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In This List

Glencore to buy Rio Tinto's Hail Creek, Valeria coal mines for US$1.7B

Essential Metals & Mining Insights - August 2020

State of the Market: Mining Q2-2020

Report Outlooks of Lithium and Cobalt

Essential Metals & Mining Insights July 2020


Glencore to buy Rio Tinto's Hail Creek, Valeria coal mines for US$1.7B

TOP NEWS

Glencore to buy Rio Tinto's Hail Creek, Valeria coal mines for US$1.7B

Glencore PLC agreed to acquire Rio Tinto's 82% stake in the Hail Creek coal mine and a 71.2% stake in the Valeria coal project, both in Queensland, Australia, for US$1.7 billion in cash. Subject to regulatory approvals, the deal is expected to close in the second half. Rio Tinto said a separate process is underway to sell its remaining Australian coal assets, including the Kestrel mine in Queensland.

SEC recommends denying Rio Tinto motion to dismiss Mozambique fraud charges

The SEC said the District Court in Manhattan should deny Rio Tinto and two of its former executives' motion to dismiss fraud charges filed against them related to coal assets in Mozambique, Reuters reported. According to the SEC, the defendants "violated multiple provisions of the federal securities laws by engaging in a prolonged fraudulent course of conduct."

Cleveland-Cliffs' Koolyanobbing iron ore mine closure risks job cuts

Cleveland-Cliffs Inc. plans to shut down its Koolyanobbing iron ore mine in Western Australia by the end of June, The West Australian reported. Earlier this year, the U.S.-based miner hinted that it would close the operation by the end of 2018 due to profit decline resulting from increasing discounts from Chinese buyers for its lower-grade iron ore. Cleveland-Cliffs told its port and rail contractors of its plan to shut down the mine, a move that could affect hundreds of jobs.

DIVERSIFIED

* Using some of its excess liquidity, Rio Tinto launched a new debt reduction program comprising a bond purchase and redemption plan of up to US$2.25 billion. The mining giant's CEO, Jean-Sébastien Jacques, said lower corporate taxes in Australia are needed "sooner rather than later," noting that the country's tax rates are already the second-highest in the developed world, The Australian reported.

* South Africa's state-owned Central Energy Fund applied to nullify 2015 deals for the sale of crude oil to Taleveras Group and joint ventures led by Vitol Group and Glencore PLC, Bloomberg News reported. The deals involve the sale of 10 million barrels of oil reserves when prices were at an eight-year low.

BASE METALS

* Rio Tinto is considering a US$1 billion investment in Mongolia to build a 450-MW coal-fired power plant for its Oyu Tolgoi copper-gold mine, The Australian reported. The company will make a construction decision for the power plant in 2019, said Jeff Tygesen, CEO of Turquoise Hill Resources Ltd., which owns 66% of Oyu Tolgoi and in which Rio Tinto owns a 51% stake. Rio Tinto started seeking a new power plan for Oyu Tolgoi after the Mongolian government canceled a power-sector cooperation with the mining giant in February.

* Switzerland's Swiss Federal Tribunal upheld a decision to seize US$1.9 million in Swiss bank accounts as part of an ongoing corruption probe tied to former Mongolian Finance Minister Bayartsogt Sangajav, Reuters reported. The seized accounts were allegedly used to transfer about US$10 million to the former minister, who was instrumental in clearing the way for Rio Tinto's Oyu Tolgoi copper-gold operation in Mongolia.

* Zambia upgraded its copper production estimate for 2017 to 800,000 tonnes, from the 786,731 tonnes announced last month, after including output from small-scale producers, Reuters reported, citing Ministry of Mines Permanent Secretary Paul Chanda.

* The independent directors of Finders Resources Ltd. urged shareholders to accept the takeover offer from Eastern Field Developments Ltd. after the latter successfully took control of Finders with a 60.22% stake. Finders has been rejecting the offer since it was announced in October 2017.

