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BHP seeks US$1B for Samarco stake from Vale

TOP NEWS

Report: BHP said to seek US$1B for Samarco stake from Vale

BHP Billiton Group is seeking about US$1 billion from Vale SA for its 50% interest in their Samarco Mineração SA joint venture, The Australian Financial Review reported, citing "people familiar with the matter." The valuation includes the provision that BHP would continue to assume liabilities in connection with the 2015 dam spill. The mining major is also asking to receive royalties for the life of the mine, as the talks between the parties continue, the sources added.

Indonesia outlines framework for Grasberg stake transfer to Inalum

Indonesian government officials signed an agreement with state-owned PT Inalum to facilitate the transfer of a majority stake in the Grasberg copper-gold mine to Inalum, Reuters reported. The provincial government of Papua and the Mimika Regency will jointly own rights to a 10% interest in Freeport-McMoRan Inc. subsidiary PT Freeport Indonesia once the divestment is completed. This stake will be a part of Inalum's total holdings in the Freeport unit. Meanwhile, Inalum CEO Budi Gunadi Sadikin said talks between the Indonesian government and Rio Tinto over the Grasberg divestment deal with Freeport are "progressing well," though details remain restricted due to a nondisclosure agreement.

First Majestic Silver to acquire Primero Mining under US$320M deal

First Majestic Silver Corp. agreed to acquire Primero Mining Corp. in an all-share deal and restructure a streaming agreement for a total transaction value of about US$320 million. Both companies' boards are backing the deal. In connection with the merger, the streaming agreement between Primero and Wheaton Precious Metals Corp. over the San Dimas silver-gold mine in Mexico will be terminated and replaced with a new agreement between First Majestic and Wheaton Precious Metals.

BASE METALS

* Sherritt International Corp. produced 35,474 tonnes of nickel and 3,053 tonnes of cobalt from its Ambatovy joint venture in Madagascar in 2017, below its full-year guidance. The company's Moa Bay joint venture in Cuba, meanwhile, produced 31,523 tonnes of nickel and 3,601 tonnes of cobalt, in line with forecasts.

* Nevada Copper Corp. successfully executed binding agreements to raise US$100 million of equity financing from institutional investors as part of its US$378 million construction financing and recapitalization transactions.

PRECIOUS METALS

* Russian gold producer Arlan is aiming to double gold output by 2020 and expects to raise production to 6.8 tonnes this year from 6.5 tonnes of gold produced in 2017, Reuters reported, citing a company director. It is targeting gold production of 13 tonnes in 2020.

* Goldplat Plc's Goldplat Recovery (Pty) Ltd unit signed a memorandum of understanding with Rand Refinery Pty. Ltd. for a final settlement deal related to a dispute about a silver sulfide processing agreement.

* Columbus Gold Corp. received conditional approval for listing spinoff company Allegiant Gold Ltd. on the TSX Venture Exchange, the last requirement to set the share distribution record date for completing the spinout transaction, which was announced in July 2017.

* Masuparia Gold Corp. started binding arbitration proceedings with respect to certain disputes with Golden Band Resources Inc. under the La Ronge South gold joint venture in Saskatchewan. Masuparia seeks to enforce the dilution of Golden Band's interest and resulting conversion of the latter's diminished interest into a 2.5% net smelter returns royalty on failing to contribute its proportionate share of these costs to the joint venture in a timely manner.

* TerraX Minerals Inc. agreed to acquire the past-producing Ptarmigan mine property, located within its Eastbelt property that is part of the Yellowknife City gold project in Canada's Northwest Territories.

* Royal Sapphire Corp. decided not to proceed with the acquisition of 70% interests in the Beardmore and Tessa gold properties in Canada.

* Armadale Capital Plc entered into a heads of agreement to sell its 12% stake in the Mpokoto gold project in the Democratic Republic of the Congo to Weghsteen Capital Advice SA.

* Avocet Mining Plc deferred completion of the US$5 million sale of its Burkina Faso assets to Ghana-based Balaji Group to Jan. 25 on the buyer's request.

BULK COMMODITIES

* Tata Steel Ltd. produced about 6.49 million tonnes of steel in the third quarter of its fiscal 2018, compared to about 6.24 million tonnes of production in the prior-year quarter. Total third-quarter sales came in at about 6.31 million tonnes, compared to year-ago sales of about 5.97 million tonnes.

* Yara International ASA completed the acquisition of Tata Chemicals Ltd.'s urea business in India in a deal valued at US$421 million on a debt- and cash-free basis. Yara will consolidate the acquired business, effective immediately.

* Itafos completed the acquisition of the Conda phosphate operations in Idaho from Agrium Inc., a subsidiary of Nutrien Ltd. In November 2017, Agrium agreed to sell the Conda mining project and Conda plant to Itafos for US$100 million, including working capital.

* China's coal imports reached 22.7 million tonnes in December 2017, up from 22.1 million tonnes in the prior month, as the government eased restrictions on coal shipments amid supply shortages, Reuters reported. For the full year, the country brought in 270.9 million tonnes of the fossil fuel, an increase of 6.1% year over year and the highest level since 2014.

