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BHP cautions against cutting coal lobby ties; Implats delays Rustenburg layoffs

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BHP cautions against cutting coal lobby ties; Implats delays Rustenburg layoffs

TOP NEWS

BHP asks shareholders to vote against cutting coal lobby ties

BHP Group asked its shareholders to vote against a resolution in upcoming annual general meetings that would require the company to suspend memberships of industry associations whose policies since January 2018 are inconsistent with the Paris climate agreement. The company said it supports the Paris agreement as a critical element of the response to global warming, however, being part of industry associations allows it to lead and improve standards related to various issues.

Implats postpones job cuts at Rustenburg on profit swing

Impala Platinum Holdings Ltd. swung to an annual profit for its financial year ended June 30 boosted by higher sales volumes, higher rhodium and palladium prices and improved performance at its Rustenburg mine in South Africa. As a result of the improved performance, the company said it would be postponing 13,000 job cuts planned at the Rustenburg operation. Implats delivered headline earnings per share of 423 South African cents, compared to a loss of 171 cents a year earlier.

Thyssenkrupp starts sale process for elevators unit

Thyssenkrupp AG kicked off the sale process for its prized elevators business, informing potential bidders that it is open to both minority and majority offers, Bloomberg News and Reuters reported, citing people familiar with the matter. The company may open a data room for potential suitors this month, and wants to sign a deal by year-end that would allow it to keep a stake of over 25% in the elevators unit, one of the sources said.

BASE METALS

* Yunnan Tin Co. Ltd.'s refined tin production for 2019 would likely be 10% below its undisclosed target due to tight supply of raw materials. The Chinese tin major said this is part of a joint action by tin producers in China. A Reuters report cited a company official as saying that Yunnan Tin would reduce about 7,000 tonnes of annual output and a group of domestic smelters would cut 20,200 tonnes in total.

* Vale SA's board approved the sale of the Jaguar nickel sulfide project in Brazil to Centaurus Metals Ltd.

* WorleyParsons Ltd., one of the biggest contractors on Rio Tinto's Oyu Tolgoi copper expansion project in Mongolia, claimed that it was responsible for reducing the project's capital expenditures despite Rio Tinto earlier flagging an up to US$1.9 billion cost blowout, the Australian Financial Review reported.

* Belmont Resources Inc. secured an option to earn up to a 75% interest in Pistol Bay Mining Inc.'s Fredart-Gerry Lake zinc-copper-silver-gold properties in Ontario.

* Toachi Mining Inc. shareholders approved Atico Mining Corp.'s proposed takeover that would form a midtier copper-gold explorer and producer focused on Latin America.

PRECIOUS METALS

* Jubilee Metals Group PLC's joint venture platinum group metals recovery plant to recover material from the Windsor PGM project was commissioned and is fully operational. The project produced 1,346 PGM ounces in its first operational month of August. CEO Leon Coetzer said the Windson project can potentially double the company's PGM production.

* Wanguo International Mining Group Ltd. entered a construction and mining contract for its Gold Ridge gold project in the Solomon Islands. The contract will become effective when the company completes its acquisition of a 77.78% equity interest in AXF Gold Ridge Pty. Ltd. The contract price for the first phase is about US$276 million, covering mining operations at Gold Ridge up to March 2034. The second phase is still being negotiated, and could be worth over US$500 million.

* Rio2 Ltd.'s updated pre-feasibility study slashed the posttax net present value, discounted at 5%, of its flagship Fenix gold project in Chile to US$121 million from US$409 million previously outlined in 2014. The latest study envisaged an ore mining rate of 20,000 tonnes per day at initial capital costs of US$111 million and sustaining costs of US$95 million over a 16-year mine life.

* Geopacific Resources Ltd. issued a letter of intent to award the engineering, procurement, and construction contract to GR Engineering Services Ltd. for a 2.4-million-tonne-per-annum process plant and other key infrastructure at its Woodlark gold project in Papua New Guinea.

* African Gold Ltd. agreed to acquire Abra Resources Pty Ltd., which owns the Samanafoulou, Sitikili, Yatia, Golokasso gold projects, and secured the option to purchase a 95% stake in the Walia gold project, all located in Mali.

* The London Metal Exchange's gold and silver futures are in doubt as lender Societe Generale, which helped launch the contracts in 2017, is expected to resign shortly as a market maker, Reuters reported, citing sources. Societe's departure means that there would be only two banks willing to offer tradeable prices, namely Goldman Sachs and Morgan Stanley.

* Altus Strategies PLC defined a potentially significant new prospect, Diba SW, at its Diba gold project in Mali.

* India's gold imports in August plummeted 73% year on year to 30 tonnes from 111.47 tonnes, driven by subdued buying as a result of higher prices and an increase in import duty, an unnamed government source told Reuters.

BULK COMMODITIES

* JSW Steel Ltd.'s US$2.7 billion bid to acquire Bhushan Power and Steel Ltd. was approved by the National Company Law Tribunal, Bloomberg News reported. The bankruptcy tribunal noted that Bhushan must distribute the profits generated during the insolvency period to the creditors. The acquisition will add 3.5 million tonnes of capacity to JSW's steel mill operations.

