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BHP CEO faces uncertainty over tenure ahead of annual general meeting

Industry Top Trends 2021: Metals and Mining

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


BHP CEO faces uncertainty over tenure ahead of annual general meeting

TOP NEWS

BHP CEO faces uncertainty over tenure ahead of annual general meeting

BHP Billiton Group CEO Andrew Mackenzie's position in the mining group is under renewed scrutiny as the company's annual general meeting approaches and as Chairman Ken MacKenzie looks to further shuffle the board, The Daily Telegraph reported. The CEO will mark his fifth anniversary at the helm of the company in March 2018, and one BHP shareholder was cited in the report as saying, "The number one item that comes up in conversation between investors is [Andrew] Mackenzie."

K+S seeking to lift EBITDA to €3B in 2030

K+S AG is aiming to lift its EBITDA to €3 billion in 2030, with at least a 15% return on capital employed, as part of its new strategy called Shaping 2030. The company intends to expand its specialty business as well as related operations, including fertigation, and grow its business in high-growth regions such as Asia and Africa.

Indonesian minister estimates PT Freeport to be worth US$8B

Indonesian Energy and Mineral Resources Minister Ignasius Jonan estimated PT Freeport Indonesia to be worth US$8 billion as talks over the divestment of a majority stake in the miner continue, Reuters reported. In a separate report, the newswire cited officials as saying that President Joko Widodo urged faster progress to complete a deal with Freeport-McMoRan Inc. regarding the rights to the miner's Grasberg copper mine.

DIVERSIFIED

* Glencore Plc on Oct. 27 will formalize its recently announced tender offer for up to 48.19% of Volcan Compañía Minera SAA's class A common shares, daily Gestión reported, citing Volcan.

* Deutsche Bank retained its buy ratings and raised price targets for both BHP Billiton Group and Rio Tinto. BHP's stock was given a target price of A$28.50 per share, while the price target for Rio Tinto was raised to A$77.00 per share, The Motley Fool reported.

BASE METALS

* Shanghai Futures Exchange zinc prices rose to their highest in almost a decade after a 4% increase Oct. 9. According to Reuters, the price reached 26,935 Chinese yuan per tonne, its highest point since March 2008, amid concerns over depleting supplies.

* The government of the Democratic Republic of the Congo ordered Sinohydro Corp. and China Railway Construction Corp.'s US$3.2 billion Sicomines copper joint venture to stop exporting unprocessed copper and cobalt and instead refine the metals within the country, Bloomberg News wrote.

* BHP Billiton Group reached a three-year early wage deal with Sindicato No 2, the supervisors' trade union at its Escondida copper mine in Chile, Metal Bulletin reported. The mine's management can now restart contract talks with the worker's trade union, Sindicato No 1.

* Nickel prices tumbled during September and into early October as the rally that had sent prices skyrocketing since June began to peter out. Three-month prices on the London Metal Exchange fell from a recent peak of US$12,380/t on Sept. 4 to close at US$10,615/t on Oct. 4.

* Cunico Resources NV reduced ferronickel production at its Feni plant in Macedonia for up to a month amid negotiations regarding finances with the government and changes to the plant's management, Metal Bulletin reported, citing sources. The move is not related to the price of nickel, but rather to "a combination of cost cutting, maintenance, management changes and talks with the government over finances and power," a source added.

* A worker at MMG Ltd.'s Las Bambas copper operation in Peru was fatally injured after the haul truck he was driving left the road near the Ferrobamba pit Oct. 3. Hilario Castro was found Oct. 5 following a search-and-rescue operation.

PRECIOUS METALS

* Centamin Plc's preliminary results revealed record gold production for the third quarter of 156,533 ounces, a 5% increase year over year. The company maintained its full-year production guidance of 540,000 ounces.

* Newcrest Mining Ltd. CEO Sandeep Biswas said the company is reviewing whether a solar farm could be installed at its flagship Cadia East gold mine in New South Wales, Australia, to shield the project from soaring electricity prices, The Australian Financial Review reported. The company said in April that it was looking for a cheaper and more reliable source of electricity for the operation.

* Meanwhile, Newcrest is looking to increase the ratio of its CEO's annual long-term incentive grants to 180% of total fixed remuneration from November 2016, compared to the previous 150%, despite the miner posting a full-year profit of US$394 million, well short of forecasts of US$452 million. According to The Australian, the proposed incentive will require shareholder approval.

* Oryx Management Ltd. agreed to expand its proposed finance facility for KEFI Minerals Plc's Tulu Kapi gold project in Ethiopia to US$140 million from US$135 million to allow for an increase in ore processing capacity to 1.9 million tonnes per annum to 2.1 mtpa, from 1.5 mtpa to 1.7 mtpa, with the upper and lower limits depending upon the hardness of the ore.

* Hummingbird Resources Plc's 33.85%-owned Cora Gold Ltd. was admitted to trading on the London Stock Exchange's AIM following a successful fundraising of about £3.5 million at an IPO price of 16.5 British pence per share.

* Dacian Gold Ltd. intersected first gold ore during underground mine development at Beresford, part of the company's Mount Morgans project in Western Australia, four weeks ahead of schedule.

* Enterprise Metals Ltd. entered a deal to fully acquire Calypso Minerals Pty. Ltd., which holds seven tenement applications prospective for gold, copper and zinc in Western Australia. The addition of tenements covering 733 square kilometers will expand the company's Murchison project landholding to 820 square kilometers.

* McEwen Mining Inc. closed the acquisition of the Black Fox gold mine in Ontario from Primero Mining Corp. The transaction was completed at US$27.5 million after making certain price adjustments, as compared to the initial purchase price of US$35 million reported when the deal was announced in August.

