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voda 23 februari 2017 17:15

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Critical court showdown on mining and environment
Published on Thu, 23 Feb 2017
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Image Source: Miningnews.com
A controversial Australian mining company’s allegedly illegal activities at its West Coast mine that resulted in massive environmental destruction is the subject of a legal battle starting in the Western Cape High Court in Cape Town on Monday.

The most obvious physical symbol of the dispute is a sea cliff directly in front of the Tormin mineral sands mine – 400km from Cape Town near Lutzville – that collapsed in January 2015.

But at the heart of this dispute is a much more significant issue, with potentially far-reaching legal and environmental consequences for the South African mining industry.

This is the future application of the government’s recently introduced management system that transferred full responsibility for granting, monitoring and enforcing the conditions of environmental authorisations for prospecting and mining operations to the Department of Mineral Resources (DMR).

Coming into effect in December 2014 after over a decade of wrangling and disagreement within government, the “One Environmental System” was designed to improve efficiencies and reduce bureaucracy and delays in the approval and management processes in the industry.

There was widespread acknowledgement that the previous system had been slow, cumbersome and due for a shake-up. But for many, assigning responsibility for the vital but contested environmental component of the mining industry to the DMR has been the equivalent of putting the fox in charge of the hen house.

And during the past two years, the DMR has come in for stinging criticism for not tackling its new environmental compliance responsibilities with enthusiasm or effectiveness.

Tormin is sited on rich concentrations of mineral sands such as zircon, ilmenite, rutile, magnetite and garnet. It is owned by Mineral Sands Resources (Pty) Ltd (MSR). MSR is in turn a subsidiary of Mineral Commodities Ltd that trades on the Australian Securities Exchange as MRC.

MRC is the company that for the past 13 years has also attempted to develop a mineral sands mine at Xolobeni on the Pondoland coastline of Transkei, before announcing in July last year that it was selling its stake in this highly controversial project to its BEE partner.

Mining started at Tormin in November 2013, although mining rights had been awarded back in 2008, and by 2015 the operation had already produced some 1.6 million tons of mineral sands, generating annual sales R603 million.

Allegedly one of a number of breaches and violations

National and provincial environmental authorities say that the collapse of the sea cliff was facilitated by the unauthorised and illegal re-positioning and operation of Tormin’s two primary beach concentrators – mechanical plants where mineral sands are initially separated from the beach sand (or primary ore).

They also say this is only one of a number of breaches and violations of the conditions of its mining right and environmental authorisation.

Following a number of complaints over two years from individuals and organisations about the mine’s alleged lack of compliance with, and transgressions of, its statutory environmental management programmes, the Department of Environmental Affairs (DEA) led a search-and-seizure operation at Tormin in September last year.

Immediately afterwards, the DEA laid criminal charges against the mine in respect of five alleged transgressions:

increasing the footprint of its secondary land-based concentration plant beyond the extent approved in its environmental management programme, without authorisation;
unlawfully widening existing roads and constructing new roads without authorisation;
constructing a jetty-like structure in the coastal public property without authorisation;
dumping at sea without a permit, because tailings are transported by pipeline from the secondary concentration plant to the beach and pumped directly into the sea; and
failing to obtain required municipal planning approval for the expansion of the secondary concentration plant.

As of January, these charges were still being investigated and no summons had been issued against Tormin.

voda 23 februari 2017 17:16

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Deel 2:

‘One Environmental System’

The allegations are denied by MSR, and the mining company has now brought a High Court review application in which it argues that both the DEA and Western Cape’s Department of Environmental Affairs and Development Planning (DEADP) currently lack any legal jurisdiction to monitor and enforce compliance with Tormin’s statutory environmental management programmes.

MSR contends this is because the “One Environmental System” has given exclusive compliance authority at Tormin to the DMR.

In terms of its three-part review application, MSR is seeking relief in the form of:

the setting aside of the decision by Vredendal magistrate CS Kroutz to issue the warrant for the search-and-seizure dated 28 September 2016, or declaring the warrant invalid;
an order for the DEA to return any documents seized during the operation and to destroy any notes and surveys done during the search; and
a declaratory order to the effect that, because of the implementation of the One Environmental System, neither the national nor the Western Cape environment ministers and their departments has authority to perform compliance monitoring and enforcement in terms of the National Environmental Management Act (NEMA) in respect of Tormin and other mines, except for one specific part of this Act – section 31D, clauses 5-8.

