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BHP's fiscal Q1'18 copper output up 14% despite Escondida delays

TOP NEWS

BHP's fiscal Q1'18 copper output up 14% despite Escondida delays

While Rio Tinto witnessed a decline in copper production and slashed its 2017 guidance due to the delayed ramp-up of the expansion of the Escondida mine in Chile, partner BHP Billiton Group reported an increase in copper output for the September quarter and left its guidance unchanged. Overall copper production increased 14% to 404,000 tonnes, with the increases from Escondida and Olympic Dam partially offset by a decline in output from the Pampa Norte mine in Chile.

Rio Tinto rebuts SEC's fraud claims against miner, former executives

The SEC charged Rio Tinto, former CEO Thomas Albanese and former CFO Guy Elliott with fraud for allegedly violating federal securities laws related to an unsuccessful acquisition of coal assets. The executives are accused of inflating the value of coal assets acquired in Mozambique for US$3.7 billion, which were sold a few years later for US$50 million. Rio Tinto rebutted the claims and said it will vigorously defend the charges.

Vale seeks partner for New Caledonia nickel ops

Vale SA is working with Scotiabank for the potential sale of a stake in its New Caledonia nickel operations, the Financial Times reported, citing people familiar with the matter. The miner has held talks with several Chinese groups, including Shenzhen-based Gem Co., which recycles and refines nickel cobalt for use in batteries.

BASE METALS

* A Swedish civil court in the city of Skellefteå began reviewing a claim filed against Boliden AB subsidiary Boliden Mineral AB by about 800 Chilean citizens over health issues resulting from the dumping of smelter sludge by the company near the city of Arica in the 1980s. The plaintiffs request US$12.3 million in compensations over damages, daily El Mercurio reported.

* MMG Ltd. produced 114,472 tonnes of copper in the third quarter, an increase of 7% on a yearly basis. The company's Las Bambas copper mine in Peru posted record production of 114,169 tonnes of copper.

* Base metals have delivered a strong price performance so far this year, but the outlook on copper, nickel and zinc may go separate ways, according to speakers at the 121 Mining Investment in Hong Kong. Helen Lau, metals and mining research analyst at Argonaut Securities, told delegates that drivers of copper demand will come from the electronics and auto industries, as China is rebalancing itself toward a more consumption-driven economy.

* Amur Minerals Corp. estimated that open pit mining from its Kun-Manie project in Russia can generate EBITDA of over US$1.6 billion, based on a nickel price of US$7.27 per pound. The four open pit defined deposits contain 77 million tonnes of ore averaging 0.73% nickel for 564,100 tonnes and 0.20% copper for 151,500 tonnes, with platinum and palladium as byproducts.

* KGHM Polska Miedz SA does not expect any significant impact on sales or core earnings from the recent breakdown of a smelter in the city of Glogow in Poland, Reuters reported. The miner said in the week of Oct. 9 that an accident at the smelter would result in production dropping by 14,000 tonnes.

PRECIOUS METALS

* Hochschild Mining Plc's attributable output in the third quarter increased to 10.3 million silver equivalent ounces, compared to 9.9 million silver equivalent ounces produced in the year-ago quarter. The record three-month production included 5.3 million ounces of silver and 67,234 ounces of gold, up from 5 million ounces of silver and 66,380 ounces of gold in the same quarter of 2016.

* Metminco Ltd.'s feasibility study for its Miraflores gold project in Colombia pegged a posttax net present value of US$72.3 million, discounted at 8%, and a 25% internal rate of return. CapEx, excluding a 7.67% contingency, is expected at US$71.8 million, with an additional US$18.5 million for sustaining CapEx over an approximate 9.5-year life.

* Newcrest Mining Ltd. will invest A$93 million to expand the West Dome open pit at its Telfer gold mine in Western Australia to extend the life of the open pit by about four years to around 2023.

* Newly listed Riversgold Ltd. is undertaking an exploration program at its Kurnalpi project in the Eastern Goldfields of Western Australia starting with a maiden drilling program just a week after it lit up the boards of the ASX following a successful IPO.

* Sula Iron & Gold Plc is seeking interested partners for a joint venture or farm-out deal for its Ferensola gold project in Sierra Leone. The company is also looking to acquire additional assets.

* Pan African Resources Plc concluded a one-year wage agreement with South Africa's National Union of Mineworkers. The agreement is in addition to the three-year wage agreement with the United Association of South Africa.

* Superior Gold Inc. expects to reach commercial production at its Hermes gold project in Western Australia in the first quarter of 2018.

