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Freeport, Indonesia nearing deal to transfer majority Grasberg stake to Inalum

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Freeport, Indonesia nearing deal to transfer majority Grasberg stake to Inalum

TOP NEWS

Freeport, Indonesia nearing deal on road-map to transfer 51% Grasberg stake to Inalum

The Indonesian government and Freeport-McMoRan Inc. will sign a new deal as early as Dec. 17 that will outline a roadmap for the transfer of a majority stake in the Grasberg copper-gold project to Indonesia's state-owned PT Indonesia Asahan Aluminium, or Inalum, Bloomberg News reported, citing people familiar with the proposal. Under this deal, Inalum will look to acquire Rio Tinto's interest in Grasberg by March 2018 and then convert into an equity stake, two of the sources told Bloomberg. Separately, an Indonesian government official told Reuters that Rio Tinto will not convert its 40% participating interest in Grasberg until 2022. "In 2022 it will automatically convert to a shareholding," the official was quoted as saying.

Workers at ArcelorMittal's Kazakh coal mines end strike

Protestors at ArcelorMittal's Kazakh subsidiary, ArcelorMittal Temirtau, ended their sit-in strike and emerged from the mines after the company agreed to a 30% pay rise and threatened legal action. The company's press office told S&P Global Market Intelligence that it planned to sue hundreds of striking workers staging the underground sit-in over a pay dispute. The company said 400 people are still striking underground in the Kazakstanskaya, Tentekskaya and Lenina mines.

Chile election puts pressure on top lithium producer SQM

Chileans head to the polls Dec. 17 to cast their votes in a tightly contested runoff election for president that has implications for the mining sector and the world's top lithium producer, Sociedad Quimica y Minera de Chile SA. Analysts consider the election outcome critical to the company in resolving its ongoing battle with the Chilean government's Production Development Corp. over land leased by SQM in the Salar de Atacama for the production of lithium, among other things, and helping it secure a new contract over the land.

BASE METALS

* British Columbia refused to issue an environmental certificate for KGHM Polska Miedz SA's preproduction-stage Ajax copper-gold project, saying the potential adverse effects are more significant than its economic benefits, Reuters reported. Canadian Prime Minister Justin Trudeau's cabinet will make a final decision on the project, the report added.

* Northern Cobalt Ltd. will acquire nine tenements in Australia's Northern Territory and made applications for four adjoining tenements, mainly prospective for lithium. The acquisition will complement the company's Wollogorang cobalt project, it said.

* Strategic Minerals Plc renegotiated the acquisition terms for the Leigh Creek copper mine in South Australia. The company will now pay A$3 million via cash and shares, instead of the previously agreed A$5 million payment through royalties, cash, shares and assumption of debt.

* Moly Mines Ltd. plans to make a conditional off-market takeover bid for all Queensland Mining Corp. Ltd. shares at 17 Australian cents apiece, which represents a premium of 49.12% to the 30-day volume-weighted average price of 11.4 cents per share as of Dec. 14. Queensland Mining directors unanimously recommend its shareholders accept the takeover bid in the absence of a superior proposal.

* PT Timah (Persero) Tbk. struck a joint-venture deal with Nigeria's Topwide Ventures Ltd. to develop a tin mining site in the West African country, The Jakarta Globe reported. The Indonesian state-owned company, meanwhile, said its revenue in the first nine months of the year soared 44.17% on a yearly basis to 6.6 trillion Indonesian rupiah, while its net profit jumped to 300.57 billion rupiah from 50.65 billion rupiah a year ago.

* South32 Ltd. committed to fund the US$10 million 2018 program and budget for the Bornite property, which forms part of Trilogy Metals Inc.'s copper-prospective Upper Kobuk Mineral Projects in Alaska.

* Clive Palmer blamed Australian Prime Minister Malcolm Turnbull for the demise of his Queensland refinery business, arguing the Australian government allowed the country's businesses to flounder while China propped up its resources sector, The Australian reported, citing a February 2016 letter from Palmer.

* An ongoing strike at Empresa Nacional de Minera's operations in Chile is also affecting five of its copper processing plants, which have run out of sulfuric acid, Metal Bulletin reported. The company announced earlier in the week that it had suspended operations at its Paipote smelter due to the strike led by the Sindicato No. 2 de Trabajadores union.

PRECIOUS METALS

* Anglo American Platinum Ltd. expects its headline earnings for 2017 to be at least 20% higher than 2016, by about 373 million South African rand, or 1.43 rand per share. The Anglo American Plc unit booked headline earnings of 1.87 billion rand, or 7.13 rand per share, in 2016. Amplats also estimates its 2017 basic earnings to increase by at least 20%.

* Sibanye Gold Ltd.'s proposed acquisition of South African platinum group metals producer Lonmin Plc will be "earnings enhancing by 2021," CEO Neal Froneman said. Sibanye agreed on terms of an all-share offer to wholly acquire Lonmin, valuing the company at about £285 million. In terms of earnings, he said pretax synergies would amount to about 1.5 billion South African rand per year by 2021. This will include overhead costs of 730 million rand per year, which is a conservative estimate, Froneman said.

* Meanwhile, South Africa's Association of Mineworkers and Construction Union president, Joseph Mathunjwa, said the union is considering its options, including a mass action and legal avenue to oppose Sibanye Gold's takeover of Lonmin, as Sibanye already indicated the transaction will lead to 12,600 job losses, Reuters reported.

* Torex Gold Resources Inc. said that during a company-organized off-site vote Dec. 14, a majority of its employees voted in favor of lifting the blockade and return to work immediately at its El Limon-Guajes gold mine in Mexico.

