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Australian law firm to file class action lawsuit against BHP on Samarco disaster

TOP NEWS

Australian law firm to file class action lawsuit against BHP on Samarco disaster

Australian law firm Phi Finney McDonald plans to file a class action lawsuit against BHP Billiton Group, arguing the company misled investors over the 2015 dam burst at its Samarco iron ore mine in Brazil that killed 19 people, The Sydney Morning Herald reported. The law firm said that the shareholders believe the mining major was aware of the risk of an imminent collapse, as well as of the related consequences.

EuroChem withdraws from Ukraine amid restrictions on Russian fertilizer imports

Fertilizer producer EuroChem Mineral Chemical Co. OJSC is completely withdrawing from the Ukrainian market following moves by the government to restrict imports of fertilizers originating in Russia. EuroChem is a Switzerland-based, diversified fertilizers producer controlled by Russian billionaire Andrey Melnichenko and holds significant assets in Russia. As part of the withdrawal, EuroChem sold its stake in Ukrainian distribution subsidiary Agrocentre EuroChem-Ukraine to the business' former management, the spokesperson confirmed. EuroChem said it would not be disclosing the price or terms of the deal.

Tata Steel swings to Q4'18 profit on pensions gain; production, sales down YOY

Tata Steel Ltd. swung to a profit of 146.88 billion Indian rupees in its fiscal fourth quarter from a year-ago loss of 11.68 billion rupees, driven in part by a one-off pensions gain. The Indian steelmaker said the restructuring of its U.K. pension scheme is now complete and resulted in an exceptional gain during the quarter of 113.76 billion rupees, including a noncash gain of 140.77 billion rupees. The company produced 6.3 million tonnes of steel and delivered 6.4 million tonnes of steel during the three-month period, decreasing from 6.4 million tonnes of production and 6.8 million tonnes of deliveries recorded in the prior-year period. Meanwhile, Tata is targeting boosting its flat steel capacity by 5.6 million tonnes per annum following the acquisition of Bhushan Steel Ltd., Metal Bulletin reported.

DIVERSIFIED

* BHP CEO Andrew Mackenzie said the company is evaluating incremental and large-scale growth options in a bid to add around US$31 billion of value, The Australian reported. The company outlined US$4 billion of low-cost latent capacity options across its operations, such as de­bottlenecking, that could result in adding US$16 billion of net present value. Meanwhile, larger-scale future growth options including the Olympic Dam copper mine, the Wards Well coal mine, the Resolution copper project, and the Jansen potash project, could add US$15 billion in value.

* On a standalone basis, Hindalco Industries Ltd.'s net profit in the fourth quarter of its fiscal 2018 rose to 6.16 billion Indian rupees from 5.46 billion rupees in the year-ago period. Full-year profit also increased to 19.34 billion rupees from 14.19 billion rupees. During fiscal 2018, the company reported its highest ever aluminum and copper production at 1.3 million tonnes and 410,000 tonnes, respectively.

BASE METALS

* Freeport-McMoRan Inc. CEO Richard Adkerson said negotiations between Rio Tinto and the Indonesian government over the mining major's 40% stake in the Grasberg copper mine has narrowed to price alone and that agreement would likely translate into prompt closure of a transaction, The Australia Financial Review reported.

* The next decade of investment in copper will be critical for the future world's increasingly electrified needs as a deficit in the metal's production is already beginning to show, financial services firm Martin Place Securities' executive chairman, Barry Dawes, said during a conference.

* Tharisa PLC acquired a 90% stake in Salene Chrome Zimbabwe Pvt. Ltd., which holds the right to three special grants covering approximately 9,500 hectares in Zimbabwe.

PRECIOUS METALS

* It makes sense for Midas Gold Corp. to partner up with gold major Barrick Gold Corp. in a recent US$38.1 million financing to develop a large and complex gold project like Stibnite in Idaho. That's the view of Joe Mazumdar, an Exploration Insights analyst who has followed the project over the years. "Having a major — only they can do it," Mazumdar told S&P Global Market Intelligence, pointing to the capital costs of the project which were estimated at US$970.3 million in a 2014 study.

