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In This List

Glencore flags layoffs at Rustenberg ferrochrome JV; De Beers may reduce buyers

Mining Exploration Insights December

Mining Exploration Insights: Dip in gold drilling weighs on results

Mining Exploration Insights: Is the exploration sector back on recovery?

State of the Market: Mining Q2-2019


Glencore flags layoffs at Rustenberg ferrochrome JV; De Beers may reduce buyers

TOP NEWS

Glencore flags layoffs at unprofitable South African ferrochrome smelter

Mining giant Glencore PLC may slash jobs at its Rustenburg ferrochrome joint venture with Merafe Resources Ltd. in South Africa due to financial losses, Business Day and Mining Weekly reported, citing a Glencore notice to employees at the site. The decision was reportedly prompted by South Africa's electricity issues and tariff increases as well as a difficult trading environment that has led to significant volumes of ferrochrome production being transferred to lower-cost competitors abroad. "Despite significant investment to make the operation more competitive, the Rustenburg smelter has suffered material financial losses, which are expected to continue for the foreseeable future," Glencore was quoted as saying by the news outlets.

Report: De Beers may reduce buyers to improve margins in 'new diamond world'

Anglo American PLC's diamond unit De Beers SA is considering slashing its roster of handpicked buyers and changing diamond allocations amid customers' struggle to generate profits, Bloomberg News reported. A glut in rough and polished diamond supplies eroded margins at middlemen, while banks also restricted funding for the sector. By decreasing its number of customers, De Beers could help boost the clients it retains, according to the newswire.

Russian steelmaker Severstal's Q4'19 output falls QOQ on maintenance works

Russian steelmaker PAO Severstal crude steel production dropped 10% quarterly to 2.71 million tonnes in the fourth quarter of 2019, it reported. The company said production was affected by short-term maintenance work at its basic oxygen furnace and electric arc furnace facilities as well as lower output from the electric arc furnace following the sale of the Balakovo mini-mill in the previous quarter. Hot metal output slipped 4% to 2.36 Mt due to maintenance work at blast furnace facilities during the December 2019 quarter.

BASE METALS

* Rio Tinto launched formal feasibility studies on developing its Winu copper-gold discovery in Pilbara, Western Australia, The Australian reported. The company reportedly upgraded the project to the study stage from the advanced exploration stage while increasing spending on an "order of magnitude" study, part of its early stage economic studies on Winu.

* China's market regulator will set new standards for high-grade copper scrap and aluminum scrap metal, effective July 1, classifying them as a resource rather than waste as the country is aiming to reduce solid waste imports to zero by the end of the year, Reuters reported.

* Zinc inventories in the London Metal Exchange are close to 20-year lows at about 50,000 tonnes amid expectations by market participants of a supply surplus this year, Reuters reported.

* Independence Group NL confirmed that its takeover bid for Panoramic Resources Ltd. has lapsed. Panoramic shareholders who accepted the offer will have their acceptances cancelled and will be free to deal with their shares as they see fit.

* Pacific Ridge Exploration Ltd. signed an earn-in agreement with Centerra Gold Inc.'s subsidiary AuRico Metals Inc. to acquire up to a 75% stake in the Kliyul and Redton copper-gold porphyry projects in British Columbia.

PRECIOUS METALS

* A newly proposed wilderness area in eastern Canada is presenting a hurdle to ASX-listed St Barbara Ltd.'s plans to use it for water for its Cochrane Hill gold development project and potentially expand operations in the area, a Nova Scotia provincial government spokesperson confirmed to S&P Global Market Intelligence.

* The price of palladium reached US$2,231 per ounce on Jan. 15, according to London Bullion Market Association data, then increased to over US$2,500 per ounce for the first time on Jan. 17, according to Reuters. "Palladium continues to make new highs as market fundamentals remain tight and we think there is little scope for material easing anytime soon," wrote UBS strategist Joni Teves.

* Meanwhile, platinum is expected to catch-up with the surge of palladium as car manufacturers are forced to switch to the metal due to shortage and the high cost of palladium, Forbes reported.

* Resolute Mining Ltd. produced a total of 105,293 ounces of gold at an all-in sustaining cost of US$1,419 per ounce during the December quarter of 2019, improving from the 73,691 ounces of gold produced at A$1,360/oz in the same quarter in 2018. The company has set a production guidance of 500,000 ounces at an AISC of US$980/oz for full-year 2020, which is comprised of 260,000 oz at US$960/oz from Syama, 160,000 oz at US$800/oz from Mako and 80,000 oz at US$1,200/oz from Ravenswood.

* A consortium of Chinese investors led by conglomerate Fosun International Ltd. abandoned its attempt to acquire GV Gold, one of Russia's largest gold mining companies, RBC reported, citing three anonymous sources familiar with the transaction, including one of the participants.

