MINING CORPORATIONS – AUSTRALIA

Heritage spats slow BHP plans

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Original article by Peter Ker
The Australian Financial Review – Page: 13 & 18 : 28-Apr-21

BHP struck the Olympic Dam Agreement with the Kokatha, the Kuyani and the Barngarla people in 2008. However, a native title ruling in 2014 deemed that the Kokatha people were the sole traditional owners of the land that encompasses the Olympic Dam copper mine. The Kokatha people contend that the existing agreement is outdated and must be replaced, and that BHP should not be consulting with the Kuyani and the Barngarla with regard to the management of heritage sites for which they no longer have any native title rights. BHP in turn contends that the terms of the 2008 agreement require it to consult with all three indigenous groups.

CORPORATES
BHP GROUP LIMITED – ASX BHP

Record production in sight for BHP

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Original article by Nick Evans
The Australian – Page: 16 : 22-Apr-21

BHP’s quarterly activities report shows that it shipped 66 million tonnes of iron ore from the Pilbara in the March quarter. This compares with 70.8 million tonnes in the December quarter and 68.5 million tonnes during the first three months of 2020. However, the fall in export volumes had been flagged by BHP in early 2021. The resources giant will only need to ship 73.1 million tonnes in the June quarter to exceed its 2019-20 export total of 283.3 million tonnes. BHP’s full-year profits will be boosted by the continued strength of the iron ore price, which has reached a 10-year high of $US189.61 a tonne.

CORPORATES
BHP GROUP LIMITED – ASX BHP

Bonanza for iron ore miners

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Original article by Peter Ker
The Australian Financial Review – Page: 1 & 16 : 21-Apr-21

Rio Tinto’s quarterly production report shows that its iron ore exports from the Pilbara totalled 77.79 million tonnes in the first three months of 2021, an increase of seven per cent year-on-year. Peter O’Connor of Shaw & Partners expects Rio Tinto to post an underlying profit of $US17.69bn ($22.7bn) for calendar 2021, eclipsing its record profit of $US15.5bn in 2011. The strength of the iron ore price during the March quarter has boosted the profits of Australia’s five biggest producers of the steel input. The iron ore price recently reached its highest level in more than nine years.

CORPORATES
RIO TINTO LIMITED – ASX RIO, SHAW AND PARTNERS LIMITED

Rio was legally cramped to go harder on execs

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Original article by Peter Ker
The Australian Financial Review – Page: 16 : 12-Apr-21

Rio Tinto has attracted much criticism over its generous severance packages in the wake of the Juukan Gorge scandal. However, the head of Rio Tinto’s remuneration committee has told the annual general meeting in London that the board had decided that it was not legally able to cancel the termination payouts of former CEO Jean-Sebastien Jacques and two other senior executives. The issue of Juukan Gorge was not raised by British shareholders, although it is likely to receive attention at the Australian leg of Rio Tinto’s annual general meeting on 6 May.

CORPORATES
RIO TINTO LIMITED – ASX RIO

Rio chair to face Juukan anger

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Original article by Nick Evans
The Australian – Page: 17 : 9-Apr-21

Rio Tinto is expected to incur a backlash against its remuneration report at the London leg of its annual general meeting on 9 April. Outgoing chairman Simon Thompson is likely to be the main target of investors’ wrath in the wake of the scandal over the destruction of ancient indigenous rock shelters at Juukan Gorge in Western Australia. The scandal resulted in the departure of three senior executives – including former CEO Jean-Sebastien Jacques – who will receive lucrative severance payments. Rio Tinto will hold its Australian annual general meeting on 8 May.

CORPORATES
RIO TINTO LIMITED – ASX RIO

UBS sees sharp drop in iron ore price

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Original article by Lachlan Moffet Gray
The Australian – Page: 16 : 6-Apr-21

UBS expects a looming increase in global iron ore supply to result in the price of the steel input falling below $US100 per tonne in the December 2021 quarter. The iron price peaked at more than $US170 per tonne earlier in the year, but UBS says it is reaching an ‘inflection point’. The firm notes that iron ore shipments from Brazil are increasing, while inventories at Chinese ports are increasing. UBS has reduced its share price targets for Rio Tinto, BHP and Fortescue Metals Group; the firm has also downgraded its recommendation on the latter two from ‘buy’ to ‘neutral’.

CORPORATES
RIO TINTO LIMITED – ASX RIO, BHP GROUP LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG, UBS HOLDINGS PTY LTD

Miners going for gold in record year

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Original article by Nick Evans
The Australian – Page: 16 : 1-Mar-21

Data from Surbiton Associates shows that Australian mining companies produced a record 327 tonnes of gold in 2020, amid a surge in the price of the precious metal. Newcrest Mining’s Cadia mine in New South Wales produced 822,478 ounces of gold during the year, ahead of Newmont’s Boddington mine in Western Australia (670,000 ounces) and Kirkland Lake Gold’s Fosterville mine in Victoria (640,000 ounces). Sandra Close of Surbiton notes that the high price of gold has prompted a number of new players to enter the sector.

CORPORATES
SURBITON ASSOCIATES PTY LTD, NEWCREST MINING LIMITED – ASX NCM, NEWMONT CORPORATION, KIRKLAND LAKE GOLD LIMITED – ASX KLA

Fortescue to stem pipeline cash flow

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Original article by Nick Evans
The Australian – Page: 16 : 1-Mar-21

Fortescue Metals Group recently stated that it is likely to release a final cost figure for its troubled Iron Bridge magnetite project within three months. The pure-play iron ore miner advised that preliminary figures show that the project will cost about $US3bn, compared with initial estimates of $US2.6bn. Fortescue is also believed to be considering a ‘build-own-operate-transfer’ model for water infrastructure associated with the Iron Bridge project, whereby other companies would bear the cost of building the water network and eventually sell it back to Fortescue.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG

BHP booms with $6.5bn payout

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Original article by Nick Evans
The Australian – Page: 15 & 18 : 17-Feb-21

BHP has reported a net profit of $US3.88bn for the first half of 2020-21, which is 20 per cent lower than previously. However, underlying net profit rose 15.4 per cent to $US6bn, while the resources group will return some $US5.1bn to shareholders via a record interim dividend of $US1.01 per share. BHP is bullish about the outlook for the iron ore price, forecasting that a significant pullback would require reduced demand from China and/or increased supply from Brazil. BHP’s iron ore division has posted underlying EBIT of $US9.32bn for the half-year, compared with $US6.34bn for the previous corresponding period.

CORPORATES
BHP GROUP LIMITED – ASX BHP

$834m in blowouts spur Fortescue exits

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Original article by Nick Evans
The Australian – Page: 15 & 18 : 17-Feb-21

Fortescue Metals Group has advised that chief operating officer Greg Lilleyman has left the pure-play iron ore miner in the wake of a sharp rise in the cost of its Iron Bridge magnetite project. Fortescue’s director of projects Don Hyma and Iron Bridge project manager Manie McDonald also recently stepped down. The Iron Bridge project was initially slated to cost $US2.6bn, but this is believed to have blown out by about $US650m. CEO Elizabeth Gaines and CFO Ian Wells will forgo their annual bonuses for 2020-21 due to the cost blowout.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG