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Rusal CEO, half of board members resign in response to US sanctions

TOP NEWS

Rusal CEO, half of board members resign in response to US sanctions

United Co. Rusal PLC's CEO Alexandra Bouriko and half of its board members have resigned, as part of efforts to protect the company from U.S. sanctions imposed in April. Bouriko's resignation took effect May 23 and the board has appointed Evgeny Nikitin, head of the company's aluminum division, as acting CEO. Executive directors Vladislav Soloviev and Siegfried Wolf, as well as five nonexecutive directors Maxim Sokov, Dmitry Afanasiev, Gulzhan Moldazhanova, Olga Mashkovskaya and Ekaterina Nikitina, have resigned as directors, with effect from June 28. The resignations came after Oleg Deripaska stepped down as a director at En+ Group PLC but remained on the Rusal board as a nonexecutive director.

Indian state seeks permanent closure of Vedanta's Tuticorin, orders power cut

Vedanta Resources PLC unit Vedanta Ltd. said that state environmental officials ordered the disconnection of the power supply and the closure of the company's Tuticorin copper smelter in South India's Tamil Nadu state, with immediate effect. Reuters reported in a same-day report that Tamil Nadu is seeking a permanent closure of the Tuticorin operations. The report added that environmental officials had cut the power supply to the smelter, as the smelter was preparing to resume production without approval. The news came after 13 people were killed during protests against a planned expansion of the facility, with police firing on protesters when the demonstration turned violent.

Greenfields key to gold's future, says St Barbara CEO

The gold industry needs to be much more proactive with greenfields exploration to ensure a thriving future, particularly in Australia where the competitive position of individual companies is being eroded by depleting reserves, miner St Barbara Ltd. CEO Bob Vassie said in an exclusive interview with S&P Global Market Intelligence.

BASE METALS

* S&P Global Market Intelligence estimated that global production of nickel in the first quarter of 2018 fell compared with the final quarter of 2017. The Metals and Mining Research estimate of 529,000 tonnes for the three-month period to end-March compares with 553,000 tonnes in the last three months of 2017, which brought the annual total to almost 2.19 Mt — fractionally higher than the amount produced in 2016.

* Fitch Ratings affirmed Freeport-McMoRan Inc.'s issuer default rating at BB+, with a negative rating outlook. The negative outlook reflects the possibility that changes in Indonesian regulations could adversely impact the economics of the company's Grasberg copper operations.

* Data from the International Copper Study Group showed that global copper surplus fell 12.8% year on year in the first two months of the year, to 110,000 tonnes, while apparent demand rose 3.9% to 3.77 million tonnes, Mining Weekly reported.

* Antofagasta PLC Chairman Jean-Paul Luksic expects a shortfall of copper in the coming years due to the slow rate at which new mines are granted permits and subsequently built and increasing demand for the commodity, Mining Weekly reported.

PRECIOUS METALS

* PJSC Polyus expects its production to hit the upper end of its forecast range of between 2.38 million and 2.43 million troy ounces, Reuters reported. The company's 2018 CapEx is expected to be slightly lower than initially planned US$850 million as it is ramping up its Natalka gold mine ahead of schedule, said CEO Pavel Grachev.

* Responding to a media statement by the Association of Mineworkers and Construction Union, or AMCU, Sibanye Gold Ltd. confirmed a seismic event May 22 at its Ikamva mine, part of the Kloof operations, that caused a fall of ground and resulted in injuries to three employees. The company said that another seismic event May 21 at the Manyano mine, also within the Kloof operations, resulted in injuries to two workers. However, AMCU's insinuations that the company willfully put its employees at risk are "blatantly disingenuous and calculated" to bring Sibanye into disrepute, adding that there was no causal relationship between the two events.

* An independent pre-feasibility study on Paramount Gold Nevada Corp.'s proposed Grassy Mountain gold mine in Oregon defined an after-tax net present value of US$87.8 million, at a 5% discount rate, with a 27.6% internal rate of return.

* LeaGold Mining Corp. completed its C$314 million acquisition of Brio Gold Inc. after securing regulatory and shareholders approvals.

* Pantoro Ltd. defined initial underground reserves for the Wagtail and Rowdies deposits that comprise probable reserves of 356,000 tonnes grading 5.4 g/t of gold for 62,000 ounces. Wagtail and Rowdies form part of the company's Halls Creek property in Western Australia, along with the Nicolsons mine.

* PanTerra Gold Ltd. will seek up to US$25 million in damages from the Dominican Republic government, claiming the latter failed to meet its contractual obligations relating to the company's Las Lagunas gold-silver tailings project.

* Spitfire Materials Ltd. signed a binding term sheet to acquire the remaining 49% of the Mulwarrie gold project in Western Australia. The miner earned an initial 51% interest in the project under an existing earn-in agreement with Goldfield Argonaut Pty. Ltd.

* Anglo Asian Mining Plc is set to declare a maiden dividend after its full-year 2017 gold equivalent output of 71,461 ounces met the upper half of its production guidance of between 64,000 and 72,000 gold equivalent ounces.

* Five people were killed in a militia attack at Banro Corp.'s Namoya gold mine in the Democratic Republic of the Congo, Reuters reported.

