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Wesfarmers makes A$1.5B bid for Lynas; Newmont dangles US$470M special dividend

Mining Exploration Insights December

Mining Exploration Insights: Dip in gold drilling weighs on results

Mining Exploration Insights: Is the exploration sector back on recovery?

State of the Market: Mining Q2-2019


Wesfarmers makes A$1.5B bid for Lynas; Newmont dangles US$470M special dividend

TOP NEWS

Wesfarmers makes A$1.5B bid for Lynas

Wesfarmers Ltd. is offering to acquire Lynas Corp. Ltd. in an all-cash deal worth A$1.5 billion, or A$2.25 per share. The offer is a 44.7% premium to Lynas' last closing price and a 36.4% premium to Lynas' 60-day weighted average price to March 25. Wesfarmers said it offers expertise and track record to realize the full potential of the Mount Weld rare earths mine in Western Australia and work with governments. The offer comes as Lynas flagged the possible closure of its Gebeng rare earths plant in Malaysia due to regulatory issues.

Newmont dangles US$470M special dividend ahead of Goldcorp merger

In the wake of widening shareholder pushback against a planned merger with Goldcorp Inc., Newmont Mining Corp. said it would offer a special dividend of 88 U.S. cents per share worth about US$470 million to premerger shareholders. Van Eck Associates Corp. had said the deal gave away too much to incoming Goldcorp shareholders, but expressed support in response to the dividend decision. Paulson & Co. Inc. also took a U-turn and said it will no longer oppose the deal, according to Bloomberg News.

Vale delays Brucutu restart after court orders stoppage of 13 dams

A Brazilian court required Vale SA to suspend 13 dams in a decision that delayed the restart of its Brucutu iron ore mine, the company's biggest mine in the state of Minas Gerais. The March 22 decision of the Court of Santa Bárbara covers the Sul dam, which receives discharges from the concentration plant at Brucutu. The company did not provide a timeline on the mine's restart.

BASE METALS

* Codelco dismissed Canadian engineering firm SNC-Lavalin Group Inc. after the latter allegedly did not honor its obligations under a US$260 million contract that included building sulphuric acid plants at the Chuquicamata copper mine in Chile, Reuters wrote.

* Glencore PLC resumed normal operations at its McArthur River zinc mine, which were suspended in the wake of Cyclone Trevor, according to a separate Reuters report.

* An updated pre-feasibility study for Pacifico Minerals Ltd.'s Sorby Hills lead-silver-zinc project in Western Australia defined a pretax net present value, at an 8% discount, of A$243 million, with a 62% internal rate of return and 16-month payback period from commercial production.

* Following the arrest of its leader, the Fuerabamba community in Peru vowed not to participate in negotiations aimed at ending a road blockade at MMG Ltd.'s Las Bambas copper mine, Reuters reported, citing Edison Vargas, the community's vice president.

* Telson Mining Corp. confirmed that the SAG mill throughput processing rate may be increased by at least 15% by reducing the size of crushed mill feed, according to test results from the Campo Morado zinc plant in Mexico. The company now intends to modify its crushing circuit and upgrade the pumping system to allow effective movement of the increased volumes.

* CanAlaska Uranium Ltd. agreed to buy the past-producing Manibridge nickel mine in Manitoba from Pure Nickel Inc.

* Murchison Minerals Ltd. expanded its Brabant Lake zinc-copper-silver deposit in Saskatchewan after acquiring another 45.9 square kilometers of mineral land holdings located east of the property.

* Ural Mining & Metallurgical Co. secured a loan worth 21 billion Russian rubles from Otkritie Bank, Kommersant reported. Part of the amount will be used to build an underground mine at the Yubileinoye copper mine in Russia.

* Mitchell Services Ltd. secured a further extension to April 2020 of its underground drilling contract with BHP Group's Olympic Dam copper mine in South Australia.

PRECIOUS METALS

* Lonmin PLC Chairman Brian Beamish conceded that the company, which is being acquired by Sibanye Gold Ltd. in a £285 million all-share deal, does not have enough funds to make new investments needed to avoid layoffs.

* Caledonia Mining Corp. PLC is looking to make further investments in Zimbabwe amid a currency crisis, Reuters reported, citing CFO Mark Learmonth, who said the company is considering acquiring brownfield projects using some of the surplus cash generated from its Blanket gold mine.

* Independence Group NL received several approaches for its 30% stake in the Tropicana gold mine in Western Australia, although the company noted that it is in no rush to sell, The Australian reported, citing Managing Director Peter Bradford. The company, however, confirmed that it is selling its mothballed Long nickel mine in the state.

* Westgold Resources Ltd. agreed to sell its Higginsville gold operations to RNC Minerals for A$25 million in cash and A$25 million in shares.

* The Minerals Council South Africa warned that about 90,222 jobs at gold and platinum mines would be at risk within the next three years due to the increased electricity tariffs imposed by state utility Eskom that will kick in April 1.

* Petropavlovsk PLC received about US$57 million worth of Russian rubles as full repayment of two bridge loans advanced to associate IRC Ltd. in 2018, following the latter's recent debt refinancing.

