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AMCU threatens to halt ops at Sibanye; Glencore selling Kazakh gold deposit to Polymetal; ThyssenKrupp to acquire Vale's steel plant stake

Industry Top Trends 2021: Metals and Mining

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


AMCU threatens to halt ops at Sibanye; Glencore selling Kazakh gold deposit to Polymetal; ThyssenKrupp to acquire Vale's steel plant stake

TOP NEWS

Unionthreatens strike at Sibanye Gold

SouthAfrica's Association of Mineworkers and Construction Union, or AMCU, has warnedto bring Sibanye GoldLtd. operations to a halt on April 6, to protest against thecompany's three-year wage agreement reached with other unions in October 2015,News24Wire reported, citing AMCU President Joseph Mathunjwa.

entered into a binding agreement with Glencore Plc unit Kazzinc Ltd. for the acquisition of Orion Minerals LLP, which holds theKomarovskoyegold deposit in the Republic of Kazakhstan. The company will pay US$100 millionin cash and Kazzinc will receive a royalty, capped at US$80 million, linked tofuture production from Komarovskoye.

has drafted a planto sell its 26.87%stake in a steel slab plant for US$1 plus the assumption of some debt toventure partner ThyssenKruppAG, Reuters reported, citing a source "close to the deal."The plant is the mostexpensive foreign investment in Brazil and cost nearly US$10 billion to build.

DIVERSIFIED

*Documents released as part of the data leak known as the Panama Papers showthat mining giant BHP BillitonGroup allowed two of its British Virgin Island-based subsidiariesto receive large sums of money, which set off a high risk warning at MossackFonseca, The Guardian reported.According to the report, a BHP Billiton spokeswoman said that the company"does not engage in aggressive tax planning." The diversified minerhas been linked to at least 19 British Virgin Island-registered subsidiarieswith the aid of the Panamanian law firm.

BASE METALS

*For more than a year, the Federation of Copper Workers, or FTC, has been pressingand lobbying with the Lower Chamber of Congress to gather the necessarypolitical support for state-owned Codelco's attempt to acquire control of the copper mine,controlled by Anglo AmericanPlc, FTC president and Codelco board member Raimundo Espinoza tolddaily La Tercera.

*Chilean President Michelle Bachelet, on April 1, ratified Espinoza as therepresentative of union workers in Codelco's board until 2020, daily Diario Financiero reported.

*Japan's Sumitomo Metal Mining Co.Ltd. agreed totransfer all of its shares in Vale Nouvelle Calédonie SAS,amounting to 7.6%, which it holds through SUMIC Nickel Netherlands BV toVale SA unitVale Canada Ltd.

* The government of Indonesia has yet to decide on how muchit will pay for a 10.64% stake in Freeport-McMoRan Inc.'s local unit PT Freeport Indonesiaas the government is still reviewing the US$1.7 billion price offered by thecompany, Tempo reported,citing Director General of Indonesia's Mineral and Coal for Energy and MineralResources Ministry Bambang Gatot. "We are still discussing the price forthe government to make a verdict. We only need to decide on its price,"Bambang added.

* (NorilskNickel) PJSC Mining and Metallurgical Company Norilsk Nickelsecured a credit facility of up to US$800 million for an eight-year period to financethe construction of the Bystrinskoye copper-gold project in Russia. The facilitywas arranged by Sberbank CIB in the form of project financing without recourseto Norilsk Nickel based on results financial and economic assessment of theproject.

PRECIOUS METALS

*Polymetal InternationalPlc entered into a binding agreement with unit for the of Orion MineralsLLP, which holds the Komarovskoye gold deposit in the Republic of Kazakhstan.The company will pay US$100 million in cash and Kazzinc will receive a royalty,capped at US$80 million, linked to future production from Komarovskoye.

* South Africa's Association of Mineworkers and ConstructionUnion, or AMCU, has warnedto bring Sibanye GoldLtd. operations to a halt on April 6, to protest against thecompany's three-year wage agreement reached with other unions in October 2015,News24Wire reported, citing AMCU President Joseph Mathunjwa.

* SaudiArabian Mining Co., or Ma'aden, on April 1 started commercialproduction at the AdDuwayhi gold mine. The company expects to ramp up gold productionto 180,000 ounces annually by the end of this year. Meanwhile, the start ofcommercial production at the Jabal Sayid copper mine of its affiliate, Ma'adenBarrick Copper Co., has been delayed from the first quarter 2016 to "allow forfinal mechanical testing to be completed." Ma'aden Barrick is jointlyowned on a 50/50 basis by Ma'aden and Barrick Gold Corp.

* NewmarketGold Inc. said that Eric Sprott will purchase 10 million commonshares of the company from Luxor Capital Partners LP and affiliates at US$2.25per share for a total of US$22.5 million. Sprott will 15,151,196 common shares inNewmarket, representing about an 8.7% ownership.

