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Newmarket Gold eyes assets in Australia, North America; Liberty House confirms bid for Tata UK; Prosecutor wants to block Samarco restart

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


Newmarket Gold eyes assets in Australia, North America; Liberty House confirms bid for Tata UK; Prosecutor wants to block Samarco restart

TOP NEWS

NewmarketGold eyeing quality assets in Australia, North America

WithUS$52.1 million cash and only US$1.6 million debt, is looking toacquire quality assets in Australia and North America, with CEO and PresidentDouglas Forster saying the "landscape is still positive … in terms ofacquisition, but we are cautious investors. … We're looking for quality andwilling to pay up for that," MiningNews.net reported."It would be nice to pair our Australian gold production with some US goldproduction. … That would be sort of the natural hedge, if you will, against thestrengthening Australian dollar," Forster said.

LibertyHouse confirms bid for Tata Steel UK

SanjeevGupta's Liberty House confirmed that it will table a bid for 's loss-making U.K.operation by May 3, London's FinancialTimes reported,citing a Liberty House spokesman. "[Liberty House] has put in place astrong internal transaction team and panel of leading external advisers to takethe bid forward," the spokesman said. The trading company is reportedlyworking with Macquarie Bank to advise on the bid and to potentially fund theoffer with a US$1 billion credit line while a Tata Steel management buyout teamis also mulling to table a bid for troubled business. Liberty House alsoagreed to acquire Tata'sScottish steel plants in late March.

Environmentalprosecutor seeks to block Samarco restart

MinasGerais state environmental prosecutor Carlos Eduardo Pinto filed a petitionwith a court in Belo Horizonte, seekingto block the planned restart of Vale SA and BHP Billiton Group's Samarco joint venture operations until proof issubmitted by Samarco MineraçãoSA that the leakages at the dam have been contained completely, The Sydney Morning Herald reported. Thestate prosecutor has also called for a fine of 1 million Brazilian reais untilthe situation is resolved.

DIVERSIFIED

*Minas Gerais state environmental prosecutor Carlos Eduardo Pinto filed apetition with a court in Belo Horizonte, seekingto block the planned restart of Vale SA and BHP Billiton Group's Samarco joint venture operations until proofis submitted by Samarco MineraçãoSA that the leakages at the dam have been contained completely, The Sydney Morning Herald reported. Thestate prosecutor has also called for a fine of 1 million Brazilian reais untilthe situation is resolved.

*Fitch Ratings said Anglo AmericanPlc's US$1.5 billion sale of its niobium and phosphates assets isat a better price than the rating agency had expected and is a positive stepfor the group's disposal program. However, several of the remaining noncoreassets are either loss-making or only marginally profitable. Fitch, therefore,continues to expectfurther disposals to be at multiples of less than 4x EBITDA, in contrast to theroughly 10x multiple for the Brazilian asset sale. Meanwhile, completion of theplanned disposals, combined with debt reduction, could lead to Anglo's outlookbeing revised to stable.

BASE METALS

* Apreliminary economicassessment on the planned redevelopment of 's zinc-copper mine in theDemocratic Republic of Congo covers the redevelopment of the mine as anunderground project, producing an average of 530,000 tonnes of zinc concentrateannually over a 10-year mine life at a total cash cost, including copperby-product credits, of approximately 54 U.S. cents per pound of zinc. The studypegs an after-tax net present value, at an 8% real discount rate, of US$533million and real internal rate of return of 30.9%.

*The president and CEO of SouthernCopper Corp. Oscar Gonzales Rocha said the company will notrenounce its TiaMaria copper project in Tambo valley and downplayed the calls fornew strikes against the Peruvian project. Gonzales said that once the secondround of presidential elections, scheduled for June 5, are over, the companywill request a pending construction license before the Ministry of Energy andMines. The miner will reapply for the license if it does not obtain the permitbefore the new government takes office, Gonzales said during an activity withcommunities in Tambo, local daily El Búhoreported.

*The Chilean internal revenue service SII is reportedly retaining about US$1billion in tax refunds to an undisclosed number of mining companies operatingin Chile, sources tolddaily El Mercurio. The sources wouldnot specify the number of companies involved in the situation, but saidCodelco is not amongthem. The Chilean state is supposedly delaying payments without giving thecompanies much explanation, allegedly due to cash difficulties in the Treasurydepartment, the sources said.

