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Chile's Codelco eyes US$1B debt issue in 2019 to overhaul mines

TOP NEWS

Chile's Codelco plans up to US$1B debt issue in 2019 to fund overhaul of mines

Chilean state miner Codelco plans to raise up to US$1 billion in 2019 to help finance the planned overhaul of its existing mines, including the El Teniente and Chuquicamata mines, Reuters reported, citing Chairman Juan Benavides. The company also outlined its exploration plans in Ecuador and Brazil and an agreement to collaborate in Kazakhstan but ruled out advancing exploration in Mongolia.

BHP targeting plant restart at Olympic Dam copper mine in October

BHP Billiton Group is aiming to restart a plant at its Olympic Dam copper-uranium mine in South Australia in October following repairs, Reuters reported. Mike Henry, BHP's president of operations for minerals Australia, said the company identified "a very credible route to growing the asset" and will seek board approval for "bite-sized chunks of capital [expenditure] with healthy returns." Meanwhile, commenting on BHP's Samarco iron ore joint venture in Brazil, Henry said the company is not on the cusp of a restart, and several steps need to be taken first.

Mototolo sale approval brings Glencore closer to exiting platinum

The South African Competition Commission approved Glencore PLC's plan to sell its stake in the Mototolo mine and chrome plant in South Africa to project partner Anglo American Platinum Ltd., Business Day reported. Mototolo is Glencore's last platinum asset, and it will exit the platinum sector once the deal closes.

DIVERSIFIED

* Based on a survey by UBS analysts, BHP's institutional shareholders favored a share buyback program to reap the gains from a US$10 billion sale of the mining giant's U.S. shale assets, The Australian Financial Review's Street Talk reported.

* PIRC, a proxy voting adviser, recommended that BHP shareholders oppose the company's remuneration report at its upcoming Oct. 17 annual general meeting, Reuters reported.

* Former Sky PLC deputy Chairman Martin Gilbert resumed his position as senior independent director of Glencore PLC, effective immediately.

BASE METALS

* Capstone Mining Corp. reported total copper production of 21,400 tonnes for the third quarter; 14,200 tonnes came from the Pinto Valley mine in Arizona.

* A restart study for Superior Lake Resources Ltd.'s namesake zinc project in Ontario pegged a posttax net present value, discounted at 10%, of US$118.9 million, a 48% internal rate of return and a 6.5-year mine life.

* Venturex Resources Ltd.'s definitive feasibility study for the Sulphur Springs copper-zinc project in Western Australia outlined a pretax net present value, discounted at 8%, of A$472 million and an internal rate of return of 51%.

* Codelco and Chile's Office of the Comptroller General asked for a 90-day suspension of the state miner's legal claim in a Chilean court in order to work out an out-of-court agreement to end an ongoing dispute over how the state miner should be supervised, La Tercera reported. The conflict began in May when the Comptroller General questioned how Codelco grants project contracts.

* Codelco's copper supplies for 2019 are almost sold out, well ahead of schedule, due to strong demand for the commodity, Bloomberg News reported, citing Chairman Juan Benavides.

* A scoping study for Rox Resources Ltd.'s Fisher East nickel project in Western Australia estimated a pretax net present value, discounted at 10%, of approximately A$79 million and an internal rate of return of about 44% under a concentrator case.

* Eurasian Resources Group SARL is aiming to ramp up cobalt output with the launch of its Metalkol facility in the Democratic Republic of the Congo as it anticipates an increase in demand for the metal by the automotive industry, Reuters reported, citing CEO Benedikt Sobotka. The company plans to boost cobalt output by fivefold to 20,000 tonnes in 2019.

* Doe Run Peru Srl's creditors agreed to begin a direct sale of the La Oroya metallurgical complex and the Cobriza copper mine for US$139 million to an interested buyer up to the end of November, Semana Económica reported. The creditors will conduct another auction process for the assets in April 2019 should they fail to find a buyer.

* Oroco Resource Corp. struck a deal with Altamura Copper Corp. for the exclusive option to acquire the remaining shares of Altamura to indirectly gain additional interest in the Santo Tomas copper concessions in Mexico. The company owns about 13% of Altamura.

* Pacifico Minerals Ltd. closed the acquisition of a 75% stake in the Sorby Hills lead-silver-zinc project in Western Australia from Quintana MH Holding Co. LLC.

* Artemis Resources Ltd. said sulfide resources at the Whundo copper mine in Western Australia rose 30% to 30,266 tonnes of copper and 30,289 tonnes of zinc contained in 2.6 million tonnes grading 1.14% copper and 1.14% zinc.

* Jangada Mines PLC identified significant nickel-copper sulfide anomalies beneath the existing platinum group metals mineralization at its Pedra Branca project in Brazil.

* Cobalt 27 Capital Corp. is now trading on the OTCQX Best Market under the symbol CBLLF.

PRECIOUS METALS

* Cia. de Minas Buenaventura SAA's third-quarter gold production fell to 290,159 ounces, from just under 400,000 ounces a year ago, while silver production saw a small jump to about 6.8 million ounces, from about 6.7 million ounces in the third quarter of 2017. Zinc production rose to 19,248 tonnes from 17,713 tonnes, and copper production rose to 12,483 tonnes from 11,531 tonnes year over year.

* Barrick Gold Corp. will seek shareholder approval at a special meeting Nov. 5 for its proposed merger with Randgold Resources Ltd.

* Sierra Metals Inc. reported a 44% yearly rise in silver production to about 700,000 ounces for the third quarter, while copper output rose 24% to 8.6 million pounds.

* Coeur Mining Inc.'s silver equivalent production in the third quarter dipped slightly to 8.5 million ounces from 8.6 million ounces a year earlier as the temporary suspension of its Palmarejo silver mine in Mexico pulled down output for the period.

* Kirkland Lake Gold Ltd. reported record-high gold production for the third quarter, increasing 30% year on year to 180,155 ounces.

* South Africa's competition tribunal scheduled a hearing for Oct. 18-19 on the proposed merger between Sibanye Gold Ltd. and Lonmin PLC.

* Torian Resources Ltd. acquired the Wombola tenement, which surrounds its Kalgoorlie East gold project in Western Australia, for A$10,000 cash.

* An updated resource estimate for Polymetal International PLC's Prognoz silver project in Russia totaled 256 million ounces of silver equivalent grading 789 g/t in the indicated and inferred categories.

* Zimbabwe-based RioZim Ltd. plans to sue the country's central bank to force it to pay the company in U.S. dollars for part of its output, Reuters reported. The miner operates three gold mines and a nickel refinery and holds a minority stake in the Rio Tinto-run Murowa Diamonds Pvt. Ltd. The Zimbabwean mines minister said the U.S. dollar shortage, which is causing problems for mining companies operating in the country, is a "short-term" problem that will be resolved by economic growth, Reuters reported.

* Metals Exploration PLC said processing operations at the Runruno gold-molybdenum mine in the Philippines will run at 80% of design capacity in October and November due to technical issues.

* Burundi started operations at African Mining Burundi Ltd., a local gold miner in which the state holds a 15% stake, Bloomberg News reported. The company was granted rights to nine mining sites.

* Benchmark Metals Inc. discovered a new zone of mineralization at the Lawyers gold-silver project in British Columbia. Grab sampling returned assays of up to 3.61 g/t gold and up to 138 g/t silver.

* Avesoro Resources Inc. discovered two mineralized vein systems located 1.5 kilometers east of its Youga gold mine in Burkina Faso.

BULK COMMODITIES

* Norsk Hydro ASA plans to return to full output at the Alunorte alumina refinery in Brazil, Reuters reported, citing CEO Svein Richard Brandtzaeg, who said the company is not considering any layoffs at the refinery. "We believe the embargo will be lifted and then we need all our people."

