B08 Metal Ore Mining

Bigger isn’t better says CEO as Newcrest doubles its profit

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Original article by Paul Garvey
The Australian – Page: 20 : 15-Feb-19

Newcrest Mining has posted a 2018-19 interim net profit of $US237m ($334m), compared with $US98m previously. CEO Sandeep Biswas says the gold miner is well-placed to capitalise on any acquisition opportunities, but stresses that a deal would have to add value for shareholders. Biswas adds that mining companies should not pursue mergers and acquisitions simply to become larger unless the deal will add value. Newcrest shareholders will receive an interim dividend of $US0.075 per share.

CORPORATES
NEWCREST MINING LIMITED – ASX NCM, NEWMONT MINING CORPORATION, GOLDCORP INCORPORATED, BARRICK GOLD CORPORATION, RANDGOLD RESOURCES LIMITED, LUNDIN MINING CORPORATION, SOLGOLD PLC

Olympic Dam gains major development status from SA

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Original article by Simon Evans
The Australian Financial Review – Page: 2 : 15-Feb-19

BHP is expected to decide in late 2020 whether to proceed with a $2.7 billion expansion of its Olympic Dam copper and uranium mine in South Australia. The SA government advised on 14 February that any expansion of the mine would be granted major development status. The proposed expansion would see mining and production increase from 200,000 tonnes a year to 350,000 tonnes a year, and would involve an increased take of water from the Great Artesian Basin.

CORPORATES
BHP GROUP LIMITED – ASX BHP, WMC RESOURCES LIMITED, SOUTH AUSTRALIA. DEPT OF ENVIRONMENT, WATER AND NATURAL RESOURCES

Rising gold price makes Evolution think twice about acquisitions

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Original article by Brad Thompson
The Australian Financial Review – Page: 18 : 14-Feb-19

Evolution Mining has reported a 2018-19 interim net profit of $92m, down from $122.5m previously. Executive chairman Jake Klein anticipates further consolidation in the gold sector and he says the mid-tier miner is open to acquisitions. However, he stresses that Evolution will only consider assets that enhance the company’s portfolio and add value for shareholders. Meanwhile, Northern Star Resources has posted an interim net profit of $82m and revenue of $633.5m.

CORPORATES
EVOLUTION MINING LIMITED – ASX EVN, NORTHERN STAR RESOURCES LIMITED – ASX NST, BARRICK GOLD CORPORATION, RANDGOLD RESOURCES LIMITED, RBC CAPITAL MARKETS

Iron ore could surge upon China’s return

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Original article by Timothy Moore
The Australian Financial Review – Page: 21 : 11-Feb-19

March iron ore futures closed 3.1 per cent higher at $US92 a tonne in Singapore on 8 February. Capital Economics says the spot price of iron ore could rally on 11 February, when Chinese traders return to the market following the Lunar New Year break. The tailings dam disaster in Brazil in late January may also impact on the iron ore price. Shares in BHP, Rio Tinto and Fortescue Metals Group have rallied in the wake of the disaster, although Vale’s share price has slumped.

CORPORATES
CAPITAL ECONOMICS LIMITED, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA, TD SECURITIES, OXFORD ECONOMICS LIMITED, MACQUARIE WEALTH MANAGEMENT, ARCELOR MITTAL SA, CITIGROUP INCORPORATED, FASTMARKETS MB

Rio debt upgrade as iron ore rises

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Original article by James Thomson
The Australian Financial Review – Page: 22 : 8-Feb-19

Moody’s Investors Service has upgraded its rating on Rio Tinto’s debt from A3 to A2. The credit ratings agency has noted that Rio Tinto is better-placed to ride out periods of increased volatility in commodity prices as a result of its debt reduction strategy. The resources giant has slashed its debt from US28.5bn in 2013 to just $US12.5bn. Meanwhile, the iron ore price has risen to almost $US90 per tonne in the wake of the latest tailings dam disaster in Brazil, and some analysts say it could test $US100.

