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Glencore to more than double FY'18 dividend on US$16B EBITDA expectation

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Glencore to more than double FY'18 dividend on US$16B EBITDA expectation

TOP NEWS

Glencore to more than double FY'18 dividend on US$16B EBITDA expectation

Glencore Plc is expected to generate free cash flow of around US$7.4 billion and EBITDA of nearly US$16.2 billion in 2018, CEO Ivan Glasenberg said during a Dec. 12 investor call, citing current spot commodity prices. The miner will more than double dividends on a yearly basis in 2018 to at least US$2 billion considering consensus 2017 EBITDA of US$14.5 billion and group CapEx guidance of US$4.1 billion.

Widened strike forces ArcelorMittal to cease output at 8 coal mines in Kazakhstan

All of ArcelorMittal's eight coal mines in Kazakhstan have ceased production as the company's workers widened their strike over wage increases, Reuters reported. The company said it was negotiating with the workers. The protest began Dec. 11 when miners refused to leave four of the eight sites.

Gold Fields replacing 1,500 workers with contractors at Tarkwa in Ghana

Gold Fields Ltd.'s Ghanaian subsidiary plans to lay off 1,500 workers who will be replaced by contract workers to operate its Tarkwa gold mine from early 2018, Bloomberg News reported, citing David Johnson, vice president at Gold Fields Ghana. As a result of the move, the company will not need to bring in new mining equipment for the remaining mine life of about five to six years.

DIVERSIFIED

* BHP Billiton Group hired four banks to help it prepare for either a sale or spin-off of its U.S. shale assets, with a decision expected to be made in early 2018, Reuters wrote, citing sources.

BASE METALS

* Glencore restarted operations at its Kamoto copper-cobalt joint venture in the Democratic Republic of the Congo, with first copper cathodes produced Dec. 11, Reuters reported, citing CFO Steven Kalmin.

* Glencore, meanwhile, expects about 2.1 million electrical vehicles to be produced per year by 2020, with demand estimated at 390,000 tonnes of copper, 85,000 tonnes of nickel and 24,000 tonnes of cobalt. "So it's clear, electric vehicles are a disruptive force and the industry will have to be prepared to produce these commodities, which is required for the growth of electric vehicles, taking into account good storage, charging infrastructure, generation of grid structure, et cetera," Ivan Glasenberg noted.

* Codelco Chairman Óscar Landerretche confirmed he will resign from his position after the government of President Michelle Bachelet ends its term in March 2018, Tele13 Radio reported.

* A union at Teck Resources Ltd.'s Quebrada copper mine in Chile is set to strike after it failed to reach a deal with the company over a bonus scheme, Reuters reported. The union comprises only a quarter of the mine's workforce, but the strike action would likely impact output, a union official noted.

* Empresa Nacional de Minera suspended operations at its Paipote copper smelter in Chile's Atacama region after workers downed tools at the site, Metal Bulletin reported. The strike action, however, has not affected the reception of mining products, the company noted.

* Finders Resources Ltd. said more of its shareholders have expressed intent to reject the takeover offer tabled by Indonesian consortium Eastern Field Developments Ltd. Shareholders owning total stakes of 33.19% plan to reject the offer of 23 Australian cents per Finders share, as the miner earlier recommended in its target statement.

* Sherritt International Corp. closed the restructuring of its Ambatovy nickel joint venture with Sumitomo Corp. and Korea Resources Corp. Under the terms, Sherritt transferred a 28% stake in the venture, eliminated C$1.3 billion of related debt from its balance sheet and will continue to serve as the mine's operator.

* Yorbeau Resources Inc. acquired the zinc-prospective KB property in Quebec from private firm Les Ressources Tectonic for total cumulative payments of C$200,000 and exploration expenditures of C$750,000 over a three-year period.

* Everton Resources Inc. secured an option from Albert Mining Inc. to acquire up to a 75% stake in seven copper-gold prospective claims in the Chapais mining district of Quebec. Everton will drill three holes and confirm two underexplored targets as part of the deal.

* Griffin Mining Ltd. subsidiary Hebei Hua' Ao Mining Industry Co. Ltd. is now debt free after repaying all of its outstanding bank loans, including US$44.7 million this year.

PRECIOUS METALS

* Following a strategic review, Newcrest Mining Ltd. agreed to sell its 89.89% interest in the Bonikro gold mine in Ivory Coast to F&M Gold Resources Ltd. and Africa Finance Corp. for a total of A$81 million.

* Chalice Gold Mines Ltd. signed a binding option and farm-in agreement to acquire up to a 70% stake in Khalkos Exploration Inc.'s Forsan gold project adjacent to its East Cadillac gold project in Quebec.

* Kinross Gold Corp. secured the rights to a 287-hectare parcel of land located immediately west of its Fort Knox gold mine in Alaska. As a result, Kinross added 2.1 million gold ounces in estimated measured and indicated resources and 300,000 ounces in estimated inferred resources at Fort Knox.

* Conquest Resources Ltd. closed the acquisition of Northern Nickel Mining Inc. and its Golden Rose project in Ontario for 10 million shares.

