TOP NEWS
Mining Indaba kicks off amid severe water crisis in Cape Town
The 24th annual Mining Indaba kicked off in Cape Town, South Africa, at a time when the Western Cape area is facing a severe water crisis as a result of the worst drought on record. The organizers of the event have pledged to align with the situation and flagged that reducing water will be a priority at the four-day event. "We have been closely following the development of the water crisis and have engaged with local government structures extensively on the issue," the Indaba's Managing Director Alex Grose flagged ahead of the event. "After much consideration, it was agreed to keep the event in Cape Town as it attracts significant investment to the local economy — conservatively estimated at around 700 million South African rand over the past ten years."
Mining ops not affected, but vigilant amid Western Cape water crisis
Mining operations have not been directly affected by the ongoing water crisis in the Western Cape province, according to the South African Chamber of Mines. However, mines have implemented mitigation measures which focus on improved water efficiency. "Given the current situation in the Western Cape, even greater emphasis is placed not only on mines adhering to their water allocations in terms of their licenses, but also to adhere to the water restrictions currently in place as a result of the drought," said the chamber's head of environment, Stephinah Mudau, in an email to S&P Global Market Intelligence ahead of Mining Indaba.
Adani's Carmichael coal mine will not receive federal rail funding
Adani Enterprises Ltd. will not receive federal funding from the Northern Australia Infrastructure Facility for the construction of a rail link to the company's controversial Carmichael coal mine in Queensland, The Guardian reported, citing Turnbull government minister Karen Andrews. The announcement is a major blow to Adani, and may spell the end of the project entirely if it cannot secure private finance.
DIVERSIFIED
* Vedanta Resources Plc 's EBITDA in the third quarter of its fiscal 2018 surged to US$1.07 billion, a 21% rise from US$882 million during the year-ago quarter due to higher volumes and commodity prices, but partially offset by input commodity inflation. Refined zinc production at the company's Indian operations declined 3% year over year to 200,000 tonnes and copper cathode output was down 1% year over year at 101,000 tonnes. Total aluminum production, meanwhile, surged 40% year over year to 445,000 tonnes.
* AWE Ltd,'s board determined that Mitsui & Co. Ltd.'s takeover offer of 95 Australian cents per share is superior to Mineral Resources Ltd.'s proposal, after the latter did not match the new offer. The board withdrew its recommendation of the Mineral Resources scheme and unanimously recommended that shareholders accept the offer from Mitsui.
BASE METALS
* Grupo México SAB de CV posted a net profit of US$125.3 million for the fourth quarter of 2017, down 4% from US$130.5 million a year earlier. In a note released the same day, GBM Research analysts Rodrigo Garcilazo and Guillermo Estrada said the quarterly results were the strongest since the first quarter of 2012, thanks to increasing copper prices while costs remained under control. The analysts wrote that Grupo México's stock price was not taking into account a long-term copper price of US$2.65/lb and maintained a "market outperformer" rating on the company.
* On a stand-alone basis, Hindalco Industries Ltd. posted a net profit of 3.76 billion Indian rupees for the third quarter of its fiscal 2018, representing a 17% year-over-year increase resulting from an 18% decrease in interest costs due to the prepayment and repricing of project loans.
* Intrepid Mines Ltd. shareholders voted in favor of selling the Kitumba copper project in Zambia to Weatherly International Plc. Weatherly, meanwhile, said that it changed the development plan for Kitumba and now intends to carry out development in two phases, with the initial focus on an area with higher-confidence mineralization and better grades.
* Bankers Cobalt Corp. struck a deal to earn up to a 70% stake in six cobalt and copper concessions in the southern Democratic Republic of the Congo.
* Rio Tinto's expansion of its Oyu Tolgoi copper-gold mine in Mongolia is under budget, according to U.S. fund Sailingstone Capital, which owns an 11% stake in Rio Tinto unit Turquoise Hill Resources Ltd., The Australian reported. However, Sailingstone raised concerns over corporate governance regarding the treatment of minority shareholders.
PRECIOUS METALS
* Mako Gold Ltd. is seeking to raise between A$5 million and A$6 million from its IPO on the ASX, which is expected to close March 9. Mako, a new gold exploration company with projects in the Ivory Coast and Burkina Faso, is offering up to 30 million common shares at 20 Australian cents each.
* Yamana Gold Inc. said that two employees of a local contractor died after an accident at the Las Vacas exploration site, which forms part of its Gualcamayo operation in Argentina. An investigation is underway, and the company is working with local authorities and the contractor to determine the exact cause of the accident.
