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Chalco eyes HK$2.53B buyback to take Chinalco Mining private

TOP NEWS

Chalco eyes HK$2.53B buyback to take Chinalco Mining private

Aluminum Corp. of China Ltd., or Chalco, plans to buy back HK$2.53 billion worth of shares in its Hong Kong-listed unit Chinalco Mining Corp. International as it moves the take the division private. The company is offering HK$1.39 cash for each share held in the unit, to be funded by Chalco's existing cash reserves.

Gecamines threatens to block Lundin withdrawal from Tenke Fungurume

Any move by Lundin Mining Corp. to off-load its stake in the Tenke Fungurume copper mine could jeopardize Freeport-McMoRan Inc.'s planned sale of its interest in the property to China Molybdenum Co. Ltd., Bloomberg News reported, citing Democratic Republic of Congo state-run miner Gecamines SARL.

Jilin Jien sits on 1.63B yuan overdue debts

Jilin Jien Nickel Industry Co. Ltd.'s overdue debts totaled 1.63 billion Chinese yuan, with unpaid accrued interest of 311 million yuan, as of Sept. 22. These debts included loans, banker's acceptances and letters of credit. Operations have been seriously affected by the economic downturn and tightening liquidity, the company said.

DIVERSIFIED

* BHP Billiton Group has been named as a defendant in a class action lawsuit filed by a former gate guard over the alleged underpayment of security workers at the mining giant's shale oil operation in Texas after their employment status was changed to independent contractors, The Australian Financial Review reported.

* Rio Tinto has fired five workers, including the general manager for community and corporate liaison, at its Richards Bay ilmenite mine in South Africa for allegedly inciting community protests over jobs and contracts, City Press reported.

BASE METALS

* A spokeswoman for KGHM Polska Miedz SA said two miners were killed and one has been seriously injured due to a cave-in incident at the company's Polkowice-Sieroszowice copper-silver mine in Poland, Fox News reported.

* The Mining Minister of San Juan province in Argentina, Alberto Hensel, said NGEx Resources Inc.'s Constellation copper-gold-silver project would be the largest mining project in South America, even surpassing Barrick Gold Corp.'s Pascua Lama. Constellation combines the Los Helados underground deposit in Chile with the José María open-pit deposit in Argentina. The project would begin to operate José María first and expand to Los Helados in seven years, news agency Télam reported.

* Newcrest Mining Ltd. has decided to match the proposal tabled by Maxit Capital LP for stock in SolGold Plc, agreeing to pay the 16 U.S. cents per share of Maxit's offer, which SolGold had declared superior to the Newcrest's initial proposal priced of 8 cents. The investment will result in a cash balance of US$48 million, which will be used for the Cascabel copper-gold project in Ecuador.

* China has made its largest local lead and zinc mine discovery in the far-western region of Xinjiang, with the site hosting nearly 19 million tonnes of lead and zinc reserves, Xinhua News Agency reported, citing the Xinjiang Bureau of Geology and Mineral Resources.

* Skeena Resources Ltd. completed the previously announced acquisition of Mount Rainey Silver Inc. in an all-share deal valued at C$4.5 million.

PRECIOUS METALS

* Goldplat Plc bounced back in the black in the year ended June 30, posting an attributable profit of £946,000 from a £1.1 million loss attributable to shareholders in the preceding year. The company also booked a 21% increase in revenues, to £20.2 million, as both gold production and sales rose during the period.

* Sojourn Ventures Inc. will not proceed with the proposed acquisition of Euroclub Holdings Ltd., saying that the going-public process for the online gaming company became too protracted. The board decided to refocus on evaluating resource and mineral exploration opportunities.

* Emerald Resources NL can now proceed to compulsorily acquire any Renaissance Minerals Ltd. shares not accepted into Emerald's off-market takeover bid after acquiring a 90.37% relevant interest in Renaissance.

* Kazakh gold miner RG Gold, which is controlled by private equity group Verny Capital JSC, is planning to boost output by 50%, to 1.5 tonnes per year by 2018, CEO Serik Syzdykov said. The company is ramping up production at its Raigorodok mine located 190 kilometers northwest of Astana, the Kazakh capital.

* Industry restructuring, construction of environmentally friendly mines, mining automation and globalization are four key growth drivers for Chinese gold producers in the next decade, Weng Zhanbin, vice chairman of Zhaojin Mining Industry Co. Ltd., said at a panel discussion at the China Mining Congress and Expo 2016, in Tianjin, China.

* An employee was killed Sept. 23 at Harmony Gold Mining Co. Ltd.'s Phakisa gold mine in South Africa, in a rail-bound equipment accident.