* Goldstrike Resources Ltd. proposes to spin off its six projects in the White Gold district of Canada's Yukon Territory to focus on its partnership with Newmont Mining Corp. on the early stage Plateau gold project in the same region. Goldstrike entered into an arrangement agreement with its subsidiary Luckystrike Resources Ltd. under which Luckystrike will indirectly acquire Goldstrike's Lucky Strike, BRC, Hotspot, Bull's Eye, Gold Source and King's Ransom properties.

* In a previous article, we recorded the trend towards lower major gold deposit discovery rates over the past decade. While this holds true for all regions, there have been some significant changes in where major new deposits are being found: notably there have been less in the Asia-Pacific region and more in Africa. The most alarming declines are in Indonesia and Australia, where the amount of gold being discovered has decreased by a collective 97% over the past decade — although strong discovery rates of the past keep Asia-Pacific as one of the most historically prolific regions. The recent decline is even more concerning for Australia, where the pool of large deposits available for development is critically low.

* After achieving record production in the fourth quarter of 2017, most producers saw gold production falling in the first quarter of 2018. Among 61 gold producers reporting in the March quarter, each producing at least 50,000 ounces in the period, production was down by more than 1.3 million ounces compared with the fourth quarter but up more than 200,000 ounces compared with the year-ago period. Nearly half of the decline from the fourth quarter of 2017 can be attributed to the top three producers.

* Asiamet Resources Ltd. posted an initial estimate of resources hosted by the polymetallic BKZ deposit at its KSK property in Kalimantan, Indonesia. The deposit was subdivided into an upper polymetallic zone comprising two domains and a lower copper zone due to the nature of the mineralization, with the estimate using cutoffs of 4.0% zinc for the high-grade polymetallic zone, 1.0% zinc for the low-grade polymetallic zone and 0.5% copper for the copper zone.

* Lumina Gold Corp. completed its first resource update for the Condor property in Ecuador since acquiring the project in 2016. The estimate covers the Santa Barbara, Soledad, Los Cuyes and Enma deposits. Condor hosts indicated resources containing 1.4 million ounces of gold, 9.2 million ounces of silver and 43 million pounds of copper within 63.8 million tonnes of ore grading 0.68 g/t of gold, 4.5 g/t of silver and 0.03% copper.

* Kootenay Silver Inc. entered into an option agreement through its Mexican subsidiary to acquire the Copalito silver-gold project, which comprises seven concessions totaling approximately 3,700 hectares in Sinaloa, Mexico.

* Yamana Gold Inc.'s Cerro Moro operation in Argentina poured its first gold and silver doré on May 15 and is on track to achieve commercial production in the second quarter. The miner said that the focus on ramping up production continues, and most of the 2018 output is anticipated in the second half.

* ASX-listed juniors are warning that the much-anticipated increase in corporate activity in the gold mining sector may stall due to a lack of substantial projects for majors to acquire.

* Richard Albarran, Brent Kijurina and Cameron Shaw of Hall Chadwick Chartered Accountants were named as joint and several voluntary administrators of Capital Mining Ltd.

BULK COMMODITIES

* JSW Steel Ltd. reported the highest-ever operational and financial performance for its fourth fiscal quarter and the full fiscal year ended March 31. Consolidated net profit after tax soared 186% year over year to 28.79 billion Indian rupees for the quarter. Revenue from operations rose 16% to 208.17 billion rupees on an annual basis, while operating EBITDA soared 67% to 52.90 billion rupees. For the full fiscal year, the group's net profit grew 76% year over year to 61.13 billion rupees, revenue jumped 18% to 715.03 billion rupees and operating EBITDA increased 22% to 147.94 billion rupees.

* Guinean lawmakers approved a US$2.9 billion deal with China's TBEA Co. Ltd. for the development of a bauxite-alumina project in the country, Bloomberg News reported. The project is expected to generate US$406 million in annual revenue for Guinea.

* Trade unions called on Tata Steel to boost future payouts to U.K. pensioners, after the Indian firm reported a significant surplus in its retirement scheme following changes that affected thousands of steelworkers, the Financial Times reported. The union said the surplus was higher than estimated and supports their case to restore pension benefits for scheme members.

