B06 Coal Mining

South32 mine closure takes toll on shares

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Original article by Tess Ingram
The Australian Financial Review – Page: 13 : 11-Jul-17

The price of coking coal could be boosted by the continued shutdown of South32’s Appin mine in New South Wales. South32 shares closed 3.2 per cent lower at $A2.72 on 10 July, as the company signalled that production at the mine will remain on hold for some time, pending a safety review. Work at the mine was suspended in May after South32 detected high levels of gas. South32 has stressed that the safety of workers is its top priority.

CORPORATES
SOUTH32 LIMITED – ASX S32, UBS HOLDINGS PTY LTD, MORGANS FINANCIAL LIMITED, STANDARD AND POOR’S ASX 200 INDEX, NEW SOUTH WALES. DEPT OF PLANNING AND ENVIRONMENT

Rio weighs up $3.5bn mines windfall

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Original article by Matt Chambers, Paul Garvey
The Australian – Page: 22 : 30-Jun-17

Rio Tinto will proceed with the sale of its Hunter Valley coal mines to Yancoal after its Australian shareholders endorsed the $US2.69bn ($3.5bn) deal on 29 June. Shareholders in Rio Tinto’s London-listed entity had approved the sale earlier in the week, and Rio has advised that more than 97 per cent of shareholders overall voted for the deal. Some analysts and investors have suggested that part of the proceeds should be returned to shareholders via a share buyback or an increased dividend, but chairman Jan du Plessis says the miner will consider its options in due course.

CORPORATES
RIO TINTO LIMITED – ASX RIO, YANCOAL AUSTRALIA LIMITED – ASX YAL, GLENCORE PLC, SHAW AND PARTNERS LIMITED, UBS HOLDINGS PTY LTD, COAL AND ALLIED INDUSTRIES LIMITED, YANKUANG CORPORATION GROUP LIMITED

Rio Tinto backs Yancoal bid again

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Original article by James Thomson
The Australian Financial Review – Page: 13 & 18 : 27-Jun-17

Rio Tinto has concluded that Yancoal’s bid for its Hunter Valley coal assets is superior to the rival offer from Glencore, despite the latter’s sweetened bid. Glencore has made a cash offer of $US2.675bn for the thermal coal assets, but Rio notes that it could take 12 months for Glencore to gain regulatory approval. In contrast, Yancoal is offering $US2.45bn in cash and royalty payments of $US240m, while it is expected to pass the last regulatory hurdles within months.

CORPORATES
RIO TINTO LIMITED – ASX RIO, YANCOAL AUSTRALIA LIMITED – ASX YAL, GLENCORE PLC, COAL AND ALLIED INDUSTRIES LIMITED, ROYAL BANK OF CANADA, YANKUANG CORPORATION GROUP LIMITED, SENRIGAN CAPITAL GROUP LIMITED, NOBLE GROUP LIMITED, BLOOMBERG LP, CITIGROUP PTY LTD

Yancoal tipped to match Rio bid by Glencore

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Original article by James Thomson
The Australian Financial Review – Page: 13 & 18 : 26-Jun-17

Peter O’Connor of Shaw & Partners says Rio Tinto’s sale of its Hunter Valley coal assets will be a good deal for shareholders, as the bidding war between Glencore and Yancoal continues. Glencore has sought to trump Yancoal by increasing its own offer, which is now $US255m higher than Yancoal’s offer of $US2.45bn. Rio Tinto recently named Yancoal as preferred bidder, and its board is likely to respond to Glencore’s revised offer on 26 June. Meanwhile, analysts expect Rio Tinto to use the proceeds of the sale to increase its 2017 dividend.

CORPORATES
RIO TINTO LIMITED – ASX RIO, YANCOAL AUSTRALIA LIMITED – ASX YAL, GLENCORE PLC, COAL AND ALLIED INDUSTRIES LIMITED, SHAW AND PARTNERS LIMITED, ROYAL BANK OF CANADA, BLOOMBERG LP, YANKUANG CORPORATION GROUP LIMITED, CHINA. MINISTRY OF COMMERCE, CITIGROUP PTY LTD

Rio Tinto coal deal raises hopes of bigger payouts

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Original article by James Thomson
The Australian Financial Review – Page: 15 & 30 : 22-Jun-17

Rio Tinto shareholders will vote on Yancoal’s $US2.45bn ($A3.2bn) offer for its Hunter Valley thermal coal assets on 27 June. Rio Tinto CEO Jean-Sebastien Jacques says Yancoal was chosen as preferred bidder due to factors such as its decision to drop a deferred payment plan and the fact that it has already gained some regulatory approvals. Peter O’Connor of Shaw & Partners expects Rio Tinto to use some of the proceeds of the sale to increase its dividend payout, while he adds that another share buyback is also possible.

