B08 Metal Ore Mining

Supply cuts and firmer demand may lift prices

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Original article by Rose Powell
The Australian Financial Review – Page: 31 : 21-Oct-15

The iron ore price has fallen by 25.2 per cent so far in 2015 and 48.3 per cent in the last year. Oversupply has also prompted the price of Brent crude oil to fall by 15.05 per cent in 2015 and 47.1 per cent over the last 12 months. Julian Jessop of Capital Economics expects the crude oil price to rebound more quickly than iron ore. Meanwhile, HSBC forecasts that iron ore will continue to trade within a range of $US50 to $US60 per tonne for the next several years.

CORPORATES
CAPITAL ECONOMICS LIMITED, HSBC AUSTRALIA HOLDINGS PTY LTD, MORGAN STANLEY AND COMPANY INCORPORATED, CITIGROUP PTY LTD, ORGANISATION OF PETROLEUM EXPORTING COUNTRIES, ROY HILL IRON ORE PTY LTD

BHP may cut dividend if DLC changes fail

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Original article by Peter Ker
The Australian Financial Review – Page: 19 : 21-Oct-15

CGI Glass Lewis has recommended that BHP Billiton shareholders support a resolution to transfer funds from its Australian-listed entity to its UK-listed company. The proposed payment is necessary to allow shareholders in both companies to continue receiving the same dividend payout. CGI Glass Lewis has warned that all shareholders could face lower dividend payouts if the resolution is rejected.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, CGI GLASS LEWIS PTY LTD, SOUTH32 LIMITED – ASX S32

S2 Resources a rare ASX debut

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Original article by Tess Ingram
The Australian Financial Review – Page: 35 : 20-Oct-15

Shares in S2 Resources closed at $A0.175 on debut after listing at $A0.22 on 19 October 2015. S2 is just the third mining company to list on the Australian sharemarket so far in 2015. It holds assets that were previously owned by Sirius Resources, which recently merged with Independence Group. S2 MD Mark Bennett and some analysts expect further heavy trading in the group’s shares to continue in the short-term.

CORPORATES
S2 RESOURCES LIMITED – ASX S2R, INDEPENDENCE GROUP NL – ASX IGO, SIRIUS RESOURCES NL, SOUTH32 LIMITED – ASX S32, BHP BILLITON LIMITED – ASX BHP, BELL POTTER SECURITIES LIMITED, DEUTSCHE BANK AG

BHP’s London listing under fire

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Original article by Amanda Saunders
The Australian Financial Review – Page: 17 & 22 : 20-Oct-15

Nikko Asset Management’s head of Australian equities, Brad Potter, says it is no longer necessary for BHP Billiton to be listed on both the Australian and UK sharemarkets. He argues that rather than reducing BHP’s cost of capital, the dual listing has in fact increased it. Potter also believes that BHP’s progressive dividend policy is unsustainable. He adds that BHP may reconsider the dual listing if shareholders reject a proposal to make a payment to its London-listed company to finance a dividend for British shareholders.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, NIKKO ASSET MANAGEMENT GROUP, RIO TINTO LIMITED – ASX RIO, ARGO INVESTMENTS LIMITED – ASX ARG, SOUTH32 LIMITED – ASX S32, BRAMBLES LIMITED – ASX BXB, LONDON STOCK EXCHANGE

Small miners close to default: RBA

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Original article by Geoff Winestock, Angela Macdonald-Smith
The Australian Financial Review – Page: 3 : 19-Oct-15

The Reserve Bank of Australia’s latest Financial Stability Review warns that many smaller resources groups are close to defaulting on debt repayments. The central bank says the number of such companies that are at risk of default has reached its highest level since the global financial crisis. Few junior miners have collapsed in 2015, although the outlook for some is uncertain, and several mining services firms have been placed in administration.

CORPORATES
RESERVE BANK OF AUSTRALIA, MIRABELA NICKEL LIMITED – ASX MBN, ATLAS IRON LIMITED – ASX AGO, EMECO HOLDINGS LIMITED – ASX EHL, TERMITE RESOURCES NL, WESTERN DESERT RESOURCES LIMITED, PLUTON RESOURCES LIMITED – ASX PLV, BANDANNA ENERGY LIMITED – ASX BND, WDS LIMITED – ASX WDS, BIG RIM PTY LTD, SARGENT, HEAVY HAULAGE AUSTRALIA PTY LTD, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO

Rinehart, Wright win legal battle against Rio Tinto

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Original article by Jonathan Barrett, Marianna Papadakis
The Australian Financial Review – Page: 10 : 15-Oct-15

The High Court of Australia has ruled in favour of Hancock Prospecting and Wright Prospecting in a case against Rio Tinto over some $A130 million in royalties. Lawyers for the litigants argued successfully that Rio Tinto owed royalties to Hancock Prospecting and Wright Prospecting, as the mining giant still controlled the mineral tenements and exploration licences in Western Australia’s Pilbara region.

