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S&P cuts Samarco Mineração ratings over missed interest payments

TOP NEWS

S&P cuts Samarco Mineração ratings over missed interest payments

After Samarco Mineração SA missed an interest payment due Sept. 26, S&P Global Ratings downgraded the company's corporate credit ratings to D from CCC on the global scale and from brCCC on the Brazilian national scale. The rating agency also lowered the issue-level rating on the company's senior unsecured notes due 2024 to D from CCC-, while at the same time lowering the issue-level rating on its senior unsecured notes due 2022 and 2023 to CC from CCC-.

Liberty House offered US$130M for Tata's UK specialty business

According to an industry source, Liberty House has offered about US$130 million for Tata Steel Ltd.'s U.K.-based specialty steel and pipe businesses, Reuters reported. About 2,000 people are directly employed by these businesses, but about 8,000 jobs would be at risk in steelmaking sectors if sale negotiations fall through.

LME to cap warehouse charges as it finalizes reforms

The London Metal Exchange finalized its warehouse reform program, with plans to introduce caps on maximum rates charged by LME-registered warehouses effective Dec. 28. The LME said Sept. 28 that it will introduce an initial schedule of maximum rates for warehouse rents and free-on-truck charges, and the rates will be frozen for five years, after which the charges will be updated annually.

DIVERSIFIED

* Teck Resources Ltd.'s vice president of investor relations and strategic analysis, Greg Waller, said the company has been implementing cost reductions across its operations, with a target to cut a further C$300 million in operating costs this year, along with a total of more than C$1 billion of annualized savings identified and included in the 2016 plan, Mining Weekly reported.

BASE METALS

* BHP Billiton Group restarted operations at its Olympic Dam copper-uranium mine after a temporary shutdown following a power outage in South Australia, Reuters reported, citing an emailed statement from the company. The company is running the operations on backup power generators.

* Lundin Mining Corp. further extended the period to exercise its right of first offer for Freeport-McMoRan Inc.'s indirect stake in the Tenke Fungurume copper-cobalt mine in the Democratic Republic of the Congo until Oct. 20. According to Mining.com, Lundin's previous extension could indicate a bigger deal in the making involving China Molybdenum Co. Ltd. and the DRC's state-owned Gecamines SARL, which has a 20% direct ownership in the project.

* Separately, Freeport CFO Kathleen Quirk indicated that the company will proceed with the US$2 billion sale of its deepwater Gulf of Mexico assets to Anadarko Petroleum Corp. without bondholders' approval, as some of them are demanding more money and changes to existing lender agreements.

* The Indian government will sell a 7% stake in state-run miner Hindustan Copper Ltd. through a two-day offer for sale beginning Sept. 29, Mint reported. The government has set a floor price of 62 Indian rupees per share, a 5.12% discount to the Sept. 28 closing price.

* For the six-months ended June 30, North Mining Shares Co. Ltd. narrowed its loss attributable to company owners to HK$2.2 million, from a loss of HK$8.2 million reported in the corresponding year-ago period. Revenue in the first half totaled HK$118.5 million, down about 40.7% on a yearly basis.

* MMG Ltd. entered a share sale agreement to sell its Avebury nickel mine in Tasmania, Australia, to Dundas Mining Pty. Ltd. for A$25 million. Avebury has been on care and maintenance since February 2009.

* Doray Minerals Ltd.'s resource inventory increased by 17% to approximately 1.4 million ounces of gold and 27,000 tonnes of copper, as of June 30, across its Deflector and Andy Well gold mines in Western Australia.

PRECIOUS METALS

* According to San Juan province Mining Minister Alberto Hensel, Barrick Gold Corp.'s Veladero mine in Argentina, which was recently suspended by the provincial government due to a cyanide spill, could reopen in the coming days if a technical report confirms repairs, Reuters reported. The report from a team of police investigators is due within 48 hours.

* Kingsgate Consolidated Ltd.'s board has recommended shareholders take no action in relation to Northern Gulf Petroleum International Pte. Ltd.'s offer for the acquisition of a controlling stake in the company, dubbing the offer as "opportunistic" and "proportional." The Singaporean firm on Sept. 16 forwarded an offer of 4.2 Australian cents per share to Kingsgate shareholders for 50.1% of the shares held.

* Echo Resources Ltd. and Metaliko Resources Ltd. are set to announce a merger of their operations, The Australian reported. The combined entity is estimated to have a market capitalization of about A$70 million.

* Petropavlovsk PLC swung to a net profit attributable to equity holders of US$9.2 million in the six months to June 30, from a net loss of US$51.8 million a year ago. The company attributed the turnaround to production cost cuts and the weakening of the Russian ruble.

*Armadale Capital Plc entered into a binding heads of agreement with African Mining Services to form a joint venture to develop and operate the Mpokoto gold project in the Democratic Republic of Congo's Katanga province.

BULK COMMODITIES

* Despite several reports suggesting that Usinas Siderúrgicas de Minas Gerais SA controlling shareholders Techint Group and Nippon Steel & Sumitomo Metal Corp., are looking to cut ties and split the assets, no formal talks are currently under way to end the partnership, Bloomberg News wrote, citing sources. Sources added that even if the companies decide to pursue any such action, the split would take as long as two years to complete.

