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Rusal owner seeking court order to forestall Norilsk Nickel stake sale

TOP NEWS

Rusal owner seeking court order to forestall Norilsk Nickel stake sale

Russian billionaire and United Co. Rusal Plc owner Oleg Deripaska is seeking an injunction in a London court to stop Roman Abramovich from selling a portion of his stake in PJSC Norilsk Nickel Co., Bloomberg News reported, citing three people familiar with the matter. The stake could be worth US$1.5 billion, and Deripaska is concerned that the move could give more power in Norilsk Nickel to rival tycoon Vladimir Potanin, who owns a 30% stake in Norilsk. Deripaska and Potanin have fought over control of Norilsk Nickel in the past until President Vladimir Putin's intervention in 2012 gave a small stake in Norilsk to an Abramovich-controlled company on the condition of preventing a feud over control of the company.

Vale posts record iron ore production in 2017

Vale SA posted record annual iron ore production of 366.5 million tonnes in 2017, rising 5.1% on a yearly basis driven by record production at its Northern System and other operations. The Brazilian mining major also reported record production of copper at Salobo, group gold output and coal output from Moatize.

Rio Tinto forced to seek domestic power options for Oyu Tolgoi copper mine

Rio Tinto will evaluate all viable power options for Turquoise Hill Resources Ltd.'s Oyu Tolgoi mine after the Mongolian government terminated the Southern Region Power Sector Cooperation Agreement. Oyu Tolgoi is now obliged to deliver a domestic power source for the operation within four years, with the cost and means of financing to be finalized between shareholders. The company noted that it has already earmarked US$250 million per year for developing a power station in Mongolia in its 2019 and 2020 CapEx forecasts.

DIVERSIFIED

* Russia's leading mining companies drafted a letter to the government outlining a proposal to allow the largest companies in the sector to conduct regional geological surveys. At the moment, state-run holding company Rosgeologia is the only organization authorized to do this in Russia. Reports of the letter initially appeared in Russian newspaper Kommersant, which obtained a copy of the document. According to the report, PJSC Alrosa, PJSC Norilsk Nickel Co., Polymetal International Plc and Kinross Gold Corp. were signatories to the letter, which expressed concern over the decrease in funding for geological prospecting and the ensuing drop in exploration.

* BHP Billiton Group spinoff South32 Ltd. appointed Vanessa Torres its chief technology officer. An effective date has not been confirmed. Torres is joining from BHP, where she worked for more than 10 years in strategy and operations, most recently as the vice president of operational infrastructure at the mining major's iron ore division.

* Rio Tinto appointed Moya Greene an independent nonexecutive director. Greene is the CEO of Royal Mail Group and will join the mining giant's board in the second half.

* Followed by bumper payouts paid by South32, Goldman Sachs expects Anglo American Plc and Glencore Plc to surprise the market with a competitive dividend, Miningmx reported.

* Chilean business group Hurtado Vicuña and Teck Resources Ltd. are allegedly close to reaching an agreement on the sale of the 13.5% stake the Chilean investor owns in Compañia Minera Quebrada Blanca SA, sources told daily Pulso.

BASE METALS

* Mitsui & Co. Ltd. entered into an agreement with JX Nippon Mining & Metals Corp. to acquire its 3.60% equity share in the Collahuasi copper mine in Chile. The company separately agreed to sell its entire 1.25% equity share in the Los Pelambres copper mine, 0.79% to JX Nippon and 0.46% to Marubeni Corp. No deal values were provided for the sale and purchase agreements.

* Barrick Gold Corp. President Kelvin Dushnisky deferred giving details but indicated on a conference call that the company would spend time talking about its copper portfolio during the investor day scheduled for Feb. 22. It was not clear to analysts what Barrick might say. Kerry Smith of Haywood Securities said he did not know what Barrick might detail, noting that copper makes up a small percent of the miner's cash flow.

* Sweden will invest 10 million kronor over the next two years to look for minerals such as cobalt and lithium, Bloomberg News reported, citing the country's enterprise minister, Mikael Damberg. "Historically we have mainly explored minerals such as copper, iron, silver and gold. But the shift to green technologies means there's an increased need for other minerals," Damberg said.

