IRON ORE – WESTERN AUSTRALIA

Miners lash Joyce’s ore comments

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Original article by James Thomson
The Australian Financial Review – Page: 15 : 12-Sep-16

Minerals Council of Australia CEO Brendan Pearson has described a proposed levy on iron ore production in Western Australia as a "bad idea" that will adversely affect both the sector and suppliers. Federal National Party leader Barnaby Joyce has been criticised after saying that he understood the motivations for state counterpart Brendon Grylls in proposing that the iron ore levy paid by BHP Billiton and Rio Tinto be increased from $A0.25 per tonne to $A5.

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

Doubts on Fortescue dividends

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Original article by Peter Ker
The Australian Financial Review – Page: 15 : 24-Aug-16

Analysts are divided regarding Fortescue Metals Group’s dividends in coming years, after the pure-play iron ore miner announced a total payout of $A0.15 per share for 2015-16. Paul McTaggart of Credit Suisse expects the total dividend to rise to $A0.17 in 2016-17, before falling to $A0.05 in 2017-18 due to expectations that the iron ore price will fall. Glyn Lawcock of UBS forecasts a dividend of $A0.18 per share in 2016-17 and $A0.11 in 2017-18, while Goldman Sachs and Morgan Stanley anticipate a big fall in the total payout for both financial years.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, CREDIT SUISSE (AUSTRALIA) LIMITED, UBS HOLDINGS PTY LTD, GOLDMAN SACHS AND PARTNERS AUSTRALIA PTY LTD, MORGAN STANLEY AUSTRALIA LIMITED, SHAW AND PARTNERS LIMITED, DEUTSCHE BANK AG, JEFFERIES AND COMPANY, WOODSIDE PETROLEUM LIMITED – ASX WPL

Fortescue super-sizes dividends

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Original article by Tess Ingram
The Australian Financial Review – Page: 1 & 8 : 23-Aug-16

Fortescue Metals Group has posted a 2015-16 net profit of $US985m, which is 212 per cent higher than previously. Underlying EBITDA rose by 27 per cent to $US3.2bn, although a lower spot iron ore price resulted in revenue falling by 17 per cent to $US7.1bn. Fortescue reduced its debt by $US2.9bn during the financial year. The pure-play miner has lifted its final dividend from $A0.02 per share to $A0.12, for a total payout of $A0.15 per share.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, RIO TINTO LIMITED – ASX RIO, UBS HOLDINGS PTY LTD, THOMSON REUTERS PLC

Barriers stifle growth, says BHP

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Original article by Paul Garvey
The Australian – Page: 1 & 2 : 17-Aug-16

BHP Billiton CEO Andrew Mackenzie has stressed the importance of Australia’s trade relationship with China, and warned that global economic growth could be threatened by a growing international push toward protectionism. He has also criticised a proposal by Western Australian National Party leader Brendan Grylls to impose an iron ore levy on BHP and Rio Tinto, arguing that they already make a major contribution to government revenue at state and federal level.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, NATIONAL PARTY OF AUSTRALIA, SAMARCO MINERACAO SA, AUSGRID PTY LTD

Contractors line up for Rio project

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Original article by Peter Ker, Tess Ingram
The Australian Financial Review – Page: 16 : 11-Aug-16

Rio Tinto has issued the first tender for the last phase of its Silvergrass iron ore mine, which is slated to cost $US338m ($A438m). The resources giant is seeking a contractor to supply crushing machinery, a conveyor belt and electric power to the project. Rio commenced the initial phase of the Silvergrass mine in 2015, making extensive use of construction contractors. It is expected to do so with the final phase of the mine, which is expected to produce about 20 millions of iron ore each year when it reaches full capacity.

