MINING CORPORATIONS – AUSTRALIA

WA’s FIFO ban a blow for resources giants

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Original article by Brad Thompson, Peter Ker
The Australian Financial Review – Page: 22 : 31-Mar-20

Workers from interstate account for about 3,000 of the 45,000 people in Western Australia’s resources sector who are on fly-in, fly-out arrangements. FIFO workers from interstate are currently exempt from a 14-day coronavirus quarantine period, but the Chamber of Minerals & Energy of WA has told its members that the state government is likely to remove this exemption within days. The Queensland and South Australian governments are also tipped to scrap the exemption for FIFO workers who cross state borders.

CORPORATES
THE CHAMBER OF MINERALS AND ENERGY OF WESTERN AUSTRALIA INCORPORATED, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, WOODSIDE PETROLEUM LIMITED – ASX WPL, NEWCREST MINING LIMITED – ASX NCM, CHEVRON CORPORATION

Miners told to keep digging as rivals halt

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Original article by Peter Ker
The Australian Financial Review – Page: 23 : 25-Mar-20

Rio Tinto and South32 are among the Australian-listed mining companies whose operations will be affected by coronavirus lockdowns in South Africa and the Canadian province of Quebec. Production at mines in Australia is continuing at present, although New Hope Corporation’s CEO Shane Stephan says it is too soon to know if the virus will force local mines to close. He adds that it would be naive to suggest that there will be no impact. BHP CEO Mike Henry says senior government officials have indicated that they are keen for the resources industry to keep operating, given its contribution to the economy.

CORPORATES
NEW HOPE CORPORATION LIMITED – ASX NHC, BHP GROUP LIMITED – ASX BHP

Newcrest axes FIFO route into PNG’s Lihir mine

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

Newcrest Mining has responded to the coronavirus pandemic by suspending the use of Australian fly-in, fly-out workers at the Lihir gold mine in Papua New Guinea. The move will take effect within days, but Newcrest will continue to use FIFO workers at its mines in Australia. The company has noted that it primarily uses local workers at Lihir, rather than employees on FIFO arrangements. Australia’s gold, iron ore, copper, oil and gas sectors are particularly reliant on FIFO workers.

CORPORATES
NEWCREST MINING LIMITED – ASX NCM

Virus could stall progress on Rio Tinto’s Mongolia project

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Original article by Peter Ker
The Australian Financial Review – Page: 27 : 17-Mar-20

Rio Tinto has advised that work on the multi-billion dollar underground expansion of its Oyu Tolgoi copper mine in Mongolia is being slowed as a consequence of efforts to limit the spread of the coronavirus. Rio had previously reported in February that copper deliveries from the mine to buyers in China were being delayed due to border control measures aimed at tackling the spread of the virus. The underground expansion of the Oyu Tolgoi mine has been the subject of ongoing delays.

CORPORATES
RIO TINTO LIMITED – ASX RIO

Rout offers BHP a fast-track for potash decision

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Original article by Peter Ker
The Australian Financial Review – Page: 14 & 18 : 16-Mar-20

BHP is due to decide by February 2021 whether to spend at least $US5.3 billion on developing the Jansen potash project in Canada. However, the coronavirus outbreak has given it the opportunity to immediately become a potash producer by launching a takeover bid for Canadian miner Mosaic. The outbreak has seen Mosaic’s shares fall by 50 per cent in the past two months, making it cheaper for BHP to acquire it than to develop Jansen, which would be unlikely to commence production until 2026.

CORPORATES
BHP GROUP LIMITED – ASX BHP, THE MOSAIC COMPANY

Tax-slugged miners are bankrolling us all

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Original article by Geoff Chambers
The Australian – Page: 2 : 10-Mar-20

A report produced by KPMG on behalf of the Minerals Council of Australia highlights the importance of the mining sector to government revenue. It shows that corporate taxes and royalties have accounted for 39- 49 per cent of the sector’s earnings since 2011-12. MCA CEO Tania Constable says that on average, the minerals sector has paid more than $20bn in taxes and royalties annually over this period. She adds that the sector is helping to finance infrastructure projects and the salaries of public sector workers such as teachers and nurses.

CORPORATES
MINERALS COUNCIL OF AUSTRALIA, KPMG AUSTRALIA PTY LTD

Chinese back Rio ore mine in Africa

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Original article by Nick Evans
The Australian – Page: 24 : 6-Mar-20

Media reports have suggested that China’s State-owned Assets Supervision & Administration Commission will approve an investment in the Simandou iron ore deposit in Guinea. SASAC oversees investments made by Chinese government-owned enterprises such as Chinalco, which is one of Rio Tinto’s partners in the deposit. The massive cost of developing the Simandou deposit – which has been estimated at around $US20bn ($30.2bn) – has contributed to the project being stalled for more than two decades.

CORPORATES
RIO TINTO LIMITED – ASX RIO, CHINA. STATE-OWNED ASSETS SUPERVISION AND ADMINISTRATION COMMISSION, ALUMINIUM CORPORATION OF CHINA LIMITED

Iron ore mining giants in virus vigil over fly-in, fly-out workforce

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Original article by Brad Thompson
The Australian Financial Review – Page: 22 : 5-Mar-20

Fortescue Metals Group has asked all employees who have travelled overseas to remain at home for 14 days before returning to work. One employee was quarantined at the Christmas Creek iron ore mine after reporting flu-like symptoms following a trip to Bali, and Fortescue has confirmed that they have tested negative for the virus. BHP and Rio Tinto are also actively taking measures to protect their workforces from the coronavirus at their iron ore mines.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO

Fool’s gold: $2bn hedge hole

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Original article by Nick Evans
The Australian – Page: 17 & 20 : 5-Mar-20

The gold price is currently trading at around $2,450 an ounce in Australian dollar terms. However, the nation’s leading gold producers have locked in forward sales of more than three million ounces at prices well below this level. Newcrest Mining stands to incur the biggest loss from gold hedging, having locked in sales of more than 658,000 ounces from the Telfer mine at just $1,875 an ounce over the next three years.

CORPORATES
NEWCREST MINING LIMITED – ASX NCM

Forrest boosts his stake in Fortescue

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Original article by Melissa Yeo
The Weekend Australian – Page: 24 : 29-Feb-20

Fortescue Metals Group has advised that chairman and founder Andrew Forrest bought more than 22 million shares in the pure-play iron ore miner between 20 and 27 February. Forrest paid some $242m to lift his stake in Fortescue from 30 per cent to about 36 per cent. Forrest will receive $828m in dividends for the first half of 2019-20 after Fortescue recently announced an interim dividend of $0.76 per share.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG