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Glencore facing US$1.14B claim over DRC cobalt mine dispute

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Glencore facing US$1.14B claim over DRC cobalt mine dispute

TOP NEWS

Glencore facing US$1.14B claim over DRC cobalt mine dispute

A Congolese-American businessman Charles Brown is demanding US$1.14 billion from Glencore PLC, claiming that he was coerced to sell his 19% interest in cobalt miner Mutanda Mining Sarl to Glencore in two transactions in 2007 and 2012, Bloomberg News reported. In January, a commercial court in the province of Lualaba in the Democratic Republic of the Congo, where the Mutanda mine is located, sanctioned Brown's request to seize US$843 million of assets from Glencore and Mutanda Mining.

Several hundred jobs at risk as Rio Tinto accelerates automation project

Rio Tinto will cut several hundred jobs in the coming years as it accelerates the long-planned automation of its iron ore mines and railways in Western Australia, The Australian reported, citing an internal company briefing. According to the document, about 600 full-time jobs would be affected as the company increases its driverless truck fleet from 77 to 325 over four years from 2017. A Rio Tinto spokesperson, however, clarified that the briefing numbers were indicative at the time and had changed with the company's knowledge of automation.

DRC to sign new mining code into law without concessions to miners

Democratic Republic of the Congo Prime Minister Bruno Tshibala on June 8 will sign into law regulations to immediately implement a new mining code, a move that could spark a legal battle between the government and major miners operating in the country, Reuters reported. The new code scraps protections for existing projects against changes to the fiscal regime, increases royalties and imposes a windfalls profit tax.

DIVERSIFIED

* Rio Tinto and China Minmetals Corp. entered into a formal agreement for their 50/50 exploration joint venture in China.

BASE METALS

* BlueBird Battery Metals Inc.'s stock jumped more than 32% in midday trading on June 7 after it signed a letter of intent to acquire Australian explorer Oberon Gold Pty. Ltd. from Providence Gold & Minerals Pty. Ltd. and two other sellers for cash and shares. Oberon holds the Sandy Point cobalt property and the polymetallic Reedy Creek property in New South Wales.

* China Nonferrous Metal Industry's Foreign Engineering and Construction Co. Ltd. has agreed to invest US$70 million in KAZ Minerals PLC's under-development Koksay project in Kazakhstan. The Chinese company will secure a 19.4% stake in the open-pit copper mine with the investment.

* JPMorgan was looking for buyers for A$156.9 million of Aurelia Metals Ltd. shares, or about 37% of the miner's outstanding capital, The Australian Financial Review's Street Talk reported, citing a term sheet sent to fund managers.

* The main union at BHP Billiton Group's Escondida copper mine in Chile presented its demands to the company, which now has until the weekend to deliver its counteroffer, Bloomberg News reported. The parties are scheduled to hold talks next week as the current contract is set to expire July 31.

* Copper miner OZ Minerals Ltd.'s takeover offer for Avanco Resources Ltd. received acceptances of 43.5%, and the offer is now unconditional.

* Separately, OZ Minerals CEO Andrew Cole said he is not worried about the company becoming a takeover target and would instead see any advances from suitors as a compliment, The Australian reported. "It would need to be for the right price, of course, because we've got plans to expand Prominent Hill and Carrapateena — plans that are not yet valued in the marketplace," Cole said.

* Private equity firm Cupric Canyon Capital LLC will start construction of its Khoemacau copper project in Botswana in October, Reuters reported, citing Johannes Tsimako, Khoemacau's manager.

PRECIOUS METALS

* Sibanye Gold Ltd. plans to accelerate deleveraging to a targeted level of 1x net debt and is mulling a streaming deal of US$500 million, and a separate US$100 million of working capital financing, CEO Neal Froneman said in a June 7 presentation.

* Petropavlovsk PLC is not satisfied with the list of five beneficiaries of Patia Trading Ltd., provided by CABS Platform Ltd. The board said it does not believe these individuals are the ultimate owners of CABS and said the disclosure is "yet another veil of secrecy." CABS is behind a proposal to replace all members of the current board at the company's next annual general meeting.

* Matsa Resources Ltd. received the final approval for the mining proposal, mine closure plan and project management plan for its Red Dog gold project in Western Australia, completing the project's permitting process and allowing mining to start immediately.

* Patagonia Gold PLC produced 10,662 gold equivalent ounces in the first quarter from its Cap Oeste project in Argentina at an average cash cost of US$693 per ounce. The company noted it is reviewing the production guidance for the year.

* The land forfeited by Impala Platinum Holdings Ltd. unit Zimplats Holdings Ltd. in Zimbabwe will be used by Karo Resources for its planned US$4.2 billion platinum project in the country, Bloomberg News reported, citing Zimbabwean Mines Minister Winston Chitando.

