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In This List

First Quantum denies receiving takeover interest; Barrick selling Massawa stake

COVID19 Mining Impacts Mining Projects With At Risk Production

Mining Insights Newsletter June 2020

A Decade of Underperformance for Gold Discoveries

State of the Market: Mining Q1-2020


First Quantum denies receiving takeover interest; Barrick selling Massawa stake

TOP NEWS

First Quantum denies receiving takeover interest from Jiangxi Copper, Rio Tinto

First Quantum Minerals Ltd. denied that it has received takeover interest from Jiangxi Copper Co. Ltd., Rio Tinto, or from any party since September, when it previously refuted similar speculations, Bloomberg News reported. First Quantum President Clive Newall said the company has been in year-long talks with Jiangxi for the sale of a minority stake in its Zambian operations, but a deal has not been finalized. As part of the negotiations, Jiangxi signed a nondisclosure agreement blocking it from purchasing an over 20% interest in First Quantum, Newall noted.

Barrick selling Massawa gold project to Teranga for up to US$430M

As it continues to divest noncore assets, Barrick Gold Corp. and its Senegalese partner are selling their combined 90% stake in the Massawa gold project in Senegal to Teranga Gold Corp. for up to US$430 million. Teranga will pay about US$300 million in cash, US$80 million in shares and up to US$50 million in gold price-linked payments due three years after closing.

Anglo American expects up to 25% growth in annual copper equivalent output by 2023

Global mining company Anglo American PLC expects 2019 copper equivalent output to be 1% to 2% higher on a yearly basis, it said in a presentation to investors. The company expects annual copper equivalent production to grow 20% to 25% by 2023 as it brings a number of projects online during the next three years. The company raised its medium-term production guidance for copper, platinum and palladium, while cutting output targets for diamonds, iron ore and metallurgical coal relative to 2018 figures.

BASE METALS

* Indonesia is set to double royalties on nickel ore sales to 10%, while also adjusting the rates for other minerals such as copper, bauxite, and aluminum, Reuters reported. Copper ore royalty was increased to 5%, while copper concentrate royalty was set at 4%. Bauxite royalty was doubled to 7%, while aluminum royalty was cut to 2%. The regulations also include a 5% royalty on nickel pig iron sales.

* Nickel-focused Mincor Resources NL received key approvals from the Western Australian government to restart the Cassini nickel project, part of its South Kambalda property.

* Horseshoe Metals Ltd. signed definitive agreements to acquire the Mount Gunson copper and Glenloth gold projects in South Australia.

PRECIOUS METALS

* Ora Gold Ltd.'s scoping study for its Crown Prince gold deposit in Western Australia expects the project to produce 22,444 ounces and generate about A$21.1 million net operating surplus, including royalty payments. Pre-development activities are estimated to cost A$1.4 million, including 30% contingency and mobilization.

* Patagonia Gold Corp.'s deal to acquire an up to 80% interest in the San Jose gold project in Uruguay from Trilogy Mining Corp., American Mining Holdings Ltd., Ecovent SA and Minerales Cala SA, is now terminated.

* Goldstar Minerals Inc. secured an option to acquire the early stage Anctil and Nemenjiche gold properties in Quebec from Les Ressources Tectonic Inc., with closing expected Feb. 15, 2020. The company can acquire the properties by paying an aggregate C$570,000, spending C$2.2 million on exploration over three years, and granting a 2% net smelter royalty, which can be bought back for C$5 million.

* GBM Resources Ltd. said that there is an opportunity to extend the mine life of the White Dam gold project, which is part of the company's acquisition of Stibium Mining (Proprietary) Ltd. unit Millstream Resources Pty. Ltd.

* Goldrea Resources Corp. is in negotiations to acquire the ground, known as Dixie Lake Baby, adjacent to the TNT Discovery on BTU Metals Corp.'s Dixie Halo gold project in Ontario.

BULK COMMODITIES

* German potash and salt miner K+S AG is mulling the sale of a stake in the Bethune potash project in Saskatchewan, which the company values at nearly €5 billion, Reuters reported, citing an unnamed company spokesman. The company is considering selling stakes in businesses in North America, as ongoing cost-cutting initiatives will not generate enough savings to meet its target of net debt as 2.7x EBITDA by the end of 2020, from the recent level of 4.3x EBITDA. K+S plans to realize synergies of over €150 million per year from the end of 2020 as part of its "Shaping 2030" corporate strategy.

* White House National Economic Council director Larry Kudlow said that the reimposing of steel tariffs on Brazil and Argentina has been discussed but there is no decision yet, despite the president's announcement a week ago that it will be "effective immediately," Bloomberg reported. According to a source who refused to be identified, Brazil plans to wait until it has official notice from the U.S. before it makes any decision.

* Zanaga Iron Ore Co. Ltd. and Glencore PLC's joint venture company Jumelles Ltd. entered a framework agreement with China Overseas Infrastructure Development And Investment Corp. Ltd. for potential cooperation in advancing infrastructure and financing requirements for the Zanaga iron ore project in the Republic of Congo. The priority is to explore the development of iron ore output of about 2 million tonnes per annum at Zanaga.