* Aurizon Holdings Ltd. is said to have informed Queensland coal companies that it would "dramatically cut" train movements on the Goonyella coal export railway network, Mining Weekly reported. "Based on these developments, the Queensland Resources Council (QRC) believes it is now clear Aurizon is determined to stop the movement of 20-million tonnes of coal," QRC CEO Ian Macfarlane said. Aurizon's capacity cut follows a regulatory move that will limit the operator's charges for access to well below what it wants to bill.

* Operations at Societe Miniere de Boké's bauxite mine in Guinea resumed as most of the workers returned after nearly two-week strike, Reuters reported. The company was forced to halt production due to the strike, causing a loss of between 1 million and 1.2 million tonnes of scheduled bauxite production, with per day losses running to US$1 million.

* China's coal-rich Shanxi province laid out plans to close 35 mines in 2018, slashing 22.4 million tonnes more of coal capacity on top of 16 million tonnes of backward mining capacity it announced to cut in March. The province aims to advance its coal industrial structure through safer and more efficient facilities and clean production.

* Fortescue Metals Group Ltd. Chairman Andrew Forrest said the company is looking at early stage projects in Argentina, Ecuador and Colombia in a bid to replicate its Pilbara iron ore business, Mining Weekly reported. Forrest also noted Fortescue's potential diversification into battery materials including copper, lithium, nickel and graphene.

* The last worker was recovered from Jastrzebska Spólka Weglowa SA's Borynia-Zofiowka-Jastrzebie coal mine in Poland, bringing the total number of fatalities to five. The miners were trapped nearly a kilometer underground after an earthquake on May 5. Two workers were rescued earlier.

* Cia. Siderúrgica Nacional will maintain its sales to the U.S. by exporting material from its operations in Brazil, following the sale of its Indiana-based unit, Metal Bulletin reported, citing CSN commercial executive director Luis Fernando Martinez.

* By 2030, the share of hard coal and lignite in the Polish energy mix will decrease from the current 80% to 60%, but the volume of hard coal for the energy sector will remain unchanged, Puls Biznesu reported, citing Grzegorz Tobiszowski, Poland's deputy minister of energy.

SPECIALTY

* Eramet said the acquisition of ASX-listed Mineral Deposits Ltd. is not a "must have" and warned that it would be several years before the Senegal-based mineral sands asset delivers cash to its owners, The Australian Financial Review reported. Mineral Deposits recently urged its shareholders to reject the French company's A$287.5 million takeover offer.

* Russian diamond producer PJSC Alrosa boosted net profit in the first quarter to 33.18 billion Russian rubles, up 40% year over year. CEO Sergey Ivanov said the uptick was primarily due to an improvement in diamond market conditions. The company intends to boost revenue from the sale of rare, colored stones where demand is stable, although it is a niche business, Reuters reported.

* Prospect Resources Ltd. appointed engineering firm DRA to provide engineering services and upfront design for the Arcadia lithium project in Zimbabwe, which remains on track to start production in the second quarter of 2019, Mining Weekly reported.

* Sheffield Resources Ltd. signed a binding agreement with the Shire of Derby-West Kimberley for a minimum 20-year access to a bulk handling facility and associated infrastructure at the Port of Derby, which will ship concentrates from the Thunderbird mineral sands project in Western Australia.

* The Association of Mining and Exploration Companies urged the Australian government to encourage investment in the lithium-ion battery industry to take advantage of the country's natural endowments, Mining Weekly. The A$165 billion global lithium value chain is forecast to grow to an estimated A$2 trillion by 2025, with Australia anticipated to capture an around A$10-billion of this total value within the next eight years, without government intervention.

* Desert Lion Energy Inc. estimated a C$7 million capital cost for the phase-one flotation plant, which will be used to process the fines from the historical run of mines stockpiles at the Rubicon and Helikon mines in Namibia at a rate of between 350,000 and 400,000 tonnes per year.

INDUSTRY NEWS

* Six environmental groups filed a lawsuit against U.S. Environmental Protection Agency chief Scott Pruitt for abandoning a regulation that would have required hard-rock miners to prove that they have funds to clean up hazardous substances released at mine sites, Reuters reported.

* Argentina and Chile pledged to revitalize an existing mining treaty between the countries to facilitate developing cross-border mining projects, the Argentine Undersecretary for Mining Sustainability Juan Biset said at Paydirt's Latin America Downunder conference in Perth, Australia.

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