* Gryphon Minerals Ltd.'s shareholders approved the planned takeover of the company by Teranga Gold Corp. The deal is expected to close in mid-October, pending statutory approvals.

* A large gold mine hosting about 100 tonnes of gold and 120 tonnes of silver deposits, with an estimated mine life of 80 years, has been discovered in China's Henan province, Global Times reported.

BULK COMMODITIES

* Semirara Mining & Power Corp. received a notice validating the company's report that its coal mining operations adhere to the Philippine government's environment standards, meaning its Semirara coal mine is safe from closure, BusinessWorld reported. Still, the company warned that shutting its coal mine could have been "disastrous" to the country.

* Russian coal miners are unable to earn profit on high prices, as the contract prices of Russian coal are not growing along with the spot prices, Vedomosti reported.

* RBC Capital Markets said Alcoa Inc.'s 345 million-tonne-per-annum Portland aluminum smelter in Victoria, Australia, is likely to close after a A$115 million per year electricity subsidy expires in November, which could accelerate the closure of the Hazelwood brown coal generator, The Australian Financial Review reported.

* Vale SA's board has not made a decision on the sale of a stake in the company's fertilizer unit and is still looking for a partner, Reuters reported, citing a securities filing from Vale. This comes after the company's shares jumped by more than 6% on Sept. 21, on speculation that the Brazilian mining giant was about to announce the partial sale of its fertilizers business to Mosaic Co.

* The explosion and subsequent closure of PAO Severstal's Severnaya mine in February has cost the company US$21 million, or 1% of EBITDA, but reduced its self-reliance in coal to 60% to 70%, forcing it to buy supplies from third parties at market rates, Interfax reported, citing Severstal CEO Alexey Mordashov.

* Beowulf Mining Plc confirmed further delays at its Kallak iron ore project in northern Sweden, after the company said it lodged a revised exploitation concession application with the Mining Inspectorate, taking into account a recent court ruling that found miners must consider the environmental effects of their activities over a wider area than was previously the case.

* After an emergency meeting called by the Chinese government, the National Development and Reform Commission approved an increase in thermal coal production for 74 major miners, partially reversing the capacity reduction that resulted in a price hike and depleted domestic stockpiles, Reuters reported. However, the commission rejected the steel industry's appeals for a ramp-up in coking coal output, Reuters reported, citing two sources familiar with the meeting's proceedings.

* While many Chinese steel majors are lowering their respective forecasts for China's production and consumption of crude steel, Paul Butterworth, research manager at the CRU International, expects China's crude steel output to peak in the next decade on the back of the country's approaching replacements of old buildings.

SPECIALTY

* Gemfields Plc expects demand for its rubies and emeralds to continue to rise in the coming year and is targeting four emerald and beryl auctions and two mixed-quality ruby and corundum auctions, as well as a 30% to 35% EBITDA margin. The company also set its annual production target for its Kagem mine in Zambia to between 30 million carats and 35 million carats of emerald and beryl output.

* A definitive feasibility study on Altura Mining Ltd.'s Pilgangoora lithium project indicated a pretax net present value of A$411 million over an initial 13-year mine life, based on the current ore reserve estimate of 20.33 million tonnes.

* Lucapa Diamond Co. Ltd. recovered an exceptional 172.67-carat diamond at its Lulo project in Angola.

INDUSTRY NEWS

* Citing a local newspaper, Reuters said China has launched a 350 billion-Chinese-yuan restructuring fund to bolster the government's "supply-side" reforms, which include mergers of inefficient state enterprises and job cuts in struggling sectors such as coal and steel.

* Liu Xiangmin, vice president of Aluminum Corp. of China Ltd., or Chalco, told delegates at the China Mining Congress and Expo 2016 that China is seeking to speed up its urbanization and industrialization initiatives over the next few years, which will support demand growth for the mining sector. However, Liu said the downturn in mining was unlikely to end soon and called for domestic producers to exercise supply discipline.

* Mining stocks in Australia are expected to deliver their best annual returns in seven years, with resources stocks up an average of 25.5% this year, The Australian reported. The sector recovered despite no decisive shift in the outlook for global growth or the outlook for China, the world's biggest commodity consumer.

* The Argentine government was notified of potential mining investments for up to US$7 billion for the 2017-2018 period during the recent China Mining Congress and Expo 2016, mainly encouraged by the recent revoking of the tax on mining exports earlier this year by the Macri Administration, Télam reported, citing mining development undersecretary, Mario Capello.

* China accounts for the largest amount of mining investments in Peru, totaling US$10.19 billion in seven deposits, representing 22.5% of the total portfolio of the Ministry of Energy and Mines. Canada ranks second place with US$9.9 billion and Great Britain with US$6 billion, La República reported.

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.