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Midtier gold miners urged to merge; GFG's A$100M Havilah investment nixed

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Midtier gold miners urged to merge; GFG's A$100M Havilah investment nixed

TOP NEWS

Investor group urges more mergers among midtier gold miners

The Shareholders Gold Council, an investor coalition led by New York hedge fund Paulson & Co, called for more no-premium mergers among midtier gold companies to eliminate duplication and slash corporate costs, Reuters and Financial Times reported. The group said Golden Star Resources Ltd., Jaguar Mining Inc., Petropavlovsk PLC, Dundee Precious Metals Inc. and Eldorado Gold Corp. were the highest spenders among the midtier miners. Reducing their number by half would generate between US$2.4 billion to US$3.2 billion of value for shareholders, according to the group.

Abrupt shareholder u-turn sinks GFG's planned A$100M Havilah investment

Havilah Resources Ltd. said shareholders owning 76.41% of the company voted against the proposed investment of up to A$100 million by Sanjeev Gupta-led GFG Alliance Ltd.'s OneSteel Manufacturing Pty. Ltd. Havilah's technical director and 19.22% shareholder Chris Giles voted against the resolution despite having supported it earlier, while almost 60% of the individual shareholders voted in favor of the proposal.

Whitehaven eyes Pembroke's Olive Downs coal project

Whitehaven Coal Ltd. is eyeing the Olive Downs coal project in Queensland, Australia, owned by Pembroke Resources Pty Ltd., The Australian reported. A stake of between 25% to 35% is on the market, although it is unclear if Whitehaven is looking to buy a stake or the entire project, which is believed to be worth more than A$1 billion, the report said.

DIVERSIFIED

* BHP Group made a strategic investment in biotech startup Cemvita Factory, which is developing a technology that may be used to improve the remediation of mine-impacted soils and water, International Mining reported.

* Friends of the Earth subsidiary Market Forces indicated that it will revive efforts to make Rio Tinto set targets for the carbon emissions of its customers, which was initially rejected by shareholders during the company's annual meeting in May, The Australian Financial Review wrote.

BASE METALS

* Epiroc AB landed a US$69 million contract to service mining equipment used at Codelco's Andina copper mine in Chile, Kitco News wrote.

PRECIOUS METALS

* The World Gold Council, an industry association composed of some of the biggest gold miners in the world, launched guidelines to address key environmental, social and governance issues for the gold mining sector. The principles will consolidate existing standards and instruments under a single framework as the importance of ESG considerations is increasing for consumers, the council said.

* Horizon Minerals Ltd., formerly Intermin Resources Ltd., agreed to a tenement exchange in Western Australia with Northern Star Resources Ltd. for nil cash consideration. Horizon will divest its Anthill, Blister Dam, New Mexico, White Flag and Kanowna North tenements and acquire Northern Star's Rosehill, Brilliant North and Gunga West projects in Coolgardie and the Golden Ridge, Balagundi, Abattoir and Mount Monger projects in Kalgoorlie.

* Polymetal International PLC agreed to its second bilateral sustainability-linked credit facility of up to US$75 million with Société Générale SA, increasing the group's total share of such financing to US$155 million.

* In August, Northern Vertex Mining Corp. achieved record monthly gold equivalent production of 3,431 ounces at its Moss gold mine in Arizona.

* Klondike Gold Corp. leased the rights and permits to a placer mine on the Eldorado Creek property, part of its Klondike gold project in Yukon, to Dulac Mining Ltd. for three years in exchange for a 10% royalty, payable in raw gold.

* AbraPlata Resource Corp. entered a definitive agreement to acquire Aethon Minerals Corp. and form a silver-and-gold-focused explorer that will develop the Diablillos project in Argentina.

* Pasinex Resources Ltd. and Cypress Development Corp. agreed to amend an option deal granting Pasinex to acquire 80% of the Spur zinc project in Nevada. The date of a US$100,000 option payment was moved to Dec. 11, while exploration obligations of US$1.6 million were deferred to 2020.

* Endurance Gold Corp. secured an option to acquire the Reliance gold property in British Columbia by paying C$300,000 over five years, issuing 4 million shares by Dec. 31, 2025, and spending C$3 million on exploration by Dec. 31, 2024.

* The CME Group Inc. will launch two gold futures contracts in collaboration with the Shanghai Gold Exchange on Oct. 14, Fastmarkets MB wrote.

BULK COMMODITIES

* Proceeds from the potential sale of thyssenkrupp AG's elevators business must stay with the group and not be distributed as a special dividend to shareholders, Reuters reported, citing Tekin Nasikkol, the works council head of thyssenkrupp Steel Europe AG.