CORPORATES
RIO TINTO LIMITED – ASX RIO, YANCOAL AUSTRALIA LIMITED – ASX YAL, GLENCORE PLC, COAL AND ALLIED INDUSTRIES LIMITED, SHAW AND PARTNERS LIMITED, ROYAL BANK OF CANADA, CITIGROUP PTY LTD, GREAT BRITAIN. SERIOUS FRAUD OFFICE, BLOOMBERG LP, BARCLAYS BANK PLC

Glencore chief pitches Hunter Valley plan to Rio Tinto bosses

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Original article by Scott Murdoch
The Australian – Page: 17 : 19-Jun-17

Rio Tinto will shortly decide which of two rival bids for its Hunter Valley coal assets it will support. Glencore has offered $US2.55bn ($A3.35bn) for the Coal & Allied assets, compared with a $US2.45bn offer from China-backed Yancoal. A team of Glencore executives led by global CEO Peter Freyberg held talks with Rio Tinto executives on the weekend of 17-18 June regarding the bid. Glencore expects significant synergies by combining the Rio assets with its existing coal mines in the Hunter Valley.

CORPORATES
RIO TINTO LIMITED – ASX RIO, GLENCORE PLC, YANCOAL AUSTRALIA LIMITED – ASX YAL, COAL AND ALLIED INDUSTRIES LIMITED, YANZHOU COAL MINING COMPANY LIMITED, PORT WARATAH COAL SERVICES LIMITED

Adani’s end of year wait for loan decision

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Original article by Mark Ludlow, Peter Ker
The Australian Financial Review – Page: 6 : 8-Jun-17

Adani aims to finalising funding for the first stage of the $A16.5bn Carmichael coal project in December 2017. Adani still hopes to partially fill a $A3.3bn funding deficit via a concessional loan from the Northern Australia Infrastructure Facility. Resources Minister Matthew Canavan says the NAIF’s board is not expected to make a decision on the loan until the end of the year. Wood Mackenzie estimates that the thermal coal price will need to average $U82 per tonne – compared with $US74 at present – for the first stage of the Carmichael project to achieve a 15 per cent rate of return.

CORPORATES
ADANI MINING PTY LTD, ADANI ENTERPRISES LIMITED, NORTHERN AUSTRALIA INFRASTRUCTURE FACILITY, AUSTRALIA. DEPT OF INDUSTRY, INNOVATION AND SCIENCE, AURIZON HOLDINGS LIMITED – ASX AZJ, WOOD MACKENZIE

Quarterly coal contract system to ‘fall over’

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Original article by Julie-anne Sprague
The Australian Financial Review – Page: 25 : 8-Jun-17

There is growing expectation that Japanese coal buyers will abandon the traditional quarterly contract price system in favour of one based on the spot price. Wesfarmers’ incoming CEO Rob Scott believes that Japan’s steel mills could opt for a new pricing system within weeks. BHP Billiton’s chief commercial officer, Arnoud Balhuizen, also recently flagged a shift away from contract pricing. Meanwhile, Scott has indicated that the sale of Wesfarmers’ coal assets is still on the agenda.

CORPORATES
WESFARMERS LIMITED – ASX WES, BHP BILLITON LIMITED – ASX BHP, THE MELBOURNE MINING CLUB, STANWELL CORPORATION LIMITED

Aussie mine focus as Peabody beats bankruptcy

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Original article by Matt Chambers
The Australian – Page: 18 : 10-Apr-17

Peabody Energy Corporation has been reinstated to the New York Stock Exchange after emerging from Chapter 11 bankruptcy protection. Peabody has reduced costs, sold or shut down coal mines and slashed its debt by $US5bn since filing for bankruptcy in April 2016. CEO Glenn Kellow has stressed the importance of Peabody’s coking and thermal coal mines in Queensland and New South Wales, noting that its Australian operations provides the company with access to the Asia-Pacific market. He adds that Australia should consider building clean coal power stations.

CORPORATES
PEABODY ENERGY CORPORATION, NEW YORK STOCK EXCHANGE, BHP BILLITON LIMITED – ASX BHP, SOUTH32 LIMITED – ASX S32, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

Coal shares tumble as China abandons limits

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Original article by Peter Ker, Lisa Murray
The Australian Financial Review – Page: 13 & 18 : 9-Mar-17

China’s National Development & Reform Commission has advised that it might not reinstate restrictions on the number of days the nation’s coal mines can operate. The NDRC has indicated that this will depend on the outlook for coal prices. Shares in Australian coal producers have fallen in response to the NDRC’s statement, including Yancoal Australia and Whitehaven Coal. Thermal and coking coal prices rallied in the wake of China’s decision to limit production to 276 days year in early 2016.

CORPORATES
CHINA. NATIONAL DEVELOPMENT AND REFORM COMMISSION, YANCOAL AUSTRALIA LIMITED – ASX YAL, WHITEHAVEN COAL LIMITED – ASX WHC, STANMORE COAL LIMITED – ASX SMR, NEW HOPE CORPORATION LIMITED – ASX NHC, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, SDIC INVEST, RBC CAPITAL MARKETS, TERRACOM LIMITED – ASX TER, REALM RESOURCES LIMITED – ASX RRP, AUSTRALIAN PACIFIC COAL LIMITED – ASX AQC, ANGLO AMERICAN PLC, SOUTH32 LIMITED – ASX S32