Wesfarmers Ltd. formally agreed to acquire 100% of Kidman Resources Ltd. for A$1.90 cash per share, in a transaction valued at A$776 million. Meanwhile, Wesfarmers agreed with Sociedad Quimica y Minera de Chile SA to amend the joint venture agreement over the Mount Holland lithium project in Western Australia between SQM and Kidman. The takeover is expected to complete in September.
BHP flags copper, nickel, oil focus in further diversification from iron ore
BHP Group has outlined a long-term strategy focusing on copper, nickel and oil for its growth, in what experts say is a trend for Australian iron ore majors to look to battery minerals for future growth given an unattractive longer-term iron ore outlook. BHP CFO Peter Beaven said that diversifying will enable the company to have more cash at the bottom of cycles and act counter-cyclically, given cash flow volatility could be reduced by about 30% over 20 years by not being solely reliant on iron ore.
Meijin Energy drops bid for mining lease at A$6.7B China Stone coal mine
Meijin Energy Co. Ltd. dropped its application for a mining lease for its proposed A$6.7 billion China Stone coal mine in Queensland, Australia, ABC News reported. The company did not explain the move, but analysts said the project is no longer in line with China's coal policy and is not financially feasible given the difficulty Adani Enterprises Ltd. has faced for the nearby Carmichael coal mine.
* Workers' unions No. 1, 2 and 3 at Codelco's Chuquicamata operations in Chile have decided to wait for the state miner to submit a second offer for a new labor contract after negotiations fell through on May 22. The unions and Codelco previously agreed to seek a consensus before May 24; however, workers have decided to wait for a new offer on May 24 and expect to vote on it between May 29 and May 30, daily Diario Financiero reported.
* Copper producer and recycler Aurubis AG agreed to acquire materials recycler Metallo Group for €380 million. Closing is expected by the end of the year.
* Mincor Resources NL entered a binding agreement with Independence Group NL to wholly acquire the Long nickel operation in Western Australia, which holds a JORC-compliant resource of 750,000 tonnes at 4.2% nickel containing 32,000 tonnes of nickel.
* Rockfire Resources PLC exercised its option to acquire 100% of the Copper Dome porphyry copper deposit in Queensland, Australia, and will pay A$30,000 cash and A$50,000 in shares to Symbolic Resources Pty. Ltd.
* Boliden AB signed a long-term electricity supply agreement with a wind power developer for annual electricity deliveries of 240 GWh in Sweden and 175 GWh in Finland. Production will take place in wind farms located close to mining operations in the Boliden area and the Kokkola smelting operations in Finland.
* Copper producers such as First Quantum Minerals Ltd. and Vedanta Resources PLC are expected to be hit by planned power outages in Zambia, where one of the worst droughts in decades is affecting the output of hydroelectric dams, Bloomberg News reported. Copper producers in the country use more than half of the country's electricity supply, according to the news agency.
* First Quantum unit Minera Antares Peru SAC terminated its option to acquire Peruvian Metals Corp.'s Panteria copper project in Peru. Peruvian Metals said it will seek new partners for the project.
* Suspended operations at Newmont Goldcorp Corp.'s Penasquito gold mine in Mexico's Zacatecas state are causing 50 million Mexican pesos in daily losses for the company, according to estimates by Mexico's mining chamber Camimex. The suspension affects 20,000 people that work directly or indirectly at the mine, Camimex said. The association called on federal and state governments to urgently address the blockade affecting the project, which has been led by trucking contractor company Cava and some members of nearby communities since March, daily La Jornada reported.
* Eldorado Gold Corp. priced its previously announced offering of US$300 million in 9.5% senior secured second-lien notes due in 2024.
* Woomera Mining Ltd. agreed to purchase an 80% interest in Cazaly Resources Ltd.'s Mount Venn gold tenements in the northeastern goldfields of Western Australia.
* Barrick Gold Corp. CEO Mark Bristow said gold miners must focus on more mergers to attract more investment, Reuters reported. "The industry is in decline and we have put ourselves in a very a tight spot because we haven't invested in exploration and our future," Bristow said.
* Philippine President Rodrigo Duterte signed a law exempting small-scale gold miners from excise and income taxes for gold sales to the country's central bank in a bid to strengthen its international reserves. The law will look to address the 99% drop in domestic gold purchases by the central bank to 10,000 fine troy ounces this year since 2010.
* Mining production in Zimbabwe, especially gold, was stunted in the first quarter due to delays in the central bank's distribution of dollar payments to miners, Reuters reported. Miners in the country are paid dollars for half of their output while the remainder is paid in the local RTGS dollar currency.