* Toronto-headquartered New Gold Inc. produced 101,423 ounces of gold equivalent in the fourth quarter of 2019, according to preliminary figures. This brought the company's full-year total to 486,141 ounces, within annual guidance of 465,000 to 520,000 ounces.

* Canada's Argonaut Gold Inc. achieved record annual gold-equivalent output of 186,615 ounces in 2019, increasing 13% year over year but falling short of the company's 2019 production target of 200,000 ounces. Argonaut produced 47,521 ounces of gold equivalent in the fourth quarter of 2019.

* ASX-listed Manas Resources Ltd. withdrew from a January 2018 agreement to earn up to 85% of the Gonsan gold project in Cote d'Ivoire, citing lack of progress in the grant of mineral permits as well as the costs and challenges related to exploring the property.

* Lucky Minerals Inc. said that it will focus its efforts on gold exploration in 2020, as it seeks a joint venture partner for the advancement of known copper opportunities on its Fortuna project in Ecuador.

BULK COMMODITIES

* Poland plans to transport some coal stocks from mines to a central warehouse to reduce growing stockpiles, Reuters reported, citing Deputy Minister of State Assets Adam Gaweda. A mining union said that the stock pile threatened to choke operations.

* K+S AG sold its waste management group Entsorgung (Schweiz) AG to Swiss-based Thommen-Furler Group. The cost of the transaction is within the lower single-digit million euro range. The transaction aims to quickly generate revenue and reduce indebtedness.

* Benchmark Dalian iron ore futures rose following Vale SA's announcement of stopping its Esperanca iron ore mine tailings operations in Brazil and Rio Tinto's drop in full-year 2019 shipments of the metal, Reuters reported.

* China's crude steel production increased 8.3% to a record of 996.34 million tonnes in 2019, Reuters reported, citing data from the National Bureau of Statistics. The increase in output is attributed to the resilient property market and robust demand as Beijing beefed up spending on infrastructure in a bid to weather an economic growth slowdown.

* India's steel industry is seeking a decrease in basic customs duty on key raw materials such as coking coal, pet coke, limestone and dolomite in the upcoming budget, The Economic Times reported.

* Cia. Siderúrgica Nacional initiated a cash tender offer for its outstanding 6.50% senior unsecured guaranteed notes due 2020, with US$433.6 million in principal outstanding. The offer is priced at US$1,020 per US$1,000 in principal and expires Jan. 24 with settlement anticipated within five business days thereafter, the company said.

SPECIALTY

* ASX-listed Lynas Corp. Ltd. is facing legal action in the Malaysian High Court that challenge the government's decision to renew the company's operating license for the Gebeng rare earths plant. The company said the three petitioners who filed the case had their previous court challenges dismissed.

* BlackEarth Minerals NL is fast-tracking the progress of its Maniry graphite project in Madagascar, with off-take discussions and bulk sample testing ongoing.

* Gemfields Group Ltd. plans to list on London Stock Exchange's AIM segment by Feb. 14. The company said it does not intend to raise capital in connection with the planned listing.

* Azarga Uranium Corp.'s preliminary economic assessment for its flagship Dewey Burdock uranium project in South Dakota outlined a posttax net present value of US$147.5 million, at an 8% discount rate, with an internal rate of return of 50%. The company expects to produce 14.3 million pounds of U308 from the project over 16 years.

INDUSTRY NEWS

* The U.S. Court of Appeals for the 9th Circuit ordered a lower court to dismiss a case in which a group of young Americans sought to make federal agencies address and limit the impacts of climate change.

* The London Metal Exchange three-month nickel price moved further above US$14,000/t on the Dec. 13, 2019, announcement of a "phase one" trade deal between the U.S. and China and closed 2019 up 31% higher year over year at US$14,025/t, S&P Global Market Intelligence's Metals and Mining Research team reported. The price has remained between US$13,755/t and US$14,190/t during January so far, seemingly yet to be negatively impacted by the surge in LME nickel stocks during December 2019.

* Metals and mining companies saw a median gain of 10.9% over the last year, with precious metals companies booking a median gain of 52.5% overall and occupying 12 ranks among the top 15 performers, based on an analysis of companies with market capitalization exceeding US$500 million at the end of 2019.

* Indiana Resources Ltd. and Winshear Gold Corp. will seek talks ahead of arbitration claiming that Tanzania breached bilateral investment treaties for placing their respective nickel and gold assets up for tender. Indiana Resources Chair Bronwyn Barnes told S&P Global Market Intelligence that Tanzania posted the coordinates of various retention licenses — not the names of the projects or operator companies — as up for tender on its Swahili-language website in December 2019.

* A new mining code in Mali will protect companies from fiscal changes for 20 years, down from the previous stability period of 30 years, Reuters reported, citing the country's mines minister Lelenta Hawa Baba Bah.

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