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ThyssenKrupp shareholders mull voting against Tata Steel joint venture

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Essential Metals Mining Insights November 2021

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ThyssenKrupp shareholders mull voting against Tata Steel joint venture

TOP NEWS

ThyssenKrupp shareholders mull voting against Tata Steel joint venture

ThyssenKrupp AG's major shareholders plan to vote against the German steelmaker's proposed European steel joint venture with Tata Steel Ltd. amid doubts about the deal, Bloomberg News reported, citing people familiar with the matter. The shareholders, which include Cevian Capital and Alfried Krupp von Bohlen und Halbach-Stiftung, are mounting pressure on ThyssenKrupp management to sweeten the terms of the deal with the Indian steelmaker.

Rio Tinto prioritizes rail capacity debottlenecking, aims to match mine and port capacity by end of 2019

Rio Tinto's Western Australian iron ore operations is aiming to complete the debottlenecking of its rail capacity, in order to match its mine capacity of 360 million tonnes per annum including the ramp-up of its Silvergrass operations and its current port capacity of 360 million tonnes per annum, by the end of 2019. The mining giant views its AutoHaul program as a crucial component in the debottlenecking of its rail capacity, which is currently up to 340 million tonnes per annum.

South32 to acquire remaining 83% stake in Arizona Mining for US$1.3B

South32 Ltd. struck an all-cash deal to acquire the remaining 83% stake in 17%-owned Arizona Mining Inc. for US$1.3 billion. The diversified miner offered C$6.20 for each Arizona Mining share, representing a 50% premium to the closing price on June 15, which implies a total equity value of US$1.6 billion for the company. Arizona Mining owns the Hermosa silver-zinc-lead project in Arizona and an extensive land package with a potential for polymetallic and copper mineralization.

DIVERSIFIED

* Glencore PLC was deemed the outstanding stock by J.P. Morgan Cazenove in a valuation analysis of the Europe, Middle East and Africa metals and mining sector, ahead of Rio Tinto and Anglo American PLC. Rio Tinto is tagged with a neutral rating by J.P. Morgan Cazenove, while Glencore and Anglo American have an overweight recommendation.

BASE METALS

* A minor leak was detected in the sulfuric acid storage plant at Vedanta Resources PLC's shuttered Tuticorin copper smelter in India's Tamil Nadu state, Reuters reported. The leak was not believed to be problematic, but the authorities decided to evacuate the storage as a safety precaution, said Sandeep Nanduri, the administrative official of the district where the plant is located.

* A pit wall failure at the Kali Kuning open pit of Finders Resources Ltd.'s Wetar copper project in Indonesia resulted in the temporary isolation of approximately 40,000 bank cubic meters of ore and a six-hour suspension of mining operations. The copper miner does not anticipate a disruption in the scheduled ore production, and a recovery plan to rehabilitate the zone and the affected ore is underway.

* Arc Minerals Ltd. increased its shareholding in the Zamsort copper-cobalt project in northwest Zambia to 61%, following the acquisition of an additional 6% stake from two shareholders of Zamsort Ltd. for 12 million shares.

* Heron Resources Ltd. secured an electricity supply contract for the Woodlawn zinc-copper project in New South Wales, Australia, through to commissioning and up to the start of production in early 2019.

* Highland Copper Co. Inc. outlined results of a feasibility study on its Copperwood copper project in Michigan, estimating an after-tax internal rate of return at 18% and a net present value, discounted at 8%, at US$116.8 million.

* Cobalt Power Group Inc. completed its acquisition of Western Cobalt Corp. for 12.2 million shares and a 2.5% net smelter royalty, 1.5% of which may be purchased by Cobalt Power for C$1.5 million at any time within five years of deal closing.

PRECIOUS METALS

* Tanzania is planning a tax legislation amendment to grant amnesty on interest and penalties for the next six months in a move that may have a significant impact on gold miner Acacia Mining PLC, which owes the government about US$190 billion in unpaid taxes along with interest and penalties, Reuters reported. Acacia's share price was up by more than 5% as of June 15 closing on the London Stock Exchange.

* South African Mineral Resources Minister Gwede Mantashe said that 20 out of 45 mining deaths since the start of this year have been reported at Sibanye Gold Ltd.'s mining operations, adding that the Mine Health and Safety Inspectorate is probing and preparing a report on the miner, with the idea of taking appropriate action, Mining.com reported.

* Centerra Gold Inc. elected not to earn-in at Erris Resources PLC's Klippen gold project in Sweden, with the decision based on drill results that are not indicative of a potentially economic mineral system. Erris also elected not to renew the Klippen license areas.

* Truck drivers lifted the blockade on the access road to Goldcorp Inc.'s Penasquito gold mine in Mexico after agreeing to negotiate on their demands with the Canadian miner, Reuters reported. A company official said the nearly two-week protests did not affect work at Penasquito.

* A preliminary economic assessment for Jangada Mines PLC's Pedra Branca platinum project in northeastern Brazil outlined a net present value, discounted at 7%, of US$192 million, an internal rate of return of 67% and a 1.6-year payback period, with a potential life of mine of 13 years.