CORPORATES
RIO TINTO LIMITED – ASX RIO, MOODY’S INVESTORS SERVICE INCORPORATED, VALE SA

Brazilian closures test iron restraint

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Original article by Paul Garvey
The Australian – Page: 27 : 7-Feb-19

UBS analysts are among those to have forecast an iron ore surplus in 2019. However, this is in doubt after a Brazilian court ordered Vale to put production at its Brucutu iron ore mine on hold in the wake of the tailings dam disaster at its Feijao mine. Vale has responded by declaring force majeure over its iron ore shipments. Vivek Dhar of the Commonwealth Bank says the iron ore price could potentially rise above $US100 per tonne following the production halt at Brucutu, whose annual output is 30 million tonnes.

CORPORATES
VALE SA, UBS HOLDINGS PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO

Miners soar as gold and iron ore prices rise

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Original article by Paul Garvey
The Australian – Page: 24 : 6-Feb-19

Peter O’Connor of Shaw & Partners notes that Australian mining stocks have gained 17 per cent since 20 December. Shares in Fortescue Metals Group, BHP and Rio Tinto rallied on 5 February, after the spot price of iron ore for delivery to the port of Qingdao in China rose above $US81 per tonne. Analysts note that the market’s response to the latest iron ore tailings dam disaster in Brazil has been markedly different to the Samarco tragedy in 2015, when commodity prices had already been retreating.

CORPORATES
SHAW AND PARTNERS LIMITED, FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, VALE SA, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, ARGONAUT SECURITIES PTY LTD

Activist sees end of BHP dual-list

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Original article by Paul Garvey
The Australian – Page: 19 : 5-Feb-19

Activist hedge fund Elliott Management argues that BHP’s $529m settlement of a tax dispute in November has strengthened the case for the abolition of its dual-listed structure. Elliott CEO Paul Singer believes that such a move would have broad support among BHP shareholders in the wake of the deal with the Australian Taxation Office regarding its Singapore marketing hub. However, British shareholders may be reluctant to support scrapping the dual listing, which could potentially result in BHP’s removal from the FTSE 100.

CORPORATES
BHP GROUP LIMITED – ASX BHP, ELLIOTT MANAGEMENT CORPORATION, AUSTRALIAN TAXATION OFFICE, FTSE 100 INDEX, FEDERAL COURT OF AUSTRALIA, RIO TINTO LIMITED – ASX RIO, GLENCORE PLC

Iron ore surge predicted to be temporary

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Original article by Timothy Moore
The Australian Financial Review – Page: 23 : 4-Feb-19

The spot price of iron ore rose above $US85 per tonne in the wake of the latest tailings dam disaster in Brazil. Goldman Sachs and Fitch Ratings are among the firms that have upgraded their iron ore price forecasts, and Capital Economics has suggested that it could peak at around $US100 per tonne. Meanwhile, Liberum Research still expects the iron ore price to retreat to $US50/tonne in 2019 and around $US40/tonne in 2020.

CORPORATES
THE GOLDMAN SACHS GROUP INCORPORATED, FITCH RATINGS LIMITED, CAPITAL ECONOMICS LIMITED, LIBERUM RESEARCH, VALE SA, FASTMARKETS MB

China demand to drive earnings: Fortescue

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Original article by Perry Williams
The Australian – Page: 24 : 1-Feb-19

Fortescue Metals Group has advised that its iron ore shipments for the December 2018 quarter totalled 42.5 million tonnes, an increase of five per cent year-on-year. The result included its first shipments of the higher-grade West Pilbara Fines. Meanwhile, Fortescue expects its earnings to be boosted by renewed demand for lower-grade iron ore among Chinese steel mills. The pure-play miner also says it is too soon to determine the likely impact of the latest tailings dam collapse in Brazil on the iron ore price.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA