MINING CORPORATIONS – AUSTRALIA

Trains give Rio’s iron ore unit a push

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Original article by James Thomson
The Australian Financial Review – Page: 15 : 19-Apr-18

Rio Tinto has advised that its Pilbara iron ore shipments totalled 80.3 million tonnes in the March 2018 quarter, which is 11 per cent lower than the December quarter but five per cent higher year-on-year. The resources group still expects shipments for the full year to be within the range of 330 million and 340 million tonnes. Rio Tinto has also advised that it expects the AutoHaul autonomous train project to be completed in 2018, and says the proportion of trains that are operating in autonomous mode rose from 60 per cent to 65 per during the quarter.

CORPORATES
RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, ROYAL BANK OF CANADA, QUEENSLAND ALUMINA LIMITED, RUSAL

Rio calm as Russia sanctions hit plant

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Original article by Paul Garvey
The Australian – Page: 17 & 20 : 16-Apr-18

Rio Tinto has advised that its Queensland Alumina Limited business is unlikely to be significantly affected by a move by the US to impose trade sanctions on Russian companies. However, Rio Tinto has responded to the trade sanctions by declaring force majeure with regard to some QAL contracts. Russian companies that are affected by the sanctions include Rusal, which has a 20 per cent stake in QAL. Rio Tinto also has offtake agreements with Rusal regarding the former’s alumina smelters in France and Iceland, while Rusal also sources bauxite from Rio Tinto for its smelter in Ireland.

CORPORATES
RIO TINTO LIMITED – ASX RIO, QUEENSLAND ALUMINA LIMITED, RUSAL, GLENCORE PLC, LONDON METAL EXCHANGE LIMITED, UNITED STATES. DEPT OF THE TREASURY, UNITED STATES. DEPT OF STATE

Atlas facing wipe-out: MinRes

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Original article by Paul Garvey
The Australian – Page: 19 : 12-Apr-18

About 15,000 of Atlas Iron’s shareholders own less than $A500 worth of shares in the iron ore producer, with 4,900 owning less than $A20 worth of shares. Mineral Resources CEO Chris Ellison has urged investors with small shareholdings to support his company’s $A280m takeover bid, warning that they will be left with worthless stock if Atlas collapses. He has questioned whether Atlas can survive if the takeover deal does not proceed.

CORPORATES
ATLAS IRON LIMITED – ASX AGO, MINERAL RESOURCES LIMITED – ASX MIN

Ore discounts force Atlas, MinRes link-up

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Original article by James Thomson, Sarah Thompson, Anthony Macdonald
The Australian Financial Review – Page: 11 & 16 : 10-Apr-18

Atlas Iron’s directors have endorsed a proposed merger with Mineral Resources, which requires the support of at least 75 per cent of Atlas shareholders. The deal values Atlas shares at $A0.0302, with stockholders to receive one Mineral Resources share for every 571 shares they hold. Atlas CEO Cliff Lawrenson has praised Mineral Resources, and he attributes the merger to the widening discount between lower-grade iron ore and the benchmark price. He says it is uncertain whether the discount is structural or cyclical.

CORPORATES
ATLAS IRON LIMITED – ASX AGO, MINERAL RESOURCES LIMITED – ASX MIN, FORTESCUE METALS GROUP LIMITED – ASX FMG, AWE LIMITED – ASX AWE, MITSUI AND COMPANY LIMITED, HOULIHAN LOKEY HOWARD AND ZUKIN, DLA PIPER, GILBERT AND TOBIN LAWYERS

BHP quits coal body over climate views

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Original article by Matt Chambers
The Australian – Page: 30 : 6-Apr-18

BHP Billiton has confirmed that it will cease being a member of the World Coal ­Association, citing factors such as differing stances on energy and climate policy. BHP has also indicated that it derives little benefit from being a member of the WCA. However, the Australasian Centre for Corporate Responsibility’s executive director Brynn O’Brien has criticised BHP’s decision to remain a member of the US Chamber of Commerce. BHP said that while the USCC’s stance on climate policy still differs to its own, membership of the organisation has significant benefits.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, WORLD COAL ASSOCIATION, UNITED STATES CHAMBER OF COMMERCE, AUSTRALASIAN CENTRE FOR CORPORATE RESPONSIBILITY, MINERALS COUNCIL OF AUSTRALIA, APPLE INCORPORATED

