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South Deep output should resume in 2019; Acacia progresses tax row talks

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South Deep output should resume in 2019; Acacia progresses tax row talks

TOP NEWS

South Deep output seen resuming in 2019 as strike ends

Gold Fields Ltd. is likely to fully restart operations at its South Deep gold project in 2019 after the National Union of Mineworkers called off a six-week strike over layoffs, Reuters reported. A company spokesperson told the newswire that although some teams were back at work, output would be negligible until 2019 due to a break for the Christmas season, training and checks to ensure mine safety.

Barrick's Acacia Mining advances discussions with Tanzania over tax row

Barrick Gold Corp. and Tanzania advanced in talks to settle a two-year tax row involving the African country and Barrick's 63.9%-owned Acacia Mining PLC unit, but it is premature to say if a deal has been reached, Reuters reported, citing a person familiar with the matter. The source told the newswire that the meeting, which included Tanzanian government officials, Barrick, and Randgold Resources Ltd., which the Toronto-based miner is acquiring, "appears to have gone well," but with "nothing in writing." A separate, same-day report by Bloomberg News, however, reported that Barrick reached a deal with Tanzania on a US$300 million payment Acacia will make in installments.

Germany, Bolivia forge lithium development partnership

Bolivian state company YLB forged a partnership with private German company ACI Systems to develop its Uyuni salt flat in the Andes, one of the globe's largest deposits, Reuters reported. The deal will also cover building a lithium hydroxide plant and establishing a factory for electric vehicle batteries in Bolivia. The joint venture aims to produce up to 40,000 tons of lithium hydroxide per annum for 70 years starting in 2022.

BASE METALS

* The sale of BHP Group's Cerro Colorado copper mine in Chile to private equity manager EMR Capital Group fell through due to financing issues, Reuters reported. Both parties agreed to call off the transaction "after it became clear that financing conditions would not be met within the agreed upon timeline," a BHP spokesperson told Reuters, without providing additional details.

* Greece is looking at ways to ensure uninterrupted electricity supply for Larco SA, which operates the Larco nickel project, in an effort to avert the possible closure of Europe's largest nickel producer, Reuters reported. The state holds a 55% interest in Larco, which owes about €280 million in unpaid electricity bills to state-controlled power utility Public Power Corp. SA.

* Southern Copper Corp. CFO Raúl Jacob said Elmer Cáceres' election as the new regional governor of Peru's Arequipa region should not interfere with the approval process for the construction of the Tia María copper project as the project's approval is under the jurisdiction of the national government, El Comercio reported. Jacob said in a report by Gestión that the planned start of production at Tia María may be delayed to 2023 from the first quarter of 2021 if Peru's Ministry of Energy and Mines does not grant the construction permits before the end of 2018.

* NGEx Resources Inc. plans to spin out its Josemaria copper project in Argentina's San Juan province into a stand-alone public company.

* Surge Exploration Inc. signed a defininitive agreement for an option to acquire the 1,059-hectare Atacama Cobalto exploration property in Chile from Compañía Minera del Pacífico SA

* Aura Minerals Inc. declared commercial production at its Aranzazu copper-gold mine in Mexico, effective Dec. 10, nearly two months ahead of schedule and below budget.

* Emgold Mining Corp. signed a letter of intent with MSM Resource LLC to lease, with an option to purchase, the Marietta copper property in Nevada.

* Kopore Metals Ltd. will begin a planned exploration program in Namibia after securing the environmental clearance certificates for all eight of its prospecting licenses.

* S&P Global Market Intelligence's Metals and Mining Research team estimates that benchmark treatment charges will increase in 2019 as concentrate stocks increase. The team said concentrate stocks will increase to 4.8 weeks of demand for concentrate in 2019, up from 4.3 weeks in 2018. As a result, S&P expects benchmark treatment charges to be set at approximately 7% of its forecast London Metal Exchange zinc cash price, up from about 5% of 2018 zinc prices.

* The Metals and Mining Research team at S&P Global Market Intelligence expects Chinese smelter output to increase 5.4% year over year in 2019, which is greater than the 3.6% increase estimated for this year. Smelter output is expected to total 7.1 million tonnes in 2018 and has been driven by the ramp-up of new smelter capacity installed in the second half. Global smelter output will rise 1.8% to 18.9 Mt in 2019, twice the expected growth of copper mine output of 0.9% to 20.7 Mt.