* Specialist alloy producer Afarak Group PLC has entered talks with employees at two of its South African operations about possible retrenchments, as a result of increased operational expenses caused by public power utility Eskom Holdings SOC Ltd.'s power outages and the deterioration of chrome ore and ferrochrome prices.

* The Western Australia State Solicitors Office asked the High Court to reject Fortescue Metals Group Ltd.'s application for special leave to appeal an unfavorable ruling on a native title case over the company's Solomon Hub iron ore operation, the Australian Financial Review reported. The office said Fortescue's application should be dismissed due to major flaws in the case.

* Thyssenkrupp AG is set to install the first above-ground jaw gyratory crusher in Australia at Hancock Prospecting Pty. Ltd.'s Roy Hill iron mine in Western Australia, International Mining reported.

* Edenville Energy PLC signed two new contracts to supply washed coal from its flagship Rukwa coal project in Tanzania. The company will supply up to 6,000 tonnes and up to 3,000 tonnes, respectively, of washed coal per month to industrial customers in Rwanda and Uganda.

* Due to not receiving offers for the Janina mining plant within the set deadline, TAURON Wytwarzanie SA decided to end the search for a potential investor, Puls Biznesu reported.

* Emmerson PLC could receive incentives from the Moroccan government that could contribute up to 10% of the total expenditure of its Khemisset potash project. The company said that it could receive up to US$40 million from the government in the form of direct subsidies.

* PT Bukit Asam Tbk still has plans to acquire coal mining land in 2020 amid a downward trend in coal prices, Kontan reported. The plan is still pending a cost and benefit analysis.

SPECIALTY

* Russian diamond monopoly PJSC Alrosa's registered a fourth consecutive month of growth in sales of rough diamonds in November, which reached US$282.1 million, after a nadir of US$164.6 million in July. Rough stone sales of the majority state-owned miner rose 11% from US$253.9 million in October and 5.9% from US$266.6 million in November 2018, which could be a sign of diamond market recovery, according to BCS Global Markets analysts.

* The Australian Takeovers Panel ordered a delay of at least 20 days in Energy Resources of Australia Ltd.'s A$476 million renounceable entitlement offer to fund the rehabilitation of the Ranger uranium mine in Australia's Northern Territory, to allow for further disclosure, and that Rio Tinto may not acquire Energy Resources shares without shareholder approval. A dissident shareholder of the Rio Tinto unit filed a petition in November seeking to block the offer, which was expected to close Dec. 11, due to unfair terms for minority shareholders.

* South Africa's Department for Energy and Mining issued an approval to Renascor Resources Ltd. to extract a 60-tonne bulk sample from the company's Siviour graphite project. Ore extracted from the bulk sample will be used in a pilot plant production trial in China.

* The Indonesian government is in talks with Chinese battery companies GEM Co. Ltd. and Contemporary Amperex Technology Co. Ltd. to build lithium battery plants in the Southeast Asian nation, Reuters reported, citing Luhut Pandjaitan, Indonesia's coordinating minister for maritime and investment affairs.

* Lynas Corp. Ltd. is seeking financial and infrastructure support from the Australian government for its proposed A$500 million rare earths processing plant in Kalgoorlie, Western Australia, The West Australian reported.

* Kenmare Resources PLC secured a US$110 million term loan facility and a US$40 million revolving credit facility mainly to repay an existing US$64 million in senior and subordinated project loans obtained for the Moma titanium mine in Mozambique, and for working capital purposes. The facilities will also provide for a future mine closure guarantee facility of up to US$40 million.

INDUSTRY NEWS

* South African miners have been forced to halt operations due to power outages caused by flash floods, Reuters reported. Harmony Gold Mining Co. Ltd. called off underground shifts, while Impala Platinum Holdings Ltd. stopped production at the Rustenberg and Marula platinum mines. Petra Diamonds Ltd., meanwhile, resumed mining operations, but with a 20% load curtailment, in line with Eskom's requirements, following the downgrade of load shedding status to Stage 4 from Stage 6.

* Madagascar is looking to double its royalties on nickel, cobalt, precious metals and gemstones to 4% from 2%, Reuters reported, citing a draft mining law that also proposes for the government to take an at least 20% interest in any marketable mining production. The bill, confirmed by the country's mines minister Fidiniavo Ravokatra, includes a jump in mining royalties for raw precious stones to 8% from 2%, a 6% royalty over rough industrial stones, and a 3% royalty over cut industrial stones.

* House Democrats said they had reached a deal with the Trump administration to advance a revised version of the United States-Mexico-Canada Agreement after months of contentious closed doors meetings and public rhetoric to get the deal passed. Speaking at a news conference, House Speaker Nancy Pelosi, D-Calif., said a revised USMCA would be put up for a vote in the House, though a date has not yet been specified.

* Exploration budgets for Canada have fallen by 9%, or US$134 million, year over year in 2019 to US$1.31 billion, dropping the country to second place behind Australia from first place in 2018, according to the Metals and Mining Research team of S&P Global Market Intelligence. The decrease exceeds the global average decrease of 3% in 2019, and in dollar terms is second only to Mexico, whose allocations have fallen by US$155 million.

* Downer Mining's sale is not expected to be closed until next year, The Australian reported, noting that engagement with bidders is still ongoing. The report mentioned that Chilean conglomerate Sigdo Koppers SA has ditched its possible bid after earlier considering an acquisition of the business.

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