IRON ORE – WESTERN AUSTRALIA

Grylls ups fight on iron ore tax

roymorgansocial Leave a comment

Original article by Andrew Burrell
The Australian – Page: 21 : 19-Oct-16

Western Australian Nationals leader Brendon Grylls claims that parliament can alter the state agreements of Rio Tinto and BHP Billiton without their consent. The state agreements require BHP and Rio to pay a levy of $A0.25 for each ton of iron ore they produce, but Grylls has proposed lifting this to $A5. He also alleges that they have breached the state agreements. A Rio spokesman has warned that future investment in WA and iron ore supply would be jeopardised if the government sought to change the state agreements.

CORPORATES
RIO TINTO ALUMINIUM (BELL BAY) LIMITED, BHP BILLITON LIMITED – ASX BHP, NATION AIR, WESTERN AUSTRALIA. DEPT OF THE PREMIER AND CABINET, AUSTRALIA. DEPT OF FINANCE

Nationals at war over mining tax

roymorgansocial Leave a comment

Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 4 : 14-Oct-16

National Party of Australia leader Barnaby Joyce has weighed into the debate on the proposed increase in Western Australia’s iron levy. Joyce says he supports policies aimed at promoting the growth of regional areas but stresses that the tax hike proposed by WA Nationals leader Brendon Grylls is not the answer. Grylls has responded by criticising Joyce for not supporting WA. Grylls wants to increase the iron ore levy from $A0.25 per tonne to $A5, in order to offset WA’s loss of GST revenue.

CORPORATES
NATIONAL PARTY OF AUSTRALIA, WESTERN AUSTRALIA. DEPT OF THE PREMIER AND CABINET, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, MINERALS COUNCIL OF AUSTRALIA, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO

Japanese, miners blast WA ‘tax grab’

roymorgansocial Leave a comment

Original article by Rick Wallace
The Australian – Page: 22 : 12-Oct-16

A proposed increase in Western Australia’s iron ore levy has been criticised by speakers at a conference organised by the Australia-Japan Business Co-­operation Committee. BHP Billiton executive Arnoud Balhuizen said lifting the levy from $A0.25 per tonne to $A5 would result in job losses and reduced investment in the state. Nippon Steel & Sumitomo Metals Corporation’s honorary chairman also expressed concern about the proposal by WA National Party leader Brendon Grylls.

CORPORATES
AUSTRALIA-JAPAN BUSINESS CO-OPERATION COMMITTEE, BHP BILLITON LIMITED – ASX BHP, NIPPON STEEL AND SUMITOMO METAL CORPORATION, NATIONAL PARTY OF AUSTRALIA, WESTERN AUSTRALIA. DEPT OF THE PREMIER AND CABINET, LIBERAL PARTY OF WESTERN AUSTRALIA, RIO TINTO LIMITED – ASX RIO, TRANS-PACIFIC PARTNERSHIP

Fortescue buys Nullagine mine for $1

roymorgansocial Leave a comment

Original article by Tess Ingram
The Australian Financial Review – Page: 18 : 11-Oct-16

BC Iron will sell its stake in the Nullagine iron ore mine in Western Australia to Fortescue Metals Group. The transaction comprises a token sum of $A1 plus a royalty on 75 per cent of future iron ore production. BC Iron initially sold a 50 per cent stake in the Nullagine mine to Fortescue in 2009, before repurchasing 25 per cent of Fortescue’s stake in 2012. Production at Nullagine was put on hold in late 2015 in response to a downturn in the iron ore price. It is estimated that keeping the mine in "care and maintenance" mode costs at least $A150,00 each month.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, BC IRON LIMITED – ASX BCI, UBS HOLDINGS PTY LTD

Rio Tinto satisfied with Autohaul fix

roymorgansocial Leave a comment

Original article by Peter Ker
The Australian Financial Review – Page: 18 : 11-Oct-16

The head of Rio Tinto’s iron ore division, Chris Salisbury, says the performance of its Autohaul driverless technology is meeting expectations. Rio has been using driverless trucks for a number of years, but a project to roll out autonomous trains at its Western Australian iron ore mines has been delayed due to software issues. This has prompted Rio Tinto to scale back its iron ore production forecast for fiscal 2017. Salisbury said the group will also seek to retrofit its existing haulage equipment with automated technology.