* Titan Minerals Ltd. closed its US$3 million private placement with Core Gold Inc. as part of an amended agreement associated with their planned merger. Together with its now 5.7% shareholding in Core Gold, Titan shareholders representing a collective 29.4% interest in the company agreed to vote in favor of the merger.

* Following a strategic review, Artemis Resources Ltd. is seeking a listing on the London Stock Exchange's AIM segment by the second quarter as part of a plan to become a gold producer focused on Western Australia's Pilbara region. The company's focus will be on the Radio Hill processing plant and the Carlow Castle gold-copper-cobalt project in Western Australia

BULK COMMODITIES

* Rio Tinto, BHP and Fortescue Metals Group Ltd. reported that their Australian operations suffered some impact after cyclones Trevor and Veronica battered the country over the weekend, Reuters wrote. Rio Tinto said some of its iron ore mining and rail operations had been impacted, while BHP said it is assessing the impact at its sites. Fortescue expects its iron ore shipments of between 1.5 million and 2 million to be delayed due to Veronica.

* Cazaly Resources Ltd.'s definitive feasibility study for its Parker Range iron ore project in Western Australia slashed capex costs by 23% to A$130 million from A$169.5 million outlined in a previous study. Operating costs were also reduced 12% to A$48.85 per tonne from A$55.29/t.

* Kalium Lakes Ltd. signed a 10-year off-take deal to supply K+S AG with 90,000 tonnes of sulfate of potash products annually from the Beyondie project in Western Australia.

* China's coking coal imports from Australia in February dropped 21% year on year to 1.2 million tonnes, from 1.5 million tonnes a year ago, as lengthy customs checks at Chinese ports delayed Australian shipments, Reuters reported, citing data from the General Administration of Customs. Imports from Mongolia surged 47% to 1.43 million tonnes as Chinese buyers looked for alternative suppliers.

* Warrior Met Coal Inc. closed a restricted payment offer for up to $150 million of its 8.00% senior secured notes due 2024 at 103% of the aggregate principal amount and a separate tender offer for $150 million of the notes at 104.25%.

* Mexico reimposed a 15% steel tariff on countries with which it does not currently have free trade deals, Reuters reported, citing the government's official gazette.

* Aluminum buyers in Japan will procure supplies for April to June at up to a 27% premium than the previous quarter, five sources directly involved in pricing talks told Reuters. The premium was set at US$105 per tonne, up from US$83 to US$85/t in the first quarter.

* Jupiter Mines Ltd. launched a strategic review of its Central Yilgarn iron ore assets in Western Australia, which include the Mount Mason DSO hematite and Mount Ida magnetite projects.

* European antitrust regulators launched an in-depth probe into Novelis Inc.'s proposed US$2.6 billion acquisition of aluminum products-maker Aleris Corp.

* Norsk Hydro ASA's extruded solutions division is now running at 60% capacity following last week's cyberattack.

* Ukrainian police are investigating state-run company Volynvuhillia and privately held Ukrainskiy Natsionalniy Product, or UNP, over a coal deal under which the former may have been selling coal from the Novovolynskaya No9 mine to UNP at 8% under the minimum price the ministry set for private buyers, Reuters reported. The police are also probing nonpayment of salaries to Volynvuhillia workers worth about 138.8 million Ukrainian hryvnias and an arrangement under which Volynvuhillia paid a local factory to enrich the coal sold to UNP.

SPECIALTY

* Pilbara Minerals Ltd. reported minimal damage caused by cyclone Veronica at its Pilgangoora lithium operations in Western Australia. However, the company flagged minor shipment delays over the coming week as the Pilbara Ports Authority continued to suspend ship-loading activities within Port Hedland.

* Starting April 5, Chile will accept bids from companies looking to develop battery materials using discounted lithium produced by Sociedad Quimica y Minera de Chile SA as part of the company's 2018 deal with the authorities, Reuters reported. The tender will close in November, and a winner is expected to be announced in early January 2020.

* Finnish energy company Fortum Oyj will start recycling lithium-ion batteries while piloting so-called "second-life" applications where electric vehicle batteries are used for stationary energy storages after they are no longer fit for their original purpose.

* The U.S. Federal Trade Commission withdrew Tronox Ltd.'s proposed takeover of Saudi Arabia-based National Titanium Dioxide Co. Ltd. from adjudication as it considers the company's divestiture plan.

* Relentless Resources Ltd. put its IPO — originally slated for February — on hold while it aims to potentially quadruple the net present value of its heavy mineral sands projects in New South Wales, Australia.

* The Australian Manufacturing Workers' Union is mulling a protest to disrupt the start of construction of Albemarle Corp.'s Kemerton lithium hydroxide plant in Western Australia over the company's refusal to assure the employment of local workers, The West Australian reported.

INDUSTRY NEWS

* The European Union completed its preparations for a no-deal Brexit as the U.K. seems increasingly likely to crash out of the bloc without a withdrawal agreement April 12, according to the European Commission.

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