BULK COMMODITIES

* Thailand's Banpu PCL signed a deal to acquire about an 80% stake in 112 wells in the Marcellus shale in northeast Pennsylvania through a deal valued at US$210 million, Reuters reported.

* Kobe Steel Ltd.'s internal checks found that about 4% of the aluminum and copper products it shipped to about 200 companies from September 2016 to August 2017 were falsely labeled to show that they met the specifications requested by customers, Reuters reported, citing a company spokesman.

* Chinese coke producer Henan Jinma Energy Co. Ltd. has set the offer price for its Hong Kong IPO at HK$3.0 per share, with net proceeds expected to be HK$352.6 million. The company received applications for a total of 581,961,000 shares in Hong Kong, which represents an oversubscription of 43.64x.

* Steel Authority of India Ltd., or SAIL, signed an agreement with POSCO, which will provide wide-ranging technical services for SAIL's IISCO steel plant in Burnpur, India.

* A weeklong strike came to an end at South32 Ltd.'s Hillside aluminum smelter in South Africa after over 600 members of the National Union of Metalworkers of South Africa accepted the company's latest wage offer, Reuters reported, citing the union.

* Edenville Energy Plc completed commissioning and testing the wash plant at the Rukwa coal project in southwest Tanzania. The plant has started producing washed coal for sale, with the company targeting production of at least 10,000 tonnes per month by January 2018.

* Beowulf Mining Plc appointed SRK Consulting (UK) Ltd. to complete a scoping study on its Kallak magnetite iron ore project in Sweden. The study is scheduled to be finished by the end of February 2018.

* An explosion in a furnace at ArcelorMittal's steel plant in Michoacan, Mexico, resulted in six injured workers and no fatal victims. An internal investigation into the incident was opened, daily El Debate reported.

* The Mineral Resources Authority of Mongolia granted Aspire Mining Ltd. mining license MV-020941, covering 860.91 hectares of the Nuurstei coking coal project, with a minimum 30-year tenure over the area.

* Crude steel output from China in the first eight months of the year increased 5.6% year over year to 566.41 million tonnes, while the steel price index reached 112.77 in August, a 37.51 point increase from a year ago, China Daily reported.

* The Queensland Supreme Court ordered Clive Palmer's Mineralogy Pty. Ltd. to pay US$17.6 million to a Singapore-based company for underwater gas survey works, The Australian reported.

* A tax audit of Metinvest BV's Northern GOK operation by Ukraine's State Fiscal Service revealed the company's underpayment of 1.3 billion hryvnia from 2012 to 2016, delo.ua reported.

* As part of simplifying its business structure, Adani Enterprises Ltd. plans to demerge its renewable energy business into associate company Adani Green Energy Ltd., Press Trust of India reported. In a separate report, Press Trust of India reported that several protests were held Oct. 7 across Australia against Adani's delayed Carmichael coal project in Queensland.

* Jastrzebska Spólka Weglowa SA will allocate about 1.5 billion Polish zloty for replacing and developing investments in its coking plants by 2030, Puls Biznesu reported.

* A miner died and another was in a critical condition after an underground gallery caved in at the state-owned Lupeni hard coal mine in Romania, Reuters reported, citing Energy Minister Toma Petcu.

SPECIALTY

* Petra Diamonds Ltd. warned that it is likely to breach a key condition of its banking agreements relating to a core earnings ratio this year after suffering a series of operational interruptions in Tanzania and South Africa, Reuters reported.

* Lucapa Diamond Co. Ltd. has locked in US$15 million of debt financing to bring the Mothae diamond project in Lesotho into production in 2018.

* Russia's Department of State Mining Supervision of the Federal Service for Environmental, Technological and Nuclear Supervision conducted an inspection at PJSC Alrosa's Udachny, Aikhal, International and Mir mines and the base warehouse of the Udachninsky GOK. The department found violations in the conduct of underground mining operations, storage and use of explosive materials for industrial use, operation of lifting equipment, boiler inspection facilities and operation of electrical installations, Vedomosti reported.

* Gemfields Plc generated revenues of US$21.5 million from an auction of high-quality rough emeralds held in Zambia, for an overall average price of US$66.21 per carat, the second-highest price the company has ever achieved.

INDUSTRY NEWS

* S&P Global Market Intelligence data revealed that the tide has turned for the Australian resources sector. So far this year, there have been 20 successful IPOs in the industry, with 10 more still aiming to list before the end of 2017. By comparison, just 10 companies that undertook IPOs to list on the ASX made the boards in 2016. In addition, nearly half the companies that have debuted on the ASX this year have traded at substantial premiums since listing.

* The top 25 mining companies were worth an aggregate US$699.6 billion at the end of September, a 33% increase compared with the corresponding quarter of 2016. S&P Global Market Intelligence calculated the global market value of the industry's listed companies at the end of September as US$1.42 trillion.

* Tanzanian President John Magufuli split the energy and minerals ministry in two, appointed Angellah Kairuki as the new mining minister and promoted Medard Kalemani from deputy energy and minerals minister to lead the new energy ministry, Reuters reported.

* U.S. nonfarm payroll employment decreased by 33,000 in September, and the unemployment rate declined to 4.2% from 4.4% in August, the U.S. Department of Labor said. The department noted that the net effect of hurricanes Harvey and Irma reduced the estimate of total nonfarm payroll employment for September.

The Daily Dose is updated as of 7 a.m. ET and scans news sources published in Chinese, English, Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Some external links may require a subscription.