CORPORATES
RIO TINTO LIMITED – ASX RIO, NRW HOLDINGS LIMITED – ASX NWH

BHP Billiton widens tougher payment terms across Pilbara

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Original article by Julie-anne Sprague, Tess Ingram
The Australian Financial Review – Page: 16 : 11-Aug-16

Suppliers to BHP Billiton’s iron ore operations in Western Australia have criticised its move to increase payment terms for more suppliers from 30 days to 60 days and require them to use a third-party payment vendor. BHP had already extended the payment terms of many suppliers in late 2015, and the latest move is expected to affect a relatively small proportion of companies that supply products and services to BHP Billiton Iron Ore.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, BHP BILLITON IRON ORE PTY LTD, QUANDREM, RIO TINTO LIMITED – ASX RIO

Forrest slams Grylls over tax threat

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Original article by Julie-anne Sprague, Tess Ingram
The Australian Financial Review – Page: 6 : 10-Aug-16

Fortescue Metals Group founder Andrew Forrest has criticised a proposal by new Western Australian National Party leader Brendan Grylls to impose an iron ore tax on BHP Billiton and Rio Tinto. Grylls has proposed changes to state agreements with the two resources giants to increase the levy on iron ore out from $A0.25 per tonne to $A5. Fortescue would not be affected as its state agreement is more recent. Grylls says the levy will not proceed if BHP and Rio successfully lobby the Federal Government to overhaul the system for distributing GST revenue.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, NATIONAL PARTY OF AUSTRALIA, WESTERN AUSTRALIA. DEPT OF THE PREMIER AND CABINET, MINERALS COUNCIL OF AUSTRALIA

Even Twiggy should fight this tax on BHP and Rio

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Original article by James Thomson
The Australian Financial Review – Page: 14 : 9-Aug-16

Western Australia National Party MP Brendon Grylls has proposed imposing a levy on iron ore producers BHP Billiton and Rio Tinto. The tax is believed to be $A5 per tonne, which would generate about $A3bn in revenue for the State Government each year. Fortescue Metals Group would benefit from the increase in the break-even price of both BHP and Rio, potentially above that of Fortescue itself. The tax could also prompt BHP and Rio to reduce production in the Pilbara. Although it appears that Fortescue and smaller iron ore miners would be exempt from the proposed tax, this could change.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, NATIONAL PARTY OF AUSTRALIA, WESTERN AUSTRALIA. DEPT OF THE PREMIER AND CABINET, LIBERAL PARTY OF WESTERN AUSTRALIA, AUSTRALIAN LABOR PARTY

Rio Tinto willing to sacrifice low-cost crown for cash

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Original article by Peter Ker
The Australian Financial Review – Page: 17 & 22 : 5-Aug-16

Rio Tinto boasted the lowest iron ore production costs in Western Australia in the first half of 2016, with a "C1" cost of $US14.30 per tonne. However, CEO Jean-Sebastien Jacques argues that increasing free cash flow is more important than bragging rights as the lowest-cost producer. Rio Tinto’s total iron ore output is tipped to be about 330 million tonnes in 2016, and Jacques has declined to comment on when the resources giant is likely to achieve its target of lifting annual output to 360 million tonnes.

CORPORATES
RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG, JP MORGAN AUSTRALIA LIMITED

Fortescue to challenge Rio Tinto’s cost crown

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Original article by Peter Ker
The Australian Financial Review – Page: 17 & 22 : 28-Jul-16

Fortescue Metals Group’s iron ore production cost fell to $US13.10 per tonne in June 2016, and averaged $US14.31/tonne during the June quarter. Fortescue expects its C1 production costs to be within the range of $US12 to $US13/tonne in 2016-17, and the group expects its iron ore shipments to be between 165 million and 170 million tonnes for the year. Fortescue has significantly reduced its production costs in recent years, with unit costs averaging $US34.03 per tonne in 2014. Fortescue shares rose $A0.29 to $A4.41 on 27 July.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, VALE SA, MACQUARIE GROUP LIMITED – ASX MQG, UBS HOLDINGS PTY LTD