* The U.S. Commerce Department imposed antidumping duties on imports of certain fabricated structural steel from China and Mexico after a preliminary determination that producers from both countries dumped the material in the U.S. market. The department imposed duties of up to 141% on imports from China and up to 31% on imports from Mexico, and will instruct U.S. Customs and Border Protection to collect cash deposits from importers.

* Russia launched the third export line at the Vostochny port, doubling the annual capacity of the coal terminal in the Far East region to 50 million tonnes to 55 million tonnes, Reuters reported.

* The U.S. Justice Department filed an injunction against Hindalco Industries Ltd. unit Novelis Inc.'s proposed US$2.6 billion takeover of Aleris Corp. on competition concerns, particularly in aluminum sheet used to make cars. Novelis said it is confident the legal proceeding will not hinder the deal from closing by Jan. 21, 2020.

* Ukraine's tax service disputed comments made by one of its officials, Evgen Bambizov, who said a probe found that ArcelorMittal owes authorities 9 billion hryvnia, or roughly US$355 million, Reuters reported. The state tax service said the issue is outside the scope of Bambizov's authority, as he was only the head of the commission reorganizing the tax service's large taxpayers' office. An audit into the company is not yet completed, the office said in the Reuters report.

* Separately, ArcelorMittal confirmed that it will continue operations at its Taranto steel plant in Italy after the Italian government adopted an amended law that restored the company's legal protection over the site.

* U.S. coal exports totaled about 5.9 million tonnes in July, down 18.3% from June and down 31.9% from the year-ago week, the U.S. Census Bureau reported. Through seven months of the year, U.S. exports were down 15.7% from the same point a year ago.

* Railroads could face US$5 billion in lost revenue as utility coal shipments fall over the next decade, according to Moody's. Moody's analysts expect utility coal demand in the U.S. to drop by more than half by 2030, falling by about 7% per year on average over the next decade, which would take a toll on coal producers as well as their transportation partners.

* Bounty Mining Ltd. said that the second recapitalization proposal received from QCoal Bounty Holdings Pty Ltd. is also not superior to the proposal received from Amaroo Blackdown Investments LLC. The directors recommended that shareholders vote in favor of the Amaroo proposal in the Sept. 30 meeting.

* BHP agreed to buy 41 autonomous trucks from Komatsu for its new South Flank iron ore mine, part of its Area C operation in Western Australia, the Australian Financial Review reported. The deal may be worth up to A$700 million over a decade, including maintenance and support activities.

* Metallurgical Corp. of China Ltd. and Wenan Iron & Steel Co. Ltd. are leading a group of investors funding a 10- -tonne-per-annum steel plant in Sarawak, Malaysia, The Star Online reported. Construction is expected to start in mid-2020.

* Andrey Kostin, head of Russian lender VTB, said the bank would discuss a debt restructuring request by coal and steel producer Mechel PAO with the company's other creditors Sberbank and Gazprombank, adding that "no one intends to harass Mechel," according to Reuters.

* Coal India Ltd. signed a deal to mine coking coal in Russia's Far East, part of an effort by India and Russia to boost their bilateral trade to US$30 billion annually by 2025, Reuters reported.

* Kibo Energy PLC signed nonbinding term sheets for power purchase and coal supply agreements for its 65%-owned Benga power plant project in Mozambique with Vale SA unit Vale Mozambique SA. The supply agreement covers the total coal requirement for the project over the modeled 25-year life of plant.

* Turkey is facing losses of up to US$3 billion stemming from Britain increasing import tariffs in sectors including steel, automotives and textiles in the event of a no-deal Brexit, Reuters reported, citing Trade Minister Ruhsar Pekcan.

SPECIALTY

* Almost 95% of Kidman Resources Ltd.'s shareholders voted in favor of the A$776 million acquisition by Wesfarmers Ltd.

* Gem Diamonds Ltd.'s attributable net profit plummeted to US$4.2 million in the half, from US$24.2 million a year ago, as revenue dropped to US$91.3 million from US$167.7 million. The company sold 55,714 carats at an average price of US$1,697 per carat, compared to year-ago sales of 61,696 carats at US$2,742 per carat.

* Marquee Resources Ltd. completed the acquisition of Centenario Lithium Ltd., owner of a 30% interest in Lithium Power International Ltd. unit Lithium Power International Holdings (Argentina) Pty. Ltd.

* Toro Energy Ltd. said its processing testwork proved that vanadium could be a viable by-product of processing uranium ore at its Wiluna uranium project in Western Australia. The company will now estimate the vanadium resource within the project.

* Moody's downgraded its corporate family rating on Tianqi Lithium Corp. to Ba3 from Ba2 citing high leverage and weak capital structure outlook until the next year.

* Almonty Industries Inc. completed constructing a second tailings dam at the Panasqueira tungsten mine in Portugal, allowing the mine to process and store tailings for another six years at the rate of 800,000 tonnes per annum.

INDUSTRY NEWS

* Senior Mali government figures say the country's new mining code is tailored around sustainable community development, while promoting both small and large-scale mining as the country looks to diversify from gold. The changes include a reduced period for the 25% income tax rate from 15 years to three years, and the creation of a local development fund into which miners pay 0.25% of their turnover, but tax deductible so it will not be an extra cost on companies. Local small-scale artisanal miners without the resources to develop environmental impact studies will also pay into a rehabilitation fund, Lassana Guindo, a technical adviser to the mines ministry, told S&P Global Market Intelligence.

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