CORPORATES
RIO TINTO LIMITED – ASX RIO, KOMATSU MINING SYSTEMS INCORPORATED, BHP BILLITON LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG, ROY HILL HOLDINGS PTY LTD, CATERPILLAR, WESTERN AUSTRALIA. DEPT OF THE PREMIER AND CABINET, NATIONAL PARTY OF AUSTRALIA

Iron ore exporters unlikely to meet shipment guidance

roymorgansocial Leave a comment

Original article by David Stringer
The Australian Financial Review – Page: 24 : 6-Oct-16

Macquarie Group forecasts that Rio Tinto’s Western Australian iron ore shipments for 2016 will fall slightly short of its guidance for 330 million tonnes. Macquarie also says BHP Billiton also may not meet its production guidance. Macquarie had forecast that shipments from the state’s major iron ore export terminals would total 216 million tonnes in the September quarter, but new data shows that about 209 million tonnes were shipped.

CORPORATES
RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG, MACQUARIE GROUP LIMITED – ASX MQG, ROY HILL HOLDINGS PTY LTD, VALE SA, METAL BULLETIN LIMITED, CITIGROUP PTY LTD, MORGAN STANLEY AUSTRALIA LIMITED, DBS GROUP HOLDINGS LIMITED, BLOOMBERG LP

BHP, Rio spurn WA plan for upfront tax

roymorgansocial Leave a comment

Original article by Tess Ingram, Julie-anne Sprague
The Australian Financial Review – Page: 3 : 5-Oct-16

Western Australian Premier Colin Barnett has again ruled out adopting a WA National Party proposal to increase the iron ore levy on BHP Billiton and Rio Tinto from $A0.25 per tonne to $A5. However, Treasurer Mike Nahan has described the levy as an anomaly, and he has held discussions with BHP and Rio regarding alternatives such as an upfront lump-sum payment. Both companies have indicated that they would not support an upfront payment.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, WESTERN AUSTRALIA. DEPT OF THE PREMIER AND CABINET, WESTERN AUSTRALIA. DEPT OF TREASURY AND FINANCE, NATIONAL PARTY OF AUSTRALIA, FORTESCUE METALS GROUP LIMITED – ASX FMG, HANCOCK PROSPECTING PTY LTD, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF INDUSTRY, INNOVATION AND SCIENCE, REACHTEL PTY LTD, MACQUARIE GROUP LIMITED – ASX MQG

BHP’s Henry slams Grylls over mining tax plan

roymorgansocial Leave a comment

Original article by Julie-anne Sprague
The Australian Financial Review – Page: 12 : 23-Sep-16

It is estimated that the iron ore levy proposed by Western Australian National Party leader Brendon Grylls would raise about $A1.5bn each year. Grylls wants to increase the state levy from $A0.25 per tonne to $A5. BHP Billiton executive Mike Henry argues that the resources giant already pays a levy of about $A5 per tonne, adding that it paid total taxes of around $A17.50 for each tonne of iron ore it produced in 2015. Henry warns that capital investment and dividends would be affected by Grylls’ proposal.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, NATIONAL PARTY OF AUSTRALIA, LIBERAL PARTY OF WESTERN AUSTRALIA, REACHTEL PTY LTD, AUSTRALIAN TAXATION OFFICE

Big gains from small Pilbara changes

roymorgansocial Leave a comment

Original article by Tess Ingram
The Australian Financial Review – Page: 16 : 19-Sep-16

The Gina Rinehart-backed Roy Hill iron ore project shipped its first iron ore from the Pilbara in late 2015. The use of technology is a key feature of the $A10bn project. Amongst other things, it uses drones to undertake surveying work, and it is trialling automated truck refuelling technology. BHP Billiton and Rio Tinto have deployed driverless trucks at their Pilbara mines, but Roy Hill Holdings Barry Fitzgerald says the company does not think the technology has a sufficient cost benefit.

CORPORATES
ROY HILL HOLDINGS PTY LTD, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, WOODSIDE PETROLEUM LIMITED – ASX WPL

FMG closer to investment grade rating

roymorgansocial Leave a comment

Original article by Peter Ker
The Australian Financial Review – Page: 15 : 14-Sep-16

Pure-play iron ore producer Fortescue Metals Group will repay $US700m ($A925m) worth of debt that is scheduled to mature in 2019. This will cut its debt obligations for 2019 to just $US2.88bn. Fortescue repaid $US2.9bn of debt in 2015-16, and the latest move will reduce its interest costs by $US26 a year. Peter O’Connor of Shaw & Partners expects Fortescue to further reduce its debt in the current financial year. Fortescue’s credit rating remains below investment grade, and Matthew Moore of Moody’s has ruled out a re-rating at present.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, SHAW AND PARTNERS LIMITED, MOODY’S INVESTORS SERVICE INCORPORATED, STANDARD AND POOR’S CORPORATION, RBC CAPITAL MARKETS