MSR’s court papers include a founding affidavit by its environmental compliance officer Sibonelo Mkhize who states: “(MSR) will demonstrate that the complaints, and alleged criminal conduct on its part, have no merit, and that all its operations and activities were lawfully authorised and that (it) is acting within such authorisations”.

Incidents during mine inspections

MSR argues it is clear that the DEA’s jurisdiction in respect of compliance monitoring and enforcement of NEMA in mining areas has been removed, “save in limited and defined circumstances”.

The respondents are Magistrate Kroutz, the Minister of Environmental Affairs, the Minister of Mineral Resources, the Minister of Water and Sanitation, and the Western Cape Minister of Environmental Affairs and Development Planning.

For technical legal reasons, the heads of the two environmental departments, DEA and Department of Environmental Affairs and Development Planning (DEADP) were later also added as respondents.

Tellingly, MSR is not seeking relief against either the DMR or water and sanitation ministers, and says they are only cited because their departments have a direct interest in this matter.

Ironically, the first complaint against Tormin was made by a DMR official, but MSR accused him of being biased. Also, the DMR had agreed with, had helped plan and was initially party to the search-and-seizure operation.

But its two officials who were part of the inspection team were withdrawn at the last minute by the deputy director-general, ostensibly because he was unhappy that police were to accompany the team.

The DEA explains in court papers that there have been incidents during other mine inspections, including one where its team was held hostage by mine employees, and so it requests a police presence as a matter of course.

The environmental authorities have not taken Tormin’s challenge lying down, and have filed voluminous replying papers.

The DEA and DEADP acknowledge the legal changes brought about by the One Environmental System, but argue inter alia that Tormin transgressed aspects of environmental authorisations granted in terms of NEMA in 2012 for which they (DEA and DEADP) have compliance responsibility, and then failed to submit an amended application that could have rectified the transgressions.

They also argue that the environmental authorities have maintained certain oversight functions under NEMA, and that MSR’s interpretation of NEMA would result in a far-reaching curtailment of powers that the environmental authorities have historically exercised under NEMA as the umbrella environmental legislation.

A third leg to the argument by DEA and DEADP is that they remain responsible for enforcing compliance with the Integrated Coastal Management Act (ICMA) and the Control of Use of Vehicles in the Coastal Area Regulations – the so-called ORV regulations – and that as such they retain jurisdiction in respect of areas such as illegal coastal discharges, unauthorised driving in a coastal area, and illegal developments/structures along the coast.

They have therefore filed a conditional counter-application: if the court rules in favour of Tormin and agrees that the DEA and DEADP ministers have no jurisdiction to perform compliance monitoring and enforcement of NEMA (other than in respect of very specific circumstances), they will ask for an order confirming their full authority over those parts of Tormin’s mining operations that occur within the coastal zone as defined by the Integrated Coastal Management Act.

Because of the national significance of the application’s outcome, lawyers and environmentalists will be watching this case keenly. The observers include activist lawyers at the Centre for Environmental Rights (CER) – a non-profit organisation that helps communities and civil society organisations realise their constitutional right to a healthy environment.

The CER was among those who submitted formal complaints about Tormin’s alleged environmental breaches, and it has also been vocal about the way in which the DMR has taken on – or not taken on – its new environmental responsibilities.

In mid-2015, the CER issued a media statement saying that despite many assurances by the DMR, both in Parliament and elsewhere, that it was “more than ready” to implement the new One Environmental System, the department “… has so far either been completely unwilling to enforce the law, or has interpreted it in such a way as to defeat the purposes of sound environmental management”.

“As far as we can tell, only the most initial steps have been taken to start building the necessary capacity and designation within the DMR to fulfil its new role of monitoring and enforcing compliance with NEMA.

“In brief, all signs so far point to the fact that civil society’s dire warnings about the risks of placing the implementation of NEMA in the hands of the DMR were entirely well-founded.”

In addition to providing legal case history that could significantly influence environmental management of the mining industry throughout South Africa, and particularly in coastal areas, the Tormin review application will also cast light on the extent to which the DMR has now taken on its new responsibilities.