* Criticizing Anglo American Plc over its plan to lay off up to 80 mine workers at German Creek coal mine, part of the Capcoal property in Queensland, Australia, CFMEU Mining and Energy Division QLD District Vice President Glenn Power said the move is a "premeditated and coordinated attack" and "is nothing but a tool of intimidation aimed at picking off workers who are vocal about protecting their rights and conditions."

* U.S. aluminum industry group Aluminum Association is seeking a "meaningful dialogue" with Chinese authorities to end incentives and subsidies that are contributing to the global oversupply and squeezing U.S. producers out of the market, Bloomberg News wrote.

* Vale SA expects the balance in supply and demand in the iron ore market to continue, with Brazil adding about 28 million tonnes of iron ore to the seaborne market in 2017, Reuters reported, citing CEO Murilo Ferreira.

* ArcelorMittal unit ArcelorMittal South Africa Ltd. made a deal, worth about 2.2 billion South African rand, to give a 17% stake in the company to its partner Likamva Resources Pty. Ltd., a specially formed, black-owned company.

* The Australian Fair Work Commission has ordered mining major BHP Billiton to reinstate a worker who was sacked at the Saraji coal mine in Queensland over an expletive-laden exchange with a colleague, The Australian reported. "The termination of his employment is disproportionate to the circumstances where it had not been made clear to employees that the use of the word ‘scab’ in any circumstances would result in dismissal," Commissioner Paula Spencer noted in her decision.

* Sources told Reuters that the Chinese government ordered 74 major coal mines to increase thermal coal production by a further 500,000 tonnes per day to boost supplies to electric utilities before winter hits.

* As India aims to boost domestic sales, the government has raised the cap on the purchase of coal by small and medium companies to 10,000 tonnes per annum, from 4,200 tonnes set almost nine years ago, Bloomberg News reported, citing a notice from the coal ministry.

* According to the Associated Press, Chinese authorities blamed illegal mining activities for a gas explosion at a small coal mine in the northwestern region of Ningxia that killed 19 people and left one miner missing. Xinhua News Agency said the blast occurred the morning of Sept. 27.

* Kosei Shindo, the chairman of the Japan Iron and Steel Federation and president of Nippon Steel & Sumitomo Metal Corp., said Baosteel Group Corp.'s acquisition of Wuhan Iron & Steel Co. Ltd. will establish stronger leadership in the country's steel industry and promote structural reform, Reuters reported.

* The Chinese government is investigating Wang Hongren, the deputy general manager of Hebei Iron & Steel Group Co. Ltd Ltd, for suspected corruption, Reuters wrote.

* Struggling steelmaker Dongbei Special Steel Group laid out a revival plan to make a 300 million Chinese yuan profit in 2018 and cut its debt-to-assets ratio to below 60%, The Economic Observer reported, citing anonymous sources. The company is seeking the Chinese government's support for its debt restructuring plans.

SPECIALTY

* Chinese firm Sichuan Tianqi Lithium Industries Inc. is vying for the controlling stake in Chile's Sociedad Quimica y Minera de Chile SA in a bid to expand its presence in the lithium industry, the Financial Times reported. Earlier this week, Tianqi purchased a 2% interest in the Chilean firm and is now seeking to purchase a separate 23% stake controlled by a vehicle of Julio Ponce Lerou.

* AREVA SA is facing legal action from Finnish utility Teollisuuden Voima as the latter tries to avoid further delays at its Olkiluoto 3 nuclear reactor in Finland, Reuters reported, citing a company statement. The utility firm wants assurances that Areva's restructuring will not result in further delays and that the plant would be ready to begin production in 2018 as scheduled.

* Resolve Ventures Inc., Nevada Sunrise Gold Corp. and Advantage Lithium Corp. reached a new deal to allow Advantage to earn up to a 50% working interest in the early-stage Neptune lithium property in Nevada.

* Lucapa Diamond Co. Ltd. sold a parcel of diamonds for A$5.3 million, bringing the total sales for the year to A$44.1 million. The parcel of 2,209 carats of alluvial diamonds from the Lulo diamond project in Angola fetched an average sale price of A$2,437 per carat.

* An expansion study on Boss Resources Ltd.'s Honeymoon uranium project, which indicated low capital outlay of US$7 million for plant restart plus US$57 million for the expansion to 2 million pounds per annum, provided the confidence to advance the project toward a pre-feasibility study, with a decision to mine by the end of 2017.

INDUSTRY NEWS

* South Australia's Mineral Resources and Energy Minister Tom Koutsantonis has urged the community and stakeholders to provide their input for the comprehensive review of mining laws in the state, adding that the Leading Practice Review of Mining Acts will enable communities to play a key role in shaping improvements to the state's framework of mining laws, Mining Weekly reported.

* According to Mexico's economy ministry data, foreign direct investment in Mexico's metallic mining industry reached US$491 million in the first half of the year compared to negative US$119 million in the corresponding year-ago period, Business News Americas reported.

S&P Global Ratings and SNL Metals and Mining, an offering of S&P Global Market Intelligence, are both owned by S&P Global Inc.

The Daily Dose is updated as of 7 a.m. Hong Kong time, and scans news sources published in Chinese, English, Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Some external links may require a subscription.