* Following its merger with Lake Shore Gold Corp., announced for 2016 thatincluded total gold production of between 370,000 to 430,000 ounces at all-insustaining costs of US$950 to US$1,000 per ounce of gold, net of byproductcredits. Meanwhile, silver production will come in between 18 million ounces to21 million ounces at AISC of US$10 to US$11 per ounce of silver produced, netof byproduct credits.

* Shares of Impala Platinum Holdings Ltd., or Implats, fell as muchas 4.4% and were trading lower at 43.90 South African rand per share inJohannesburg today after Black-controlled Royal Bafokeng Holdings reduced itsstake by 5% to 6.3% in the platinum producer company, BloombergNews reported, citing a company statement.

* Kommersant reported that ,controlled by Suleyman Kerimov's son, is preparing to hold a secondary offeringon the Moscow stock exchange. At the same time, the company is in talks withAsian investors for the sale of part of its treasury package. At the end oflast year, the head structure of Polyus Gold Group held delisting from theLondon Stock Exchange, and the market now speculates on why the company onceagain is to expand its shareholder base.

*Torian Resources Ltd.acquired the Bardocgold project in Kalgoorlie, Western Australia, which is its eighth acquisitionin the past 12 months. The project covers about 38.6 square kilometers and isowned by Torian and its major shareholder and joint venture partner

*Latin American MineralsInc. signed a nonbinding term sheet with SilverStream SEZCfor a gold streaming purchase agreement for its Paso Yobai gold project in Paraguay. SilverStream willprovide Latin American Minerals with US$1 million in three tranches.

*Dynasty Metals & MiningInc. said an unexpected walkout by workers at its gold mine in Ecuadorresulted in the temporarysuspension of all activities at the site. The company is indiscussions with worker's representatives, in cooperation with laborauthorities, to resolve the situation.

BULK COMMODITIES

*Vale SA has drafted a plan tosell its 26.87% stake in a steel slab plant for US$1 plus theassumption of some debt to venture partner ThyssenKrupp AG, Reuters reported, citing a source"close to the deal." The plant is the most expensive foreigninvestment in Brazil and cost nearly US$10 billion to build.

*Anglo American Plcwill sell its 70%interest in the Foxleigh metallurgical coal mine in Queensland,Australia, to a consortium led by Taurus Fund Management. The transaction willbe effected via a sale of shares in the subsidiary companies holding AngloAmerican's interest in Foxleigh.

* AdaniEnterprises Ltd. has secured keyapprovals for three separate mining leases for its coal project in theAustralian state of Queensland, bringing the company closer to start working atthe site, Mint reported.

* The British government will changethe procurement rules to necessitate public sector to consider domesticsteel for infrastructure projects "allowing them to compete moreeffectively with international companies," Bloomberg News reported, citingthe U.K.'s business secretary Sajid Javid. "By changing the procurementrules on these major infrastructure projects we are backing the future of U.K.steel — opening up significant opportunities for U.K. suppliers," Javidsaid.

* ParingaResources Ltd. started a bankable feasibility study on No. 2 Mine inKentucky, following a positive scoping study. A scoping study into the No. 2mine found that for capital expenditure of US$44 million, the mine woulddeliver a 1.8 million-tonne-per-annum operation with a mine life of 20 years."Typically, a coal project in the US at this stage would move directlyinto construction; however, we will complete the BFS to identify key areas foroptimization," Company CEO David Gay said.

* Creditor banks of ASX-listed shotdown the US$927 million recapitalization proposal from U.S.-based GSOCapital Partners LP, leaving the future of thousands of workers and the Whyallasteelworks in South Australia hanging in the balance, The Sydney Morning Herald reported.

*BHP Billiton increased its staff to up to 30 in Brazil, including two topexecutives, as the mining giant looksto resume operations at its Samarco iron ore joint venture with Vale in the country,Bloomberg News reported. Offices have also been opened in Belo Horizonte, whichis about 70 miles from BHP's Samarco interest.

*Fitch Ratings downgraded TataSteel Ltd. and its Tata Steel UK Holdings Ltd. unit's long-term foreigncurrency issuer default rating to BB from BB+/Stable and placed it on ratingwatch evolving. The downgrade reflects the decline in Tata Steel'sprofitability and jump in leverage during the financial year 2016, followingchallenging market conditions for its operations in India and overseas, specificallyin the U.K.

*Separately, The Wall Street Journal reportedthat the U.K. government pledged to assist Tata Steel secure a suitor for itsembattled steel plants in the country by providing help to any prospectivebuyer about the company's increasing pension deficit and hefty energy burden.