Source : Miningnews.com

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bottelier 23 februari 2017 17:29

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Vreemd aandeel

voda 23 februari 2017 18:09

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thyssenkrupp sells Brazil's CSA to Ternium

Ternium and thyssenkrupp have announced that they have struck a deal regarding the sale of Brazilian slab producer Companhia Siderúrgica do Atlântico (CSA) to Ternium.

For thyssenkrupp, the sale marks a “… milestone” in its intended transformation from a steel to a technology and industrial services group, it notes in its statement. It also closes the door on the German group’s most painful venture, from which it has been wanting to exit for most of this decade.

The two companies agreed on a sale price €1.50 billion ($1.58 billion), which “… is more than anticipated by the financial market, with analysts mostly expecting around €1 billion,” thyssenkrupp’s cfo Guido Kerkhoff said on Wednesday morning at a press conference attended by Kallanish. He added that the sale price is also better than prices achieved in most transactions in the steel industry of recent years.

Nearly three years earlier, thyssenkrupp had also divested the US part of its Steel Americas division, namely the hot-rolling mill and the stainless steel rolling mill in Calvert, Alabama.

At the conference, ceo Heinrich Hiesinger said that the group had bided its time to sell off CSA. “At that time it made sense to sell Alabama, but not CSA; it was not time that dominated the process, but the quest for sensible solutions,” he said. “We accepted that, and I think it is a strength of the company that we are conscious of that responsibility,” he said.

Kerkhoff added that “… we have worked step by step on creating the conditions for the sale of CSA, making it attractive for a buyer. This is reflected in the purchase price.” CSA in the last three quarters has been operating profitably, the managers noted.

For its American venture, the German group spent in total more than €12 billion. After deducting the revenue of the sales in Brazil and Alabama, and the financial investment of former CSA partner Vale, the net loss still stands at €8 billion.

Ternium, with main its operations in Argentina and Mexico, decided to acquire the plant to secure self-sufficiency in semis. The group bought 3.7 million tonnes of slabs in 2016 having produced 6mt of crude steel and shipped 9.8mt of finished products. CSA output will feed Ternium rolling lines, while the company has agreed also to supply 2 million tonnes/year to the former thyssenkrupp Calvert mill in Alabama.

Source: Kallanish.com

[verwijderd] 24 februari 2017 07:22

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www.mining.com/vale-swings-back-into-...

Brazil's Vale (NYSE:VALE), the world's No.1 iron-ore producer, profited from a sharp surge in iron ore prices that helped the company swing to a net profit of $525 million in the fourth quarter from a $8.6bn loss for the same period a year earlier.

The Rio de Janeiro-based company logged a net profit for the full year of $3.98 billion, a significant recovery from a loss of $12.13 billion it reported for 2015, the biggest in the miner's history.

Vale sees iron ore prices staying strong, down only to about $80 per tonne from the over $91 a tonne they are currently trading at.
"With strong production and the recovery in prices, it was forecast we'd have a strong quarter and finish the year strongly. And that's exactly what happened," Vale's Chief Financial Officer Luciano Siani said in a video on the company's website.

Unlike several analysts and even companies that predict iron ore prices are set fall sharply in the medium-term, Vale sees the steelmaking material staying strong, down only to about $80 per tonne from the over $91 a tonne is currently trading at.

The modest price correction will be the result of increasing steel demand and reduced fresh output coming into the global market this year, Peter Poppinga, Vale’s executive director of ferrous minerals said in a call with investors and press.

According to the executive, 2017 will see only 45 million tonnes of new iron ore supply being pumped into the market, down from 70 million tonnes last year. About 50% of that total, he noted, will come from Vale’s new S11D mine, in the south-eastern state of Minas Gerais.

The company, which cut the ribbon on the massive operation in December, said the mine should be operating at full tilt next year. By then, the amount of iron ore being dug will be enough to fill 225 Valemax ships — the largest cargo carriers in the world.

Just to put that in perspective and quoting Breno Augusto dos Santos, the geologist who helped discover the mine, the massive asset will enable Vale to remain the iron ore market leader for at least a century.

And that is only considering the “D” block of the deposit. There are three other blocks at S11 that can be exploited later: A, B and C.Vale swings back into the black on soaring iron ore prices
The entire S11 deposit has a mineral potential of 10 billion tonnes of iron ore, while blocks C and D have reserves of 4.2bn tonnes, Vale said last month during the mine opening.

