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South32 to divest energy coal unit; Glencore's McArthur River expansion approved

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South32 to divest energy coal unit; Glencore's McArthur River expansion approved

TOP NEWS

South32 in talks for South African coal unit sale; FY'19 profit plummets 71%

South32 Ltd. entered into exclusive negotiations with Seriti Resources Holdings Pty. Ltd. for the sale of its South Africa Energy Coal operation, and approvals are expected by June 2020. Bloomberg News reported that final offers for the unit ranged from US$300 million to US$350 million. The company's shares were down 5% in early afternoon trading on the ASX on a 71% drop in net profit in its fiscal 2019 to US$389 million, or 7.6 cents per share, after a US$578 million impairment charge related to the energy coal operation.

Glencore granted greenlight to expand McArthur River zinc mine in Australia

Glencore PLC secured approval to start work for the expansion of its McArthur River zinc mine in Australia's Northern Territory, which drew controversy in December 2017 due to the absence of a report on an accidental dump of toxic waste, The Guardian reported. The company seeks to extend the operation until 2048.

SQM's Q2'19 net income drops YOY on lower prices, sales volumes

Sociedad Quimica y Minera de Chile SA's net income in the second quarter dropped to US$70.2 million, from US$133.9 million a year ago. Revenue in the three months fell 22.6% year over year to US$494.1 million. The second quarter results were mainly impacted by lower lithium sale prices, partly compensated by higher lithium sales volumes.

BASE METALS

* Antofagasta PLC's net profit attributable to shareholders in the first half jumped to US$302.4 million, from US$194.3 million a year ago. Revenue in the six months climbed 19.1% year over year to US$2.53 billion on the back of higher copper sales volumes, partially offset by lower realized prices. EBITDA grew 44.4% to US$1.31 billion on lower cost of sales.

* Axiom Mining Ltd. has scaled back operations at its San Jorge nickel deposit, part of its Isabel project in the Solomon Islands, after a prospecting license for Kolosori was rejected. The company said it has currently no date for the first shipment of ore. Axiom added that it is engaged in due diligence with two private equity resource investors for a potential transaction to diversify the company's assets and provide access to nickel laterite processing know-how and additional finance.

* Copper miner KGHM Polska Miedź SA reported a profit of 418 million Polish zlotys for the second quarter, surging 143% from 172 million zlotys in the year-ago period. Revenue increased 11% year over year to 5.74 billion zlotys, while adjusted EBITDA dropped 8% to 1.28 billion zlotys and net sales slipped 4% to 666 million zloty.

* Codelco shuttered its Ventanas copper smelter in Chile for maintenance, Reuters reported, noting that the company did not give details on the length or impact of the closure. The facility was halted in September 2018 following a gas leak.

* MMG Ltd. swung to a first-half loss of US$81.0 million, from a year-ago profit of US$128.7 million, due to lower prices and sales volumes following a blockade at the Las Bambas copper mine in Peru.

* The management of China Molybdenum Co. Ltd.'s 80%-owned Tenke Fungurume copper mine in the Democratic Republic of Congo vowed to preserve jobs amid low prices and higher production costs, the Financial Times reported, citing a company letter to workers. The mine reportedly said its production is currently unstable due to equipment issues and is unsure if it can make up the output shortfall by year-end.

* Anglo American PLC agreed to spend US$29.6 million on local development projects near its Quellaveco copper project in Peru this year instead of in 2022 after anti-mining protests in the country threatened to halt construction, Reuters reported, citing Eduardo Serpa, Anglo American's sustainability manager in Peru.

* The government of Queensland, Australia, allowed New Century Resources Ltd. to defer royalty payments for three years, and repay them over the following three-year period.

* Kazakhstan's refined copper output rose 13.4% year over year in the first seven months to 270,078 tonnes, while refined zinc production climbed 3.3% to 192,258 tonnes and crude steel output dropped 1.2% to about 2.7 million tonnes, Reuters reported, citing Statistics Committee data.

PRECIOUS METALS

* St Barbara Ltd. reported a 36% drop in its fiscal 2019 net profit to A$144.2 million, from A$227.0 million the year before, amid lower production from the Gwalia mine, part of its Leonora gold operations in Western Australia.

* B2Gold Corp. exercised its option to acquire 51% of a 25,000-hectare project area in Finland that includes Aurion Resources Ltd.'s Kutuvuoma and Ahvenjarvi gold projects.

* PJSC Norilsk Nickel Co. CFO Sergey Malyshev said the company's Global Palladium Fund plans to buy between 300,000 and 500,000 troy ounces of palladium by the end of the year, which it will purchase from other holders' existing stockpiles and sell to industrial consumers, Reuters reported.

* Bear Creek Mining Corp. is reassessing the capex required for construction of its Corani silver-lead mine in Peru, the company's Vice President of Corporate Development Andrés Franco said. The company is performing technical adjustments concerning future production at the mine, daily Gestión reported.

* Ariana Resources PLC was granted a new operational license for its Salinbas gold project in Turkey. The company is in discussions with a number of other companies for joint development of the project.

* Katoro Gold PLC agreed a term sheet to sell the unit holding its Imweru and Lubando gold projects in northern Tanzania to Lake Victoria Gold Ltd. for up to US$1.0 million and a 1.5% net smelter royalty.

* Altus Strategies PLC signed a nonbinding term sheet with Glomin Services Ltd. for a joint venture on the company's Lakanfla and Tabakarole gold projects in western and southern Mali.

* First Mining Gold Corp. granted Momentum Minerals Ltd. an option acquire the Turquoise Canyon gold project in Nevada for up to C$500,000 in proceeds over four years.

* Administrators were appointed to Avocet Mining PLC after the company failed to find investment opportunities.

* Generation Mining Ltd. expanded its Marathon palladium project in Ontario to 21,965 hectares after staking 215 new claim blocks.

* After a strategic review, Alba Mineral Resources PLC decided to focus on developing the Clogau gold project in the U.K. for the rest of the year as it intends to fast-track assets that it can quickly bring into production.

BULK COMMODITIES

* Coal producers in North America will see a decline in EBITDA of more than 3% over the next year, triggering Moody's to change its outlook on a sector facing an export market showing signs of weakness.

* Venture Minerals Ltd. decided to restart mining at its Riley iron ore mine in Tasmania, Australia, after a pre-feasibility study outlined a posttax net present value, discounted at 8%, of A$27.2 million and a 303% internal rate of return, based on two years of production. Total capex was estimated at A$6.70 million. The company also signed a full off-take agreement for Riley product for 100% of the first two years of iron ore production.

* The Mines Tribunal in India issued a stay order on Karnataka government's cancellation of the mining lease extension granted to National Mineral Development Corp. Ltd. for the Donimalai iron ore mine. The stay order would prohibit the state government from taking any further action regarding the mining lease or initiate an auction process for the Donimalai mine.

* The Valdivia Environmental Court in Chile rejected the blasting permit at Sociedad Minera Isla Riesco SA's Mina Invierno coal project in Magallanes region, arguing that the company did not submit the necessary information. The environmental assessment service SEA had granted the license, but two out of three judges voted against it, a ruling which company officials and mining industry representatives warned was "driven by anti-mining sentiment," daily La Tercera reported.

*Fertoz Ltd. unit Fertoz Agriculture started export of its key fertilizer product from its Vietnam supplier direct to the Philippines.

* Yanzhou Coal Mining Co. Ltd. unit Yancoal Australia Ltd. reported a rise in net profit for the first half to A$564 million, from A$361 million a year ago, as a one-off tax expense adjustment of A$219 million boosted earnings.

* Mineral Resources Ltd.'s fiscal 2019 attributable net profit slumped 39% to A$165 million, or 87 cents per share, driven by a halt in lithium direct shipping ore sales from the Wodgina mine in Western Australia and the suspension of the Carina iron ore mine in the region. The company said construction of the Wodgina spodumene concentrate plant was delayed due to faulty valves and construction of all three trains is now expected to complete by September-end.

* Assore Ltd. anticipates an impairment charge of 507 million South African rand for its fiscal 2019 while projecting increased earnings year over year due to better market conditions and a weaker rand.

* The Tianjin government, the sole shareholder of bankrupt producer Bohai Steel Group Co. Ltd., is urging the company's creditors to execute a bankruptcy restructuring plan by the end of September, Reuters reported, citing two creditor sources with direct knowledge of the matter.

* AJ Lucas Group Ltd. secured a three-year, A$70 million contract to provide drilling services at EMR Capital Pty. Ltd. and PT Adaro Energy Tbk.'s Kestrel coal joint venture in Queensland, Australia, Australian Mining wrote.

SPECIALTY

* Malaysian International Trade and Industry Minister Darell Leiking said Lynas Corp. Ltd. will have to face "repercussions" if it does not follow the agreement for the recently granted six-month extension to operate the Gebeng rare earths processing plant, The Australian Financial Review reported. Leiking said Lynas CEO Amanda Lacaze will have to convince the government that the company will comply.

* Tibet Mineral Development Co. Ltd.'s net loss attributable to shareholders in the first half narrowed to 2.9 million Chinese yuan, from 37.2 million yuan a year ago.

* Botswana Diamonds PLC's prospecting licenses PL232 and PL235, covering over 500 square kilometers, were renewed for an additional two years to Sept. 30, 2021. The company is in extended discussions with a major international diamond producer to joint venture the next phase of work on the strategic licenses.

* Noble Group Holdings Ltd., which took over the assets of Noble Group Ltd., is expected to focus on liquefied natural gas and rare earths as it rejigs its portfolio following the completion of a US$3.45 billion restructuring in December 2018, Reuters reported, citing unnamed sources.

* A pre-feasibility study for Infinity Lithium Corp. Ltd.'s San Jose lithium project in Spain estimated a pretax net present value, discounted at 10%, of US$860.5 million and a 42.3% internal rate of return. Capital payback from start of production is pegged at 2.5 years.

* An arbitration tribunal awarded Stans Energy Corp. US$24 million over Kyrgyzstan's seizure of the Kutessay II rare earths mine.

* Ceylon Graphite Corp. received environmental approval for its K1 graphite project in Sri Lanka. Commercial production will commence once the industrial mining license is granted.

* Botswana's minister of mineral resources, green technology and energy security approved A-Cap Energy Ltd.'s two-year delay in the mining program for its Letlhakane uranium project, now scheduled to start construction at the end of October 2021.

* Hudson Resources Inc. made its first shipment of anorthosite product from its White Mountain mine in Greenland.

INDUSTRY NEWS

* Mali ended VAT exemptions for miners and shortened their grace period during fiscal changes under a new mining code that aims to increase the sector's contribution to the economy, Reuters reported.

* A push from some U.S. lawmakers and presidential candidates to transition the U.S. entirely to renewable or zero-emission electric power poses a bigger challenge for some states than others. But proposals in Congress for utilities to gradually raise sales from renewable or carbon-free sources may offer a more measured path for states to boost clean generation, supporters say.

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