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Philippines to limit production area for nickel miners

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


Philippines to limit production area for nickel miners

TOP NEWS

Philippines to implement measures limiting production area for nickel miners

The Philippines is implementing rules to limit the land miners can develop at any one time as part of new measures to protect the environment, Reuters reported. Under the regulation, mines that produce up to 1 million tonnes of nickel ore per annum will be limited to a 50-hectare production area at any one time, while mines that produce 9 million tonnes and above will be given areas ranging up to 100 hectares. Projects with a processing plant will be allowed up to 162 hectares. The restrictions, backed by President Rodrigo Duterte, target 29 of 48 mines operating in the country, which are nickel producers that supply ore to China.

Cypress Development pegs US$1.45B value for Clayton Valley lithium project

Cypress Development Corp.'s preliminary economic assessment for the Clayton Valley lithium project in Nevada pegged a net present value, discounted at 8%, of US$1.45 billion, an internal rate of return of 32.7% and a 2.7-year payback period. Initial CapEx was pegged at US$482 million over two years, with preproduction and operating expenses pegged at US$3,983/t of lithium carbonate equivalent. Average production is targeted at 24,042 tonnes per year.

Albemarle may buy FMC's lithium spinoff if IPO falls through

Albemarle Corp. may make a play for FMC Corp.'s lithium business if the latter's IPO, scheduled for October, fails, Reuters reported, citing comments made in June by the head of Albemarle's global lithium business, Eric Norris. FMC is targeting US$100 million in an IPO for its lithium business spinoff, Livent Corp., in New York. A spokesman for Albermarle declined to comment on potential acquisition plans. "Like any potential acquisition, Albemarle would evaluate a target considering multiple data points and market conditions at the time," the spokesman said.

BASE METALS

* Cornerstone Capital Resources Inc. decided not to proceed with its spinoff of all its assets except the Cascabel copper property, as announced in July 2017, due to ongoing delays in obtaining certain approvals.

* Amerigo Resources Ltd. kicked off commissioning of the new rougher flotation circuit as part of the phase-two expansion at the company's Minera Valle Central copper project in Chile. Construction of the new cleaner flotation circuit is expected to be completed this month, while construction of Minera Valle Central's molybdenum circuit will be finished in October.

* Analysts cast doubt that Lundin Mining Corp. would top a C$1.86 billion all-cash offer by Zijin Mining Group Co. Ltd. for Nevsun Resources Ltd. and noted Zijin's obvious thirst for Nevsun's assets and Lundin's reticence to pay more than what it sees as fair value. Zijin's offer of C$6 per share trumped a hostile attempt by Lundin, which had bid C$4.75 per share in cash.

* South African mining entrepreneur Shirley Hayes' Shirley Hayes IPK Pty. Ltd. plans to develop the Concordia copper mine in South Africa using a "cluster mining model" to retain a small-mining focus while building up run-of-mine production of more than 1.2 million tonnes per year over three years, Miningmx reported.

* Thakadu Battery Materials kicked off construction of a 250 million South African rand nickel sulfate plant at Lonmin PLC's base metals refinery, part of its Marikana operations in South Africa, Mining Weekly reported. The plant is projected to produce 25,000 tonnes per year of high-purity, battery-grade nickel sulfate. Commercial production is targeted by the end of the first half of 2019.

* IBC Advanced Alloys Corp. was awarded a contract from a major global manufacturer of commercial satellite systems to produce first article beryllium-aluminum alloy cast demonstration components related to satellite platforms.

PRECIOUS METALS

* Geopacific Resources Ltd.'s ASX stock fell by as much as 11.5% on Sept. 6 after Pacific Road Capital sold its 6% stake in the Papua New Guinea-focused gold junior. Geopacific Managing Director Ron Heeks said he is happy to see the back of all that private equity, which he did not want more of in his share register. Heeks told S&P Global Market Intelligence that the specific fund was due to end its 10-year life, and Geopacific was the last holding the fund needed to exit before closing. He said it had been something of a burden as it was an overhang from Geopacific's takeover of Kula Gold Ltd., its partner in the Woodlark joint venture of which Geopacific recently acquired 51%.

* Following positive results from ongoing drilling at the Royal Sheba deposit, part of the Barberton gold operations in South Africa, Pan African Resources PLC CEO Cobus Loots said the company will finalize a definitive feasibility study on the project with a view of starting project development in the near term. The mineral resources at Royal Sheba grew 150% to 900,000 ounces contained in 8.56 million tonnes at 3.27 g/t of gold.

* An Australian financial services firm sounded caution over Northern Star Resources Ltd.'s first, and therefore higher-risk, overseas diversification, Alaska's Pogo underground gold mine. While Hartleys called Pogo yet "another transformational acquisition" and acknowledged that Northern Star can and has delivered, the firm maintained its "neutral" recommendation on the miner as operational success has been wholly constrained to Australia, and Pogo "adds some complexity and additional risk."

* BHP Billiton Group's purchase of a 6.1% stake in SolGold PLC may lead to a bidding war with Newcrest Mining Ltd., which owns a 14.5% stake in the Australian copper-gold miner, The Australian Financial Review reported. Meanwhile, BHP has reportedly secured other exploration areas near SolGold's Ecuadorian tenement. According to the report, SolGold CEO Nick Mather said he was not aware of BHP's plan to purchase the 6.1% stake from Guyana Goldfields Inc.

* Panthera Resources PLC's joint venture partner in India, Metals Mining India Pvt. Ltd., filed a writ petition and a stay application with the High Court of Rajasthan in Jodhpur, India, after the government rejected a prospecting license application for the Bhukia gold-copper joint venture, according to a Sept. 6 release.

