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Ongoing Alcoa strike may extend beyond 4 weeks

Greenhouse gas and gold mines Nearly 1 ton of CO2 emitted per ounce of gold produced in 2019

Essential Metals & Mining Insights - September 2020

Essential Metals & Mining Insights - August 2020

State of the Market: Mining Q2-2020


Ongoing Alcoa strike may extend beyond 4 weeks

TOP NEWS

Ongoing Alcoa strike may extend beyond 4 weeks

The ongoing strike by Alcoa Corp. workers at three of its alumina refineries and two bauxite mines in Western Australia may be extended further following a vote by striking workers on Sept. 6, Reuters reported. The union expects most workers to vote in favor of the strike, which started Aug. 8. Meanwhile, an Alcoa spokeswoman said the company had contingency plans to continue running its operations during the strike. The refineries produce about 9.3 million tonnes, or about 8% of the world's alumina output.

Former Rio Tinto execs to be grilled in Australia over Mozambique fraud case

Three former Rio Tinto executives will be grilled under oath in Australia by the U.S. Securities and Exchange Commission about fraud charges against former CEO Thomas Albanese and former CFO Guy Elliott, who are both accused of inflating the value of the company's coal assets acquired in Mozambique for US$3.7 billion, The Australian reported. Former Rio board audit committee member Mike Fitzpatrick, ex-Rio coal chief Doug Ritchie and former Rio coal chief development officer Matt Coulter are scheduled for depositions between January and March.

Evolution expects decline in gold output for next 3 years amid cost focus

Evolution Mining Ltd. said it expects to produce between 720,000 and 770,000 ounces of gold per year in its 2019 and 2020 fiscal years, and between 700,000 and 750,000 ounces in 2021, as the company focuses on margins over production growth. Production in fiscal 2018 totaled 780,000 ounces at all-in sustaining costs of A$797 per ounce. AISC for 2019 and 2020 are estimated at between A$850/oz and A$900/oz, with an increase to between A$870/oz and A$920/oz for 2021. Capital expenditure is anticipated to remain elevated in 2019 due to investment in major projects at Cowal, the company noted, before declining from 2020 onward.

BASE METALS

* Chilean state-owned copper miner Codelco stopped operations at three out of four furnaces at its Ventanas foundry on Sept. 3 after sensing high levels of sulfur dioxide, Reuters reported. The levels of the gas rose to 20% over the accepted limit for five minutes, due to which the furnaces were shut down as a "voluntary and preventative measure."

* Nickel Mines Ltd. increased its stake in Hengjaya Holdings Private Ltd. by 35% for US$70 million to increase its interest in the two-line rotary kiln electric furnace plant currently under construction within the Indonesia Morowali Industrial Park to 60%.

* Minotaur Exploration Ltd. and OZ Minerals Ltd. expanded the scope of drilling at its Eloise copper joint venture in Queensland, Australia, to include similarly defined nearby electromagnetic targets.

* Mineral exploration expenditures in Australia surged 28.4% year on year in the June quarter to A$563.4 million, mainly driven by a 38.1% increase in expenditures on selected base metals, according to data from the Australian Bureau of Statistics.

* Altus Strategies PLC signed a letter of intent with ASX-hopeful Raptor Resources Ltd., granting the latter an option to acquire Aterian Resources Ltd. subsidiary Atlantic Resources Ltd., which is advancing four copper and base metal projects in Morocco.

PRECIOUS METALS

* Lonmin PLC's largest shareholder Public Investment Corp. which owns a 29.2% stake in the struggling miner, will support a takeover by Sibanye Gold Ltd., Reuters reported. Public Investment, which is also the second-largest shareholder in Sibanye with an 11.2% interest, said the deal "will assist in driving consolidation in an ailing sector."

* Separately, Sibanye launched a US$400 million tender offer to buy back bonds to slash its outstanding debt and reduce annual interest costs by about US$26 million. The company will fund the repurchase from existing cash resources, including the US$500 million advance proceeds of a recent streaming deal.

