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China's Zijin trumps Lundin, to buy Nevsun for C$1.86B

Greenhouse gas and gold mines Nearly 1 ton of CO2 emitted per ounce of gold produced in 2019

Essential Metals & Mining Insights - September 2020

Essential Metals & Mining Insights - August 2020

State of the Market: Mining Q2-2020


China's Zijin trumps Lundin, to buy Nevsun for C$1.86B

TOP NEWS

China's Zijin trumps Lundin, to buy Nevsun for C$1.86B

China's Zijin Mining Group Co. Ltd. entered into a definitive agreement for an all-cash takeover of Nevsun Resources Ltd. in a C$1.86 billion deal. The C$6.00 per share offer is a 26% premium over the C$4.75 per share hostile takeover bid for Nevsun launched by Lundin Mining Corp. in late July. Reacting to the offer, analysts cast doubt that Lundin would top Zijin's offer, and noted Zijin's obvious thirst for Nevsun's assets and Lundin's reticence to pay more than what it sees as fair value.

BHP sets up looming battle with Newcrest after SolGold deal

BHP Billiton Group may have set up a looming battle against Newcrest Mining Ltd. after the mining giant's acquisition of a 6.1% stake in SolGold PLC, The Australian Financial Review reported. According to the report, the transaction suggests that SolGold could be a subject of a bidding war between the two companies, given Newcrest's 14.5% stake in SolGold and position as its most likely acquirer over the past two years. BHP and Newcrest in 2016 also vied for the right to acquire a strategic stake in SolGold.

Randgold restarts Tongon operations, further cuts FY'18 gold output guidance

Randgold Resources Ltd. has restarted normal operations at its Tongon gold mine in the Ivory Coast after management lifted the lock-out imposed on workers after a protracted illegal strike. The company further slashed the output guidance for the year to 230,000 ounces, which was previously cut to 250,000 ounces due to the strike. Meanwhile, discussions between the management, workers, community leaders and the government for ending the occasional industrial unrest at the mine will resume where they were interrupted by the strike in July.

DIVERSIFIED

* AMG Advanced Metallurgical Group NV expects its full-year 2018 EBITDA to exceed US$190 million on the back of improving market conditions across its critical materials portfolio. EBITDA in 2017 rose 25% year over year to US$125.5 million.

BASE METALS

* Cornerstone Capital Resources Inc. will not proceed with its previously announced assets spinoff due to delays in obtaining certain approvals. The proposed transaction excluded the company's interests in the Cascabel copper concession in Ecuador and shares of SolGold.

* Consolidated Zinc Ltd. approved the development plan for its Plomosas zinc-lead-silver project in northern Mexico and will immediately start mining the high-grade Tres Amigos mineralization. The company also entered agreements with Grupo México SAB de CV to process the Plomosas ore through the latter's concentrator plant at Santa Eulalia and sell the product to their San Luis Potosi smelter.

* Helix Resources Ltd. and Japan Oil, Gas and Metals National Corp. reached a joint venture deal, where JOGMEC will earn 60% interest in the Samuel copper project in Chile by funding exploration of up to US$2.4 million.

* Thakadu Battery Materials kicked off construction of a 250-million South African rand nickel sulfate plant at Lonmin PLC's base metals refinery, part of its Marikana operations in South Africa, Mining Weekly reported. The plant is projected to produce 25,000 tonnes per year of high-purity battery-grade nickel sulfate. Commercial production is targeted by the end of the first half of 2019.

* An updated resource estimate for the Vale do Curaçá property, part of Ero Copper Corp.'s MCSA Mining Complex in Brazil, increased reserves by 108%, while measured and indicated resources increased by 107%. The property, which comprises the Pilar, Vermelhos and Surubim mines, hosts proven and probable reserves of 18.4 million tonnes grading 1.86% copper, representing 342,800 tonnes of copper.

* Broken Hill Prospecting Ltd. said Cobalt Blue Holdings Ltd. secured a 70% stake in the Thackaringa cobalt project in New South Wales, Australia, after completing the second stage of the earn-in deal.

PRECIOUS METALS

* DRDGold Ltd. is hedging 50,000 ounces of gold, spread equally over nine months, at between 565,000 and 609,000 South African rand per kilogram cash, which will be settled at the end of each month. In fiscal 2019, the company expects to produce 148,000 to 154,000 ounces of gold at a cash operating cost of about 490,000 rand per kilogram from its Ergo operation in South Africa.

* Apart from BHP, SolGold CEO Nick Mather said Hancock Prospecting Pty Ltd. was also interested in owning a stake in SolGold. "Hancock Prospecting are on our southern border," he told The Australian Financial Review.

* Golden Minerals Co.'s preliminary economic assessment for its El Quevar silver project in Argentina's Salta province defined an after-tax net present value of US$44.9 million, discounted at 5%, and a 17% internal rate of return.

* A mining engineer of Continental Gold Inc. was fatally wounded after being attacked by armed individuals in the Colombian town of Buriticá, where the company's Buritica gold project is located. Another engineer is currently being treated and is in stable condition.

* GoGold Resources Inc. signed a definitive agreement with Metalla Royalty & Streaming Ltd. to sell its 2% royalty on the Santa Gertrudis gold project in Mexico for US$12 million.

* Centenera Mining Corp. agreed to acquire up to a 100% interest in six precious metals properties in Argentina from an arm's length party, Tres Cerros Exploraciones SRL, through three separate option agreements.

