCorp.'s share price led Deutsche Bank to downgrade the stock to sell based on valuation, Fairfax MediaAustralia reported.

BULK COMMODITIES

* Citing market challenges, Yancoal Australia Ltd. placed its Donaldson coal operations in New South Wales, Australia,on care and maintenance,a month earlier than anticipated. The move follows a halt in mining activities atthe Abel underground mine and the start of new feasibility studies that will considerthe future development of new underground working areas.

* Mexican steelmaker DeAcero exports manager Germán Gasca saidthe dumping accusations by rival companies CAPSA and Gerdau SAare unfounded and anticompetitive. Gasca called CAP and Gerdau's requirement toestablish a tariff of least 27.5% for concrete reinforcing steel rebars "abusive,"daily Diario Financiero reported.

* Anglo AmericanPlc's Brasil Iron Ore Business Unit on April 30 completed the 100thshipment from its Minas-Rio iron ore complex in Brazil. The shipment of iron orepellets left the Port of Açu in São João da Barra, Rio de Janeiro state, towardNorth America, Notícias de Mineração reported.

* According to India's Mines Secretary Balvinder Kumar, has agreedto repurchase 25% of theshares out of the 80.93% interest the Indian government owns at a price to be determinedlater this month. The buyback is part of the government's drive to raise up to 565billion Indian rupees to offset the national 2016-17 fiscal deficit.

* BHP BillitonGroup, which manages eight coal mines in Queensland, Australia, mayhold an early direct vote of workers on a redraft of their enterprise agreement,The Australian Financial Review reported, citing three major coal unions in the Australian state.The unions, in a circular to their members, said management was planning "extreme"and "massive departures" from legacy work agreements.

* U.S. Steel Corp.plans to offer US$500million worth of senior secured debt due 2021, subject to market and other conditions.The company will use the proceeds to repay debt, prioritizing near-term liabilitiesand general corporate purposes.

* Alcoa Inc.reached an agreementwith the Bonneville Power Administration, which will help improve the competitivenessof its Intalco aluminumsmelter in Ferndale, Washington state. With the agreement, the facility will notcurtail at the end of the second quarter.

* Sanjeev Gupta's Liberty House confirmed that it will tablea bid for Tata Steel Ltd.'sloss-making U.K. operation by May 3, London's Financial Times reported, citing a Liberty House spokesman. "[Liberty House]has put in place a strong internal transaction team and panel of leading externaladvisers to take the bid forward," the spokesman said. The trading companyis reportedly working with Macquarie Bank to advise on the bid and to potentiallyfund the offer with a US$1 billion credit line while a Tata Steel management buyoutteam is also mulling to table a bid for troubled business. Liberty House also agreedto acquire Tata's Scottish steel plants in late March.

SPECIALTY

* FMC Corp.recorded net income attributable to shareholders in the first quarter of US$48.3million, or 36 cents per share, reversingthe net loss of US$46.8 million, or 35 cents per share, recorded in the year-agoperiod. Guidance for earnings per diluted share was raised by 5 cents to betweenUS$2.55 and US$2.85, compared to the adjusted EPS of US$2.47 for full year 2015.

* Workers at AREVASA's Cominakuranium mine in Niger initiated a 72-hour strike May 2, saying they have yet to receivethe full payment of bonuses for meeting financial targets last year, Reuters reported,citing two unions.

* Lanka GraphiteLtd. said a breakthroughtechnique has been developed for graphene production under its materialcollaboration agreement with the National Taiwan University of Science and Technology.The Liquid Phase Exfoliation technique has potential to lead to mass productionof graphene, the company said.

* Athabasca NuclearCorp. entered into a binding letter of intent with to the Torp Lake and Phoenix lithium claims in Canada.

* Platypus MineralsLtd. said Lepidico Ltd.has granted European Metals HoldingsLtd. an option to acquirea license to use the L-Max technology for the latter's Cinovec lithium project in the Czech Republic forA$20,000.

INDUSTRY NEWS

* The recent uptick in debt buybacks in the mining industry hassparked optimism that the mining sector is recovering.In the week to April 29, Evraz Plcbought back US$184.4 million worth of notes due April 2017 and 2018, said it will redeemon May 20 all of its outstanding US$1.4 billion 4.5% notes due Feb. 25, 2017, andFortescue Metals Group Ltd.issued a voluntary redemption notice to holders of its 8.25% senior unsecured notesdue in 2019, paying down a further US$577 million worth of debt.

* The government in India is planning to startmonitoring mines in the country through satellites, starting this year, aftera three-month pilot project found widespread illegal limestone mining in a big state,Reuters reported, citing India's Mines Secretary Balvinder Kumar. The Indian Bureauof Mines is digitizing maps of all mines under the purview of the ministry to checkwhether companies are complying by rules or mining outside their lease areas.

* Moody's flagged that more Brazilian companies will face increasingliquidity risk through next year as surging borrowing costs and the harshest recessionin decades affect their ability to service debt, Reuters reported. Despite cost-cutting initiatives, raising funds hasemerged as challenge for the oil and gas, homebuilding, transportation, telecommunicationsand media, and metals and mining industries, the rating agency added.

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