* Endeavour Mining Corp. agreed to sell its 80% interest in the Tabakoto gold mine in Mali to BCM Investments Ltd. subsidiary Algom Resources Ltd. for US$60 million in cash. The deal is expected to close in the fourth quarter this year. "Tabakoto has been sold following a comprehensive review which determined that the capital investments required to reduce its AISC did not meet our capital allocation criteria," Endeavour President and CEO Sébastien de Montessus said.

* Kin Mining NL has revealed the reasons for its successive upheavals and outlined a new operating strategy for its Leonora gold project in Western Australia as it works on an optimized definitive feasibility study ahead of a resource upgrade expected in the next fortnight. At Kin's general meeting in Perth, Australia, Managing Director Andrew Munckton said that the Cardinia plant was suspended due to cost over-runs, the mining plan focused on near-surface oxide ores as the deposits were not drilled to depth, power and water supply was uncertain and high risk, and mining approvals were not secured.

* The Constitutional Court of Guatemala reversed a Supreme Court decision to reinstate the mining license for the Escobal silver mine, held by Tahoe Resources Inc. unit Minera San Rafael SA.

* Metallon Corp. Ltd. gave a three-month notice for dismissal to hundreds of workers at the Mazowe mine in Zimbabwe after it was placed on care and maintenance, the African News Agency reported.

* ECR Minerals PLC's shares rose by as much as 21% to 1.02 British pence after announcing that its Blue Moon gold project in Victoria, Australia, has potential for a significant gold discovery with deeper drilling. In addition, the company identified two new gold prospective targets named Red Moon and Yellow Moon.

* KEFI Minerals Plc received approval from the Ethiopian central bank for the banking arrangements for the Tulu Kapi gold project.

BULK COMMODITIES

* Ahead of its planned listing in November on the ASX, Coronado Coal LLC was valued at between US$2.5 billion and US$3.1 billion by Credit Suisse, The Australian reported. Analysts at Goldman Sachs, meanwhile, valued Coronado at between US$2.1 billion and US$2.8 billion. Goldman forecast that the coal miner will report EBITDA of US$659 million and free cash flow of US$377 million in 2019.

* Jindal Steel & Power Ltd. is considering restructuring its business to cut its 420 billion Indian rupee debt, Bloomberg News reported, citing Chairman Naveen Jindal. The plan, which would require board and regulatory approval, would involve splitting its steel, power and international businesses into three stand-alone entities. The steel unit would include the coal mines, while the foreign business would hold the Oman steel plant.

* Binzhou in China's Shandong province is planning to support development of a high-end aluminum industry with five new projects, including a 10,000-tonne-per-year aluminum alloy plant, Reuters reported, citing a local government document. The plant will be built by Huachuang Metal, while an additional aluminum alloy project, focused on the automotive and aerospace industries, will be developed by Hangqiao Technology. A third plant for making aluminum formwork will be built by Yangxin Taihe New Material, and a fourth project will have the annual capacity to produce up to 1.88 million tonnes of carbon materials.

* Buffalo Coal Corp. is kicking off a restructuring process at its Magdalena coal operations in South Africa after the mining contractor, STA Coal Mining Co. Pty. Ltd., said it will not renew the mining services agreement. The company said given its current financial position, it may have to retrench workers and shutter the mine if no feasible alternatives are found. A consultation process has commenced in South Africa with organized labor and relevant stakeholders.

* Glencore PLC is said to remain focused on its thermal coal operations, especially as prices for the commodity reached US$115 per tonne, a yearly increase of 21%, Miningmx reported.

* Coal India Ltd.'s output grew 12% in the first five months of its fiscal year after producing 216.2 million tonnes of coal in the period, The Hindu reported. The improvement mostly came from its subsidiaries, namely Eastern Coalfields Ltd., Northern Coalfields Ltd., South Eastern Coalfields Ltd. and North Eastern Coalfields.

* Canyon Coal (Pty) Ltd.'s investment in new mines over the next four years will double the 1.5 billion South African rand it has invested in South Africa to build capacity of about 10 million tonnes per year, Miningmx reported.