*ArcelorMittal shutdown a hot strip mill at its northwestern Indiana complex as part of arestructuring of its U.S. operations, The Associated Press reported.ArcelorMittal spokeswoman Mary Beth Holdford said the company does not plan anylayoffs under its restructuring program.

*Fitch Ratings downgraded SteelAuthority of India Ltd.'s long-term foreign currency issuer ratingto BB from BBB-, with a negative outlook. The downgrade follows thedeterioration in the company's financial profile after a prolonged weakening ininternational steel prices as well as its debt-funded CapEx program, whichmagnified the impact of weak prices.

* India's state-owned National Aluminium Co. Ltd. achieved its bauxite and aluminaproduction in the 2015-16 fiscal year. Production reached a total of 6,340,142tonnes of bauxite and 1,953,000 tonnes of alumina in the period, an increase of10.47% and 5.51%, respectively, compared to the prior fiscal year. The companyalso produced 372,000 tonnes of metal, up 13.79% compared to the correspondingfigure in the previous fiscal year.

* FortescueMetals Group Ltd. will shift to an owner-operator model at the Christmas Creekiron ore mining operations within its Chichester Hub property in Western Australia, effectivefrom Sept. 30 upon completion of the current mining services contract withDowner EDI Ltd.

*Mining services group RCR Tomlinson Ltd. decided to exitthe coal market, citing low profitability in the Australian coal industryduring the last five years, Australian Mining reported. The company also"intends to discontinue 12 unprofitable businesses highly exposed to thistype of mining services" as part of its business strategy review.

*China's Hebei Iron & SteelGroup Co. Ltd emerged as the onlybidder for the Serbian state-owned Zelezara Smederevo steel plant thatSerbia offered for sale. The government announced the sale of the plant in anattempt to divest loss-making businesses, in line with its €1.2 billion loandeal signed with the International Monetary Fund, Reuters reported.

*CONSOL Energy Inc.closed the US$420 millionsale of one of the most productive Central Appalachia coal mines toCoronado IV LLC, a unit of Coronado Coal LLC. The sale of the mine in southwestVirginia is intended to help CONSOL pay down debt.

*The board of the Bratsk Aluminum Plant, part of , approved anopen-ended program of bonds worth up to 70 billion Russian rubles, Vedomosti reported.

*British Prime Minister David Cameron hopes for cooperation between the U.K. andChina in battlingovercapacity in the steel industry, Reuters reported, citing Cameron'sspokesperson.

SPECIALTY

* DenisonMines Corp. released the results of a preliminary economicassessment on the WheelerRiver uranium project, which pegged base case pre-tax net present value of C$513million, internal rate of return of 20.4% and initial CapEx of C$560 million ona 100% ownership basis. Assuming contract price of US$44 per pound of U3O8, theGryphon deposit is expected to produce 40.7 million pounds U3O8, over aseven-year mine life, at a cash operating cost of US$14.28 per pound U3O8 whilethe Phoenix deposit will produce 64.0 million pounds U3O8, over a nine-yearmine life, at a cash operating cost of US$22.15 per pound U3O8. The Wheelerproject is a joint venture between Denison, Cameco Corp. and JCU (Canada) Exploration Co. Ltd.

*Gemfields Plc earned revenuesof about US$33.3 million from the auction of predominantly higher quality roughemerald extracted by 75% subsidiary Kagem Mining Ltd. and higher quality amethyst from 50%subsidiary Kariba MineralsLtd. in Zambia.

*Bushveld MineralsLtd. signed a memorandum of understanding between its 84% ownedenergy subsidiary, Bushveld Energy Ltd., and UniEnergy Technologies, for cooperationin the development of market opportunities for vanadium-redox flow batteries.

*Alligator Energy Ltd.decided to terminateits farm-in and joint venture agreement with Cameco Corp.'s Cameco Australia Pty. Ltd. unit over theMamadawerre uraniumproject in Northern Territory, Australia. The company will now focus on itsBeatrice andTin Camp Creekuranium projects, it said.

* Vedomosti reportedthat PJSC ALROSA canreduce diamond production this year by 4% to 37 million carats. The company hassoftened its plan to reduce production due to increased demand for diamonds inthe first quarter.

* Abankruptcy court in the U.S. has confirmed the fourthjoint amended plan of reorganization filed by , taking the bankruptrare earths producer a step closer before it will be able to emerge fromChapter 11 protection as a newly reorganized entity, Mining Weekly wrote.

*MZI Resources Ltd.officially openedits flagship Keysbrook mineral sands project in Western Australia.

INDUSTRY NEWS

*RBC Daily reportedthat the fate of Russian mines with high methane content and the risk ofemission will be discussed on April 4 at a meeting with Prime Minister DmitryMedvedev.

The Daily Dose is updated asof 7 a.m. New York time, and scans news sources published in Chinese, English,Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Someexternal links may require a subscription.