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Codelco earmarks US$40B until 2026 for smelter upgrades, mine overhauls

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

State of the Market: Mining Q2-2020


Codelco earmarks US$40B until 2026 for smelter upgrades, mine overhauls

TOP NEWS

Codelco earmarks US$40B until 2026 for smelter upgrades, mine overhauls

Chile's Codelco unveiled a US$40 billion investment program through to 2026, which will focus on the development of key structural projects and smelter upgrades to meet the country's tougher environmental policies, Metal Bulletin wrote. The investment will be financed from the company's own resources and from the coffers of the Chilean government.

Glencore, Bunge in standstill agreement

Glencore Plc has a standstill agreement that temporarily prevents it from making a hostile bid for grain trader Bunge Ltd., The Wall Street Journal reported, citing people familiar with the matter. Bunge rebuffed Glencore's takeover approach in May, and this agreement could mean that the Swiss trader will renew its effort for an acquisition. Given Bunge's market value, a deal for the firm would likely carry a price tag of more than US$10 billion, according to the report.

Polymetal hits record gold equivalent output in Q3

Polymetal International Plc produced a record 470,000 gold equivalent ounces in the third quarter, jumping 26% year over year on the back of strong contributions from the fully ramped up Svetloye heap leach operation at the Okhotsk hub and Mayskoye oxide ore processing. Sales in the third quarter increased 17% year over year to US$546 million on higher gold sales and prices.

DIVERSIFIED

* Vale SA's shareholders will vote Oct. 18 to elect independent board members from a list including Isabella Saboya, Marcelo Gasparino, Ricardo Reisen and Sandra Guerra, Valor International reported.

* Elliott Advisors is expected to appear at BHP Billiton Group's annual shareholder meeting in London in the week of Oct. 16 as it continues to push for strategic change at the miner, Financial Times wrote. The activist investor has not put forward any resolutions for the meeting, but it had urged the company to drop its complex corporate structure and spin off its entire oil business.

BASE METALS

* Tongling Nonferrous Metals Group Co. Ltd. expects net profit in the third quarter to range between 128.7 million Chinese yuan and 173.7 million yuan, compared to 48.9 million yuan a year ago, due to hikes in prices of main products and in processing fees of copper foil.

* Yunnan Copper Industry (Group) Co. Ltd. expects net profit to surge to between 86 million yuan and 110 million yuan in the third quarter, up from the 33.8 million yuan recorded a year ago. The company attributed this to strengthened cost controls as well as price increases in nonferrous metals.

* Nzuri Copper Ltd.'s feasibility study for the stage one development of its 85% owned Kalongwe oxide copper-cobalt project in the Democratic Republic of the Congo estimated a post-tax net present value, discounted at 10%, of US$82 million, a 55% internal rate of return and a 21-month payback period. The company expects annual average production of 19,360 tonnes of copper and 1,507 tonnes of cobalt during the seven year life of mine.

* OZ Minerals Ltd.'s Prominent Hill operation in South Australia recorded a strong third quarter with underground production up 15% on a quarterly basis, while unit costs declined 21%. The mine produced 28,880 tonnes of copper and 29,264 ounces of gold during the three-month period.

* Orosur Mining Inc. produced 8,626 ounces of gold in the first quarter of fiscal 2018 at its San Gregorio mine in Uruguay. The company expects 30,000 ounces to 35,000 ounces of gold output in the full year.

* Queensland Mining Corp. Ltd. is selling its White Range copper project in Queensland, Australia, to Moly Mines Ltd. in a A$53 million binding deal.

* Strategic Minerals Plc entered into a binding term sheet to acquire the Leigh Creek copper mine in South Australia from Resilience Mining Australia Pty. Ltd.

* Vast Resources Plc produced 1,082 dry tonnes of copper concentrate in the third quarter, up 31% from the second quarter.

* Vedanta Resources Plc and its Konkola Copper Mines Plc unit have not given up a legal challenge against a high court ruling that permits members of a Zambian community to claim damages in an English court, Miningmx reported. The English High Court of Justice in May 2016 ruled that the English courts have jurisdiction to hear claims by the community that pollution from KCM's operations damaged their livelihoods. Vedanta appealed this decision, but it was dismissed Oct. 13 by the English Court of Appeal.

* Irish zinc explorer Group Eleven Resources is seeking to raise up to C$10 million in a planned IPO in Canada, with the proceeds to be used to advance exploration at its prospects and cover corporate costs, the Irish Independent reported.

PRECIOUS METALS

* Aphrodite Gold Ltd. will book an impairment of about A$15.2 million on its exploration and evaluation assets in its Dec. 31 financial report.

* Evolution Mining Ltd. produced a record 220,971 ounces of gold in the September quarter at an all-in sustaining cost of A$786 per ounce, compared to output of 218,079 ounces of gold in the previous quarter at A$825 per ounce.

* Bryah Resources Ltd. is set to list on the ASX on Oct. 17 under the ticker BYH after raising A$5 million in an IPO.

* B2Gold Corp. expects to hit the upper end of its production guidance range for the full year of between 530,000 ounces and 570,000 ounces of gold as its Fekola mine in Mali ramps up. During 2018, the mine's first full year of production, the company's total production is expected to increase about 70% to between 925,000 and 975,000 ounces.

* Avesoro Resources Inc. unit Bea Mountain Mining Corp. entered into equipment finance facility agreements with Mapa Insaat ve Ticaret AS to facilitate the purchase of heavy mining equipment totaling about US$6.1 million.

