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BHP to invest US$3B on Olympic Dam expansion

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

State of the Market: Mining Q2-2020


BHP to invest US$3B on Olympic Dam expansion

TOP NEWS

BHP to invest US$3B on Olympic Dam copper mine expansion to double output

BHP Billiton Group will invest around US$3 billion into an overhaul and expansion of its Olympic Dam copper mine in South Australia, The Australian reported. The miner outlined new plans for an immediate US$800 million injection to stabilize the project over the next few years, to be potentially followed in 2020 by a US$2.1 billion brownfields expansion that would double the mine's output.

Highland Gold to double output in midterm on Kekura project commissioning

Highland Gold Mining Ltd. is looking to double its gold output to 500,000 ounces per annum over the next few years as it brings online its Kekura project in Russia, CEO Denis Alexandrov told S&P Global Market Intelligence on the sidelines of the London Mines and Money conference.

Mechel Q3 coal, pig iron output rises; steel production falls

Russia's Mechel PAO posted mixed third-quarter production results, with run-of-mine coal and pig iron output each increasing by 2% quarter on quarter to 5.4 million tonnes of run-of-mine coal and 1 million tonnes of pig iron and steel production declining by 9% to 1 million tonnes.

BASE METALS

* Codelco reiterated that copper production from its Andina Division in Chile will not be affected by the planned closure of the division's underground operations in 2022, Metal Bulletin reported, citing the company. The statement comes after union workers blocked access to the Andina mine to protest the closure.

* European Cobalt Ltd. acquired a significant portfolio of cobalt-copper-nickel projects, dubbed the Basinge project, in Sweden's Bergslagen district via direct license application.

* Save the Scenic Santa Ritas, the Arizona Mining Reform Coalition, the Center for Biological Diversity and the Sierra Club filed a lawsuit challenging the U.S. Forest Service's approval of Hudbay Minerals Inc.'s Rosemont copper project in Arizona. The lawsuit alleges the forest service failed to comply with mandatory procedural and substantive requirements before granting the approval.

* Alexander Mining Plc unit MetaLeach Ltd. was granted the patent for a method of oxidative leaching of sulfide ores and concentrates in the U.S. The patent has a 20-year term, effective from June 13, 2010.

* Eastern Field Developments Ltd., the bidding vehicle for an Indonesian consortium looking to take over Finders Resources Ltd., said the recent operational and financial downgrades by the target company "raise serious questions about Finders' ability to achieve its long-stated production goals and extend mine life." The consortium tabled a 23 Australian-cent-per-share cash offer in October.

* New Century Resources Ltd.'s restart feasibility study for the Century zinc mine in Queensland, Australia, pegged a net present value, discounted at 8%, of A$1.31 billion and a 270% internal rate of return. Start-up capital cost is estimated at A$50 million and post-commissioning ramp-up capital cost, including a soluble zinc plant, is estimated at A$63 million. The mine is expected to produce 507,000 dry tonnes of zinc concentrate per annum during its 6.3-year mine life.

* Ivanhoe Mines Ltd. updated the preliminary economic assessment for its Kamoa-Kakula copper project in the Democratic Republic of the Congo, incorporating 50%-higher mining rates than the December 2016 PEA. The new PEA estimated a net present value, discounted at 8%, of US$7.2 billion, a 33% internal rate of return and a 44-year mine life.

PRECIOUS METALS

* Tanami Gold NL completed the sale of its interest in the Western Tanami gold project in Western Australia for A$4 million to Northern Star (Tanami Gold) Pty. Ltd., a wholly owned subsidiary of Northern Star Resources Ltd.

* Rockcliff Metals Corp. acquired the Lucky Jack gold property in Manitoba through its Goldpath Resources Corp. unit. Lucky Jack covers 2,557 hectares immediately south of the company's Laguna gold project.

* Golden Queen Mining Co. Ltd. filed a final short form prospectus in Alberta and Ontario in connection with a previously planned rights offering to raise up to US$25.0 million.

* Integra Resources Corp. plans to spend C$10 million exploring the DeLamar gold project, a past producing mine in Idaho, in 2018.

* S&P Global Ratings revised its outlook on New Gold Inc. to stable from negative while also affirming the miner's B long-term corporate credit rating.

* Lonmin Plc's future is hanging in the balance as South Africa's Department of Mineral Resources investigates allegations that the miner violated social and labor plans, fin24 reported. A nonprofit organization, Mining Forum SA, wrote to Mining Minister Mosebenzi Zwane asking him to suspend the company's mining license over noncompliance.

