B08 Metal Ore Mining

China will act quickly to spur economy: Rio

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Original article by Peter Ker
The Australian Financial Review – Page: 15 & 22 : 27-Feb-20

Rio Tinto has reported underlying earnings of $US10.37bn ($15.77bn) for 2019. The result was bolstered by a strong rise in the iron ore price; the group’s average received price was 37 per cent higher than in 2018. Meanwhile, Rio Tinto has warned that both the Chinese and global economies will be adversely affected by the coronavirus outbreak in the March quarter. However, CEO Jean-Sebastien Jacques expects the Chinese government to pursue stimulus measures, which will in turn boost demand for commodities. Shareholders will receive a final dividend of $US2.31 per share.

CORPORATES
RIO TINTO LIMITED – ASX RIO

Rio to spend $US1b on climate

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Original article by Peter Ker
The Australian Financial Review – Page: 22 : 27-Feb-20

Rio Tinto has updated its climate change policies, which now include a net zero carbon emissions target of 2050. In addition, the resources group aims to reduce its scope 1 and scope 2 emissions to 15 per cent of 2018 levels by 2030, while it has set a goal of reducing its emissions intensity to 30 per cent of 2018 levels by the same date. However, it has not set any targets for scope 3 emissions. Rio Tinto has also committed to investing $US1bn ($1.5bn) in climate initiatives over the next five years.

CORPORATES
RIO TINTO LIMITED – ASX RIO

BHP digs deep to make most of data analytics

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Original article by Nick Evans
The Australian – Page: 17 & 21 : 26-Feb-20

BHP will seek further productivity gains by increasing its focus on technologies such as data analytics and machine learning. The resources giant is also expected to make greater use of cloud technology rather than continuing to operate its own data centres. BHP will restructure its technology division as part of this process, which is expected to result in the loss of about 700 jobs in a division that employs 2,000 people. BHP will redeploy some of the displaced workers.

CORPORATES
BHP GROUP LIMITED – ASX BHP

ATO probes Rio on its pricing of aluminium

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Original article by Peter Ker
The Australian Financial Review – Page: 13 : 25-Feb-20

Rio Tinto’s Australian aluminium business is the subject of a transfer pricing assessment by the Australian Taxation Office. It is understood that the ATO’s investigation is looking at Rio’s Boyne aluminium smelter in Queensland, and the manner in which transactions between Boyne and Rio’s Singapore marketing hub have been structured in recent years. The ATO’s investigation comes at a time when Rio is holding discussions with governments concerning a possible rescue package for its loss-making Australian aluminium smelters. The ATO also launched a $212 million transfer pricing claim against Alcoa in December.

CORPORATES
RIO TINTO LIMITED – ASX RIO, AUSTRALIAN TAXATION OFFICE, ALCOA OF AUSTRALIA LIMITED

Alcoa owes $212m taxes, ATO claims

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Original article by Nick Evans
The Australian – Page: 19 : 24-Feb-20

Alcoa has stated in its latest financial report that its Australian unit has been served with a $212 million tax bill by the Australian Taxation Office. Alcoa has stated that the ATO is of the view that Alcoa of Australia has underpaid tax on the sale of alumina, which it produces in Western Australia. A spokeswoman for Alcoa of Australia has stated that it disputes the ATO’s claim, and it plans to make use of the statutory rights available to it to challenge the ATO’s position.

CORPORATES
ALCOA INCORPORATED, ALCOA OF AUSTRALIA LIMITED, AUSTRALIAN TAXATION OFFICE

Forrest’s payout tops $2bn as Fortescue’s profit rises

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Original article by Nick Evans
The Australian – Page: 19 : 20-Feb-20

Fortescue Metals Group has posted a 2019-20 interim net profit of $US2.5bn ($3.7bn), which is 281 per cent higher than previously. The pure-play iron ore miner has reported underlying EBITDA of $US4.2bn and revenue of $US6.5bn for the half-year. Fortescue’s shipments totalled 88.6 million tonnes for the period, and its average realised price for the steel input was 73 per cent higher than the previous corresponding period. Shareholders will receive an interim dividend of $0.76 per share, boosting the wealth of founder Andrew Forrest.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG

Virus fears cloud BHP outlook

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Original article by Nick Evans
The Australian – Page: 17 & 22 : 19-Feb-20

BHP has posted a 2019-20 interim net profit of $US4.87bn ($7.29bn), which is 29 per cent higher than previously. Underlying EBITDA rose by 15 per cent to $US12.1bn, with a rise in the price of iron and copper boosting this figure by $US1.5bn. CEO Mike Henry says the coronavirus has had a limited impact on BHP to date, but he warns that commodity exports may be affected if the outbreak is not contained by the end of March. Shareholders will receive a record half-year dividend of $US0.65 per share.

CORPORATES
BHP GROUP LIMITED – ASX BHP

South32 calls for clear guidance on scope 3

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Original article by Peter Ker
The Australian Financial Review – Page: 23 : 14-Feb-20

Diversified miner South32 has posted a 2019-20 interim net profit of $US99m, which is 84 per cent lower than previously. The group’s underlying earnings fell 80 per cent to $US131m and revenue was down 16 per cent due to lower prices for its key commodities. CEO Graham Kerr says South32’s focus is on Scope 1 carbon emissions at present, but he argues that all companies will eventually need to address their Scope 3 emissions. He adds that governments must clarify how planning approvals will take Scope 3 emissions into account.

CORPORATES
SOUTH32 LIMITED – ASX S32

Virus slows Rio Tinto copper sales

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Original article by Peter Ker
The Australian Financial Review – Page: 17 : 13-Feb-20

The Oyu Tolgoi copper mine is located in the Khanbogd province, where the Mongolian government has declared a state of emergency due to the coronavirus. Rio Tinto has advised that Mongolia’s efforts to contain the virus’s spread will result in shipments of copper concentrate being delayed. The mine’s output is usually shipped across the border to China via trucks. BHP also recently advised that its copper shipments to China may be delayed, while OZ Mineral has indicated that it has not yet been impacted by the coronavirus outbreak.

CORPORATES
RIO TINTO LIMITED – ASX RIO, BHP GROUP LIMITED – ASX BHP, OZ MINERALS LIMITED – ASX OZL

Vale confirms drop in iron ore exports

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Original article by Peter Ker
The Australian Financial Review – Page: 16 : 13-Feb-20

Brazilian iron ore miner Vale now expects output of 63-68 million tonnes in the March quarter, compared with previous guidance of 68-73 million tonnes. The production downgrade has been attributed to factors such as heavy rains, while Vale says its revised forecast does not take into account any impact of the coronavirus. Vale’s problems may bolster demand for Australian iron ore; the sector’s exports volumes are forecast to reach a record $84bn in 2019-20, despite the recent disruption caused by Tropical Cyclone Damien.

CORPORATES
VALE SA, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, ROY HILL HOLDINGS PTY LTD