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Randgold doubles annual dividend after rise in FY'17 profit

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Randgold doubles annual dividend after rise in FY'17 profit

TOP NEWS

Randgold doubles annual dividend after rise in FY'17 profit

Randgold Resources Ltd.'s fourth-quarter 2017 net profit decreased year over year to US$75.5 million from US$78.5 million, and gold production declined to 340,958 ounces from 378,388 ounces. Its full-year profit rose to US$278.0 million, from US$247.5 million in 2016, as a result of higher gold output amid a stronger realized price and lower costs. The company's board recommended a dividend of US$2.00 per share, double its 2016 dividend. Production for 2018 is expected to fall between 1.30 million and 1.35 million ounces at a total cash cost per ounce between US$590 and US$640.

Adani fails to secure federal funding for Carmichael rail project

Adani Enterprises Ltd. will not receive federal funding from the Northern Australia Infrastructure Facility to construct a rail link to the company's controversial Carmichael coal mine in Queensland, Reuters reported. This is a major blow for Adani, which was looking to secure a A$900 million concessional loan for rail to link Carmichael to port, and could spell the end of the project if Adani is unable to secure private financing.

Rusal's Q4'17 aluminum, alumina, bauxite output up QOQ

United Co. Rusal Plc's aluminum production increased 1.4% quarter over quarter to 944,000 tonnes in the fourth quarter of 2017, and alumina and bauxite production improved 1.3% and 7.4%, respectively, to 1.99 million tonnes and 2.95 million tonnes. Nepheline production dropped 7.4% on a quarterly basis to 1.04 million tonnes, while aluminum foil and packaging products registered a 2.1% increase to 26,100 tonnes.

DIVERSIFIED

* Bold Baatar, Rio Tinto's head of energy and minerals, said the company will compete with companies such as Facebook and Google for workers that will help with its mining automation project, Bloomberg News reported. Baatar said two-thirds of Rio Tinto's engineers are miners but this number will be halved within a decade.

* Shares of BHP Billiton Group and Rio Tinto both fell by over 2% on the ASX as the exchange recorded its biggest fall since August 2017, Reuters reported.

BASE METALS

* A group of workers is trying to set up a new union at BHP Billiton Group's Escondida copper mine in Chile to supplant Union No. 1, as they are being "intimidated and insulted" by members of the existing union, Bloomberg News reported. The breakaway group needs at least 10% of the mine's workers to join their ranks by Feb. 8 to hold separate wage negotiations with the company.

* Glencore Plc could receive a US$250 million bill if the Democratic Republic of the Congo proceeds with implementing its revised mining code, which includes a provision for higher taxes on cobalt, U.K.'s The Sunday Times reported.

* Grupo México SAB de CV posted a net profit of US$125.3 million for the fourth quarter of 2017, down 4% from US$130.5 million a year earlier. GBM Research analysts Rodrigo Garcilazo and Guillermo Estrada said the quarterly results were the strongest since the first quarter of 2012 thanks to increasing copper prices while costs remained under control. The analysts wrote that Grupo México's stock price was not taking into account a long-term copper price of US$2.65/lb and maintained a "market outperformer" rating on the company.

* On a stand-alone basis, Hindalco Industries Ltd. posted a net profit of 3.76 billion Indian rupees for the third quarter of its fiscal 2018, representing a 17% year-over-year increase resulting from an 18% decrease in interest costs due to the prepayment and repricing of project loans.

* Víctor Gobitz, the president of Peruvian mining association IIMP, said expansion plans in 2018 for the Antapaccay, Toquepala, Cerro Verde, Las Bambas, Toromocho and Antamina copper projects are expected to increase the country's annual copper production by 500,000 tonnes, Andina reported. Gobitz, who is also president and CEO of Cia. de Minas Buenaventura SAA, noted that Peru's current yearly output is 2.5 million tonnes.

* Intrepid Mines Ltd. shareholders voted in favor of selling the Kitumba copper project in Zambia to Weatherly International Plc. Weatherly said it changed the development plan for Kitumba and now intends to carry out development in two phases, with the initial focus on an area with higher-confidence mineralization and better grades.

* Bankers Cobalt Corp. struck a deal to earn up to a 70% stake in six cobalt and copper concessions in the southern Democratic Republic of the Congo.

PRECIOUS METALS

* Randgold Resources said it will engage in discussions with the Democratic Republic of the Congo over the enactment of a new mining code, which the company believes will limit the growth of the country's mining industry and its economic prospects.

* Sibanye Gold Ltd. produced 1.4 million ounces of gold from South Africa in 2017, exceeding its guidance of between 1.35 million and 1.38 million ounces, after output in the second half rose 4% over the first half.

* Saturn Metals Ltd. aims to raise up to A$7 million in an IPO of up to 35 million shares at 20 cents each. The proceeds will fund exploration on the Apollo Hill and Ra Resource areas in Western Australia.

* Yamana Gold Inc. said two employees of a local contractor died after an accident at the Las Vacas exploration site, which forms part of its Gualcamayo operation in Argentina. An investigation is underway, and the company is working with local authorities and the contractor to determine the exact cause of the accident.

* Guyana Goldfields Inc. plans to invest US$120 million in the Aurora gold mine in Guyana to conduct underground mining activities, a first in the country's history, Mining.com reported.

* Indonesian miner PT J Resources Asia Pasifik Tbk. allocated US$300 million for capital expenditure this year to develop the Doup gold mine in Sulawesi and the Pani gold mine in Gorontalo, Kontan reported.

* Kin Mining NL secured all necessary approvals to begin the process plant construction for the Leonora gold project in Western Australia. Gold production is on track to begin in the second half.

