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Paulson gains control of Detour board; GEM halts cobalt deal with Glencore

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Lithium prices rally cobalt prices correct


Paulson gains control of Detour board; GEM halts cobalt deal with Glencore

TOP NEWS

Paulson & Co. shakes up Detour Gold's board, wins most seats in proxy battle

Detour Gold Corp.'s shareholders largely sided with Paulson & Co. Inc. in a bitter contest for control of the Detour board, electing five Paulson & Co. nominees to a nine-member board at a special shareholders meeting. The vote brings to an end Paulson & Co.'s push to shake up the board, having successfully made its case for most directors to be replaced.

Chinese battery recycler halts 3-year cobalt purchase deal with Glencore

China-based battery recycler GEM Co. Ltd. ceased the purchase of cobalt from Glencore PLC, as the price of the battery metal tanked below the agreed price under a three-year deal, Reuters reported, citing sources familiar with the matter. Prices for the commodity crashed to US$55,000 per tonne on the London Metal Exchange since late March, as a result of excess supply in China. The market for the battery metal is expected to take a hit in the coming years due to the expected surplus.

Resolute starts ore production at world's first, fully automated sub-level cave gold mine

Resolute Mining Ltd. started sublevel cave ore production at the new Syama underground mine in Mali, along with the extraction of first ore from the southern end of the Syama sublevel cave, on budget and within schedule. Syama will be the world's first purpose built, fully automated sublevel cave gold mine, according to Resolute's Managing Director and CEO John Welborn.

BASE METALS

* S&P Global Ratings lowered its zinc and nickel price assumptions for 2019 and 2020, reflecting the rising supply expectations for zinc and optimistic demand growth built into the nickel price that will likely rationalize. Nickel prices are now expected at US$12,000 per ton in 2019 and US$12,500 per ton in 2020, while zinc prices are pegged at US$2,700 per ton in 2019 and dropping to US$2,600 per ton in 2020.

* Codelco's Chuquicamata copper mine in Chile was operating normally after employees blocked access to the site overnight, Reuters reported, citing the company. The workers, who have been protesting for a month over the company's plan to transform the open pit into an underground mine, said that Codelco failed to properly include workers in the redesign, and cited continuing issues with healthcare provisions.

* EMX Royalty Corp. agreed to sell the Bleikvassli, Sagvoll, and Meråker polymetallic projects in Norway, and the Bastuträsk polymetallic project in Sweden to OK2 Minerals Ltd., in exchange for a 9.9% stake in the latter.

* Silkroad Nickel Ltd. unit PT Teknik Alum Service entered into a long-term off-take agreement with PT TBR to supply 15 million tonnes of nickel ore over a five to eight year period, beginning March 2020, Mining.com reported. The total contract value of the agreement is estimated to be over US$290 million.

* Southern Copper Corp. will invest about US$50 million in exploration works at its Michiquillay copper project in Peru's Cajamarca region over two years, starting in 2019, with production slated to begin in 2025, CFO Raúl Jacob told Gestión.

* Orion Minerals Ltd. COO Walter Shamu said the company is aiming to start production at the Prieska zinc-copper mine in South Africa by 2021, Mining Weekly reported.

* Cuba's nickel plus cobalt sulfide production is set to top 50,000 tonnes in 2018, Reuters reported, citing Eder Manuel Olivero Garcel, the head of the country's state monopoly Cubaniquel.

* PNX Metals Ltd. earned a 90% interest in the Burnside and Chessman projects in Australia's Northern Territory from Kirkland Lake Gold Ltd. unit Newmarket Gold NT Holdings Pty Ltd. with a view to defining additional resources that can be incorporated into its Hayes Creek zinc-gold-silver project.

* Kopore Metals Ltd. received environmental clearance certificates for all eight of the company's recently granted exclusive Namibian prospecting licenses.

* Strategic Energy Resources Ltd. joined the Mineral Exploration Cooperative Research Center, a collaboration between mining majors, educational institutions, as well as Geoscience Australia and all the Geological Surveys in Australia. The collaboration aims to develop new exploration tools and deployment methods that will reduce drilling costs and increase the quantity and quality of collected data.

* Magmatic Resources Ltd. purchased the existing net smelter royalties granted to Clancy Exploration Ltd. on the company's Myall, Wellington North, Parkes East and Moorefield projects. The royalties ranged from 2.0% to 2.5%, payable out of the gross revenue from the company's East Lachlan projects.