* Coolgardie Minerals Ltd. agreed to sell its first 100,000 tonnes of oxide ore produced from the Geko gold mine at a fixed gold price of A$1,650 per ounce to Northern Star Resources Ltd.

* Patagonia Gold PLC expects about a 10% tax charge on the sales value of dore exports from Argentina due to the new export tax the government implemented until Dec. 31, 2020.

* OreCorp Ltd. received approval from the Tanzanian Fair Competition Commission to increase its interest in the Nyanzaga gold project to 51%. It also entered into a completion agreement with Acacia Mining PLC to allow the company to move to 100% ownership by making a further payment of US$7 million. The acquisition still remains conditional on approval by the Mining Commission.

* Golden Minerals Co.'s preliminary economic assessment for its El Quevar silver project in Argentina's Salta province defined an after-tax net present value of US$44.9 million, discounted at 5%, and a 17% internal rate of return.

* Western Australia's gold explorers spent A$162 million in the June quarter, which is the highest since reporting began in 1988, The West Australian reported, citing data from the Australian Bureau of Statistics.

* A mining engineer of Continental Gold Inc. was fatally wounded after being attacked by armed individuals in the Colombian town of Buriticá, where the company's Buritica gold project is located. Another engineer is being treated and is in stable condition.

* GoGold Resources Inc. signed a definitive agreement with Metalla Royalty & Streaming Ltd. to sell its 2% royalty on the Santa Gertrudis gold project in Mexico for US$12 million.

* Reserves at Alamos Gold Inc.'s Island gold mine in Ontario increased 8% to 959,000 ounces of gold contained in 2.8 million tonnes grading 10.7 g/t, after mining depletion. Measured and indicated resources rose 99% to 221,000 ounces of gold contained in 841,000 tonnes grading 8.18 g/t.

* Alliance Resources Ltd. outlined a maiden resource at the Weednanna gold deposit, part of the Wilcherry Hill project in South Australia, of 181,000 ounces of gold contained in 1.1 million tonnes grading 5.1 g/t.

BULK COMMODITIES

* Egyptian steelmaker and regional heavyweight Ezz Steel Co.'s net loss after tax and minority interests in the first half shrunk to 389.3 million Egyptian pounds, compared to a year-ago loss of 1.07 billion pounds. Consolidated net sales for the half increased 42% year over year to 25.5 billion pounds mainly due to a more than 50% jump in long sales and a 19% increase in flat sales on a yearly basis.

* ArcelorMittal accepted for repurchase all the notes tendered after the early tender date under its previously announced offer to buy back up to US$750 million of notes due 2039 and 2041.

* South African iron ore and manganese miner Assore Ltd. hiked the interim dividend 67% year over year to 10 South African rand per share after recording a profit attributable to shareholders of 2.45 billion rand per share for the first half, up from 2.21 billion rand recorded a year ago. Revenue in the period surged to 3.84 billion rand, compared to 3.28 billion rand in the prior-year half.

* Norsk Hydro ASA signed two agreements with the state government of Pará to resume normal operations at the Alunorte alumina refinery in Brazil. The company noted that the agreements do not establish a timeline to resume full operations at the refinery. However, the move is seen as an important step toward restarting operations and preserving jobs at Alunorte and at the Paragominas bauxite mine and Albras aluminum plant.

* Eurasian Resources Group Sàrl, formerly known as ENRC, won a landmark appeal in a London court to keep documents generated during an internal corruption probe from the hands of authorities, Reuters reported. The judgment stemmed from a dispute between the company and Britain's Serious Fraud Office, which in 2013 opened a fraud investigation into ENRC's dealings in Kazakhstan and Africa, over which documents are confidential and protected by professional privilege.

* Russia resumed coal exports via train through the North Korean port of Rajin, Kommersant reported, citing Primorye's acting governor, Andrei Tarsenko.

* Two miners were rescued after being trapped 160 meters down GFG Alliance's Tahmoor coal mine in Australia, news.com.au reported. The incident was caused by a lift malfunction.

* Sirius Minerals PLC signed two construction contracts for its North Yorkshire potash project in England. The London-listed producer also flagged an increase in stage-two funding requirement by up to US$600 million to potentially US$3.6 billion.

SPECIALTY

* Rio Tinto's 80%-owned Mandena mineral sands operation in Madagascar was found to have polluted local water sources with radioactive substances known as radionuclides, Mining Technology reported, citing a study by the Andrew Lees Trust.

* PJSC Alrosa put 163 gem-quality rough diamonds with total weight of 2,615 carats up for auction in Hong Kong. Auction results will be announced Sept. 20.

* VTB Capital analysts said world diamond sales in the second quarter rose 8% yearly to 37.9 million carats as Alrosa's sales in July grew 17%, Vedomosti reported.

INDUSTRY NEWS

* Chinese mergers and acquisitions activity is likely to fall during the latter half of this year, market watchers said, although they remain divided as to why. Ivan Wong, financial advisory partner at Deloitte China, told S&P Global Market Intelligence that Chinese companies are unlikely to be as aggressive in M&A since they are more likely to devote capital to projects they have already purchased.

* Australia remained one of the most attractive countries for the global mining industry in 2017 with US$1.08 billion in nonferrous exploration budgets, keeping the country in second place since 2002. S&P Global Market Intelligence data shows that with a year-over-year budget increase of more than 19%, compared with a 14% global average increase, Australia's exploration sector rebounded quicker in 2017 than many other jurisdictions.

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