* Avocet Mining PLC transferred 30% of its Tri-K gold project in Guinea to Managem S.A., taking the latter's stake in the joint venture to 70%, under the deal signed in 2016.

* BTU Metals Corp. agreed to acquire the Burnthut gold project in northwestern Ontario in a cash and stock deal. The property is contiguous to First Mining Gold Corp.'s Goldlund project.

* Tasca Resources Ltd. struck an option deal with the arm's length vendors to acquire the Handcamp property in Newfoundland and Labrador.

* Sonoro Metals Corp.'s Minera Mar De Plata SA De CV subsidiary executed a formal option deal with a private individual to acquire the nine-hectare El Colorado concession within the company's Cerro Caliche gold property in Mexico's Sonora state.

BULK COMMODITIES

* Norsk Hydro ASA unit Alunorte - Alumina do Norte do Brasil SA signed two agreements crucial to the resumption of normal operations at its Alunorte alumina refinery in Brazil. The company inked a technical term of adjusted conduct, which regulates project-related activities, and a social term of commitment, which addresses community development efforts in Barcarena. Alunorte has been operating at 50% capacity since March due to embargoes imposed by authorities.

* Eurasian Resources Group Sàrl, formerly known as ENRC, won a landmark appeal in a London court to keep documents generated during an internal corruption probe from the hands of authorities. The judgment stemmed from a dispute between the company and Britain's Serious Fraud Office, which in 2013 opened a fraud investigation into ENRC's dealings in Kazakhstan and Africa, over which documents are confidential and protected by professional privilege.

* The Department of Environment and Science in Queensland, Australia, is taking Adani Enterprises Ltd.'s Abbot Point Bulkcoal Pty. Ltd. to court over an unauthorized discharge of sediment water from the Abbot Point coal terminal during Cyclone Debbie in early 2017. The department said that the discharged water was more than eight times above the levels authorized in a temporary emissions license.

* Alumina production of Alcoa Corp. is likely to take a hit as a result of the ongoing strike at the company's three alumina refineries and two bauxite mines in Western Australia, Reuters reported, citing the Australian Workers' Union National Secretary Daniel Walton. "Fully staffed, refineries should produce about 26,000 tonnes of alumina per day. Currently more than half the operational staff responsible for this work are on strike," Walton said.

* Downer EDI Ltd. secured a five-year, A$286 million contract extension to continue providing mining services at the Commodore open cut coal mine in South East Queensland. Downer has been servicing Commodore since 2001 to deliver coal to the Millmerran power station, owned by Millmerran Power Partners.

* Two miners were rescued after being trapped 160 meters down GFG Alliance's Tahmoor coal mine in Australia, news.com.au reported. The incident was caused by a lift malfunction.

SPECIALTY

* AfrAsia Bank Ltd. CEO Sanjiv Bhasin says more institutional money is flowing into Africa, with Battery Minerals Ltd. having received indicative terms from some financial backers for its Montepuez graphite project in Mozambique amid financiers' concerns about graphite hopefuls' ability to secure debt funding. Mauritius-based Bhasin, whose bank facilitates deals for institutional debt and equity for African projects, told S&P Global Market Intelligence that the "frequency and quantum" of such money into the continent is increasing, and said he did not detect at the Africa Down Under conference in Perth, Australia, any expressions of concern for miners' ability to raise debt.

* PJSC Alrosa put 163 gem-quality rough diamonds with total weight of 2,615 carats for an auction in Hong Kong. Auction results will be summed up on Sept. 20.

* Lithium Australia NL subsidiary VSPC Ltd. will formally commission on Sept. 6 its cathode powder pilot plant and battery-testing facility in Brisbane, Australia.

* Black Rock Mining Ltd. secured environmental approval for its Mahenge graphite project in Tanzania. It will submit a mining license request after completion of a definitive feasibility study.

* Frontier Diamonds Ltd. recovered a 111.45-carat diamond during the processing of material from the Bellsbank kimberlite pipe exploration project and tailings from the Sedibeng mine in South Africa.

* Kibaran Resources Ltd. secured a guarantee from Tanzania's Mining Commission for a 10-year renewal of the Epanko graphite project's mining license, pending the fulfillment of requirements under the country's mining act.

* Kodal Minerals PLC released an initial resource estimate for its Bougouni project in southern Mali, with inferred resources of 17.3 million tonnes at 1.20% lithium oxide. The estimate uses a 0.5% cutoff and covers three deposits known as Sogola-Baoule, Ngoualana and Boumou.

* Uracan Resources Ltd. secured an option to earn up to a 100% interest in the Huzyk Creek vanadium property in Manitoba. The property consists of a mineral exploration license covering around 216 square kilometers.

INDUSTRY NEWS

* Australia remained one of the most attractive countries for the global mining industry in 2017 with US$1.08 billion in nonferrous exploration budgets, keeping the country in second place since 2002. S&P Global Market Intelligence data shows that, with a year-over-year budget increase of more than 19% compared with a 14% global average increase, Australia's exploration sector rebounded quicker in 2017 than many other jurisdictions.

* Master Drilling Group Ltd. will acquire the businesses of South African mining contracting company Atlantis Group for 107.5 million South African rand, Mining Weekly reported. Master Drilling said the acquisition would expand its international footprint, especially in India, Brazil and Zambia, where the two companies have active raiseboring businesses.

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