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S&P downgrades Mosaic over Vale fertilizer deal

TOP NEWS

S&P downgrades Mosaic over Vale fertilizer deal

S&P Global Ratings downgraded Mosaic Co.'s corporate credit rating and issue-level ratings to BBB- from BBB on the back of the planned acquisition of Vale SA's fertilizer business for US$2.5 billion. According to S&P, the deal comes at a time when fertilizer pricing has been depressed. The firm maintained a stable outlook for Mosaic in anticipation that the miner will prioritize free cash flow generation rather than shareholder rewards and additional acquisitions.

Court orders Vedanta Resources unit to pay US$103M to ZCCM

The High Court of Justice in the U.K. ordered Vedanta Resources Plc unit Konkola Copper Mines Plc to pay about US$103 million to Zambian state-owned copper miner ZCCM Investments Holdings Plc over a copper price agreement, Bloomberg News reported. The payment is due within 30 days, and Konkola said it was in talks with ZCCM and other relevant stakeholders to resolve all outstanding issues within this period.

Alcoa's Portland smelter closure risks over 3,600 job losses, A$800M in GDP

The shutdown of Alcoa Corp.'s troubled Portland aluminum smelter in Victoria, Australia, would deduct A$800 million from the national gross domestic product and could result in the loss of over 3,600 jobs, The Australian reported, citing a report commissioned by the Australian Workers Union.

BASE METALS

* A lawyer for detained Israeli billionaire Beny Steinmetz said the proceedings are a way for the Guinean government to "illegally expropriate" BSG Resources Ltd.'s mining rights in the country, Reuters reported. Steinmetz was detained Dec. 18 over bribery and corruption allegations.

* The bill that will capitalize Chilean state miner Codelco with US$975 million this year will be submitted for Congress' approval Dec. 20. The Lower House's Finance commission should review the draft in the next six days, daily Diario Financiero reported.

* Asian Mineral Resources Ltd. and Kasbah Resources Ltd. mutually agreed to terminate a scheme implementation agreement pursuant to which Kasbah agreed to be acquired by Asian Mineral Resources.

* Riva Resources Ltd., formerly known as Dragon Energy Ltd., entered an exclusive nonbinding memorandum of understanding for an exploration farm-in and joint venture with a LeadFX Inc. subsidiary over the Paroo Station lead property in Western Australia.

PRECIOUS METALS

* S&P Global Ratings upgraded its corporate credit rating on Coeur Mining Inc. to BB- from B+, with a stable outlook, after the company redeemed US$190 million of its 7.875% notes due 2021 with the proceeds from its US$200 million equity offering. S&P expects the miner to meet its production and cost targets and generate EBITDA such that adjusted debt leverage will remain in the 1x to 2x range over the next 12 months.

* Great Panther Silver Ltd. struck a deal to acquire the Coricancha gold-silver-lead-zinc-copper mine and mill complex from Nyrstar NV subsidiary Nyrstar Coricancha SA.

* Avanco Resources Ltd. estimated a maiden resource for the Blanket Zone at the CentroGold project in northern Brazil of 12.2 million tonnes at 1.8 g/t of gold containing 694,000 ounces of gold.

* Golden Queen Mining Co. Ltd. declared commercial production at its Soledad Mountain gold-silver mine in California.

* Strategic Metals Ltd. said its board unanimously approved a spinout of its Eureka, Triple Crown and Treble precious metals projects in Canada's Yukon Territory to Trifecta Gold Ltd.

* Richmont Mines Inc. received approvals from the Ontario government for the amendments to both air and wastewater environmental compliance approvals for the Island gold mine in Ontario. The amended permits support a potential ore mining and processing rate increase to an average of 1,100 tonnes per day, from the current 900 tonnes per day.

BULK COMMODITIES

* Unlike Mosaic, S&P Global Ratings said Vale's ratings are not immediately affected by the purchase deal that will see Mosaic acquiring Vale's fertilizer business.

* The U.S. Department of the Interior finalized the Stream Protection Rule, which aims to protect streams and forests from the impact of coal mining over the next two decades. According to Reuters, the rule is likely to be reversed by President-elect Donald Trump, who said that in his early days in office, he would reverse a number of regulations targeting the coal industry.

* Luossavaara-Kiirunavaara AB, or LKAB, said it will not proceed with the development of its Mertainen iron ore project in Sweden and will mothball the open-pit mine until prevailing market conditions improve. According to LKAB, Mertainen's products cannot be made profitable at the moment.

* Vale SA said recent heavy rains at the Quadrilátero Ferrífero area in Minas Gerais state, Brazil, caused the rupture of a pipe in the drainage system at its Fabrica Nova iron ore mine Dec. 17, daily Valor Econômico reported.

* Cyrus Mistry, who was expelled as the chairman of Tata Sons Ltd., resigned as the chairman of Tata Motors Ltd. and as a director of Tata Steel Ltd., Tata Chemicals Ltd., Tata Global Beverages Ltd. and Indian Hotels Co., Bloomberg News reported.