CORPORATES
HANCOCK PROSPECTING PTY LTD, WRIGHT PROSPECTING PTY LTD, RIO TINTO LIMITED – ASX RIO, SUPREME COURT OF WESTERN AUSTRALIA

BHP may be tempted by ailing mining assets

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Original article by Peter Ker
The Australian Financial Review – Page: 24 : 14-Oct-15

Todd Warren of Colonial First State Global Asset Management says BHP Billiton seems to be becoming more keen to pursue mergers and acquisitions. A number of rival mining groups are believed to be considering asset sales, which could present buying opportunities for BHP. It already holds a 33.75 per cent stake in Glencore’s Antamina copper mine in Peru, which is one of the assets that Glencore may divest. BHP was among the bidders for Barrick Gold Corporation’s Zaldivar copper mine in Chile.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, COLONIAL FIRST STATE GLOBAL ASSET MANAGEMENT, GLENCORE PLC, BARRICK GOLD CORPORATION, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, ANTOFAGASTA PLC, ANGLO AMERICAN PLC, BP PLC, PEABODY ENERGY CORPORATION, TECK CORPORATION, MITSUBISHI CORPORATION, BLACKROCK INCORPORATED

Glencore puts Cobar mine up for sale

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Original article by Peter Ker
The Australian Financial Review – Page: 16 : 13-Oct-15

Debt-laden Glencore is seeking to offload the Cobar copper mine in central western New South Wales. The mine’s output for the first half of 2015 was 24,800 tonnes of copper concentrate and 239,000 ounces of silver. Glencore’s Lomas Bayas copper mine in Chile has also been put on the market, and an unnamed analyst based in London says neither of the assets are likely to be of interest to major mining groups.

CORPORATES
GLENCORE PLC, BLOOMBERG LP, RIO TINTO LIMITED – ASX RIO, XSTRATA AG, X2 RESOURCES PARTNERS LP

OZ Minerals spruiks faster, cheaper Carrapateena plan

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Original article by Peter Ker
The Australian Financial Review – Page: 13 &18 : 7-Oct-15

OZ Minerals has indicated that developing the Carrapateena copper and gold deposit on a much smaller scale than originally planned is its preferred option. OZ estimates that it could reduce the cost of developing the mine to about $A1bn by focusing on higher-grade ore at the shallowest depths. A feasibility study in 2014 had estimated that the original plan for a block cave mine would cost about $A2.98bn. CEO Andrew Cole has stressed that three options for the project remain under consideration.

CORPORATES
OZ MINERALS LIMITED – ASX OZL, KKR AND COMPANY LP, ARGONAUT SECURITIES PTY LTD, ROYAL BANK OF CANADA, BHP BILLITON LIMITED – ASX BHP, PANAUST LIMITED, NEWCREST MINING LIMITED – ASX NCM

Gold stocks take off after gloomy report on US jobs

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Original article by Stephen Cauchi
The Australian Financial Review – Page: 31 : 6-Oct-15

Data showing that a lower-than-expected 142,000 jobs were created in the US during September 2015 has prompted a rally in the spot price of gold. It rose by 2.2 per cent to $US1,136 per ounce on 2 October, and in turn bolstered support for Australian-listed gold producers. Northern Star Resources rose by 5.9 per cent to a record $A2.85 on 5 October, while Newcrest Mining was 9.5 per cent higher at $A13.80. The jobs data has dampened expectations of a US interest rate rise in the near-term.

CORPORATES
NORTHERN STAR RESOURCES LIMITED – ASX NST, NEWCREST MINING LIMITED – ASX NCM, EVOLUTION MINING LIMITED – ASX EVN, BEADELL RESOURCES LIMITED – ASX BDR, UNITED STATES. FEDERAL RESERVE BOARD, RBC CAPITAL MARKETS, IG MARKETS LIMITED, STANDARD AND POOR’S ASX ALL ORDINARIES GOLD INDEX, BANK OF JAPAN, EUROPEAN CENTRAL BANK, SUMITOMO GLOBAL RESEARCH