* Golden Queen Mining Co. Ltd. completed the sale of a 50% stake in the Soledad Mountain gold-silver mine in California through the sale of its Golden Queen Mining Holdings Inc. unit to Chairman and CEO Thomas Clay and members of his family.
* Equinox Gold Corp. agreed to sell its Elk gold project in British Columbia through the sale of its Gold Mountain Mining Corp. subsidiary to privately listed Bayshore Minerals Inc. for C$10 million.
* China Baowu Steel Group Corp. Ltd. is mulling moving blast furnaces to Cambodia from Xinjiang in China late this year in order to maintain output levels, amid Beijing's drive to cut industrial slack, by shifting excess capacity outside of the country, Reuters reported, citing a source familiar with the company's plans. The steelmaker is looking to relocate two blast furnaces with a combined capacity of 3.1 million tonnes, and two converters to turn iron into steel.
* Technology that could capture carbon dioxide emitted by coal plants for use or storage could be a lifeline to pull coal into a "new era" in a lower-carbon energy world, but the expensive technology will likely need the government's help in the form of research and subsidies, according to an exclusive S&P Global Market Intelligence report.
* Gensource Potash Corp. agreed to form a joint venture company to develop the Maverick potash project within the Vanguard property in Saskatchewan. The Maverick project will be developed alongside the company's other project at the Vanguard area, Vanguard One. Meanwhile, an international fertilizer producer agreed to a 10-year off-take for 250,000 tonnes per year.
* BHP is considering spending about A$800 million to automate 500 haul trucks across its iron ore operations in Western Australia and coal sites in Queensland, International Mining reported, citing CFO Peter Beaven.
* Germany plans to spend €40 billion to soften the impact of a ban on coal mines and coal-fired power plants in parts of the country, Financial Times wrote.
* Despite approving thyssenkrupp AG CEO Guido Kerkhoff's plan to list the group's elevator business, the company's supervisory board remains open for the possible sale of the unit, which drew interest from Finnish rival KONE Oyj, sources told Reuters.
* Ausdrill Ltd.'s BTP Equipment Pty Ltd. unit won a three-year, A$126 million contract extension to provide mining and ancillary equipment to Peabody Energy Corp.'s coal mines in Hunter Valley and Bowen Basin in Australia.
* Sociedad Quimica y Minera de Chile SA's first-quarter earnings slipped to US$80.5 million, or 31 cents per share, from US$113.8 million, or 43 cents per share, a year ago. Results in the period were hit by lower margins from its lithium business, due to lower average prices and higher costs related to a new lease payment structure with CORFO, the Chilean Economic Development Agency.
* ASX-listed Talga Resources Ltd.'s preliminary feasibility study for its Vittangi graphite project in Sweden estimated a pretax net present value, discounted at 8%, of US$1.06 billion, a 55% internal rate of return and a 1.5-year payback period after commissioning of the second stage. Capex is estimated at US$27 million for the first stage, and US$147 million for the second stage, including contingency of about 20%.
* AVZ Minerals Ltd.'s extended scoping study for the Manono lithium project in the Democratic Republic of the Congo outlined a pretax net present value of US$2.63 billion, at a 10% discount rate, with an internal rate of return of over 64%, based on an annual throughput of 5 million tonnes per annum. CapEx for the project is now estimated at US$380 million to US$400 million.
* The Barruecopardo tungsten joint venture project in Spain, owned 70% by Oak Tree Capital Management LP and 30% by Ormonde Mining PLC, started open-pit mining at the northern starter pit. Meanwhile, commissioning of the process plant is complete, and it is achieving throughput rates of up to 190 tonnes per hour. The joint venture is planning to mine higher grade ore sources in the near term.
* Aura Energy Ltd. produced the first samples of yellowcake product at its Tiris uranium project in Mauritania as part of a definite feasibility study.
* Lucapa Diamond Co. Ltd. recovered a 126-carat diamond at its Mothae mine in Lesotho. The company noted that it was the biggest diamond recovered since commercial mining started in January.
* The government of Western Australia noted that about one third of the successful applicants in the latest round of the exploration incentive scheme's co-funded exploration drilling program were battery materials focused. A total of A$5.1 million will be granted to 45 companies and prospectors.
* Drilling activity in the March quarter continued to trend downward after a recent peak in October 2018, according to the Metals and Mining Research team at S&P Global Market Intelligence. Despite this downtrend, however, many companies — especially small-cap pure explorers — received above-average boosts to their share prices following the announcement of results at their projects during the quarter.
* Tanzania will start voiding inactive mining exploration licenses and distribute the land to small-scale miners who can immediately begin work, Reuters reported, citing Deputy Minister for Minerals Stanslaus Nyongo.
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