* A Minex Consulting report found that gold exploration spending in Australia will need to double if the country is to maintain current export rates for the metal, The Australian Financial Review wrote.

BULK COMMODITIES

* Kobe Steel Ltd. plans to pay customers' costs related to its own mislabeled products, Reuters reported, citing CEO Hiroya Kawasaki. The company extended the list of products compromised by falsified data, including aluminum, copper, iron powder products and metal materials used in optical discs. The company has not yet received any demand for compensation.

* U.S. Steel Corp. is under investigation by the law firm, Kahn Swick & Foti LLC, on whether the officers and directors of the company breached their fiduciary duties to shareholders, or otherwise violated state or federal laws, that resulted in the US$180 million net loss for the first quarter. The company and its executives were previously sued in a securities class-action lawsuit, charging them with failing to disclose material information.

* Beijing Shougang Co. Ltd. expects net profit for the third quarter to surge between 567% and 617% from the 120 million Chinese yuan recorded a year ago on the back of domestic supply-side reform and reduced costs. Net profit is expected between 800 million yuan and 860 million yuan, or between 15 fen per share and 16 fen per share.

* China's iron ore imports increased to a new record of 102.8 million tonnes in September, up 16.0% from August and 10.6% from a year ago, news wire Wallstreetcn reported, citing data from China Customs. The country imported 27.1 million tonnes of coal, which was a new high in almost three years and represented an increase of 7.2% from August and 10.8% from a year ago.

* S&P Global Ratings assigned a BB- preliminary long-term corporate credit rating to Malaysia-based aluminum extrusion and smelting company Press Metal Aluminium Holdings Berhad, with a positive outlook. S&P expects that the company will use the proceeds from its proposed US$400 million notes to refinance outstanding debt.

* China Coal Energy Co. Ltd. produced 58.0 million tonnes of coal in the first nine months of the year, down 3.5% on a yearly basis. Coal sales, meanwhile, fell 4.5% year over year to 95.9 million tonnes.

* Alcoa Inc.'s Portland aluminum smelter in Victoria, Australia, has returned to full production capacity after suffering power issues in December 2016, Mining Weekly reported.

* The government of China's Binzhou city, home to aluminum major China Hongqiao Group Ltd., has ordered the closure of 2.57 million tonnes of annual smelting capacity this winter, Reuters reported, citing a government document.

* North China's Shanxi province plans to shut down another nine coal mines involving a total capacity of 5.3 million tonnes within the year, on top of the original goal of phasing out 18 mines with a combined capacity of 17.4 million tonnes, Xinhua News Agency, reported, citing a circular issued by the provincial government.

* ArcelorMittal increased the size of its debt buyback offer to US$1.41 billion, from up to US$1.25 billion previously, and accepted for repurchase about US$1.19 billion in 2022, 2039, and 2041 notes by the early tender date of Oct. 12.

* Brazilian steelmaker Gerdau SA is increasing its recently reported cash tender offer to US$640 million, from US$500 million, to buy back its 2021, 2020 and 2024 bonds.

* Champion Iron Ltd. unit Québec Iron Ore Inc. signed a rail transportation and port-facilities access agreement with Société Ferroviaire et Portuaire de Pointe-Noire for the transportation, unloading, stockpiling and loading of iron ore concentrate from Sept-Iles to Pointe-Noire in Quebec.

SPECIALTY

* Tibet Mineral Development Co. Ltd. flagged an expected year-over-year surge of between 1,430.04% and 1,494.49% in net profit for the third quarter on higher sales volume of lithium products. Net profit is expected to range between 35.6 million yuan and 37.1 million yuan.

* POZ Minerals Ltd. was granted the mining leases over its Blina diamond project in Western Australia after signing a mining agreement with the Bunuba Dawangarri Aboriginal Corp. The company plans to start diamond bulk sampling and trial mining operations at Blina in 2018.

* Stellar Diamonds Plc signed conditional share purchase agreements to sell its assets in the Republic of Guinea to Gold Knight Ltd. for US$1.3 million.

* Triton Minerals Ltd. now has conditional agreements for 100% of planned production from its flagship Ancuabe graphite project in Mozambique after signing an offtake for 25% of the mine's output with China-based Haida Graphite.

* Lynas Corp. Ltd. booked sales of A$112 million in the quarter that ended Sept. 30, representing a 108% increase on a yearly basis, driven by a sharp uptick in the market price for neodymium and praseodymium, strong production performance and sustained demand for the company's products.

* Paladin Energy Ltd.'s administrators said that Electricite de France SA terminated a long-term supply agreement signed June 8, 2012, after Paladin failed to pay US$277 million by Oct. 9.

* S&P Global Ratings lowered its long-term corporate rating on South Africa's Petra Diamonds Ltd. to B from B+ with a stable outlook. The downgrade follows the rating agency's revision in its South African rand exchange rate assumption and its lower earnings estimate for the company.

INDUSTRY NEWS

* A state-owned freight and logistics company in South Africa, Transnet, is making efforts to revive its terminal facilities at the Richards Bay port, which is used to ship manganese and chrome to Asia and Europe, Metal Bulletin reported. The KwaZulu-Natal province, where the port is located, was recently hit by severe storms.

* Li Jinming, the former chairman of Chinese state-owned enterprise Guangdong Rising Assets Management, has been turned over to prosecutors for investigation after the company's investments in several Australian mining ventures lost more than A$1 billion, The Australian reported.

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. London time and scans news sources published in Chinese, English, Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Some external links may require a subscription.