S11D, also known as Serra Sul, will add 90m tonnes of annual capacity to Vale’s output by 2020, or about 20% of its expected output for that year.

Iron ore prices climbed around 80% last year following near-decade lows of $38 a tonne in December 2015. The commodity has carried last year’s bullish momentum into the start of 2017, with prices rallying amid speculation that China’s demand for overseas ore will hold up even as the world’s largest miners, such as Vale, bring on new capacity.

[verwijderd] 24 februari 2017 07:27

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www.bloomberg.com/news/articles/2017-...

Iron Ore Powers Back to $100 in World’s Top User as Miners Surge

[verwijderd] 24 februari 2017 07:29

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www.bloomberg.com/news/articles/2017-...

ArcelorMittal’s Surging Profit Underscores Steel Turnaround
by Thomas Seal and Thomas Biesheuvel
February 10, 2017, 10:20 AM GMT+4 February 10, 2017, 5:08 PM GMT+4
Steel prices recovered as Chinese stimulus boosted demand
Steel, iron ore and coal prices jumped at least 80% last year
ArcelorMittal’s biggest earnings jump in seven years and forecasts for better steel demand showed the recovery in commodities is gaining strength.

The shares added 6.5 percent to 8.01 euros in Amsterdam trading, extending a rally that has more than tripled the value of the world’s top steelmaker in the past year. Earnings before interest, taxes, depreciation and amortization jumped 20 percent, the most since 2010, bolstered by higher prices for steel and iron-ore.

The company has undergone a dramatic turnaround in the past year as steel prices jumped on the back of stronger economic growth in China and a broader commodities recovery. ArcelorMittal said its main financial goal is to pay down debt and return to an investment-grade credit rating, so the board decided against paying a dividend.

“We model significant further earnings gains” based on better steel demand and expanding margins, Seth Rosenfeld, an analyst at Jefferies in London, said by phone. “The Europe performance is very positive for the company. It’s the biggest earnings driver.”

Global steel consumption may rise as much as 1.5 percent in 2017, after a 1 percent increase last year, the company said.

European steel prices surged 82 percent last year, while benchmark rates for iron ore and coking coal, which ArcelorMittal also mines, also jumped.

Earnings before interest, taxes, depreciation and amortization rose to $6.26 billion last year, the Luxembourg-based company said in a statement. The figure beat the $6.14 billion average estimate from a survey of analysts. Ebitda in the fourth quarter was $1.66 billion, 51 percent higher than a year ago.

While the company stopped providing earnings guidance, the forecast for more steel consumption suggests profit will increase further, analysts from Goldman Sachs Group Inc. said.

Net debt decreased by $4.6 billion to $11.1 billion at year-end, the company said.

Aditya Mittal, the company’s chief financial officer, said it would benefit from more spending on U.S. infrastructure and policies that enforce fair trade.

“There needs to be a comprehensive solution to the Chinese overcapacity issue, as well as the subsidies that they grant to their steel industry,” he told reporters on a call. “That the U.S. enforces existing rules, and ensures there’s a level playing field, we’re very supportive of that.”

voda 24 februari 2017 13:49

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Cosco Shipping and Baowu Steel ink strategic cooperation

Sea Trade reported that China’s state-owned entities China Cosco Shipping Corporation Limited (Cosco Shipping) and China Baowu Steel Group have inked a comprehensive strategic cooperation.

The cooperative partnership seeks to benefit the two sides to further develop businesses in the areas of shipping, logistics, shipbuilding and so forth.

Cosco Shipping stated that the cooperation would also bring about synergies among state-owned enterprises for sustainable business expansion.
Posted 09 February 2017

Source : Sea Trade

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voda 24 februari 2017 13:51

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Saudi Iron and Steel Co reduces wire rod & HR prices

Saudi Iron and Steel Company (Hadeed) has decreased wire rod prices for the domestic market by SAR 50 (USD 13) per ton, now reaching to SAR 1950 (USD 520) per ton CPT Riyadh.