* A raft of digital innovations, including remote-controlled drills and other automation, boosted production at PJSC Polyus' flagship Olimpiada mine 36% year over year, the Financial Times reported, citing company management. In the third quarter, production at Olimpiada grew to 344,800 ounces of gold, compared with 253,300 ounces in the same period of 2016.

* Southern Arc Minerals Inc. said it used cash proceeds from the sale of its Singaporean Indotan Lombok Pte. Ltd. subsidiary to PT Ancora Indonesia Resources Tbk to acquire 100 million PT Ancora shares, representing a 5.66% stake. Indotan Lombok owns 90% of PT Indotan Lombok Barat Bangkit, which in turn holds the exploration permit for the feasibility-stage West Lombok gold property in Indonesia.

* Crusader Resources Ltd. unveiled a short-term strategy comprising a dual listing on the London Stock Exchange's AIM and development plans for its Borborema, Juruena and Novo Astro gold projects in Brazil. For the longer term, Crusader will continue to acquire and develop assets through to production, aiming to become a gold producer with annual output of 150,000 to 200,000 ounces of gold.

* Central Iron Ore Ltd. said mining operations have started at its Eureka gold project in Western Australia, which it is selling to Tyranna Resources Ltd. for A$3.2 million.

BULK COMMODITIES

* Adani Enterprises Ltd. seeks to adjust to constraints around its A$16.5 billion Carmichael coal mine project after Queensland, Australia, Premier Annastacia Palaszczuk said she would veto a proposed A$900 million infrastructure loan application immediately after she was sworn in Dec. 12, Reuters reported, citing a company statement.

* Agrium Inc. said its Australian agricultural-retail unit Landmark Operations Ltd. signed a binding purchase agreement to acquire Macrofertil, Louis Dreyfus Co.'s Australian fertilizer distribution business. The company did not disclose the purchase price but noted that Macrofertil has about US$120 million in annual sales.

* Pushing back on a bearish reaction to the sale of Contura Energy Inc.'s Powder River Basin assets to a Revelation Energy LLC subsidiary, analysts at B. Riley FBR Inc. said it could be a "positive harbinger" for 2018. On Dec. 11, Contura completed the sale of its Eagle Butte and Belle Ayr mines, along with related reserves, equipment, infrastructure and other properties, to Blackjewel LLC for deferred consideration of up to US$50 million. The sale eliminated about US$200 million in undiscounted reclamation obligations for the company.

* Noble Group Ltd. subsidiary Noble Americas Emerald Corp. completed the US$34.5 million sale of coal sales unit MR Coal Marketing and Trading to an unnamed buyer, The Business Times reported.

* France-based Alliance Miniere Responsable commenced production at its bauxite mine in Guinea, seeking to produce between 6 million and 10 million tonnes per year, Reuters wrote.

* PJSC Magnitogorsk Iron & Steel Works shareholders approved a dividend of 1.11 Russian rubles, or about US$209 million, for the third quarter.

* The board of Morien Resources Corp. approved the implementation of a dividend policy and declared an inaugural dividend of 0.5 Canadian cent per share, payable Dec. 27 to shareholders on record as of Dec. 20.

* The government of Mozambique intends to off-load its 10% interest in the Chiuta iron ore project in the country on the Mozambican stock exchange, Macauhub reported.

SPECIALTY

* AMG Advanced Metallurgical Group NV mandated HSBC and Citi to raise US$500 million in new credit facilities, comprising a seven-year US$300 million term loan B and a US$200 million revolving credit facility, after its supervisory board approved the construction of a second lithium concentrate plant at its Mibra mine in Brazil.

* Anglo American Plc's rough diamond sales in the 10th sales cycle of 2017 for its De Beers SA unit slipped to a provisional US$450 million, from US$466 million in the ninth sales cycle. Sales in the 10th sales cycle of 2016 totaled US$422 million.

* Gem Diamonds Ltd. said a proposed offer to sell its Ghaghoo diamond project in Botswana to an unnamed party was withdrawn. The project has been under care and maintenance since February due to prevailing market conditions.

* Bass Metals Ltd. completed the acquisition of the Millie's Reward project in Madagascar, which is highly prospective for lithium-in-spodumene mineralization. The company plans to immediately begin an exploration program with a view to establish priority drill targets.

* An initial resource estimate for American Pacific Borate & Lithium Ltd.'s Fort Cady borate-lithium project in California determined that the project hosts indicated and inferred resources totaling 93 million tonnes grading 6.3% boron trioxide, or B2O3, and 374 parts per million of lithium, for 5.9 million tonnes of contained B2O3, using a cutoff grade of 5% B2O3.

* A U.S. federal appeals court upheld a lower court decision that maintains a ban on uranium mining around the Grand Canyon, Reuters report. The court also upheld a ruling allowing a uranium mine nearby to open.

INDUSTRY NEWS

* Russian mining giants PJSC Norilsk Nickel Co., En+ Group plc and SUEK LTD. have pledged to invest over 580 billion Russian rubles for the sustainable development of the Krasnoyarsk region in Russia, where they all hold significant assets. The miners signed a memorandum with the regional government following a meeting in Moscow on Dec. 12

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.