* Vale SA launched a cash tender offer to repurchase up to US$1 billion of debt.

* Coronado Global Resources Inc. awarded a six-year, A$1.3 billion contract to CIMIC Group Ltd.'s Thiess Pty. Ltd. to provide mining services at the Curragh coal operation in Queensland, Australia. Separately, the company amended its secured multicurrency syndicated facility agreement to US$550 million from US$350 million and extended the loan's maturity by a year to February 2023.

* Greek-based industrial conglomerate MYTILINEOS SA's first half net profit fell year on year to €81.6 million from €83.9 million due to the first-time adoption of International Financial Reporting Standards, normalization of the effective tax rate, and an increased stake in its METKA EGN subsidiary.

* Phosphate miner Kropz PLC expects a delay in reaching production at its Elandsfontein mine in South Africa, saying it will take at least until year-end to conduct further test work, engineering design and associated financial modeling to define an alternative process. The company expects to record an impairment of about US$49 million in its first-half results to account for the delays and lower forecast for phosphate rock prices.

* The National Coal Council devoted much of its annual fall meeting to discussing technologies that may provide opportunities for the struggling coal sector. But several coal industry experts and representatives seemed less optimistic that the commercialization of these technologies would occur in time to have a significant impact on coal's current trajectory, according to an exclusive S&P Global Market Intelligence report.

* Bounty Mining Ltd. received another unsolicited funding proposal from QCoal Bounty Holdings Pty. Ltd. and said results of the ongoing review of the offer by its independent board committee will be released soon.

* China's top steelmaking city, Tangshan, ordered steel mills and other industrial companies to cut output or emissions for four days ahead of the mid-autumn public holidays, part of a larger effort to reduce air pollution, Reuters reported, citing two sources and a notice.

SPECIALTY

* Brazil-based Sigma Lithium Resources Corp. held off a deal with Ganfeng Lithium Co. Ltd. to supply lithium to Tesla Inc. due to issues with the Chinese firm's terms, Reuters reported, citing Sigma CEO Calvyn Gardner. Sigma prefers to ship its lithium directly to Tesla, but no cathode maker is currently based in the U.S. Sigma also held informal talks with Volkswagen AG and BMW, the report said.

* Pilbara Minerals Ltd. slashed 36 jobs and dismissed mining contractor MACA Ltd. at its Pilgangoora lithium mine in Western Australia, where mining activities were recently suspended for the short term due to unfavorable market conditions, The Australian reported.

* The Federal Court of Australia approved Wesfarmers Ltd.'s A$776 million takeover of Kidman Resources Ltd. The deal is expected to take effect on Sept. 23.

* Namdeb Holdings Ltd., a diamond joint venture between Anglo American PLC's De Beers SA unit and the Namibian government, sold the mothballed Elizabeth Bay mine and associated marine assets as a going concern to local consortium Lewcor, Reuters reported. The deal is worth 120 million Namibian dollars, or about US$8.2 million, the report said.

* Botswana Diamonds PLC's 40%-owned unit Vutomi Mining (Pty) Ltd. received environmental approval over a portion of the residual diamond-bearing gravels produced from the Marsfontein mine in South Africa, contiguous to the company's Thorny River mine. The company expects to receive a two-year, renewable mining permit soon covering five hectares.

* Vertical Exploration Inc. entered a nonbinding letter of intent to team up with AREV Brands International Ltd. on distributing wollastonite from its St-Onge property in Quebec to supply the cannabis market.

INDUSTRY NEWS

* The Philippines' mining industry lagged in addressing the challenges being tackled by their foreign counterparts amid a struggle to set up a fiscal regime that can compete against other mining jurisdictions, PricewaterhouseCoopers' Venture Hub colleague partner Pocholo Domondon said at the Mining Philippines 2019 conference in Manila.

* The Trump administration formally repealed the Obama-era Clean Water Rule, setting the stage for the finalizing of a proposal that would significantly curtail federal protections for the nation's wetlands and waterways.

* Two JPMorgan Chase & Co. metals executives, Michael Nowak and Gregg Smith, were put on leave following a U.S. criminal investigation into the bank's metals trading practices, Reuters reported.

* The London Metal Exchange plans to allow longer queues for loading out metal, a move that may boost the profits of warehouses but result in higher costs for consumers, Reuters reported, citing metal industry sources.

* South African mining union UASA welcomed a new requirement for strikes to be first supported by workers through a secret ballot, a rule that will end wild strikes without member consultations, Bloomberg News reported.

* South Africa's mining output in July climbed 2.4% from last year, the first increase in nine months as coal and iron ore production rose, Bloomberg News wrote.

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