Source : Strategic Research Institute

voda 24 februari 2017 13:52

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S&P revises Metalloinvest outlook to Stable

Metalloinvest announces that Standard & Poor’s Ratings Services has revised its outlook on Metalloinvest from Negative to Stable. S&P also affirmed the Company’s ‘BB’ long-term corporate credit rating.

Source : Strategic Research Institute

voda 24 februari 2017 13:52

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Iran iron ore concentrate output in 10 months

Financial Times reported that Iran’s iron ore concentrate production increased in the first 10 months of the current Iranian year (March 20, 2016–Jan. 19, 2017) owing to better export demand and higher domestic steel production.

During this period, iron ore concentrate production rose 17.27% to reach 25.47 million tons year-on-year, according to Iranian Mines and Mining Industries Development and Renovation Organization. Three major mining companies accounted for the biggest part of total volume: Golgohar Company (40%), Chadormalu Mining and Industrial Company (30%) and Iran Central Iron Ore Company (13%), Metal Expert reported.

The rise was driven by the continuous growth of crude steel production in the country, which demands higher volumes of raw materials.

Over the first 10 months of the current Iranian year, Iranian steel mills produced 15.4 million tonnes of crude steel (up 10% y-o-y). Foreign markets also contributed to the growth, where miners shipped 15.15 million tonnes of iron ore (up by 50% y-o-y).

The Iranian government plans to introduce a 5-15% export tariff on fines and lumps of all grades in the next Iranian year (starting March 21, 2017), which has raised concerns among Iranian miners as it might undermine their foreign activity and lead to oversupply in the local market.

Source : Financial Times

voda 24 februari 2017 13:56

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Canadian Tribunal amends its order on certain carbon steel fasteners from China and Chinese Taipei

The Canadian International Trade Tribunal has completed the interim review of its order made on January 5, 2015, in Expiry Review Inquiry No. RR-2014-001, in respect of certain carbon steel fasteners originating in or exported from the People’s Republic of China and Chinese Taipei.

Source : Strategic Research Institute

voda 24 februari 2017 13:57

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Taiwan steelmakers CSC & Chung Hung applause import tax extension

Taipei Times reported that Taiwan local steelmakers welcomed the government’s decision to extend anti-dumping taxes on imports from six countries by five years, which is expected to curb unreasonably low prices for steel imports.

Mr Wang Shyi-chin executive vice president of China Steel Corp said that “The measure could help sustain the development of the nation’s steel market. Without related anti-dumping duties, steep price competition would erode profits and lower the capacity utilization rates of local steelmakers.”

Chung Hung Steel Corp vice president Mr Li I-hsiang said that before the introduction of the taxes, some Chinese steelmakers sold products 30 percent cheaper than products made in Taiwan. He said that “Under the WTO framework, local companies are more vulnerable to fluctuations in product prices adding that foreign companies also take advantages of zero tariffs on their galvanized steel exports to Taiwan.”

The Ministry of Finance on Monday announced the continuation of anti-dumping duties on carbon steel plates and galvanized steel products imported from China, South Korea, Brazil, Indonesia, India and Ukraine. The ministry, which started to levy the anti-dumping taxes on a temporary basis last year, said that taxes would range from 8.66 percent to 80.5 percent.

Source : Taipei Times

voda 24 februari 2017 14:02

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CISA led industry groups firmly against substandard steel production in China

The China Iron and Steel Association, Chinese Society for Metals, hina Foundry Association, China Special Steel Enterprises Association and Stainless Steel Council of China Special Steel Enterprises Association jointly issued a document on Feb 13 to show their firm stance on the crackdown of polluting low-end steel production.

The document said that although a sequence of campaigns had been launched to cull shoddy steel production in the past decade, there are illegal steel producers evading punishments by expanding the capacity of intermediate frequency induction furnaces and industrial frequency furnaces and adding onto production lines refining furnaces or facilities for continuous casting and rolling, which, in a real sense, are incapable of controlling the key indexes in steel production process.

It is stressed in the document that the low-grade steel produced by the small low-tech furnaces is not only a source of pollution but also a major safety hazard to the society, thus it should be resolutely rooted out.

The document further confines the use of intermediate frequency induction furnaces and industrial frequency furnaces to producing casting products as smelting facilities and smelting ferrochrome and ferronickel in the production of stainless steel and high-alloy steel.