BULK COMMODITIES

* As fertilizer prices continue to recover, PJSC PhosAgro boosted its overall production in the fourth quarter of 2017 by over 13% to 2.3 million tonnes. Nitrogen-based products registered the largest increase in the quarter, of 38% to 561,500 tonnes, while output of phosphate-based fertilizers climbed 7% to 1.7 million tonnes. Production of phosrock and nepheline also showed improvement, growing to 2.6 million tonnes from 2.5 million tonnes a year ago.

* According to Reuters, Mitsubishi Corp. raised its profit guidance for its fiscal year ending March 31 to ¥540 billion after higher coal prices bolstered its recurring profit for the nine months ending Dec. 31, 2017, by 12% to a record ¥416 billion. The Japanese company expects its metals unit to generate ¥240 billion of the year's expected profits.

* German industrial workers and employers are set to return to the negotiation table by Feb. 5 after a series of 24-hour strikes over wages and working hours last week, Reuters reported, citing labor union IG Metall.

* Voestalpine AG CEO Wolfgang Eder classified 20% of Europe's current steel capacity as surplus and said the sector must be ready to shutter factories and focus on high-quality products to beat lower-cost rivals overseas, the Financial Times reported.

* JSW Steel Ltd. confirmed it is pursuing an acquisition of Bhushan Steel Ltd., Bhushan Power and Steel Ltd. and Monnet Ispat & Energy Ltd. and has already submitted the resolution plan for Monnet Ispat and finalized the bidding process for Bhushan Steel and Bhushan Power and Steel, Press Trust of India reported, citing joint Managing Director and group CFO Seshagiri Rao. JSW Steel is also seeking permission to acquire 2,980 acres to set up a steel plant at Paradip in Odisha, India. The company filed an application to seek forest clearance and will decide on the plant capacity once it secures approvals, Rao said.

* Indonesian coal major PT BUMI Resources Tbk. is taking a cautious path after it reduced its US$4.2 billion in outstanding debts by almost half through completing the largest debt restructuring deal in Southeast Asia in 2017, according to Director and Corporate Secretary Dileep Srivastava, who said in an interview with S&P Global Market Intelligence that the company has no plans for further M&A, financing or expansion in the next two to three years as it focuses on generating revenue from existing operations to repay debt.

* AWE Ltd. unanimously recommended a previously announced A$594 million off-market takeover bid by Mitsui & Co. Ltd., following Mineral Resources Ltd.'s failure to match the competing bid. The company's board determined that the Mitsui bid, which valued the company at 95 cents per share, was superior to Mineral Resources' all-share bid of 80 cents per share structured as 1 new Mineral Resources share for every 22.325 AWE shares.

* The profit of Toyota Tsusho Corp.'s metal business for the third quarter of the company's fiscal 2017 rose 24.7% year on year to ¥22.7 billion from ¥18.2 billion due to higher metal market prices.

* France will invest €5 million to support operations at the Ascoval steel plant at Saint-Saulve for a year, Reuters reported, citing Finance Minister Bruno Le Maire. The move is expected to save several hundred jobs.

SPECIALTY

* PJSC Alrosa is actively looking to expand its footprint globally, the company’s vice president for Africa told S&P Market Intelligence on the sidelines of the Mining Indaba in Cape Town, South Africa. "We are looking to expand," Vladimir Marchenko said in an interview, noting that even areas such as Latin America were not ruled out. "At the moment, we are mostly focused on Angola [outside of Russia], but the company is actually actively looking for opportunities to expand the business worldwide."

* Anson Resources Ltd. signed a deal to acquire the existing oil and gas well and lease at its Paradox lithium project in Utah, potentially reducing the project's infrastructure costs.

INDUSTRY NEWS

* The 24th annual Mining Indaba kicked off in Cape Town, South Africa, at a time when the Western Cape area is facing a severe water crisis as a result of the worst drought on record. Event organizers pledged to align with the situation and said reducing water use will be a priority at the four-day event. "We have been closely following the development of the water crisis and have engaged with local government structures extensively on the issue," conference Managing Director Alex Grose said ahead of the event. "After much consideration, it was agreed to keep the event in Cape Town as it attracts significant investment to the local economy — conservatively estimated at around 700 million South African rand over the past ten years."

* While debt and financing issues dominated 2017's conference, the agenda for this year's Mining Indaba points to a remarkably buoyant mood among industry participants. Exploration and junior miners take center stage alongside sustainability and innovation themes. However, some topics, especially on the regulatory horizon, are unlikely to see a lot of progress.

* Mining operations have not been directly affected by the ongoing water crisis in South Africa's Western Cape province, according to South Africa's Chamber of Mines. However, mines have implemented mitigation measures that focus on improved water efficiency. "Given the current situation in the Western Cape, even greater emphasis is placed not only on mines adhering to their water allocations in terms of their licenses but also to adhere to the water restrictions currently in place as a result of the drought," the chamber's head of environment, Stephinah Mudau, said in an email to S&P Global Market Intelligence ahead of Mining Indaba.

* South Africa's Chamber of Mines recently unveiled the results of an industry survey showing that a third of the country's largest mining companies are not looking at new investments in 2018 and one company is considering pulling out of the country, Reuters reported.

* Australian mining contractor Downer EDI Ltd. will flag a A$77 million impairment for the first half of fiscal 2018 due to the nonrenewal of two mining services contracts and delays in securing alternative contracts, Reuters reported.

* Mining investment in Peru grew 15.7% year over year to US$4.92 billion in 2017, according to official government figures from the country's Energy and Mines Ministry. Investment in mining infrastructure and exploration led the way with annual growths of 44.3% and 34.2%, respectively.

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.