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In This List

Polyus not looking for new investors after Fosun deal cancellation

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


Polyus not looking for new investors after Fosun deal cancellation

TOP NEWS

Polyus not looking for new investors after Fosun deal cancellation

Russian gold miner PJSC Polyus is not looking for a new deal to replace the agreement struck with a consortium of Chinese investors led by Fosun International Ltd. to acquire a 10% stake in the company. The deal, worth an estimated US$886.9 million, fell through in January, fueling media speculation that the cancellation was linked to the arrest of Russian billionaire Suleiman Kerimov. Director of Investment for Polyus Victor Drozdov told S&P Global Market Intelligence that the key reason behind the cancellation was "the inability of the Chinese side to get approval for the deal."

Zambia's US$8B claim against First Quantum concerns US$540M in imports

First Quantum Minerals Ltd. Chairman and CEO Philip Pascall said the 76.5 billion Zambian kwacha, or US$8 billion, tax claim it received from the Zambian tax regulator relates to imports of US$540 million of equipment and consumables it brought into the country between January 2012 and December 2017 for the Sentinel mine at its Trident - Sentinel copper-nickel operation. The tax bill includes roughly US$5.7 billion in interest, Pascall said, with US$2.1 billion in penalties and a US$150 million duty-related assessment.

Wheaton Precious Metals swings to loss in Q4'17; FY'17 profit plummets 70.4%

Wheaton Precious Metals Corp. swung to a net loss of US$137.7 million, or 31 cents per share, in the fourth quarter 2017, from a profit of US$10.9 million, or 2 cents per share, in the previous year. For full year 2017, the company's net profit plummeted 70.4% to US$57.7 million, or 13 cents per share, from US$195 million, or 45 cents per share, in 2016, as revenue fell 5.4% to US$843.2 million. During the full year, gold and silver production fell 3.1% and 5.7% to 355,104 ounces and 28.6 million ounces, respectively, but exceeded its production guidance of 340,000 ounces of gold and 28 million ounces of silver.

DIVERSIFIED

* Rio Tinto's head of new ventures and its lithium division, Andrew Latham, said the company was "actively looking" to invest in metals which it expects to be impacted by the electric vehicle market, The Australian reported. Latham said the market is expected to have a positive impact on battery minerals, including tin, silver and tungsten, in addition to lithium, cobalt and nickel.

* Anglo American PLC is cautiously considering the acquisition of new projects as markets for commodities, including coal and copper, improve, the Financial Times reported. Anglo American CEO Mark Cutifani said that the company is always looking for potential acquisitions, but it will first work on improving its existing projects.

* Vale SA accepted for repurchase about US$968.3 million of its outstanding 5.875% guaranteed notes due 2021, which had a total of US$1.25 billion outstanding.

* Vedanta Ltd. finalized the terms of its 40 billion Indian rupee debt issue, with the bonds to mature in three years at a likely coupon rate of 8.50%, Mint reported, citing two sources familiar with the matter. The proceeds will be used for debt refinancing, working capital and general corporate purposes.

BASE METALS

* Indonesian state-owned PT Indonesia Asahan Aluminium (Persero), or Inalum, is nearing a deal on bank financing to fund the acquisition of a controlling stake in Freeport-McMoRan Inc.'s PT Freeport Indonesia unit, Reuters reported. Inalum CEO Budi Gunadi Sadikin said the company has lined up banks for the transaction and it expects to reach an agreement "very, very soon."

* Ivanhoe Mines Ltd. is in strategic discussions with "significant" mining firms and investors regarding its assets. Several investors that have expressed interest have no material limit on the provision of capital, Ivanhoe noted, but there can be no assurance that any transaction will be completed. Shares in the company were up over 9% in Toronto.

* Mongolia's Anti-Corruption Authority and Switzerland's prosecutors will jointly work on an ongoing bribery and money-laundering probe related to Swiss bank accounts tied to a former Mongolian finance minister, in which Rio Tinto's Oyu Tolgoi copper-gold operation is reportedly an element, The Australian reported.

* Bezant Resources Plc is renewing its focus on its copper-gold assets in Argentina and the Philippines, including the Mankayan project, due to the strong fundamentals of copper in the medium to long term.

* Tyranna Resources Ltd. signed an option to acquire the Goodsprings cobalt project by purchasing the issued share capital of US Cobalt Pty Ltd. in an all-share deal valued at approximately US$2.4 million.

PRECIOUS METALS

* Eldorado Gold Corp. narrowed its net loss attributable to shareholders in the fourth quarter of 2017 to US$20.7 million, or 3 US cents per share, from a year-ago net loss of US$32.5 million, or 5 cents per share. In the full year, the Vancouver-based company's loss shrunk to US$9.9 million, or 1 cent per share, from the 2016 loss of US$344.2 million, or 48 cents per share.

* Cygnus Gold Ltd. formed a joint venture with a Gold Road Resources Ltd. unit on a 25/75 basis to develop the Yandina gold project in Western Australia.

* Radius Gold Inc. secured a lease and an option to buy the Coyote gold property in Nevada from Geologic Services Inc. in exchange for a 2% to 3% net smelter return royalty, depending on the prevailing prices of gold.