* Australia rejected a call by a group of 91 scientists to phase out coal use by 2050, saying that to comply with the recommendation is "irresponsible," the Financial Times reported.

* In September, Australia's Port Hedland shipped about 37.4 million tonnes of iron ore to China, rising 5.3% from shipments in August, Reuters reported. According to the Pilbara Ports Authority, total shipments from the port to China were about 43.5 million tonnes, up from 42.4 million tonnes in August.

* Westmoreland Coal Co. filed for bankruptcy protection with an agreement to sell its mining business to a group of lenders in a transaction intended to reduce its debt.

* Universal Coal PLC's EBITDA forecast for its fiscal 2019 is pegged at A$93 million, representing a 29% increase from the previous year. The Australia-listed producer also projects a 28% increase in sales tonnage to 6 million tonnes per annum.

* Nine employees were killed and 14 others injured when a fire broke out in a gas pipeline at Steel Authority of India Ltd.'s Bhilai steel plant in the Indian state of Chhattisgarh. In the wake of the incident, SAIL removed the plant's head and suspended two senior officials, the Press Trust of India reported.

* Evraz PLC began a US$60 million expansion project for its Nizhny Tagil iron and steelworks plant, scheduled to be launched in 2021, with options to build a second plant at the site, Vedomosti reported, citing Ilya Shirokobrod, vice president for sales and logistics.

* Bolivia inaugurated a US$188 million potash plant with a capacity of 350,000 tonnes per annum on the Salar de Uyuni, which is viewed as the next step to begin lithium production, Mining Journal reported.

* Resources at Highfield Resources Ltd.'s Muga potash project in Spain increased to 234.8 million tonnes grading 12.28% potassium oxide in the combined measured and indicated categories.

* MaxTech Ventures Inc. signed a joint venture agreement to explore various manganese, vanadium and other strategic mineral mining claims in Brazil with Daniel Geyerhahn Garcia of Goldmen Resources Brazil and his partners.

* Peabody Energy Corp. declared force majeure on its North Goonyella coking coal operation Oct. 9 due to elevated gas levels at the mine site, market sources told S&P Global Platts.

* Chinese aluminum exports are seen rising in the coming months and in 2019 as the country boosted tax rebates as part of a package to reduce the impact of a trade dispute with the U.S., Reuters reported, citing industry consultancy CRU.

* Altech Chemicals Ltd. is close to securing funds for its Johor Bahru high-purity alumina project in Malaysia. Due diligence on the proposed debt facility is expected to be completed by the end of November, The West Australian reported.

* Fertoz Ltd. secured a 100,000-tonne stockpile of phosphate rock located near its Butte, Mont., operations.

SPECIALTY

* Wolf Minerals Ltd. said its board decided to appoint administrators after talks with creditors failed. On Oct. 9, the company said it would run out of working capital within two days if it does not successfully conclude ongoing funding talks. Trading of its London-listed shares was suspended earlier Oct. 10.

* MGX Minerals Inc. secured a definitive option deal to acquire a 50% stake in Chilean Lithium Salars SpA, after signing a memorandum of understanding in early August. Chilean Lithium Salars holds a 100% interest in three lithium-prospective projects in Chile.

* Mezzotin Minerals Inc. completed the sale of the Sabi Star rare earth property in Zimbabwe to a local subsidiary of Hong-Kong-based private investor Max Mind Investment Ltd. for US$125,000.

* Oroplata Resources Inc. unit LithiumOre Corp., a lithium resource exploration and development company, established a battery metals extraction division.

* Australian Abrasive Minerals aims to restart its Harts Range garnet mine in Australia's Northern Territory by early 2019, ABC reported. The company, which went into administration in 2017, said it is now financed by Australian investors.

INDUSTRY NEWS

* Fitch Ratings said maintaining low-cost positions is critical for small to midsize miners to continue long-term profitability and competitiveness and for sustaining reasonable levels of cash flow generation. According to a special report, peak free cash flow generation for the current cycle is expected this year, while aggregate free cash flow is expected to remain positive into 2020.

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