PRECIOUS METALS

* PJSC Polyus, PJSC Alrosa and the Republic of Sakha signed a cooperation agreement for the potential development of the Far Eastern Russian republic's electrical power infrastructure, and exploring further development of the Srednebotuobinskoye oil and gas field and the Svetlinksaya hydropower plant. The agreement is aimed at exploring reliable energy supply for promising investment projects in the Bodaybo district of the Irkutsk region, including Russia's largest untapped gold deposit.

* Sibanye Gold Ltd. extended the wage deal it reached with the National Union of Mineworkers to all employees at its South African gold operations. Responding to Sibanye's offer, the Association of Mineworkers and Construction Union said the miner has resorted to further "underhanded tactics" to discredit the legal and protected status of its strike, Mining Weekly reported.

* Hudbay Minerals Inc. shareholder Waterton Global Resource Management Inc. withdrew a request for a special meeting with the miner for an advisory resolution. Waterton instead announced its intent to nominate a majority slate of dissident directors.

* Chaarat Gold Holdings Ltd. secured improved terms for the acquisition of Kapan gold mine in Armenia, with Polymetal International PLC agreeing to accept US$10 million of the US$55 million consideration in convertible notes, compared to US$5 million originally. Chaarat also entered into a committed revolving term loan facility agreement with Labro Investments Ltd. for US$15 million and expects its temporary suspension of trading on the London Stock Exchange to be lifted today.

* Explaurum Ltd.'s updated feasibility study for the Tampia gold project in Western Australia outlined a posttax net present value, discounted at 8%, of approximately A$103 million, a 46% internal rate of return, and a 1.25-year payback period. Meanwhile, Explaurum said its board will respond to Ramelius Resources Ltd.'s sweetened takeover offer of 13.4 Australian cents per share in due course.

* Cash-strapped Gabriel Resources Ltd. plans to raise up to US$20 million in a nonbrokered private placement to help fund its international arbitration fight with the Romanian government over the Rosia Montana gold project.

* Reunion Gold Corp. plans to undertake a non-brokered private placement of up to 83,333,333 shares to raise C$15.0 million, for the exploration and development of its gold projects in French Guiana and Guyana, and for general working capital.

* Alamos Gold Inc. slowed down development activities and spending at its Kirazli project in Turkey until its operating license is granted. The company is in discussions with the Department of Energy and Natural Resources over the delay and expects to ramp up major construction and earthworks activities in the spring of 2019, pending receipt of the license.

* North American Palladium Ltd. signed a contract with Redpath Canada Ltd. for the underground development of its Lac des Iles palladium mine in Ontario, which will expand its mining rate from over 6,000 tonnes per day currently to 12,000 tonnes per day.

* The Loei Provincial Court in Thailand ordered gold mine operator Tungkum Ltd. to pay compensation to 149 local families affected by the company's mining activities and to rehabilitate the environment, Thailand's Matichon reported.

* Drilling at the Eastern Gold Zone of Amex Exploration Inc.'s Perron gold-silver project in Quebec returned a high-grade assay of 1.35 meters grading 269.23 g/t gold, from 241.85 meters.

* Refinitiv is projecting a 2.2% year-over-year increase in gold supply in 2018, led by mine production, Mining Weekly reported.

BULK COMMODITIES

* Coal railway workers at Aurizon Holdings Ltd. have postponed parts of a planned strike in Queensland due to cyclone forecasts, Reuters wrote, citing a union official. Aurizon's major railways in the Australian state's Bowen Basin transport coal from mines owned by BHP, Glencore, Anglo American PLC, as well as Peabody Energy Corp. to ports on the east coast. BHP said earlier that it does not expect a significant impact from the strikes, while the others did not or were not available for comment, Reuters added.

* China's crude steel output fell to 77.62 million tonnes in November, the lowest in seven months, due to falling profit margins and production restrictions for the winter due to pollution, Reuters reported citing data from the National Bureau of Statistics. The country produced 66.16 million tonnes in November 2017.

* Worried over not being able to meet pollution reduction targets, authorities in China's Tangshan and Xuzhou cities have ordered mills to further lower output, Reuters reported. The Tangshan city government ordered output cuts of 40% from the previous 30%, while Xuxhou ordered steel mills to completely shut down operations throughout December.