PRECIOUS METALS

* Cia. de Minas Buenaventura SAA is temporarily suspending production at its Orcopampa gold mine in Peru from Dec. 17 through Jan. 31, 2019, to focus on centralizing the operation. The company made the decision in line with its strategy to prioritize Orcopampa's debottlenecking program over ore extraction.

* Despite having spent more than US$1 billion on early-stage exploration since the modern Gold Fields was founded in 1998 and two multimillion-ounce deposits were discovered, Johannesburg-based Gold Fields Ltd. has never taken a project from discovery to production, demonstrating how elusive greenfields exploration success can be, the Metals and Mining Research team at S&P Global Market Intelligence reported.

* Anglo American Platinum Ltd. unit Rustenburg Platinum Mines Ltd. closed the sale of its 33% interest in the Bafokeng-Rasimone platinum joint venture in South Africa to Royal Bafokeng Platinum Ltd. and Royal Bafokeng Resources Pty. Ltd. Meanwhile, Rustenburg Platinum Mines reached an agreement with Atlatsa Resources Corp. resulting in a 300 million South African rand acquisition of the resources in Atlatsa's Kwanda North and Central Block prospecting rights.

* Ramelius Resources Ltd. is improving its takeover bid for Explaurum Ltd. by 2 Australian cents per share in addition to the existing consideration of 1 Ramelius share for every 4 Explaurum shares. This brings Ramelius' best and final consideration to 13.4 cents per share.

* Roxgold Inc. completed the plant expansion at the Bagassi South gold project in Burkina Faso on schedule and about US$2.8 million under budget, increasing capacity at the plant by nearly 50% to 400,000 tonnes per annum.

* Matsa Resources Ltd. signed an agreement with GME Resources Ltd. to acquire the Devon gold project and the surrounding project area in Western Australia for A$100,000 in cash and shares.

* Erris Resources PLC and Centerra Gold Inc. submitted two applications for new gold targets in northern Sweden and a reservation application for a priority gold target in Finland, which they plan to advance in the first half of 2019. Centerra Gold elected not to continue drilling on the Brännberg project as the mineralized system did not demonstrate potential for a resource of more than 1 million gold ounces. Brännberg will revert back to Erris. Käringberget will be given up after Centerra's exploration found the project had limited mineralization potential.

* PowerOre Inc. agreed to fully acquire the Opemiska copper mine complex in Quebec from privately owned company Explorateurs-Innovateurs de Québec inc. in a cash and share deal.

* Landore Resources Ltd. will release a preliminary economic assessment and an updated resource estimate in February 2019 for the BAM gold deposit, part of its Junior Lake property in Ontario.

* Capricorn Metals Ltd. secured a A$107 million funding package from Macquarie Bank to fund most of the construction costs for the Karlawinda gold project in Western Australia.

* Decade Resources Ltd. entered into an option agreement with Rotation Minerals Ltd. to acquire a 100% interest in the Bow gold-silver claims in British Columbia.

BULK COMMODITIES

* Struggling with low prices in Shanghai, China's Henan Zhongfu Industrial Co. Ltd suspended 30% of its aluminum capacity by closing a 250,000 tonne-per-year smelter in the city of Linzhou in Henan, Reuters reported. The company plans to transfer this capacity to China's Sichuan as the company was "facing relatively large pressure on production operations" at the Linzhou site due to rising coal prices and production limits during the winter.

* Project Halo, a South African consortium, submitted the winning bid of 3.05 billion South African rand for three major assets owned by Gupta family-linked Tegeta Exploration and Resources Pty. Ltd., which has been in administration since February, Bloomberg News reported. The sale includes Optimum Coal Holdings Ltd. for a maximum of 2.8 billion rand, Koornfontein Mines Pty. Ltd. for 200 million rand, and Optimum Coal Terminal Pty. Ltd. for 50 million rand, according to the term sheet seen by Bloomberg.

* ThyssenKrupp AG's incoming supervisory board member, Martina Merz, emerged as the front-runner to lead the company's supervisory board, Reuters reported, citing sources. The supervisory board could add a proposal to appoint Merz as chairperson in the invitation to the company's Feb. 1 annual general meeting, the sources added.

* Unionized railway workers at Aurizon Holdings Ltd., represented by the Rail, Tram and Bus Union, are planning to go on strike after pay negotiations hit a snag, Reuters reported. Queensland, Australia, miners including BHP Group, Glencore PLC, Anglo American PLC and BTU Metals Corp. may see coal shipments from mine to port delayed due to the strike action.