Experts and researchers from the above-mentioned institutions and from USTB (University of Science & Technology Beijing), MPI (China Metallurgical Industry Planning and Research Institute) and China Metallurgical Information and Standardization Institute all contributed to the launch of this document.

Source : MySteel

voda 24 februari 2017 14:03

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POSCO C&C to expand color coated steel production Line

POSCO Coated & Color Steel Co (C&C), an affiliate of POSCO Group which engages in the manufacture and sale of coated steel sheets, will expand its production facilities for color steel sheets, which are the company’s main product.

The company announced on Feb. 22 that it has decided to invest 39 billion won (US$34.08 million) in establishing a Pohang color steel continuous coating facility (No.4 CCL). It is to increase the number of color steel sheet production lines from the current three to four.

POSCO C&C is supplied with cold rolled coils from POSCO and manufactures galvanized steel sheets, aluminum coated steel sheet and color steel sheets.

Color steel sheets are generally used to produce panels for buildings and home appliances, while coated steel sheets are used in automotive mufflers and interior and exterior materials for buildings.

Source : Business Korea

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voda 24 februari 2017 14:05

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Keystone & Dakota Access pipeline makers must buy US steel – Mr Trump

CNBC reported that US president Mr Donald Trump said that the companies behind two hotly contested oil pipelines must use US steel in their projects. Mr Trump told United States Steel CEO Mario Longhi during a meeting of business leaders at the White House that "And you're going to be doing pipelines now, you know that, right?. We put you heavy into the pipeline business because we approved, as you know, the Keystone pipeline and Dakota, but they have to buy, meaning steel, so I'll say US steel, but steel made in this country and pipelines made in this country."

Trump ordered the Department of Commerce last month to develop a plan that would require any company that builds a pipeline within US borders to use American-made materials and equipment. But he has previously stopped short of language suggesting a requirement in public statements, instead saying he would like the projects to be built with US raw steel and pipes.

The Commerce Department has not yet issued a report on the requirement, but Mr Trump on Thursday said the companies behind the Keystone XL and Dakota Access pipelines would "have to buy" pipes made from US steel.

The requirement to use US steel would create challenges for TransCanada because much of the pipe for its Keystone XL project has already been manufactured. In 2012, TransCanada said 50 percent of the pipes used to build the project would come from a plant in Little Rock, Arkansas, operated by Indian conglomerate Welspun. The remaining pipe would be made in Canada, Italy and India.

It is unclear how the mandate would affect Energy Transfer Partners, since all but a small portion of its Dakota Access pipeline has been built. Energy Transfer expects the project to be ready to ship oil on April 1.

Source : CNBC

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voda 24 februari 2017 14:07

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Flush with funds’ banks keen to fund steel industry - Minister Birender Singh

Financial Express reported that India’s steel minister Mr Birender Singh while speaking at the Indian Express Group’s Idea Exchange programme said that despite the recent crisis that the domestic steel industry is fast recovering from, its long-term potential is huge and it is more than feasible its capacity would increase dramatically from 120 million tonnes at present to 300 million tonnes by 2030-31.

He said that banks, which are “flush with funds”, have now become favourably disposed to giving fresh loans to the steel industry. He said “Our banks are sitting on deposits of over Rs 15 lakh crore and are paying 4% interest on savings accounts. So it is natural that most of them are now looking for borrowers.”

Source : Financial Express

voda 24 februari 2017 14:17

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Vale looking to raise USD 1.5 billion with sale of some assets

Bloomberg reported that Vale SA is downsizing its divestment plans this year as commodity prices recover, focusing on unloading less-important operations while jettisoning proposals to sell any of its prized iron-ore assets, said people with knowledge of the plans.

The Rio de Janeiro-based company is looking to raise about USD 1.5 billion with the sale of shipping, fertilizer and energy assets, the people said, asking not to be identified because talks are private. With iron-ore prices up more than 80 percent in the past year, Vale has ceased efforts to sell future production in so-called streaming deals, they said. The company’s press department confirmed that there are no talks under way to sell iron assets.

The Brazilian company joins Anglo American Plc and Glencore Plc in scrapping some proposed asset sales as cost cuts and recovering commodity prices generate enough cash to meet debt-reduction targets.

