B08 Metal Ore Mining

Sacked Rio exec set for legal stoush

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Original article by Peter Ker
The Australian Financial Review – Page: 1 & 12 : 18-Nov-16

Bold Baatar will succeed Alan Davies as CEO of Rio Tinto’s energy and minerals division, after the latter was dismissed following an internal investigation into a scandal regarding the Simandou iron ore project in Guinea. Davies has criticised Rio’s handling of the investigation, and he intends to take legal action over his dismissal. Rio has also sacked its head of legal affairs, Debra Valentine. The $US10.5m payment to a consultant in Guinea has been referred to regulatory authorities in Australia, the US and the UK.

CORPORATES
RIO TINTO LIMITED – ASX RIO, THE MELBOURNE MINING CLUB, AUSTRALIAN FEDERAL POLICE

‘Too far, too fast’ for iron ore upswing

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Original article by Jessica Sier
The Australian Financial Review – Page: 33 : 17-Nov-16

Katana Asset Management’s Romano Sala Tenna says the iron ore price has risen too quickly, and he notes that global supply is likely to increase if the price remains elevated. The pullback in the price of the steel input in mid-November 2016 has followed a rally in the wake of Donald Trump’s presidential election win. China’s Ministry of Industry & Information Technology recently forecast that the nation’s annual production of crude steel will fall to between 750 million and 800 million tonnes by 2020.

CORPORATES
KATANA ASSET MANAGEMENT LIMITED, CHINA. MINISTRY OF INDUSTRY AND INFORMATION TECHNOLOGY, UBS HOLDINGS PTY LTD, CLARKSONS PLATOU SECURITIES, BLOOMBERG WORLD IRON AND STEEL INDEX, REPUBLICAN PARTY (UNITED STATES)

Iron ore price surges, but producers wary of lifting output

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Original article by Jessica Sier
The Australian Financial Review – Page: 31 : 15-Nov-16

The spot price of iron ore with 62 per cent content has risen by 102 per cent since early 2016, and 22 per cent so far in November. However, Daniel Morgan of UBS does not believe that the current price is sustainable, noting that iron ore miners have not increased their production capacity in response to the price surge. He adds that the iron ore market is unlikely to benefit from the election of Donald Trump, as the US is not an iron ore importer.

CORPORATES
UBS HOLDINGS PTY LTD, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, MACQUARIE WEALTH MANAGEMENT, BC IRON LIMITED – ASX BCI, ATLAS IRON LIMITED – ASX AGO, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO

Fortescue in $US473m deal for ships funding

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Original article by Tess Ingram
The Australian Financial Review – Page: 20 : 15-Nov-16

Pure-play iron ore miner Fortescue Metals Group will finance its new fleet of bulk cargo vessels primarily via a $US473m loan from the China Development Bank Financial Leasing Company. Fortescue CEO Nev Power says it could potentially lead to more Chinese banks arranging structured financing deals in Australia. The fleet of eight very large ore carriers will cost $US556m in total, with delivery of the final one scheduled for mid-2018.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, CHINA DEVELOPMENT FINANCIAL LEASING COMPANY LIMITED, PATERSONS SECURITIES LIMITED

Grylls tax could crimp BHP dividend

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Original article by Peter Ker
The Australian Financial Review – Page: 13 & 18 : 14-Nov-16

BHP Billiton executive Mike Henry has warned that a proposed increase in Western Australia’s iron ore levy would cost the resources giant about $A1.3bn in forgone capital expenditure and dividend payments. He adds that a significant fall in spending capacity would have implications beyond Western Australia. Amongst other things, increasing the levy may affect BHP’s plans for the South Flank iron ore project, which is slated to replace the Yandi mine when it is exhausted. Rio Tinto’s Tom Price project is also nearing the end of its mine life.