* Four people were killed and five others were injured in a landslide at an artisanal gold mine in Honduras, Reuters reported, citing the fire department.

BULK COMMODITIES

* Gina Rinehart's Hancock Prospecting Pty Ltd. lodged an off-market takeover bid to acquire Atlas Iron Ltd., in which it owns a 19.6% stake, in an all-cash deal where Atlas shareholders will receive 4.2 Australian cents per share held. The iron ore explorer, which reached an agreement to merge with Mineral Resources Ltd. in April, advised its shareholders to take no action to the takeover offer.

* Noble Group Ltd. requested a trading halt prior to the Singapore Exchange's market open, after its share prices tanked to 5.4 Singapore cents at market close June 14. The commodities trader is working toward a controversial restructuring, which third-largest shareholder Goldilocks Investment Co. Ltd. has opposed.

* BHP Billiton Group awarded a A$260 million mining infrastructure works contract for the South Flank iron ore project to CIMIC Group Ltd., shortly after approving a US$2.9 billion development of the Western Australian project.

* Tyler Mitchelson, head of Anglo American's metallurgical coal business, plans to aggressively expand the miner's Australian operations, The Australian reported.

* An Australian railroad issue watched closely by international metallurgical coal buyers and sellers could soon be resolved, taking the air out of recent high prices, an analyst said. A dispute over regulated returns between Australian regulators and Aurizon Holdings Ltd. that threatened to curtail at least 20 million tonnes of coal from the export market per year may be close to a resolution, Seaport Global Securities analyst Mark Levin wrote. Supply uncertainty around the dispute was one of several major factors causing metallurgical coal prices to rise to over US$200/tonne on the spot market, Levin said.

* Australian coal miner Bounty Mining Ltd. was admitted on the ASX after raising A$18 million in an IPO. The company's shares will start trading on the exchange under the ticker MNG, effective June 19.

* The Queensland government in Australia will fund A$180,000 over the next three years for a collaborative research project between Rio Tinto and a researcher from the University of Queensland to develop an innovative mining process that could unlock massive, untapped, bauxite deposits in the state within the next five years, Mining Weekly reported.

* Brazil slapped anti-dumping duties of up to US$888.27 per tonne on imports of welded austenitic stainless steel pipes imported from Malaysia, Thailand and Vietnam, Metal Bulletin reported, citing a statement by the country's Ministry of Industry and Foreign Trade and Services.

* Demand for steel in Russia is expected to grow up to 4% in 2018 and 8% by 2021 due to activity in the construction sector, Vedomosti reported.

* The construction of stadiums in Russia for the 2018 FIFA World Cup required 200,000 tonnes of steel, of which about 25% was supplied by PJSC Novolipetsk Steel, Vedomosti reported.

* Italy's special long steelmaker Ori Martin purchased a majority stake in compatriot steelmaker Ferrosider, Metal Bulletin reported.

* China's National Energy Administration approved a 3.25 billion Chinese yuan coal project, with an annual capacity of 2.4 million tonnes, in the country's southwestern Guizhou province, ifeng.com reported.

SPECIALTY

* Chilean antitrust regulator FNE will launch a probe into the market impact of Tianqi Lithium Corp.'s purchase of a 24% stake in Sociedad Quimica y Minera de Chile SA for US$4.1 billion, Reuters reported. "In our investigation, the FNE will seek to verify, or dismiss, whether anti-competitive risks in Chile ... are plausible, and of a magnitude that makes them relevant," the FNE said in a statement.

* Lithium Power International Ltd. said the Centenario lithium project in Argentina is now a joint venture with Centernario Lithium Ltd. on a 70/30 basis, after the latter failed to complete the acquisition of the project. The explorer, meanwhile, is evaluating options to dispose its 70% interest in Centenario, as well as its Pilbara and Greenbushes assets in Western Australia.

* Red 5 Ltd. sold its royalty entitlement from Galaxy Resources Ltd.'s Mt Cattlin lithium mine in Western Australia to Lithium Royalty Corp. for A$11 million.

* Atlas Iron made the first shipment of direct shipping ore sourced from Pilbara Minerals Ltd.'s Pilgangoora lithium project in Western Australia to Sinosteel Australia Pty Ltd.

* Lucapa Diamond Co. Ltd. fetched US$2.0 million from the sale of 1,782 carats of diamonds from its Lulo project in Angola, representing an average price per carat of US$1,150.

INDUSTRY NEWS

* The U.S. Treasury Department hit 14 companies with fresh sanctions due to ties to controversial mining-entrepreneur Dan Gertler and business in the Democratic Republic of the Congo. "Gertler has used his close friendship with DRC President Joseph Kabila to act as a middleman for mining asset sales in the DRC, requiring some multinational companies to go through Gertler to do business with the Congolese state," the department said.

* The Minerals Council South Africa said it does not support some elements in the latest draft of the mining industry charter, including a stipulation that 1% of core profit is paid to communities and employees. The latest draft by the South African government also outlines plans to lift black ownership at permit-holding mining companies to 30% from 26% within five years. However, the industry lobby group said the raised target was never agreed as a recommendation between the parties.

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