* China's top state coal miners slashed spot coal prices to keep prices stable, which climbed by more than 10% after Beijing reversed a ban on using coal for heating amid the nation's winter heating crisis, Reuters reported. Coal mining companies, including Shanxi Coking Coal Group Co. Ltd., Datong Coal Mine Group Co. Ltd. and Jinneng Group Co. Ltd., lowered their coal prices by 15 to 20 yuan per tonne, according to the China Coal Transport and Distribution Association.

* China's exports of unwrought aluminum and aluminum products rose 4.5% year over year to 4.79 million tonnes in 2017, Metal Bulletin reported.

* PJSC Novolipetsk Steel will increase production of iron ore pellet at its Stoylensky iron ore plant in Russia by 11.89% year over year to 6.4 million tonnes per annum in 2018, Metal Bulletin reported.

* The Indonesian Energy Ministry is aiming to boost coal production by 5% year over year to 485 million tonnes in 2018, the Jakarta Globe reported.

* India's export of finished steel increased 28.9% year over year to 964,000 tonnes in December 2017, Press Trust of India reported, citing official data. Meanwhile, from April to December 2017, the export of finished steel rose 52.9% to 7.61 million tonnes compared to the same period last year.

* Moody's upgraded Brazilian steelmaker Gerdau SA's corporate family rating to Ba2 from Ba3, with a stable outlook. The upgrade reflects debt reduction and liability management efforts, which have intensified since October 2017 and are expected to result in much faster deleverage than previously thought.

* A ThyssenKrupp AG shareholder took a swipe at the German steelmaker's CEO Heinrich Hiesinger for failing to achieve his own profit targets, raising tensions ahead of the company's annual meeting, Reuters wrote. Swedish investor Cevian, which holds an 18% stake in Thyssenkrupp, reiterated its call for the restructuring of the group.

* Western Australia's Port Hedland reopened Jan. 13 after cyclone Joyce dissipated, Reuters reported, citing the operator of the terminal.

* South Africa's Transnet confirmed that the manganese export facility at Port Elizabeth will be transferred to the nearby Port of Ngqura by October 2023, Mining Weekly reported.

* Sumitomo Corp. increased its stake in Malaysia-based Sumiputeh Steel Centre Sdn. Bhd. to 100% from 50%.

* African Potash Ltd. signed another agreement to develop a blockchain-based agricultural ecosystem solution with Gibraltar-based TokenCommunities Ltd., which will complement its previous agreement with GMEX Group Ltd.

* Oracle Power Plc agreed to acquire the remaining shares in Sindh Carbon Energy Ltd. from private Pakistani company Sindh Koela Ltd for £3.6 million. Upon completion, Oracle will have a 100% interest in the Pakistani operating companies for both mining and power at Block VI in the Thar Desert, where it is developing a combined lignite coal mine and minemouth power plant.

* The U.S. Commerce Department relayed its findings on its investigation of the impact of steel imports on U.S. national security to President Donald Trump, Reuters reported. The department, which did not reveal the report's recommendations, said Trump has 90 days to enact a final decision based on the report.

* The U.S. International Trade Commission allowed an anti-dumping probe into the imports of aluminum alloy sheet metal from China, after an initial finding revealed that the product was harming local producers, Reuters reported.

SPECIALTY

* Russia's PJSC Alrosa dropped its production guidance for 2018 to 36.6 million carats from the estimated 39.3 million carats produced in 2017 in the wake of the flood at its Mir mine. After a 7% output drop in 2018, the company expects production to ramp up to 38.2 million carats by 2020, driven by the newly operational Verkhne-Munskoe mine.

* Alrosa is holding a contest for ideas on how to restore operations at the flooded Mir mine, part of its Mirny Division property in Siberia. Operations at the Mir pipe were shut down in early August 2017 after floodwaters from the pit mine above cascaded into the facility, killing eight miners. The deadline for applications is Jan. 29, and the company is offering a prize of 1.5 million Russian rubles for the best proposal.

* Additionally, Alrosa received approval from Angolan President Joao Lourenço to expand the company's stake in the Catoca diamond mine in Angola by 8.2% to 41% for US$70 million. The transaction will be legally formalized in February or March.

* 92 Resources Corp. said the recently completed eight-day 2017 field program at its Hidden Lake lithium property in Canada's Northwest Territories led to the discovery of a new lithium-bearing pegmatite and returned assays of up to 2.57% lithium oxide.

INDUSTRY NEWS

* Australia's nonferrous exploration budget of US$1.08 billion helped it hold onto fifth place regionally in 2017, a position it has occupied since 2004, according to the Metals and Mining Research team of S&P Global Market Intelligence. Data compiled for S&P Global Market Intelligence's Corporate Exploration Strategies series shows that, with a year-over-year budget increase of more than 19% compared with a 14% global average increase, Australia, together with the United States, had the second-largest budget increase in 2017 after first-placed Latin America with 20%.

* Canada remains the top country destination for exploration with a budget of US$ 1.1 billion, almost 14% of the global total, according to S&P Global Market Intelligence's Metals and Mining Research Team. The 12% year-over-year increase in Canada's exploration budget is attributed solely to the junior sector.

S&P Global Market Intelligence is owned by S&P Global Inc.

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