CORPORATES
BHP BILLITON LIMITED – ASX BHPRIO TINTO LIMITED – ASX RIONATIONAL PARTY OF AUSTRALIACITIC PACIFIC MINING MANAGEMENT PTY LTDVALE SABP PLC

Chaney lashes WA Nats’ iron tax plan

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Original article by Paul Garvey, Eli Greenblat
The Australian – Page: 23 : 11-Nov-16

Wesfarmers chairman Michael Chaney has criticised a proposal by Western Australian National Party leader Brendon Grylls to increase the state’s iron ore levy. He argues that BHP Billiton and Rio Tinto already make a significant contribution to government revenue from taxes and mining royalties, and the existing arrangement for sharing GST revenue means WA’s income will not rise anyway. He adds that the levy increase would also result in job losses and reduced investment in WA, while Brazil would gain a greater share of iron ore exports at Australia’s expense.

CORPORATES
WESFARMERS LIMITED – ASX WES, NATIONAL PARTY OF AUSTRALIA, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, COLES SUPERMARKETS AUSTRALIA PTY LTD

Email trail led to Rio’s bribery investigation

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Original article by James Chessell
The Australian Financial Review – Page: 23 & 26 : 11-Nov-16

Francois de Combret has been named as the consultant who received a $US10.5m ($A13.7m) payment from Rio Tinto in connection with its Simandou iron ore project in Guinea. Rio Tinto executive Alan Davies has been suspended in the wake of revelations that the resources group is investigating the payment. It has also been revealed that former Rio Tinto CEOs Tom Albanese and Sam Walsh were involved in email discussions with Davies regarding the payment. Walsh was the head of the group’s iron ore division at the time.

CORPORATES
RIO TINTO LIMITED – ASX RIO, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, UNITED STATES. SECURITIES AND EXCHANGE COMMISSION, UNITED STATES. DEPT OF JUSTICE, GREAT BRITAIN. SERIOUS FRAUD OFFICE, BSG RESOURCES LIMITED, INTERNATIONAL CENTRE FOR SETTLEMENT OF INVESTMENT DISPUTES, LAZARD LLC, UBS AG, VEDANTA RESOURCES PLC

Iron ore price hits Hancock profits

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Original article by Paul Garvey
The Australian – Page: 24 : 11-Nov-16

Hancock Prospecting has revealed that its revenue fell from more than $A2bn in 2014-15 to $A1.72bn in 2015-16, while its net profit from operations was 33 per cent lower at $A443m. Hancock Prospecting has attributed the revenue and earnings deficit to a fall in the iron ore prices during the financial year. The group also notes that construction of the Roy Hill iron project resulted in its total debt rising to $A8.9bn.

CORPORATES
HANCOCK PROSPECTING PTY LTD, ROY HILL IRON ORE PTY LTD, RIO TINTO LIMITED – ASX RIO, HOPE DOWNS IRON ORE PTY LTD

Twiggy slams BHP, Rio for ‘high-grading’ ore

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Original article by Paul Garvey
The Australian – Page: 23 : 10-Nov-16

Fortescue Metals Group chairman Andrew Forrest had criticised BHP Billiton and Rio Tinto for focusing on the production of higher-grade iron ore and overlooking lower-grade ore that needs some processing before shipment. He argues that this merely reduces the value of an orebody and shortens a mine’s life. Fortescue itself uses a beneficiation process to upgrade the quality of lower-grade iron ore. Meanwhile, Forrest does not expect the financial market volatility in the wake of Donald Trump’s presidential election win to be sustained.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, BLUESCOPE STEEL LIMITED – ASX BSL, DEXUS PROPERTY GROUP – ASX DXS, DELOITTE TOUCHE TOHMATSU LIMITED, NATIONAL PARTY OF AUSTRALIA

BHP urges suppliers to join tax fight

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Original article by Peter Ker
The Australian Financial Review – Page: 25 & 30 : 10-Nov-16

BHP Billiton executive Mike Henry has warned that mining services firms would be adversely affected by the Western Australian National Party’s proposed increase in the state’s iron ore levy. He says the mining services sector should lobby against the policy, arguing that they will receive less work if the levy is increased from $A0.25 per tonne to $A5, while employment in the sector will fall. Henry also says there should be greater collaboration between resources groups and mining services firms.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, NATIONAL PARTY OF AUSTRALIA, RIO TINTO LIMITED – ASX RIO, ORICA LIMITED – ASX ORI