* Option contracts expiring Nov. 28 and Jan. 29, with 1 kilogram of gold as underlying, were launched by the Multi Commodity Exchange of India, The Hindu reported.

BULK COMMODITIES

* PAO Severstal's third-quarter net profit fell 30.8% year over year to US$297 million, compared to US$429 million a year ago. The company recorded a US$112 million income tax expense and a US$23 million foreign exchange loss. Meanwhile, the board of Severstal recommended that shareholders at a Nov. 24 extraordinary meeting approve a dividend of 35.61 Russian rubles per share for the three months that ended Sept. 30.

* The U.S. Department of Justice stepped into Kobe Steel Ltd.'s data falsification scandal, as a new report claimed the steelmaker's plants had been rigging product quality data for decades. Kobe Steel said its U.S. subsidiary received a request from the Justice Department seeking documents related to compromised products sold to U.S. customers.

* Gerdau SA could pocket about 2 billion Brazilian reais, or US$630.48 million, through the sale of its three rebar steel producing facilities in the U.S., Reuters reported, citing newspaper Valor Econômico. Two market sources told the paper that the Brazilian steelmaker is selling its Rancho Cucamonga, Sayreville and Knoxville units to U.S.-based Commercial Metals Co. by the end of the year.

* Ncondezi Energy Ltd. conditionally raised £750,000 before expenses through an oversubscribed placement of shares. The funds will be used to meet immediate financing needs until August 2018.

* One of China's largest aluminum producers, Xinfa Group, will have to reduce output by 381,900 tonnes at its smelter in Shandong province to comply with the government's directive of planned curtailments to ease air pollution, Reuters reported, citing a draft policy document. The production cut will start from Nov. 15 and remain in place until March 15, 2018.

* Nanjing Iron & Steel Co. Ltd. expects its nine-month net profit to reach 2.05 billion Chinese yuan, up 800% year over year, Securities Times reported.

* Seven miners were killed and another is missing after part of an illegal coal mine in Turkey's Sirnak province caved in, Reuters reported.

SPECIALTY

* Lithium is expected to remain in short supply as a result of the evolution in the electric vehicle industry and despite large amounts of new supply being scheduled to come online in the next five years, according to speakers at the 121 Mining Investment in Hong Kong. Adrian Griffin, managing director of Lithium Australia NL, warned that uncertainties on the supply side will continue to weigh on the sector.

* Karelian Diamond Resources Plc is looking for the source of the green diamond the company discovered in the Kuhmo area of Finland, through an extensive work program designed to identify the kimberlite train.

* Activists in Niger are calling on President Mahamadou Issoufou to negotiate with Areva SA, after the French nuclear giant announced 200 job cuts and retrenching of 500 contractors at its Somair uranium mine in the West African nation to tackle a downturn in nuclear fuel prices, Bloomberg News reported.

* A legal dispute between Chile's state-backed development agency Corfo and Sociedad Quimica y Minera de Chile SA over the latter's lithium lease in the Salar de Atacama region will return to arbitration after talks failed. A decision on the arbitration is expected by the end of the year.

* A scoping study on Plymouth Minerals Ltd.'s San Jose lithium-tin project in Spain's Extremadura region estimated a pretax net present value, discounted at 8%, of US$401 million, an internal rate of return of 28% and a payback period of 2.7 years.

* Battery Minerals Ltd.'s value engineering study for its Montepuez graphite project in Mozambique slashed CapEx to US$42.3 million, operating expenses to US$337 per tonne and the payback period to less than two years.

* Sheffield Resources Ltd. selected GR Engineering Services Ltd. as the preferred engineering, procurement and construction tenderer of the mineral processing plant and facilities for the Thunderbird mineral sands project in Western Australia. The company separately said Taurus Mining Finance Fund and Taurus Mining Finance Annex Fund agreed to arrange and underwrite a US$200 million project development facility to advance Thunderbird.

* Vedomosti reported that rough diamonds may be exempted from value-added tax in Russia. PJSC Alrosa will be able to sell diamonds to Russian cutters without the tax.

* Peninsula Energy Ltd. decided to exit and sell its 74% interest in the Karoo uranium projects in South Africa through an active process over the rest of the year.

* Southern China's Jiangxi province unveiled 19 measures to tighten control over the supply chain of rare earths, jrj.com reported. Only companies with a production quota are allowed to engage in mining, imports and sales.

INDUSTRY NEWS

* South Africa's Chamber of Mines submitted an application to South Africa's High Court in Gauteng, seeking a judicial review and setting aside of the revised mining charter that was unveiled in mid-June. In the founding affidavit, the chamber said the charter continues to have a "disastrous effect" on the mining industry, investors and employees.

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.