* Following a review of previous exploration activity at the Akyanga license area, Ortac Resources Ltd. identified significant gold mineralization at Akyanga East, a parallel structure only 400 meters from the known gold resource.

* The Chilean Supreme Court dismissed a joint claim filed by environmental watchdog SMA and evaluation service SEA against Barrick Gold Corp.'s suspended Pascua Lama gold project over alleged environmental damages caused by avalanches recorded in May and June 2016. The court dismissed the regulators' claim that the avalanche had affected the project's water treatment plant, leading to the spill of wastewater into the El Estrecho river, daily Diario Financiero reported. Separately, Barrick Gold is looking into how to restructure Pascua Lama, Executive Director René Muga told daily El Mercurio.

* Peruvian environmental regulator OEFA is monitoring the tailings spill recorded at Pan American Silver Corp.'s Huaron mine in Pasco region in the early hours of Dec. 14, news agency Andina reported.

* Hummingbird Resources Plc achieved ore commissioning at its Yanfolila gold mine in Mali. First gold is expected this month, with commercial ramp-up during the first quarter of 2018. Output in the first full year is expected at about 130,000 ounces of gold.

* Sunvest Minerals Corp. signed a definitive deal to acquire the Parrott Lake silver property in British Columbia for 4 million shares and C$100,000 in cash.

* Cornerstone Capital Resources Inc.'s security holders approved the previously announced spinoff of all of its assets, except its interest in the Cascabel copper project in Ecuador and shares of SolGold Plc, into a new exploration company called Cornerstone Exploration Inc.

* Gascoyne Resources Ltd. signed flat forward gold sales contracts with Commonwealth Bank of Australia and the National Bank of Australia covering 164,000 ounces of gold production from its Dalgaranga project in Western Australia, at a delivery price of A$1,712 per ounce. The banks are also providing a A$60 million loan for the project's development.

BULK COMMODITIES

* Indonesia's state-owned coal miner PT Bukit Asam (Persero) Tbk. intends to invest 6.5 trillion Indonesian rupiah for capital expenditure in 2018 to expand its downstream coal business, The Jakarta Post reported, citing the company.

* Noble Group Ltd. Chairman Paul Brough said the troubled commodities trader is negotiating a debt restructuring deal with creditors to avoid bankruptcy, Reuters reported. "We hope to receive proposals from our creditors in the near future. The ball's in their court," Brough said.

* Bauxite Resources Ltd. approved a cash reward of 5 Australian cents per share to shareholders for a total of about A$10.7 million. The ASX-listed company is a takeover target from Mercantile Investment Co. Ltd., which made an unsolicited off-market takeover offer in November to buy 1 of every 2 fully paid shares in Bauxite Resources that it does not already own for 9 Australian cents apiece.

* Kommersant reported that VEB's supervisory board approved syndicated financing for the completion of the Taishet aluminum plant and a loan for the Krasnoyarsk metallurgical plant, part of En+ Group plc. VEB will invest 18.5 billion Russian rubles in Taishet and 7.7 billion rubles in the creation of the production of aluminum plates in Krasnoyarsk with the capacity of 60,000 tonnes per year.

* S&P Global Ratings assigned a BB- issue-level rating and a recovery rating of 3 to SunCoke Energy Inc.'s proposed US$45 million term loan A. Meanwhile, the company's issue-level rating on its existing US$100 million cash flow revolving credit facility was lowered to BB-, from BB+.

* Indian Captive Power Producers Association President Rahul Sharma said the captive power producers are considering increasing their coal imports, as they are only getting half of their requirement from Coal India Ltd., Mining.com reported.

* Labrador Iron Ore Royalty Corp. declared a regular cash dividend of 25 Canadian cents per share and a special dividend of 30 cents per share for the fourth quarter.

* Corsa Coal Corp. expects total metallurgical coal sales of between 2.1 million and 2.8 million short tons in 2018. Cash production cost per ton sold in 2018 is expected to be between US$70 and US$74 per short ton from the Northern Appalachia division and US$58 to US$62 per short ton from the CAPP division.

* Vedanta Ltd. plans to raise about 5 billion Indian rupees via the issuance of nonconvertible debentures and is holding a meeting of its committee of directors Dec. 19.

SPECIALTY

* Triton Minerals Ltd.'s definitive feasibility study for its Ancuabe graphite project in Mozambique pegged a pretax net present value, discounted at 10%, of US$298 million, a 36.8% internal rate of return and a 3.8-year payback period. The company also estimated a maiden ore reserve of 24.9 million tonnes at 6.2% total graphitic carbon for 1.5 million tonnes of contained graphite.

* Chinese institutional fund management group NextView agreed to acquire a 19.89% equity interest in Bacanora Minerals Ltd. and purchase up to 15,000 tonnes of lithium per annum from the company.

* Albemarle Corp. agreed to divest its polyolefin catalysts and components business to W. R. Grace & Co. in a US$416 million deal. As part of the transaction, Grace will assume the lease and operations at the product development center in Louisiana and operations at the South Korea site.

* Nemaska Lithium Inc. signed a definitive agreement to sell its Sirmac lithium project in Quebec to ABE Resources Inc. for C$250,000 in cash and 15 million common shares along with an assumed pre-existing 1% net smelter royalty on certain Sirmac claims. Meanwhile, Nemaska received the mining lease for its Whabouchi lithium project in Quebec from the Ministry of Energy and Natural Resources.

INDUSTRY NEWS

* The government of Odisha, India, ruled out extending the Dec. 31 deadline to recover penalties from miners for illegal mining activities in the province as ordered by the Supreme Court, Mining Weekly reported. According to government data, the amount recoverable from miners will be about US$781 million, which is higher than the US$468 million estimated when the court issued the verdict.

S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.

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.