* Eastern Platinum Ltd. is seeking damages from certain former executives and directors related to payments totaling US$13.7 million to Serina Services AG and Ingwenya Inc.

* Claiming greater shareholder support in a battle for board control, the former CEO of Alexandria Minerals Corp. blasted some of his former colleagues as "nasty folk" and denied allegations he acted improperly in raising funds or in managing the company's exploration. "They're ignorant complaints," said Eric Owens, who was fired by Alexandria earlier this year and is now trying to reshape the junior explorer's board of directors.

* Sovereign Mines of Africa PLC, which has been an AIM cash shell since early 2017 announced an agreement to acquire a U.K. gastropub chain called Turf to Table and complete its exit from mining.

* PJSC Polyus estimates Russia's largest untapped gold deposit, Sukhoi Log, to have an average annual output of 1.6 million ounces of gold at a cash cost of US$420/oz to US$470/oz. The company said that an investment decision and start of construction CapEx spending are planned for 2020 and 2021, while production will commence in or around 2026.

* Two mine workers were found dead at the Cieneguita gold-silver complex in Chihuahua, Mexico, after a June 4 dam collapse swept away workers and machinery, Reuters reported. Authorities earlier said seven workers were missing after the incident.

* Gold Fields Ltd. agreed to earn up to a 70% joint venture interest in tenements in the western portion of Lefroy Exploration Ltd.'s namesake gold project in Western Australia.

BULK COMMODITIES

* S&P Global Ratings lowered Atlas Iron Ltd.'s long-term issuer credit rating to CCC from B- and placed the ratings on CreditWatch with developing implications, from CreditWatch with positive implications previously. S&P said Atlas' merger with Mineral Resources Ltd. would be positive for its credit quality, but the recent challenge from the new 19.9% shareholder Fortescue Metals Group Ltd. may result in the company going into default within the next 12 months if a transaction fails to materialize. The issue-level rating on the company's term loan B was also lowered to CCC and the recovery rating was retained at 3.

* Western Resources Corp. unit Milestone Potash Corp., which owns the Milestone potash project in Saskatchewan, entered an agreement with SNC-Lavalin Inc. to complete the detailed engineering for the project.

* TerraCom Ltd. secured sales for 520,000 tonnes at an average forecast price of US$92 per tonne from its Blair Athol thermal coal mine in central Queensland, Australia. The company said it is looking to lock in another 130,000 tonnes of sales in the coming weeks.

* Uncertainty lingers in the metallurgical coal market as China considers plans to increase U.S. coal imports in order to reduce the significant trade deficits between the two economies, sources said.

* European steel industry association Eurofer said an 8% increase in steel imports this year is a direct result of the import tariffs on the metal imposed by the U.S., which caused trade flows to be deflected to Europe, Reuters reported.

* Czech Republic-based Trinecké Zelezárny made a nonbinding offer for ArcelorMittal's ArcelorMittal Ostrava AS unit, Trinecke Zelezarny told Metal Bulletin.

SPECIALTY

* A dissident shareholder group, Greyling Investments Inc., dropped its bid to shake up the board of Global Atomic Corp.

* AVZ Minerals Ltd. shares closed more than 20% down on the ASX June 7 after Chairman Klaus Eckhof sold more than half of his stake in the company, The Australian reported.

* Botswana Diamonds Plc Managing Director James Campbell said the company is interested in acquiring liquidated BCL Mine's stake in the Maibwe Diamonds joint venture project, Reuters reported. BCL is selling its 51% interest in Maibwe Diamonds for an undisclosed amount.

* Battery cell maker Northvolt AB secured an environmental permit for what will be Europe's largest lithium-ion battery cell factory, Metal Bulletin reported. The initial phase of construction will begin June 8.

INDUSTRY NEWS

* Global oil majors' moves in recent years points to an "agnostic" future of energy production that could conceivably include owning or investing in battery minerals extraction companies which would be "small CapEx" compared to their usual spend and well within their capabilities, Deloitte's global LNG leader told S&P Global Market Intelligence.

* South African Minister of Mineral Resources Gwede Mantashe said the country has an eight-year backlog in the issuance of mining rights as proper processing of applications for mining licenses stalled over the years, Mining Weekly wrote. Addressing the recent mining related deaths in the country, Mantashe added that the department's Council for Geoscience and other stakeholders were paying special attention into seismicity.

* In the latest edition of S&P Global Market Intelligence's World Exploration Trends report, the company forecast a full-year exploration budget increase of 15% to 20%. Based on an increase in the number of meters of drilling started or announced in the March quarter, it appears that the industry's exploration activity is currently moving in line with projections.

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This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings, a separately managed division of S&P Global. Descriptions in this news article were not prepared by S&P Global Ratings. The original S&P Global Ratings documents referred to in this news brief can be found in the sources section.