MINING CORPORATIONS – AUSTRALIA

Rio could return up to $13.2b to shareholders over next 18 months

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Original article by James Thomson
The Australian Financial Review – Page: 20 : 4-Aug-17

Rio Tinto shareholders will receive a full-year dividend of $US2.60 per share for calendar 2017, after the interim dividend was increased from $US0.45 to $US1.10 per share. The resources giant will also repurchase up to $US1bn worth of its London-listed shares, and Paul Young of Deutsche Bank says it has the capacity to undertake about $US2bn worth of buybacks annually from 2018. Meanwhile, CEO Jean-Sebastien Jacques says Rio Tinto will only consider acquisitions that add value for shareholders.

CORPORATES
RIO TINTO LIMITED – ASX RIO, DEUTSCHE BANK AG, UBS HOLDINGS PTY LTD, MACQUARIE GROUP LIMITED – ASX MQG, COAL AND ALLIED INDUSTRIES LIMITED, YANCOAL AUSTRALIA LIMITED – ASX YAL, IRON ORE COMPANY OF CANADA

Noble Group to challenge Yancoal raising

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Original article by James Thomson
The Australian Financial Review – Page: 15 : 3-Aug-17

Glencore will buy $US300m worth of shares in Yancoal Australia via the latter’s $US2.5bn ($A3.1bn) equity raising, which will be used to finance its acquisition of Rio Tinto’s coal assets in the Hunter Valley. However, Noble Group claims that the capital raising will "oppress" minority shareholders such as itself, with their stakes to be diluted as a result of the new capital. Yancoal estimates that acquiring the Rio Tinto assets will generate synergies of $A120m to $A145m.

CORPORATES
YANCOAL AUSTRALIA LIMITED – ASX YAL, GLENCORE PLC, NOBLE GROUP LIMITED, SENRIGAN CAPITAL GROUP LIMITED, COAL AND ALLIED INDUSTRIES LIMITED, YANZHOU COAL MINING COMPANY LIMITED, SHANDONG TAIZHON ENERGY COMPANY, GENERAL NICE DEVELOPMENT LIMITED, CINDA ASSET MANAGEMENT CORPORATION, SHANDONG LUCION INVESTMENT HOLDINGS GROUP COMPANY LIMITED, MITSUBISHI CORPORATION, BHP BILLITON LIMITED – ASX BHP

Rio hands out China bonanza

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Original article by James Thomson, Tess Ingram
The Australian Financial Review – Page: 1 & 22 : 3-Aug-17

Rio Tinto has posted a 2017 interim net profit of $US3.3bn, which is 93 per cent higher than previously, while underlying earnings rose by 152 per cent to $US3.9bn ($A4.9bn). The strong result was driven by its iron ore division, whose earnings rose by 87 per cent to $US3.3bn. Shareholders will receive a record interim dividend of $US1.10 a share, compared with just $US0.45 for the same period in 2016. Meanwhile, CEO Jean-Sebastien Jacques is upbeat about the outlook for the Chinese economy.

CORPORATES
RIO TINTO LIMITED – ASX RIO, YANCOAL AUSTRALIA LIMITED – ASX YAL, COAL AND ALLIED INDUSTRIES LIMITED, SHAW AND PARTNERS LIMITED, CITIGROUP PTY LTD, BARCLAYS BANK PLC

Rio’s chance to reward investors with jump in returns

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Original article by Matt Chambers
The Australian – Page: 17 & 28 : 1-Aug-17

Rio Tinto is widely tipped to post a 2017 interim underlying profit of $US4.12bn ($A5.16bn), compared with $US1.56bn previously. Market watchers also anticipate that Rio will lift its interim dividend from $US0.45 per share to $US1.18, with the prospect of a full-year payout of $US2.50 per share. Paul Hissey of RBC Capital Markets forecasts that a special dividend will boost Rio Tinto’s interim payout to $US1.42 a share. However, Glyn Lawcock of UBS expects the interim dividend to be $US0.93.

CORPORATES
RIO TINTO LIMITED – ASX RIO, RBC CAPITAL MARKETS, UBS HOLDINGS PTY LTD, BHP BILLITON LIMITED – ASX BHP, ANGLO AMERICAN PLC, GLENCORE PLC, VALE SA, GREAT BRITAIN. SERIOUS FRAUD OFFICE

Glencore nears $1.4bn deal on Rio coalmines

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Original article by Matt Chambers
The Australian – Page: 17 & 20 : 28-Jul-17

Yancoal Australia is set to on-sell some of its newly-acquired New South Wales thermal coal assets to Glencore in a deal worth $US1.139b ($A1.42bn). Glencore will acquire a 49 per cent stake in the Hunter Valley Operations from Yancoal and Mitsubishi following the completion of Yancoal’s acquisition of Rio Tinto’s NSW coal mines for $US2.69bn. Yancoal had trumped Glencore in a bidding war for the Rio Tinto assets.