* PolarX Ltd. estimated a maiden JORC-compliant inferred resource for the Zackly copper-gold deposit in Alaska, part of its Alaska Range project, of 3.4 million tonnes grading 1.2% copper, 2.0 g/t gold and 14.0 g/t silver from surface.

* Cobalt 27 Capital Corp. Executive Chairman Anthony Milewski said the most pressing issue for electric vehicle manufacturers is securing supplies of battery minerals, including cobalt, Mining Weekly reported.

* Canadian Metals Inc. signed a definitive option agreement to acquire the TV Tower, Mountain Brook and Blackshale SedEx zinc properties in New Brunswick. The properties comprise 355 claim units covering 7,762 hectares.

* Capstone Mining Corp. said an electrical technician at its Cozamin copper mine in Mexico was fatally injured while working on an underground voltage regulator. Operations at the mine resumed after a temporary halt, with the exception of the immediate area of the accident.

PRECIOUS METALS

* PJSC Polyus CEO Pavel Grachev said the company is developing markets for a mining byproduct that can be used for gasoline and hybrid car batteries and is planning to sell shares on the market and raise gold production, Bloomberg News reported. "We are trying to expand output of existing assets as much as possible and at the same time return all free cash flow to our shareholders," Grachev said.

* Power producers Total Eren and AEMP opened Essakane Solar in Burkina Faso, which they said is the world's largest hybrid solar/thermal plant. The plant will supply electricity to IAMGOLD Corp.'s IAMGOLD Essakane SA unit, which operates the Essakane gold mine in the country.

* S&P Global Ratings placed its ratings on Hecla Mining Co., including the B corporate credit rating, on CreditWatch with positive implications following the U.S.-based silver-gold miner's acquisition of Klondex Mines Ltd. for US$462 million.

* Galane Gold Ltd. signed an earn-in agreement that will allow B2Gold Corp. to indirectly acquire up to a 70% stake in a newly incorporated Galane unit that applied for two prospecting licenses covering about 520 square kilometers around the Mupane gold project in Botswana.

* As a proxy war for control of Colorado Resources Ltd. looms, both sides in the battle, which pits an ex-president and CEO against some of his old colleagues, slung allegations of self-interest in managing the company. Among other things, Colorado Resources' existing board alleged that ex-President and CEO Adam Travis worked against the interest of shareholders when he personally consolidated ownership of an exploration property called Gin next to the company's North ROK copper-gold property in British Columbia in 2013.

* Gold Reserve Inc.'s preliminary economic assessment of its 45%-owned Siembra Minera gold-copper project in Venezuela pegged a posttax net present value, discounted at 10%, of US$3.93 billion, a 31.1% internal rate of return and a 4.1-year capital payback.

* Classic Minerals Ltd. signed a nonbinding memorandum of understanding with Tianye SXO Gold Mining Pty. Ltd. for the treatment of ore extracted from the Forrestania gold project in Western Australia.

* Red 5 Ltd. expects full processing operations at its Darlot gold mine in Western Australia to resume toward the end of the week, following reduced production rates while issues with the first mill of the project were being fixed.

* Katoro Gold PLC suspended feasibility work on the Imweru gold project in Tanzania until it reaches a final decision on the economic viability and further development of the property. The announcement saw its shares fall over 20% in early morning London trade.

BULK COMMODITIES

* Japanese Trade Minister Hiroshige Seko told a news conference that there is a "high chance" some Japanese steel and aluminum products will be excluded from U.S. tariffs, saying specific items "contribute greatly to U.S. industries and many of them have little substitute," Reuters reported.

* EU Trade Commissioner Cecilia Malmstrom will make her defense in the U.S. that European producers should be exempted from steel and aluminum tariffs imposed by the Trump administration, adding that the EU is willing to cooperate to counter steel overproduction by China, the Financial Times reported.