* Afederal court in the Argentine province of San Juan rejected two legal claimsfiled by AntofagastaPlc's LosPelambres copper mine in Chile, as part of the civil trial betweenAntofagasta and GlencorePlc over the ElPachon tailings deposit, which is owned by Pelambres but located inGlencore's El Pachon mine in Argentina. Pelambres argued that the court had nojurisdiction over the landfill and other legal procedures. The mine can appeal theruling, daily Diario Financiero reported.

* Inits bid to further cut costs, Codelcois looking for new low-cost suppliers and revamp its offices in China to bringdown its C1 costs to US$1.25 per pound, from US$1.38 per pound in 2015,Business News Americas reported.

*Operations at the Antucoya copper mine in northern Chile were after a worker felland died at the site during inspection of a mine installation. The mine isowned by AntofagastaPlc unit Antofagasta Minerals SA and

* Aworker died in Volcan CompañíaMinera SAA's Andaychagua zinc mine in Peru's Junín region, afterbeing run over by heavy machinery. The company and police are investigating theincident, news radio RPP Noticias reported.

*JSC Chelyabinsk ZincPlant's 2015 net profit jumped 59% year over year to 3.75 billion Russianrubles, versus 2014 profit of 2.35 billion rubles. The Russian companyattributed the jump in annual profit to the devaluation of ruble, growth in zincand zinc alloy sales, as well as the reversal of the previously accruedimpairment loss related to the LLP Nova Zinc property, plant and equipment.

PRECIOUS METALS

*With US$52.1 million cash and only US$1.6 million debt, is looking toacquire quality assets in Australia and North America, with CEO and PresidentDouglas Forster saying the "landscape is still positive … in terms ofacquisition, but we are cautious investors. … We're looking for quality and willingto pay up for that," MiningNews.net reported."It would be nice to pair our Australian gold production with some US goldproduction. … That would be sort of the natural hedge, if you will, against thestrengthening Australian dollar," Forster said.

* Zijin MiningGroup Co. Ltd. booked an 84.6% year-over-year drop in first-quarternet profit attributable to shareholders of 63.8 million Chinese yuan, whileoperating income rose 22% to 19.40 billion yuan. The company attributed thefall in net profit to use of hedging against rising prices for gold and othermetals. Mine-produced gold production rose to 10,262 kilograms from 8,309kilograms produced in the first quarter of 2015 and sales rose to 10,382kilograms from 7,590 kilograms.

* ASX-listed Pantoro Ltd. struck a deal with to acquire theremaining 20% interest in the Halls Creek gold project in Western Australia,increasing its ownership to100%. The project includes the high-grade Nicolsons mine andprocessing plant.

*Two employees of Anglo AmericanPlatinum Ltd. were killed in an incident involving a winch rope at theTumela mine, part of the Amandelbult platinum operations in South Africa on April26.

*DRDGold Ltd.declared athird-quarter dividend of 38 South African cents per share for the quarterended March 31. Together with the interim dividend of 12 cents per share, thetotal distribution of 50 cents to date in fiscal 2016 is a 400% improvement onthe total distribution of 10 cents per share for the whole of fiscal 2015.

*Illegal gold mining in Peru's River Santiago is causing contamination ofdrinking water, destruction of forests, child labor, and prostitution, The Guardian wrote,citing local NGOs.

*The Royal Bank of Canada is suing NordGold NV unit CrewGold Corp. over a US$7.1 million fee that the bank was supposed toget for selling all or a substantial portion of the company to a third party in2010, Mining.com reported. Crew Gold representatives will contest the claim inthe Ontario Superior Court of Justice once the trial begins in late May, as thecompany says that the Royal Bank of Canada was not involved in the final sale.

BULK COMMODITIES

*Sanjeev Gupta's Liberty House confirmed that it will table a bid for 's loss-makingU.K. operation by May 3, London's FinancialTimes reported,citing a Liberty House spokesman. "[Liberty House] has put in place astrong internal transaction team and panel of leading external advisers to takethe bid forward," the spokesman said. The trading company is reportedlyworking with Macquarie Bank to advise on the bid and to potentially fund theoffer with a US$1 billion credit line while a Tata Steel management buyout teamis also mulling to table a bid for troubled business. Liberty House alsoagreed to acquireTata's Scottish steel plants in late March.