* Canada finalized a plan on Dec. 12 to phase out traditional coal-fired electricity, transition to cleaner energy and cut carbon pollution in a little more than a decade. The nation's goal is to produce 90% of its electricity from nonemitting sources by 2030, cutting carbon pollution by 12.8 million tons, according regulations issued by Environment and Climate Change Canada.

* Andrew Cosgrove, an analyst at Bloomberg Intelligence, said Vale SA's acquisition of technology firm New Steel SA bolstered its case over a possible acquisition of the remaining 50% interest in the Samarco iron ore joint venture in Brazil, held by BHP Group Ltd.

* Steelmaker Evraz PLC, coal miner Kuzbassrazrezugol - Vzryvprom OOO and the investment arm of CJSC Sinara Group are discussing the potential financing of JSC Russian Railways' planned high-speed rail link between Moscow and Kazan, RBC Daily reported, citing two anonymous sources.

* S&P Global Ratings said Chilean miner CAP SA's low leverage metrics and cash flow generation will allow it to absorb losses from a fatal incident at the Guacolda 2 Port in November. The port is used to ship its pellet production, which accounts for half of its mining unit's output.

* Cia. Siderúrgica Nacional forecasts Brazil's apparent flat steel consumption to increase 6% to 13.43 million tonnes in 2019, from 12.67 million tonnes projected in 2018, Fastmarkets MB reported.

* Arianne Phosphate Inc. inked its second off-take deal, for high purity phosphate concentrate from its Lac a Paul project in Quebec.

* China's aluminum output in November rose to 2.82 million tonnes, reflecting a 19.2% increase from its year-ago output and rebounding after three consecutive months of decline, Reuters reported.

* Macarthur Minerals Ltd. revised its production strategy and cost estimates for the Moonshine magnetite and Ularring hematite projects in Western Australia, to align the developments with market conditions, capital markets and regional infrastructure availability.

SPECIALTY

* Mineral Resources Ltd. struck a binding US$1.15 billion asset sale and share subscription agreement with Albemarle Corp. for the sale of a 50% interest in the Wodgina lithium project and the formation of a joint venture.

* BlackRock has reduced its stake in lithium-miner Bacanora Minerals Ltd to less than 5% from the previous 9.96%, as the company has struggled to raise financing for its projects this year, the Financial Times reported.

* Lynas Corp. Ltd. clarified media reports on the cost of exporting water leach purification residue by saying that the estimated costs, which seem to be much lower than the company's own initial assessments, were made on the basis of an analyst's views and report noted that the figures were only a rough estimate.

* JSC National Atomic Co. Kazatomprom completed the acquisition of a 40.05% stake in Energy Asia (B.V.I.) Limited, leading to increased ownership in the Kharasan and Kharassan-2 uranium projects in Kazakhstan. It also acquired a 16.02% participatory interest in the chartered capital of JV "Khorasan-U" LLP.

* Westwater Resources Inc. filed for arbitration with the International Centre for the Settlement of Investment Disputes against Turkey over the country's seizure of its Temrezli and Şefaatli uranium projects in June.

* Delrey Metals Corp. signed an all-share deal to acquire Western Energy Metals Ltd., giving the company the 2,714-hectare Peneece and the Blackie vanadium properties in British Columbia.

* Firestone Diamonds PLC recovered a 46-carat white diamond from its Liqhobong mine in Lesotho.

* Galan Lithium Ltd. secured approval from authorities in Argentina to undertake a maiden drill program at the Candelas lithium brine project, which is expected to start in early January 2019.

* Zimbabwean Mining Minister Winston Chitando said that De Beers SA and Vast Resources PLC will be permitted to explore for diamonds in the country, which will make them the first listed companies to mine in that sector for two years, Reuters reported. De Beers said that it was not mining in Zimbabwe and had no intentions, while Vast did not provide comments, the newswire added.

INDUSTRY NEWS

* November did not see a lot of movement in consensus metals price expectations month over month as the year draws to a close. Yet, looking forward to 2019, expectations for nearly all metals are for a meaningful price recovery from the depressed price levels seen in the second half, according to the Metals and Mining Research team at S&P Global Market Intelligence.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings, a separately managed division of S&P Global. Descriptions in this news article were not prepared by S&P Global Ratings.

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