* Japanese aluminum buyers agreed to pay 25% higher premiums for metal deliveries in the second quarter, at US$129/tonne, compared to premiums paid in the first quarter. Sources directly involved in the pricing talks told Reuters that the agreed price is the highest in three years.

* Metinvest BV's net profit in 2017 increased by more than five times on a yearly basis to US$617 million, driven primarily by higher revenues and lower impairments.

* China is expected to close more mines as its supply-side reform moves to the next phase and it targets eliminating more zombie companies, Zhu Baoliang, chief economist and director of economic forecasting at China's State Information Center, told delegates at the Credit Suisse Asian Investment Conference in Hong Kong.

* New Hope Corp. Ltd.'s net profit in the first half of its fiscal 2018 spiked 111% to a record A$115.6 million from a net profit before nonregular items of A$54.9 million in the same period in the prior year.

* IRC Ltd. is expecting to swing to profit for the year ended Dec. 31, 2017, due to an increase in revenue of more than fivefold to approximately US$110 million.

* China's raw coal production edged up 3.3% year over year to 3.52 billion tonnes in 2017 due to increasing demand and high-quality capacity, Xinhua News Agency reported, citing the National Bureau of Statistics. The increase was the first since 2014, after output hit a six-year low in 2016, the report said.

* Looking to return to the ASX, Jupiter Mines Ltd. is targeting A$240 million, higher than the originally expected amount of between A$150 million and A$200 million. The company, which holds a 49.9% stake in the Tshipi manganese mine in South Africa, lodged a prospectus with the Australian Securities and Investments Commission.

* Verdant Minerals Ltd. signed a nonbinding memorandum of understanding with Wilson International Trading Ltd. for the off-take of up to 350,000 tonnes per year of phosphate rock concentrate or other phosphate products from its Ammaroo phosphate project in Australia's Northern Territory.

SPECIALTY

* The Australian Tax Office is reviewing the pricing of related-party sales to Chengdu Tianqi Industry Group Co. Ltd. and its partner Albemarle Corp. of lithium product from the Greenbushes mine in Western Australia in 2015 and 2016, which could result in them paying more tax for those years. Tianqi Lithium Australia Pty. Ltd. general manager Phil Thick said that even a negative outcome from the Australian Tax Office would not impact his company's construction in Kwinana, south of Perth. "That has no impact on our project at all."

* Alabama Graphite Corp. received final approval from the Supreme Court of British Columbia for its acquisition by a Westwater Resources Inc. subsidiary.

* Vimy Resources Ltd. estimated a maiden inferred resource at its Angularli deposit, part of the Alligator River project in Australia's Northern territory, of 25.9 million pounds of U3O8 contained in 910,000 tonnes at 1.3% U3O8 at a 0.15% cutoff grade.

INDUSTRY NEWS

* S&P Global Market Intelligence's Pipeline Activity Index recovered ground for a second consecutive month in February, rising to 96 from 92 as increases in initial resources and significant financings were tempered by a drop in drilling activity and project milestones.

* French tire maker Michelin is looking to acquire British engineering company Fenner for £1.2 billion to "accelerate its growth in this (high-technology materials) area, and to strengthen its position as a key player in the recovering mining markets," Reuters reported, citing Michelin CEO Jean-Dominique Senard.

* Zimbabwe introduced changes to a law to limit majority ownership by state entities to only diamond and platinum mines, Reuters reported. The law, introduced during former President Robert Mugabe's term, aimed to increase black ownership in the mining sector.

* According to South Africa's Solidarity trade union, in-principle agreements have been reached about certain changes to the third iteration of the mining charter during discussions between the government and the mining industry over the weekend, Mining Weekly reported.

* Mining companies in the Democratic Republic of the Congo are unlikely to secure substantial concessions in discussions with authorities over changes to the mining code, Bloomberg News reported, citing Albert Yuma, chairman of state-miner Gecamines SA. "There can be no renegotiation on any point once the code has been promulgated," Yuma said.

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