* Flinders Mines Ltd. applied to the ASX to delist its shares on the bourse, citing various challenges in progressing its Pilbara iron ore project in Western Australia.

* Mount Gibson Iron Ltd. said it is on track to restart the Koolan Island iron ore project in Western Australia and begin ore sales by the end of March 2019. Initial waste mining has started.

* Clive Palmer and Mineralogy Pty. Ltd. filed another case in Western Australia's Supreme Court, demanding that the court make Chinese rival Citic Ltd. pay the nearly A$200 million in royalties awarded in a 2017 ruling, The West Australian reported.

* The Western Australian government is set to announce a new class of mining lease for minerals found in brine, slashing rental rates for potash producers to A$2.32 per hectare, compared to the standard A$18.70 per hectare, for the first five years of the lease and to A$4.64 per hectare from the sixth year on.

* The Yerunakovskaya-VIII coal mine in Russia, owned by Evraz PLC's PJSC Raspadskaya unit, suspended mining operations due to fire at a conveyor belt, Vedomosti reported. There were no injuries from the incident.

SPECIALTY

* Bacanora Lithium PLC Chairman Mark Hohnen said the company is in talks with financial advisers over listing its Deutsche Lithium GmbH unit on "at least one public market in 2019."

* Gemfields Group Ltd. CEO Sean Gilbertson said in an interview that the company is keen on acquiring new sapphire assets in Africa, with the potential deals to be unveiled in the third quarter of 2019. Gilbertson also said the miner is eager to increase both its emerald and ruby footprint.

* Botswana Diamonds PLC is in advanced negotiations with a major diamond producer over a partnership in its Sunland Minerals Pty. Ltd. venture, which holds prospecting licenses in the Kalahari and Orapa areas of Botswana. Managing Director James Campbell said, "Negotiations are far advanced, but you never quite know when the ink will go onto paper, particularly when you are dealing with a large producer."

* A definitive feasibility study for Platina Resources Ltd.'s namesake Platina scandium project in New South Wales, Australia, estimated a posttax net present value, at an 8% discount, of US$166 million with an internal rate of return of 29%.

* Northern Graphite Corp.'s review of the Bissett Creek graphite project in Ontario outlined a posttax net present value of C$150 million, at an 8% discount rate, and an internal rate of return of 22%.

* Galan Lithium Ltd. received permits from the Secretaria de Estado de Minería — Gobierno de Catamarca to conduct a maiden drill program at its Candelas lithium project in Argentina, which is due to start in early January 2019.

* Frontier Lithium Inc. expanded its PAK lithium project in Ontario through the addition of 725 claim cells covering 14,248 hectares.

* Fura Gems Inc. published the maiden inferred resource estimate for its 76%-owned Coscuez emerald mine in Colombia of 6 million carats of emeralds contained in 3 million tonnes grading 2.0 carats per tonne. This is the first resource estimate for emeralds in the South American nation. The explorer vows to gradually phase out informal miners' access to Coscuez shafts while helping locals find alternative employment, Reuters reported.

* Savannah Resources PLC successfully produced salable quartz and feldspar co-products during ongoing metallurgical test work at its Mina do Barroso lithium project in Portugal. The company said the co-products offer a significant possible upside to project economics. Savannah is planning further testing to assess their viability by generating samples for client assessment. Additionally, producing quartz and feldspar products could allow the company to lower waste generation, minimizing Mina do Barroso's potential environmental footprint.

* Advantage Lithium Corp. engaged GHD Chile SA for early engineering at the Cauchari lithium joint venture in Argentina with Orocobre Ltd. toward the completion of a feasibility study by June 2019.

INDUSTRY NEWS

* Peruvian President Martin Vizcarra is looking to boost annual mining investment to US$8 billion when his term ends in 2021, compared with the US$4.6 billion forecast for 2018, Bloomberg News reported. According to Peru's Mines and Energy Ministry, the country's Cajamarca region could attract up to US$18.2 billion of investments in new projects.

* The world's 25 largest mining companies had an aggregate market capitalization of US$623.18 billion at the end of November, with 15 companies posting month-over-month reductions. The November total was down 10.9% from the aggregate US$699.54 billion capitalization of the top 25 companies at the end of October.

* Junior and intermediate companies' aggregate financing tumbled 65% month over month in November, the second consecutive monthly decline. The total amount raised for precious metals, base metals and specialty commodities was only US$274 million, a 33-month low.

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