* India's exports of steel items to the U.S., affected by the latter's sanctions on the metal, dropped 42% in the June quarter, Mint reported. Overall, the country's steel exports to the U.S. fell 5.7% to US$468 million during the period, while aluminum exports rose 54% to US$181 million.

* Lanebrook Ltd. distributed all of its 62.74% shareholding in Evraz PLC to its direct shareholders on a pro rata basis. Crosland Global Ltd. now holds a direct interest in 31.37% of the total voting rights, and Greenleas International Holdings Ltd. holds 30.52%. The distribution will not change the indirect economic interest in EVRAZ held by Alexander Abramov, Alexander Frolov, Roman Abramovich and Eugene Shvidler, according to the release.

* Kalium Lakes Ltd. recorded a 150% increase in measured and indicated resources at the Beyondie sulfate of potash project in Western Australia. Measured resources stood at 1.7 million tonnes grading 11,488 milligrams per liter of sulfate of potash, while indicated resources were at 9.2 million tonnes grading 12,459 milligrams per liter of sulfate of potash.

* GMR Infrastructure Ltd. divested to PT Golden Energy Mines Tbk. its stake in four Indonesian coal mining firms, namely PTBSL Group entities PT Barasentosa Lestari, PT Duta Sarana Internusa, PT Dwikarya Sejati Utama and PT UNSOCO, through its step down companies, Press Trust of India reported.

* The U.S. included 19 Indonesian steel products, including carbon and alloy and stainless steels, from its list of commodities exempted from 25% import tariffs, The Jakarta Post reported.

* JSW Steel Ltd. plans to expand the production capacity of its Vijayanagar plant in India's Karnataka to 18 million tonnes per year, Press Trust of India reported. The facility has a current capacity of 12 Mt/y. The company in June revealed plans to invest 75 billion Indian rupees to boost the capacity to 13 Mt/y by March 2020.

SPECIALTY

* The lab-grown diamonds industry filed a complaint against Anglo American PLC unit De Beers SA with the U.S. Federal Trade Commission, accusing the latter of dumping its lab-grown stones at below cost pricing, Bloomberg News reported. Chatham Created Gems Inc. CEO Tom Chatham, who filed the complaint, said the equipment to grow diamonds is "not cheap." De Beers plans to sell the synthetic diamonds at about US$800 per carat, which is about 10% of the price of a natural diamond or 20% of the price of current lab-made diamonds.

* Meanwhile, De Beers will allow diamond buyers to reject some lower-quality stones at its sale this week amid a weak low-end diamond market, Bloomberg News reported, citing unnamed sources. The diamond miner, known for requiring buyers to take what is offered, also made the move in 2016, when India's ban on high-value currency notes crippled demand.

* Liontown Resources Ltd. reported a maiden resource estimate for the Kathleen's Corner and Mount Mann deposits at its wholly owned Kathleen Valley lithium-tantalum project in Western Australia of 21.2 million tonnes at 1.4% lithium oxide and 170 parts per million tantalum pentoxide in the measured, indicated and inferred categories, at a 0.5% lithium oxide cut-off.

* Syrah Resources Ltd. intends to raise A$94 million through an institutional placement to complete the ramp-up of the Balama graphite operation in Mozambique through to positive cash flow.

* Volt Resources Ltd.'s unit Volt Graphite Tanzania Ltd. received the Environmental Impact Assessment Certificate for its Bunyu graphite project from the National Environment Management Council of Tanzania.

* Talga Resources Ltd. inked a deal with Biomer Technology Ltd. for the joint development of graphene-enhanced thermoplastics for potential commercialization in the healthcare and coating markets.

* Work to complete an updated preliminary feasibility study for European Metals Holdings Ltd.'s Cinovec lithium-tin project in the Czech Republic has started. The study, which will model the production of higher value lithium hydroxide, will be finalized over the coming two months.

* BlueRock Diamonds PLC started kimberlite processing from KV1, the second kimberlite pipe in the Kareevlei diamond mine in South Africa.

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