* Lundin Mining Corp.'s attributable net earnings dropped to US$133.0 million in the fourth quarter of 2017, from US$162.9 million in the year-ago quarter, as sales rose year over year to US$533.3 million from US$459.2 million. The year-ago results for the fourth quarter included impairment reversals of US$95.9 million. The company estimated its 2018 CapEx at US$850 million, with exploration expenditures anticipated to be about US$83 million.

* Nexa Resources SA swung to a fourth-quarter 2017 net profit of US$24.0 million, or 19 cents per share, from a loss of US$77.0 million, or 68 cents per share, in the comparable year-ago period. Revenues for the period increased 27.4% year over year to US$736.7 million, mainly due to higher-than-average zinc, copper and lead prices in the global market.

* As the date for the beginning of the new government of President-elect Sebastián Piñera approaches, six top executives have resigned from their positions in Codelco, and another two vice presidents are expected to leave the Chilean state miner by the end of February, sources told daily Diario Financiero.

PRECIOUS METALS

* Australia's gold miners are preparing for a long, tough campaign to convince Queensland's government to lower its gold royalty, which industry says is among the highest in the world and threatens the future of the state's gold production. The campaign kicked off this month with a new discussion paper by advisory firm Grant Thornton, which makes the case for Queensland to move to an "ad valorem" or profit-based regime for gold on par with other Australian jurisdictions.

* Newcrest Mining Ltd. expects its gold production to grow stronger in the second half of the year as the company's Cadia mine in New South Wales, Australia, gradually ramps up following a seismic event in April 2017 that disrupted operations, Bloomberg News reported, citing Newcrest CEO Sandeep Biswas.

* Brio Gold Inc. accepted a sweetened takeover offer from LeaGold Mining Corp., and the companies struck a definitive deal. Brio Gold shareholders will receive 0.922 of a LeaGold common share and 0.4 of a LeaGold share purchase warrant against each share held. The consideration values Brio Gold at about C$314 million.

* Yamana Gold Inc.'s net loss attributable to equity holders narrowed 48.0% year over year in the fourth quarter of 2017 to US$191.0 million, or a loss of 20 cents per share. The net loss was attributed to the noncash impairment losses on the remeasurement of Gualcamayo and related Argentinian exploration in association with their reclassification as assets held for sale, partially offset by the income tax recovery in Argentina related to a tax rate change of US$216.8 million.

* Kinross Gold agreed to acquire two hydroelectric power plants to help secure a long-term power supply for its Paracatu gold mine in Minas Gerais, Brazil. In addition to Paracatu's power needs, the transaction is expected to lower production cost of sales by about US$80/oz over the life of the mine and generate a levered internal rate of return of about 15% to 30%, depending on the final terms of the planned debt financing.

* Semafo Inc.'s pre-feasibility study at its Mana project in Burkina Faso estimated total recoveries of about 1.5 million ounces of gold at all-in sustaining costs of US$809 per ounce for the life of mine. Separately, the company forecast gold production in 2018 from the Mana and Boungou projects at between 235,000 and 265,000 ounces at all-in sustaining costs of US$900/oz to US$940/oz.

* Dundee Precious Metals Inc.'s fourth-quarter 2017 net loss attributable to shareholders from continuing operations shrunk to US$1.4 million, or 1 U.S. cent per share, from a net loss of US$107.5 million, or 67 cents per share, for the same period in 2016, which included impairment charges of US$115.2 million. Production in the quarter increased 12% for gold contained in concentrate to 49,390 ounces, copper production increased 7% to 9.5 million pounds, and silver production was up 6% to 53,920 ounces on a yearly basis.

* McEwen Mining Inc.'s updated feasibility study for the Gold Bar mine in Nevada estimated a posttax net present value, discounted at 5%, of US$54 million, an internal rate of return of 23% and a payback period of 3.1 years. Gold production over the seven-year mine life is estimated at 397,700 ounces, higher than the previous plan's 325,400 ounces.