* Eurasia Mining Plc's shares shot up by over 30% in early Feb. 2 trade on the London Stock Exchange following the announcement that the company received approval for a draft permit for the Monchetundra platinum-palladium project in the Russian Arctic.
* All of Sibanye Gold Ltd.'s workers trapped underground at the Beatrix gold mine in South Africa were safely returned to the surface, the company said. A total of 955 miners were trapped underground at the mine after a storm knocked out power Jan. 31.
* Indonesian miner PT J Resources Asia Pasifik Tbk. allocated US$300 million for capital expenditure this year to develop two gold mines, Doup in Sulawesi and Pani in Gorontalo, Kontan reported.
BULK COMMODITIES
* JSW Steel Ltd. confirmed that it is pursuing the acquisition Bhushan Steel Ltd., Bhushan Power and Steel Ltd. and Monnet Ispat & Energy Ltd., and has already submitted the resolution plan for Monnet Ispat and finalized the bidding process for Bhushan Steel and Bhushan Power and Steel, Press Trust of India reported, citing joint Managing Director and group CFO Seshagiri Rao. JSW Steel is also seeking permission to acquire 2,980 acres to set up a steel plant at Paradip in Odisha. The company has filed an application to seek forest clearance, and will decide on the plant capacity once it secures approvals, Rao added.
* Mitsui & Co. Ltd.'s mineral and metal resources segment posted a profit attributable to shareholders of ¥229.3 billion for the nine months ended Dec. 31, 2017, more than doubling year over year from ¥100 billion. The group attributed the increase mainly to higher coal and iron ore prices in Australia.
* Sojitz Corp.'s metals and coal segment recorded a profit attributable to shareholders of ¥15.06 billion for the nine months ended Dec. 31, 2017, up ¥10.44 billion from a year ago. The increase was attributed to higher sales prices for coal and an increase in the share of profit from investments in steel business and other companies.
* Itochu Corp.'s metals and minerals segment posted a net profit attributable to shareholders of ¥57.1 billion for the first nine months of its fiscal 2018, compared to the ¥24.7 billion profit recorded in the year-ago period. The segment achieved a ¥27.1 billion increase year over year in gross trading profit in the nine months to ¥66.1 billion, thanks to higher prices for coal and iron ore as well as higher sales volume in iron ore business.
* PAO Severstal decided to make a capital investment of about 49.5 billion Russian rubles in 2018 after its net profit in the fourth quarter of 2017 almost doubled quarter over quarter. Severstal's fourth-quarter net profit surged 89.6% quarter over quarter to US$563 million, or 69 U.S. cents per share. The board recommended a dividend of 27.72 rubles per share for the three months ended Dec. 31, 2017.
* France will inject €5 million to support operations at the Ascoval steel plant at Saint-Saulve for a year, Reuters reported, citing Finance Minister Bruno Le Maire. The move is expected to save several hundred jobs.
* Altona Energy Plc signed a nonbinding memorandum of understanding with joint venture partners Wintask Group Ltd. and Sino-Aus Energy Group Ltd. to jointly assess the potential for a conventional coal mine in the Westfield tenement, part of the Arckaringa property in South Australia.
* Noble Group Ltd.'s sale of four dry bulk carrier ships, which would have netted the company about US$30 million, fell through as the buyers failed to secure board approval.
SPECIALTY
* Paladin Energy Ltd. closed its fully subscribed offering of US$115 million senior toggle notes secured by certain Paladin subsidiaries and maturing Feb. 1, 2023. The closing of the offering follows Paladin's announcement that it completed its previously announced restructuring through a deed of company arrangement that saw the transfer of 98% of its shares to creditors and other investors.
* Gem Diamonds Ltd. recovered 30,560 carats of diamonds in the fourth quarter of 2017 from the Letseng mine in Lesotho, a 1% decline from the previous quarter.
* BlueRock Diamonds Plc said former CEO Riaan Visser intends to file for provisional liquidation of the company's operating subsidiary, Kareevlei Mining Pty. Ltd., in relation to alleged debts owed to the former executive. The company noted that Visser's claims are without merit and said it intends to vigorously defend itself in this regard.
* Bluejay Mining plc conditionally raised £17 million via a placing. The funds will be used mainly to advance the Dundas ilmenite project in Greenland, including completing environmental and social impact assessments in the spring.
The Daily Dose is updated as of 7 a.m. Hong Kong time, and scans news sources published in Chinese, English, Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Some external links may require a subscription.