Coking coal’s future bright

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Original article by Eli Greenblat
The Australian – Page: 17 & 26 : 29-Mar-18

Rio Tinto has completed its exit from the coal sector with the sale of its 80 per cent stake in the Kestrel coking coal mine in Queensland for $US2.5bn ($A3.2bn). The stake was sold to a consortium of EMR Capital and Indonesia-based Adaro Energy, and follows the recent sale of Rio Tinto’s Hail Creek and ­Valeria coal projects. EMR Capital CEO Jason Cheng is upbeat about the outlook for coking coal, arguing that demand will remain strong as there is no alternative to it for the steel industry.

CORPORATES
RIO TINTO LIMITED – ASX RIO, EMR CAPITAL PTY LTD, PT ADARO INDONESIA, SOUTH32 LIMITED – ASX S32, GLENCORE PLC

Fortescue faces iron ore discount dilemma

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Original article by James Thomson
The Australian Financial Review – Page: 20 : 28-Mar-18

China’s growing demand for higher-grade iron ore has boosted the profits of BHP Billiton and Rio Tinto, while the widening discount for lower-grade ore slashed the interim earnings of Fortescue Metals Group. The pure-play miner has advised that its iron ore is now expected to fetch 65 per cent of the benchmark price, compared with its recent forecast of 70-75 per cent. The discount has widened from just five per cent in the March 2016 quarter to 35 per cent, but Fortescue still maintains that it is cyclical and will narrow over time. However, rival producers argue that the discount is structural.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, VALE SA, CLEVELAND-CLIFFS INCORPORATED

Bribery probe clouds Rio’s Mongolia deal

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Original article by Matt Chambers
The Australian – Page: 21 : 23-Mar-18

Swiss and Mongolian authorities are investigating the origins of a $US10 million ($A12.9 million) payment into a Swiss bank account. The account belongs to former Mongolian finance minister Bayartsogt Sangajav. Bayartsogt has denied suggestions that the payment was linked to Rio Tinto’s Oyu Tolgoi copper and gold project, although Swiss authorities have stated that they are investigating whether Rio or any of its business units had a role in the deposit. Rio has indicated that it has had no contact from Swiss authorities on the matter.

CORPORATES
RIO TINTO LIMITED – ASX RIO, IVANHOE MINES LIMITED, TURQUOISE HILL RESOURCES LIMITED, SWITZERLAND. OFFICE OF THE ATTORNEY GENERAL, WHITEHAVEN COAL LIMITED – ASX WHC

No quick return from coal sale

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Original article by Richard Gluyas, Matt Chambers
The Australian – Page: 20 : 22-Mar-18

Citigroup expects Rio Tinto to return the bulk of the proceeds from the sale of the Hail Creek coal to shareholders, after paying about $A300m in taxes on the $US1.7bn ($A2.2bn) deal. However, Rio Tinto CEO Jean-Sebastien Jacques says the resources group is unlikely to return capital to investors before the release of its full-year report in February 2019. He stresses that Rio Tinto is divesting its coal assets because commodities such as iron ore and aluminium offer better growth options.

CORPORATES
RIO TINTO LIMITED – ASX RIO, CITIGROUP PTY LTD, UBS HOLDINGS PTY LTD, PACIFIC ALUMINIUM PTY LTD

BHP content with iron ore grade boost for now

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Original article by Peter Ker
The Australian Financial Review – Page: 19 : 22-Mar-18

BHP Billiton is tipped to make an investment decision on the South Flank iron ore project in Western Australia by mid-2018. The company’s average iron ore grade is 61 per cent at present, but this would rise to 62 per cent if the project is approved. However, BHP’s Edgar Basto says that aside from South Flank, BHP is unlikely to increase its average iron ore grades in the near-term. He adds that factors such as the stronger Australian dollar and rising labour costs have contributed to an increase in the expected cost of the project.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, VALE SA