* U.S. SteelCorp. plans to offer US$500 million worth of senior secured debtdue 2021, with netproceeds to be used for the repayment of outstanding debt, focusingon near-term maturities, and any remaining proceeds for general corporatepurposes.

* Potash Corp.of Saskatchewan Inc. CEO Jochen Tilk is almost certain that Chinawill inka potash supply contract this year, but was not sure of the timing,Bloomberg News reported. He added that China would try to make the contract anannual agreement. "These negotiations are generally led by some of ourcompetitors. When they will be settled and who will be the party to settle, wereally don't know," said Tilk. Canpotex is a marketing venture representingPotash Corp., MosaicCo. and AgriumInc.

* YancoalAustralia Ltd. has placed the Donaldson coal mine in New South Wales,Australia, on care andmaintenance, effective May 2. The move follows a halt in miningactivities at the Abel underground mine and the start of new feasibilitystudies. The company attributed the decision to ongoing global marketchallenges. The majority of Donaldson employees have been redeployed to theneighboring Austar and Ashton underground operations.

*Metinvest BV producedabout 2.00 million tonnes of crude steel in the first quarter, from the 1.67 milliontonnes produced in the same period in 2015. Hot metal production rose 17% yearover year to 2.06 million tonnes, and iron ore concentrate output increased 6%to 7.91 million tonnes. Production of coal concentrate decreased 6% to 799,000tonnes.

* BC IronLtd. estimated the cost of damages suffered in the unincorporatedNullagine jointventure with Fortescue MetalsGroup Ltd. to be about A$91.8 million. BC Iron is seeking damagesfrom Watpac in legal proceedings initiated in 2015 as a result of Watpac's failureto comply with its obligations under its mining service contract.

*Brazil's Gerdau SA isplanning to increase capacity at its plant in India's Andhra Pradesh by 200,000tonnes to 500,000 tonnes in total through an investment of 10 billion Indianrupees, The Hindu Business Line reported."We have started looking at plans to expand product portfolio and furtherprocess debottlenecking," Gerdau Steel India Ltd. Managing Director SridharKrishnamoorthy said.

*Coal of Africa Ltd.entered into a memorandum of understanding with , which is interested in acquiring a stake in Coal of Africa'sSouth Africa-based Makhadocoking coal project, Mining Weekly reported.

*Separately, Business Day reported that Hengshun pitched a proposalto acquire up to 34% interest in the Makhado project through a Coal ofAfrica unit for about US$114 million.

*United Co. RUSAL Plcwill also prepaydebt worth US$522 million, utilizing new refinancing tranches topay off US$414 million and the company's own funds for the remaining US$108million.

*The U.S. Department of Commerce initiatedanti-dumping investigations and countervailing duty probes into imports ofcertain carbon and alloy steel cut-to-length plate coming from a number ofcountries, including Brazil, China and Korea, Reuters reported. Theinvestigations were initiated on the requests put forward by , and SSAB Enterprises.

*Russian fertilizer producer PJSCUralkali entered into a loan agreement with 16 international banksfor a US$1.2 billion loan, Reuters reported.The company plans to utilize the five-year loan for refinancing and otherpurposes.

*The recent surge in steel prices may fuelthe reopening of the mills, resulting in overcapacity which the Chinesegovernment has tried to limit by increasing transaction fees and warning retailinvestors against commodity trading, the FinancialTimes reported.

SPECIALTY

* NemaskaLithium Inc. purchased a new modular mill for lithium concentrate production atthe Whabouchimine in Quebec, Canada. The self-contained portable mill has a processingcapacity of 10 tonnes per hour and will be used to process a bulk sample ofabout 29,000 tonnes from Whabouchi during the summer and fall this year.

*Lithium Australia NLand Cazaly ResourcesLtd. have combined their present and future lithium mineral interestswithin a 100-kilometer radius of Kalgoorlie, Western Australia, for an initialperiod of five years, forming the Goldfields Lithium Alliance on a 50/50 basis.

INDUSTRY NEWS

*The government in India is planning to start monitoringmines in the country through satellites, starting this year, after athree-month pilot project found widespread illegal limestone mining in a bigstate, Reuters reported, citing India's Mines Secretary Balvinder Kumar. The IndianBureau of Mines is digitizing maps of all mines under the purview of theministry to check whether companies are complying by rules or mining outsidetheir lease areas.

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.