* Manitou Gold Inc. agreed to acquire Argo Gold Inc.'s RockStar gold project in Ontario in a cash and stock deal.

BULK COMMODITIES

* Rio Tinto is bracing for more iron ore price volatility but believes, with BHP Billiton Group, that China's One Belt One Road initiative will drive huge demand for decades to come, amid slowing demand growth from the Asian giant. Rio Tinto supply chain and services managing director Ivan Vella told attendees at the Global Iron Ore & Steel Forecast Conference that the company was "optimistic" about the medium to longer-term but sees some slowdown and adjustment in China, especially in demand growth in the construction, infrastructure and automotive sectors.

* The consensus among analysts at the Global Iron Ore & Steel Forecast Conference was that Chinese steel mills' preference for higher-grade ore and continuing discounts for lower grades is a structural shift, not cyclical, which will favor the "big four." Citigroup Asia commodities strategies Tracy Liao told attendees that the firm expects 58% and 62% grade differentials to stay wide for longer.

* China Coal Energy Co. Ltd. is reviewing large overseas acquisition targets and established a task force to seek more opportunities, Zhu Jieli, general manager of the company's strategic planning department, told S&P Global Market Intelligence after an earnings briefing in Hong Kong. "We are looking at some deals, and we have a team specialized in overseas markets," Zhu said.

* Creditors reviewing offers for debt-laden Essar Steel India Ltd. rejected the bids submitted by ArcelorMittal and Numetal as they failed to meet eligibility criteria, The Hindu reported.

* Jeffries Japan Ltd. analyst Thanh Ha Pham said Kobe Steel Ltd. should consider divesting its steel assets and shift its focus to its aluminum, industrial compressors and power supply divisions, saying that its steel business is "too small to be competitive" against its bigger rivals, Bloomberg News reported.

* Centrex Metals Ltd. sold the Wilgerup and Kimba Gap iron ore projects in South Australia to OneSteel Manufacturing Pty Ltd.-owned SIMEC Mining, in exchange for royalties of up to A$5 million per mine. The company intends to focus on its fertilizer mining developments, including its flagship Ardmore phosphate rock project in Queensland, Australia.

* France's Ascoval is looking for a majority partner to continue steelmaking operations beyond 2019, Metal Bulletin reported. The company is targeting boosting its finished steel production to 245,000 tonnes this year from 190,000 tonnes in 2017, despite uncertainty around its ownership status. Ascoval is a joint venture between Ascometal S.A. and Vallourec SA.

* Korab Resources Ltd said that an updated pre-feasibility study to develop its Winchester magnesite deposit as a direct shipping ore operation in Australia's Northern Territory estimated pretax earnings from the project at up to US$614.2 million over the project's 12-year life.

SPECIALTY

* Chengdu Tianqi Industry Group Co. Ltd. intends to aggressively increase its lithium production and believes that transfer pricing negotiations with the Australian Tax Office will be simplified when its A$700 million lithium hydroxide plant goes online, The Australian Financial Review reported, citing Tianqi Lithium Australia Pty Ltd. general manager Phil Thick.

* Bearing Lithium Corp.'s board approved a plan to spin off its stake in Commander Resources Ltd., its interests in exploration projects in Canada's Yukon Territory and a lithium project in Nevada into a newly incorporated subsidiary. Bearing Lithium intends to seek a listing of the spinoff company's shares on the TSX Venture Exchange.

* Tawana Resources NL intends to restructure its assets in a bid to focus on its flagship Bald Hill lithium-tantalum project in Western Australia. The company will spin out its Cowan and Yallari lithium projects in Western Australia as well as its Mofe Creek iron ore project in Liberia to a wholly owned public company.

* Tando Resources Ltd agreed to acquire the SPD vanadium project in South Africa by acquiring the issued share capital of Steelpoortvan Pty Ltd., which has the right to acquire a 74% interest in project owner Vanadium Resources (Pty) Ltd., through staged payments of a total 35 million shares.

* Tronox Ltd.'s Tronox LLC subsidiary agreed to sell the assets and liabilities of its electrolytic operations in Nevada to EMD Acquisition LLC for US$13 million. The transaction is expected to close mid-2018.

* An independent capital cost review for Vital Metals Ltd.'s Watershed tungsten project in Queensland, Australia, lowered the estimated CapEx to A$105.8 million, from A$172 million in the 2014 definitive feasibility study.

* The Greenland government granted Alba Mineral Resources Plc a 12-month moratorium on the exploration expenditure commitment for the Amitsoq graphite project, the license for which was renewed for a further five years.

INDUSTRY NEWS

* The number of positive project status changes increased in the September 2017 quarter but fell off in the December quarter. However, the number of production startups at new mines, expansions and reopenings in the fourth quarter was the highest quarterly total for the year, while the number of negative project milestones declined in the third quarter and fell to zero in the final quarter, according to the Metals and Mining Research team at S&P Global Market Intelligence.

* The world's 50 biggest investment banks booked higher metals-related revenue in 2017 compared to oil sector-related revenue as relatively stable crude prices discouraged hedging activity. The banks generated revenue of US$1.6 billion from trading, selling derivatives and other activities in metals, compared to US$1.4 billion in oil, Reuters reported, citing financial industry analytics firm Coalition.

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.

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