After iron-ore prices slumped to USD 38 a metric ton at the end of 2015 amid a global glut, Vale opened the door to selling some of its best assets to ease one of the mining industry’s biggest debt loads. In August, Vale was said to be in talks with a group of Chinese investors for a multibillion-dollar iron-ore streaming deal. Then demand picked up in China and prices of the steel-making ingredient are now back above USD 90, sending Vale’s earnings back to 2014 levels.

Still, the company is moving forward with the sale of assets it considers outside its core interests.

It’s trying to sell a nitrogen operation in the city of Cubatao, four iron-ore carriers and energy assets including a stake in the Belo Monte hydroelectric dam in the Amazon, the people said.

Vale confirmed on Friday that it’s looking to divest the Cubatao assets, which were left out of Vale’s USD 2.5 billion sale of fertilizer operations to Mosaic Co. announced in December. The company declined to comment on energy assets, vessels or the amount it’s seeking to raise.

Source : Bloomberg

voda 24 februari 2017 14:20

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Anglo to hold Kumba as Cutifani ends disposals plan

ANGLO American ended its strategy of cutting net debt through asset disposals saying instead it would operate twice as many assets as targeted a year ago owing to efficiency gains it had achieved.

It also planned to resume dividend payments in its 2018 financial year following a reduction in net debt to USD 8.5 billion which it achieved through a USD 3.5 billion improvement in free cash flow, utilisation of taxed losses, and USD 1.8 billion in disposal proceeds.

The bottom line for the year to December was $1.24 in share earnings compared to a loss of $4.36/share in the previous financial year. The operating improvement was owing to net $1.5bn increase in volumes, and cost controls which overcame a 3% decline in average realised prices.

Net debt as of December 31 was at $8.5bn, $1bn better than consensus, and far better than the $10bn target the group had earmarked a year ago in Anglo’s results presentation in which its CEO, Mark Cutifani, was pilloried for failing to respond quickly enough to the decline in commodity prices.

Today, however, Cutifani declared the group unrecognisable from the one he took over in 2013. He said in a media conference call that “This is not the company you knew three years ago; we have streamlined; we have got fitter.”

He said that “I make no apologies for turning Anglo American into the kind of machine it is today adding that instead of cutting assets under control to about 16 as described a year ago the group would hold no less than 30 assets.”

This included the Minas Rio iron ore mine in Brazil and the group’s larger South African assets: its 70% stake in Kumba Iron Ore, its export coal mines, and its stake in Samancor, a manganese operation it shares in joint venture with South32.

Source : Miningmx.com

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voda 24 februari 2017 14:21

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Fortescue paying down debts and dividend

The Australian reported that Fortescue Metals chief Mr Nev Power says once problematic debt levels could be paid right down to zero after a bumper first-half profit saw debt reduced by USD 1.7 billion (USD 2.21 billion) and a record dividend that will deliver chairman and major shareholder Andrew Forrest USD 207 million.

After just three years ago being on the brink of buckling under high debt, looming repayments and low iron ore prices, Fortescue now finds itself unexpectedly having to decide what to do with surplus cash, having smashed through its original recent net gearing target.

Yesterday, the Perth mining company Mr Forrest took control of in 2003 reported a 283 per cent increase in first-half profit to USD 1.22 billion, which was in line with forecasts.

Buoyed by high iron ore prices and USD 3.7 billionn of annual cost cuts in the past three years, Fortescue paid down net debt down to USD 4 billion and raised its interim dividend to 20c a share, fully franked, from 3c last year.

Mr Forrest’s 33.3 per cent stake in FMG means his holding is valued at USD 7 billion at the current share price and that he will get a dividend payout of USD 207 million.

Fortescue’s net gearing is now 30%, well below its target of 40%, but Mr Power says the repayments will continue.

Mr Power said that “Paying down all the debt is not out of the question. We think of this as like a mortgage and the interest cost is taking cashflow, so we are happy to pay it down.”

He said the company will focus on debt reduction, which can boost equity value by degearing, investing in the current iron ore business to make sure it is sustainable and returns to shareholders.

He said that “As our cash flows continue to increase and debt reduces we can focus on increasing those returns.”

Mr Power said that he company is pursuing low-cost early stage exploration in NSW and Ecuador, which could be a growth option in five years or so, but it was unlikely Fortescue would acquire more developed assets.

Source : The Australian

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