* The Federal Supreme Court of Ethiopia dismissed all claims against KEFI Minerals Plc on the impact of exploration field activities conducted between 1998 and 2006, a period that predated KEFI's involvement in the Tulu Kapi gold project. The original claim of US$12 million was previously reduced to US$600,000, but now the company is no longer liable for any damages.

* Primary Gold Ltd. entered into a memorandum of understanding with Westgold Resources Ltd. for an exclusive period until Dec. 31 to negotiate a two-year toll treatment agreement for processing the former's Coolgardie gold project ore at Westgold's 1.2 million-tonne-per-annum Jubilee mill in Western Australia.

* Mining services provider Ausdrill secured contract extensions at AngloGold Ashanti Ltd.'s Iduapriem gold mine in Ghana and at Resolute Mining Ltd.'s Syama gold mine in Mali, as well as for Evolution Mining Ltd.'s Mungari gold project in Western Australia, Mining Weekly reported.

* A two-day clash between Guinean and Malian villagers over control of a gold mine straddling the countries' joint border left at least 17 dead, Reuters reported, citing a Guinean official.

BULK COMMODITIES

* Vale SA and Mitsui & Co. Ltd. signed binding financing contracts that will raise US$2.73 billion for the Nacala Logistic Corridor project. The rail and port infrastructure project aims to link Vale's Moatize coal mine in Mozambique to the Nacala-à-Velha terminal, where the miner will build a deepwater seaport.

* ArcelorMittal will redeem all of its outstanding US$643.5 million of its US$1.50 billion 6.125% notes due June 1, 2018, on Dec. 28.

* U.S. Commerce Secretary Wilbur Ross said his department was self-initiating anti-dumping and countervailing duty investigations of common alloy aluminum sheet imports from China.

* Minbos Resources Ltd. terminated the merger agreement to acquire its 50% joint venture partner in the Cabinda phosphate project in Angola, Petril Phosphates Ltd.

* Indian steelmaker Essar Steel India Ltd. struck an agreement with Jastrzebska Spólka Weglowa SA for the potential purchase of raw materials from the polish miner through 2030, Puls Biznesu reported.

SPECIALTY

* French prosecutors raided the headquarters of state-owned Areva SA, the Financial Times reported. The national financial prosecutor's office, however, did not confirm the reason for the search. According to one of the sources, the search was not related to an ill-fated acquisition of several African uranium mines.

* PJSC Alrosa is auctioning a rare diamond collection called The Dynasty, which includes a giant 51.38-carat stone.

* A large oval-shaped 14.93-carat diamond named the Pink Promise was sold to an anonymous buyer for US$32 million in Hong Kong, just short of breaking a world auction record, Reuters reported.

* Hastings Technology Metals Ltd.'s definitive feasibility study for its Yangibana rare earths project in Western Australia pegged an after-tax net present value, discounted at 8%, of A$466 million, a 78% internal rate of return and a 2.3-year payback period. Preproduction capital costs are estimated at A$335.3 million, with operating costs of A$17.06/kilogram of total rare earth oxides.

* Galaxy Resources Ltd. executed binding, long-term off-take contracts with multiple customers throughout Asia. The company's Galaxy Lithium Australia Ltd. unit that owns the Mount Cattlin project in Western Australia agreed to sell 100% of the planned lithium production from the project for five years beginning in 2018.

* European Metals Holdings Ltd. posted a further upgrade in resources for its Cinovec lithium-tin project in the Czech Republic. The indicated resource is pegged at 372.4 million tonnes grading 0.44% lithium oxide, representing a 7% increase compared to the previous estimate. The total resource now stands at 695.9 million tonnes.

INDUSTRY NEWS

* Sentiment across the mining industry continues to improve as investors and producers become more upbeat about the outlook for the sector, feedback from this year's Mines and Money conference in London showed. Nonetheless, consensus remains divided on whether the sector is actually at the beginning of the next bull market.

* Goldman Sachs Group is among the five bidders for the metals trading arm of Canada's Bank of Nova Scotia, ScotiaMocatta, for which the bank is seeking up to US$1 billion, Reuters reported, citing sources. JPMorgan is running the sale process, with the aim of completing the transaction before the end of March 2018.

* Brazil's Senate approved a bill creating an autonomous regulatory agency for the mining sector, Reuters reported. The bill will return to President Michel Temer for a signature, creating a permanent law based on a temporary decree.

S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.

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.