* Alcoa joint venture Alcoa World Alumina and Chemicals secured its first major third-party contract to supply about 400,000 bone dry tonnes of bauxite from its Huntly mine in Western Australia. The Western Australian government also granted approval for Alcoa to export up to 2.5 million tonnes per annum of bauxite for five years to third-party customers.

* The Australian wrote in a separate report that Australia's green groups have warned that they will fight to stop the Portland smelter gaining access to clean energy funding, after Federal Industry Minister Greg Hunt flew to owner Alcoa's headquarters in the U.S. to offer a lifeline of subsidized federal funding for its power supply.

* Techint Group is looking to file a lawsuit in the highest appeals court in Brazil to challenge a decision made in favor of Nippon Steel & Sumitomo Metal Corp. by a state court in October in the companies' battle for control of Usinas Siderúrgicas de Minas Gerais SA, Reuters reported, citing "a source close to the matter."

* Adani Enterprises Ltd. Chairman Gautam Adani said the company is not concerned about its debt levels, adding that its debt-to-EBITDA ratio is "at a comfortable level of 3.25:1," Live Mint reported. Adani added that the company is looking to invest in additional industries including coal conversion, defense and water.

* According to Press Trust of India, the Indian government intends to review the status of 72 previously allocated coal blocks, which were either allotted or auctioned to companies including Steel Authority of India Ltd., Hindalco Industries Ltd., JSW Steel Ltd., and NTPC Ltd.

* Liberty House and SIMEC, owners of the U.K.'s only aluminum smelter, plan to invest £120 million in a project at the plant in Lochaber, Scotland, to make aluminum wheels for the car industry, Reuters reported. The groups acquired the 47,000-tonne smelter and two hydro-electric power stations in November from Rio Tinto.

* The New South Wales Planning Assessment Commission approved the extension of Centennial Coal Co. Ltd.'s Airly coal mine for 20 years, after more than a year of public hearings and an independent study, ABC reported. The project is expected to secure more than 70 existing jobs and up to 135 positions if operations ramp up.

* PT Adaro Energy Tbk expects coal production in 2017 to fall to between 52 million tonnes and 54 million tonnes, in line with 2016 production, as it focuses more on stocking coal reserves, Kompas reported, citing a company official.

* Mexico imposed a 35.64% definitive anti-dumping duty on high-carbon ferromanganese volumes imported from South Korea, Metal Bulletin reported.

SPECIALTY

* Mkango Resources Ltd. signed a collaboration agreement with Noble Group Ltd. subsidiary Noble Resources International Pte. Ltd., allowing the company to acquire up to a 12.5% interest in Mkango.

* Metalicity Ltd. is acquiring a 579-square-kilometer lithium exploration portfolio in the Pilbara region of Western Australia from Fortescue Metals Group Ltd., including the Lynas Find North lithium project.

* Bacanora Minerals Ltd. said it is in advanced talks with a significant Asian off-take partner for the supply of battery-grade lithium carbonate. The company plans to start production from its Sonora project in Mexico in 2019, with a full capacity of 35,000 tonnes of lithium carbonate per year.

* Sociedad de Inversiones Oro Blanco SA justified the suspension of the sale of its stake in Sociedad de Inversiones Pampa Calichera SA, which holds a 23% stake in Sociedad Quimica y Minera de Chile SA, arguing that the binding offers received did not meet the requirements. Chinese groups Tianqi Lithium, Shanshan Group, and Chinese investment firm GSR GO Scale Capital Advisors had been invited by Oro Blanco to submit their proposals, daily Pulso reported.

* Separately, the controlling companies of SQM are looking at ways to reduce debt by US$800 million after the failed sale of Pampa Calichera, daily Diario Financiero reported.

* Meanwhile, Chile's Council of State Defence filed a criminal claim against SQM after finding that the company is legally liable in the alleged bribery and campaign corruption scandal involving high-profile political leaders. If found guilty, the company risks fines and potential closure, daily La Tercera reported.

* Kairos Capital Corp. signed a binding letter of intent to acquire a 26,400-hectare lithium property portfolio covering exploration claims over six salars in regions I and II of northern Chile.

INDUSTRY NEWS

* Research by S&P Global Market Intelligence showed continued momentum in the performance of mining shares. S&P Global Market Intelligence's Pipeline Activity Index rose from 80 to 84 month over month to reach a 44-month high in November, as increases in junior and intermediate company financings and announced initial resources at projects and mines were somewhat tempered by declines in the number of reported drill assays and project milestones.

* Only 27% of the bonuses the 12 largest mining companies operating in Chile pay their workers are tied to productivity goals, according to a preliminary report by productivity commission CNP, daily Pulso reported.

* India may cancel tariffs on over 70% of the goods traded with China under the proposed Regional Comprehensive Economic Partnership agreement, Live Mint reported.

* President-elect Donald Trump is considering appointing former U.S. attorney Debra Wong Yang as the next chair of the Securities and Exchange Commission, Bloomberg News reported, citing an unnamed source "with direct knowledge of the matter."

* International Monetary Fund head Christine Lagarde has been convicted of negligence but will not face a fine or jail sentence, Bloomberg News reported. The former French finance minister was found guilty on one count of negligence regarding a state payout to businessman Bernard Tapie during her time in office.

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

S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.