* An updated resource estimate for Midas Gold Corp.'s Stibnite property in Idaho includes an initial measured resource. Stibnite hosts measured and indicated resources totaling 104.9 million tonnes grading 1.66 g/t of gold, 2.53 g/t of silver and 0.09% antimony for 5.6 million ounces of gold, 8.5 million ounces of silver and 203.8 million pounds of antimony.

* Hummingbird Resources Plc started the 2018 exploration program at its Yanfolila gold mine in Mali and intends to spend US$8 million to US$10 million on exploration this year in a bid to extend the mine's life.

* Scotgold Resources Ltd. said the director of rural planning and development at the Loch Lomond and the Trossachs National Park Authority issued a recommended approval of the company's application for the development of Cononish gold-silver mine in the U.K.

* S&P Global Ratings revised its outlook on Russia-based gold exploration and production company Petropavlovsk Plc to negative from stable, while affirming its B long-term issuer credit rating on the company.

BULK COMMODITIES

* Norsk Hydro ASA hiked its dividend for 2017 to 1.75 Norwegian kroner, from 1.25 kroner in 2016, as the company's net income in the fourth quarter of 2017 surged to 3.60 billion kroner, or 1.71 kroner per share, from 1.01 billion kroner, or 52 Norwegian øre, in the fourth quarter of 2016. Revenue in the quarter increased 83% year over year to 38.80 billion kroner, mainly on the back of higher realized all-in aluminum and alumina prices.

* The Federal Court of Australia rejected a native title group's attempt to ban Adani Enterprises Ltd. from registering an indigenous land use agreement for its A$16.5 billion Carmichael coal development in Queensland's Galilee Basin, according to a social media post by Adani Australia.

* South32 CEO Graham Kerr said the miner is exiting the thermal coal business, as it holds an uncertain future that does not support long-term investment and because the world needs to decarbonize, The Australian reported.

* Whitehaven Coal Ltd. posted a net profit of US$257.2 million for the half ended Dec. 31, 2017, rising from US$157.5 million from the same period a year ago, on the back of higher coal prices. The company declared an interim dividend of 13 U.S. cents per share. Meanwhile, the company revised its salable coal production guidance to 20.5 million to 21.0 million tonnes, following reduced production from the Narrabri mine during the first half.

* Fortescue Metals Group Ltd. said it achieved the milestone of awarding A$2 billion in contracts and subcontracts to Aboriginal businesses and joint ventures under its Billion Opportunities program.

* Bowen Coking Coal Ltd. agreed to buy Cape Coal Pty. Ltd.'s 100% acquisition right over the Hillalong East coking coal project owned by Rio Tinto Exploration Pty. Ltd. Hillalong East is near the company's Mount Hillalong project in Queensland, Australia.

* Shougang Hierro-Peru SA doubled its net profit in 2017 on an annual basis to 417.4 million Peruvian soles, compared to 208.0 million soles in 2016, driven by higher sales prices, Metal Bulletin reported.

SPECIALTY

* W Resources Plc signed a credit and guaranty agreement for a US$35 million secured term loan facility to fund the development of the La Parrilla tungsten mine.

* Cia. Siderúrgica Nacional agreed to place part of its stock in Usinas Siderúrgicas de Minas Gerais SA as a guarantee in a debt restructuring agreement with one of its creditor banks, sources told Bloomberg, in a report cited by Brazilian online media UOL. CSN owns a 16.4% stake in Usiminas.

INDUSTRY NEWS

* Western Australian miners have driven the state's business confidence to its highest single-quarter increase since the end of the global financial crisis, and analysts say their determination to boost production is a welcome respite for investors frustrated by years of disappointment despite back-to-back years of rising profits. The Chamber of Commerce and Industry Western Australia's December-quarter Survey of Business Confidence launched this week revealed that the state's miners were the sector expecting the greatest proportion of capital spend increases next quarter.

S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.

The Daily Dose is updated as of 7 a.m. ET and scans news sources published in Chinese, English, Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Some external links may require a subscription.