BULK COMMODITIES

* Shares in Russia's largest aluminum company, Rusal, rallied on the Moscow and Hong Kong stock exchanges May 24 on the back of the resignation of the CEO and half of the board. The board members that resigned from Rusal were all representatives from EN+, and the Russian government believes that the move will send a positive signal to the U.S. and contribute to a possible loosening of sanctions on Rusal. "This is good. It means they will soon lift sanctions," Russian Finance Minister Anton Siluanov told journalists at the St. Petersburg International Economic Forum.

* The Ukrainian government included Russian businessman Oleg Deripaska on a recently expanded sanctions list, mirroring the U.S., Reuters reported. Deripaska has majority stakes in Rusal and En+ Group PLC. Rusal owns a large aluminum plant in Ukraine.

* Oleg Deripaska has reportedly asked the Russian government to purchase Rusal's aluminum, Reuters reported, citing a senior Russian government source. Deripaska is also seeking support from car manufacturer GAZ and has applied to secure a loan from Promsvyazbank. Separately, Reuters wrote that Deripaska is mulling the sale of his shares in En+ Group to the company to bring his interest below the controlling level.

* Russia's Mechel PAO posted a 76% year-over-year drop in net profit for the first quarter to 3.29 billion Russian rubles due to a slump in sales. The drop in sales impacted revenue, which fell 3% year on year to 74.85 billion rubles. Likewise, operating profit was down 26% year over year to 13.38 billion rubles, and EBITDA fell 19% to 18.44 billion rubles.

* Samir Cairae, CEO of Vedanta's metals business in India, warned that the company may reduce aluminum output if limits on coal supplies to the country's nonpower sectors continue for another week, Bloomberg News reported. The limited coal supply is a result of a government directive to prioritize coal deliveries to power stations as India's private and public thermal power plants face severe coal shortages amid rising electricity demand, Mining Weekly reported the same day.

* Whitehaven Coal Ltd. signed a deal to acquire the remaining 25% stake in the Winchester South coal development project in Queensland, Australia, after it agreed in March to pay US$200 million for acquisition of a 75% interest in the project from Rio Tinto.

* After a nearly 10-week strike at the IOC iron ore mine, Iron Ore Co. of Canada Inc. and striking workers are three days into a fresh round of talks after two previous offers were rejected. Iron Ore Co. of Canada, which is majority owned by Rio Tinto, confirmed talks were ongoing but declined to take specific questions about negotiations.

* The European Commission launched a probe into hot-rolled steel sheet piles imported from China to determine whether the products are being dumped in Europe. According to Reuters, the probe follows complaints from EU steelmaker group Eurofer.

* India launched a dispute proceeding at the World Trade Organisation against the U.S. tariffs on imports of India-made steel and aluminum, Metal Bulletin wrote. The two sides will now engage in talks, but if the parties fail to resolve the dispute within 60 days, New Delhi could request that a WTO disputes panel be formed to adjudicate.

* Bahrain's United Stainless Steel Company BSC said that it does not plan to declare force majeure after a recent factory fire at its stainless steel re-rolling mill, and planned deliveries of the material will not be disrupted, Metal Bulletin reported, citing a spokesman for plant managing entity Chromiumsteel.

* Evraz PLC announced an interim dividend of 13 U.S. cents per share per, totaling US$187.6 million. The dividend is payable June 22 to shareholders on record as of June 8. Meanwhile, Moody's upgraded subsidiary Evraz Group S.A.'s corporate family rating to Ba2 from Ba3 and probability of default rating to Ba2-PD from Ba3-PD, shifting the outlook on the company's ratings to stable from positive.

SPECIALTY

* PJSC Alrosa expects its first-half sales of rough diamonds to be significantly higher than it originally expected on the back of a stronger market, Reuters reported. CEO Sergey Ivanov said the company's full year production is forecast to reach 36.6 million carats, but sales will reach about 40 million carats due to sales from the stockpile earlier in the year.

* Shares in Petra Diamonds Ltd. fell May 24 after it announced plans to raise up to US$178 million through a 5-for-8 fully underwritten rights issue to cut its debt and for working capital. It will issue 332,821,725 shares at 40 pence each, 36 pence below the stock's closing level May 23. Shares were down 16% in midday London deals.

* The Western Australian government plans to establish a task force to explore the state's potential to produce and process lithium and other energy materials and to create jobs. The task force will oversee development of a strategy to maximize the exploitation of lithium and other energy materials in the state.

* Chile's constitutional court will not intervene in a dispute between Codelco and Lithium Power International Ltd.'s 50%-owned Minera Salar Blanco SpA over adjoining lithium deposits in the country's Maricunga salt flat, saying it was the responsibility of a lower court judge to make a ruling over the case, Reuters reported.

* Mountain Province Diamonds Inc. sold 350,000 carats of diamonds at US$81 per carat for US$28.3 million in proceeds in its fourth diamond sale this year. The proceeds are the highest total for any of the company's tender results to date.

INDUSTRY NEWS

* The Philippines' Mineral Industry Coordinating Council completed reviewing mining companies' appeals against suspensions and closures ordered by Regina Paz Lopez, who formerly led the country's environment department, Manila Bulletin wrote. To conclude the process, the council will consolidate its findings with the results of the review conducted by the Department of Environment and Natural Resources.

* South African Minister of Mineral Resources Gwede Mantashe said the government intends to finalize the revamped mining charter by June-end, Mining Weekly reported.

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