CORPORATES
YANCOAL AUSTRALIA LIMITED – ASX YAL, GLENCORE PLC, MITOLO GROUP PTY LTD, RIO TINTO LIMITED – ASX RIO, COAL AND ALLIED INDUSTRIES LIMITED, YANZHOU COAL MINING COMPANY LIMITED

Fortescue digs in for mighty cost challenge

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Original article by Tess Ingram
The Australian Financial Review – Page: 15 : 28-Jul-17

Fortescue Metals Group shipped 170 million tonnes of iron ore in 2016-17, and the pure-play miner anticipates similar volumes in 2017-18. Fortescue has reported an average C1 cash cost of $US12.82 per tonne for 2016-17, including $US12.16 a tonne in the June quarter, and it has targeted a cash cost of $US11 to $US12 per tonne for 2017-18. CEO Nev Power says Fortescue also aims to achieve productivity and efficiency gains, while he has flagged a further reduction in its debt.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, CITIGROUP PTY LTD, MERRILL LYNCH (AUSTRALIA) PTY LTD, RBC CAPITAL MARKETS

UK to probe Rio’s Guinea bribe scandal

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Original article by Matt Chambers
The Australian – Page: 19 & 22 : 26-Jul-17

The Serious Fraud Office in the UK will undertake an investigation into a $US10.5m payment to a consultant in 2011 regarding Rio Tinto’s Simandou iron ore project in Guinea. The resources giant had notified anti-bribery agencies in the US, the UK and Australia about its concerns regarding the payment in late 2016. The SFO has asked for anyone with further information on the issue to come forward. The scandal resulted in the dismissal of two senior Rio Tinto executives.

CORPORATES
RIO TINTO LIMITED – ASX RIO, GREAT BRITAIN. SERIOUS FRAUD OFFICE, AUSTRALIAN FEDERAL POLICE, UNITED STATES. DEPT OF JUSTICE, UNITED STATES. SECURITIES AND EXCHANGE COMMISSION, ROLLS-ROYCE PLC

Lihir digs in to get Newcrest on target

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Original article by Paul Garvey
The Australian – Page: 20 : 25-Jul-17

Newcrest Mining’s gold production totalled 551,815 ounces in the June 2017 quarter, compared with 598,602 ­ounces in the March quarter. However, record quarterly output of 276,230 ounces at the Lihir mine in Papua New Guinea helped offset lost output at the Cadia mine in New South Wales. Full production at Cadia is expected to resume in the September quarter, following earthquake damage in April. Meanwhile, Newcrest has applied for 40 exploration tenements in Ecuador.

CORPORATES
NEWCREST MINING LIMITED – ASX NCM, SOLGOLD PLC, RBC CAPITAL MARKETS, GOLDMAN SACHS AUSTRALIA PTY LTD

Atlas looks to build buffer before returning to debt markets

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Original article by Paul Garvey
The Australian – Page: 19 : 24-Jul-17

Atlas Iron MD Cliff Lawrenson says the iron ore miner will not repay its outstanding Term Loan B debt of $A103m until it has a working capital buffer of around $A50m. He adds that a revolving credit facility is among the options being considered to provide the company with more balance sheet flexibility. Lawrenson believes that capital markets will rate Atlas Iron more highly once its Term Loan B debt has been paid off.

CORPORATES
ATLAS IRON LIMITED – ASX AGO

Giants join juniors in the hunt for minerals

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Original article by Paul Garvey
The Australian – Page: 17 & 20 : 24-Jul-17

Newcrest Mining has established a joint venture with Encounter Resources to explore for gold in Western Australia. The alliance is part of a growing trend for major global miners to enter joint venture arrangements with smaller Australian explorers. Encounter Mining MD Will Robinson says it is a cost-effective way for large miners to undertake greenfields exploration programs. He adds that more big miners are starting to ramp up their exploration in the wake of cutbacks following the downturn in the resources sector.

CORPORATES
NEWCREST MINING LIMITED – ASX NCM, ENCOUNTER RESOURCES LIMITED – ASX ENR, ASSOCIATION OF MINING AND EXPLORATION COMPANIES, RIO TINTO LIMITED – ASX RIO, ANGLOGOLD ASHANTI LIMITED – ASX AGG, ORINOCO GOLD LIMITED – ASX OGX