TABLE OF CONTENTS
Barrick Gold Buys Copper Producer Equinox Minerals
Harmony CEO: Wafi-Golpu Gold Mine Development Cost Could Reach $4 Billion
Konkola Copper Mines Plans $1762m Copper Treatment Project
ArcelorMittal SA to Proceed with ICT Deal
Belo Sun to Increase Resources at Its Brazilian Gold Project
Calibre Mining Cuts High-Grade Gold and Silver in Nicaragua
Lithium Americas Outlines $399m Mine Plan for World-Class Lithium-Brine Resource
Capstone to Acquire Far West Mining form Santa Domingo, JV with KORES
Rio Tinto to Spend $238m on Bingham Canyon Feasibility Study
Vedanta Buys 11% of Cairn India from Petronas
Rio Tinto in New Agreement with Orissa in India
India's Punj Lloyd Buys 50% Stake in Indonesia Coal Mine
Mongolia’s Oyu Tolgoi to Begin Production in August 2012
Oceanagold's Didipio Gold-Copper Project Advances
Hyderbad-Based GVK to Acquire Hancock Coal Mines
Petaquilla Minerals to Acquire Iberian Resources
Metso to Deliver Minerals Processing Equipment and Services to Swedish Mine
Barrick has thwarted China's biggest ever takeover bid for an Australian-listed miner by striking a friendly $CAN7.3 billion ($A7.15 billion) deal to buy copper producer Equinox Minerals.
Chinese state-controlled Minmetals Resources dumped plans for a hostile $C6.3 billion tilt at Zambia-focused Equinox after the target's board unanimously backed Barrick's all-cash offer.
The dual Australia and Toronto-listed Equinox is a hot property because it owns the big Lumwana copper mine in Zambia.
Barrick's offer of $C8.15 a share is closer to what some analysts say would represent fair value for Equinox than Minmetals' indicative price of $C7 a share.
The move on Equinox is the first pure copper buy for Barrick, the world's biggest gold producer, which also owns copper mines in Chile.
"Assets like this rarely come on the marketplace," said Barrick chief executive Aaron Regent. "Most large copper producing mines are tucked away in the portfolios of majors."
Under the agreement with Barrick, Equinox has abandoned its $C4.8 billion tilt for Canada's Lundin Mining.
South African miner Harmony Gold's cost of developing its Wafi-Golpu gold prospect in Papua New Guinea could exceed initial estimates of $3 billion, its chief executive said according to Reuters.
"It could reach $4 billion," CEO Graham Briggs told a media presentation, adding its operations could be 50 percent bigger than originally anticipated.
He said costs could grow for logistical regions in a remote and undeveloped area.
In a recent analysts' presentation, Harmony, the world's fifth-largest gold miner, said Wafi-Golpu might yield 300,000 to 700,000 ounces of gold and 200,000 to 320,000 metric tonnes of copper a year, both wide ranges.
It shares the project with Australian partner Newcrest Mining Ltd.
Harmony has said it may fund its half of the costs from a bond issue as well as commercial debt, cash, or commodity-backed financing on copper.
Zambia's Konkola Copper Mines (KCM) owned by London-listed Vedanta Resources plans to invest $172 million in a new copper treatment project.
The proposed project would produce 50,000 tonnes of finished copper per year, KCM said in a report submitted to the state-run Environmental Council of Zambia and reported by Reuters.
Under Zambian law, mining companies and other investors planning huge infrastructure projects are required to seek the prior approval of the Environmental Council of Zambia.
KCM planned to treat approximately 156 million tonnes of stockpiled ores that were difficult to treat using ordinary copper treatment methods, it said.
"The materials will be treated using a process known as agitated leaching. This process uses acidic solutions to treat the materials into finished copper," the report said.
The lifespan of the project to be located in the Nchanga mine plant area was estimated at 13 years but could exceed that if more materials were sourced from Nchanga mine, it said.
About 1,700 jobs would be created during the construction phase of the project and 300 permament jobs would be created after its completion, KCM said.
KCM plans to invest $1 billion in the next 3-4 years on expansion and upgrades in a bid to become a major global copper producer, its chief executive said in December last year.
Bloomberg reported that ArcelorMittal South Africa Limited plans to proceed with its acquisition of Imperial Crown Trading 289 Limited, the company awarded the right to a portion of Kumba Iron Ore Limited's Sishen mine.
The steelmaker denied a report by the Johannesburg based Sunday Times saying ArcelorMittal South Africa was considering pulling out of the deal.
Mr Themba Hlengani manager of corporate communications for ArcelorMittal South Africa said that "It's probably a speculation. The transaction is still on the go. Nothing has changed, the process is still under way."
ArcelorMittal South Africa offered to buy ICT for ZAR 800 million to get the prospecting rights to 21.4% of the output of Sishen mine at cost plus 3%. The mine is South Africa’s largest iron ore deposit.
South Africa awarded the Sishen right to ICT in March last year after it reverted to the state from ArcelorMittal South Africa. ICT's only asset is the Sishen prospecting franchise. Kumba, a unit of Anglo American Plc, owns the rest of the mine's rights.
Canadian miner Belo Sun Mining Corp said it will expand its drilling operations to increase the resources at its flagship gold project in Brazil, and will also fund a feasibility study at the project.
The company said it will fund the drill program at the Volta Grande gold project in Para State with funds it raised in a bought deal in March.
It will invest $12.5 million for the completion of a bankable feasibility study and basic engineering studies, the company said in statement.
Earlier this month, Belo Sun had announced a 23 percent increase in the indicated contained ounces and a 5 percent increase in the inferred mineral resources at the project.
Belo Sun, formerly known as Verena Minerals Corp, has two other gold properties in Brazil, the Rainbow Alexandrite project in Goias state and the Patrocinio Gold project in Para State.
Calibre Mining hit one of its best gold-silver intercepts yet as it continues drilling to define two areas of mineralization at its Riscos de Oro project in Nicaragua.
Hole 10 cut as much as 5.4 metres @ 10.25 g/t gold and 288.25 g/t silver starting 223 metres downhole. Above that intercept in the same hole Calibre also returned 1.5 metres @ 5.98 g/t Au and 9.1 g/t Ag and 4.2 metres @ 2.5 g/t Au and 5.16 g/t Ag.
Calibre Mining President and CEO Robert Brown speculated "we may be seeing a telescoping of the system," as other holes drilled at Riscos de Oro have also encountered multiple zones of gold-silver mineralization.
Hole 10 was a 50 metre step-out from last year's Hole 1 that cut impressive silver grades - as much as 0.8 metres @ 1,990 g/t Ag.
With 2,500 metres of drilling planned this year, Calibre Mining aims to complete a resource estimate at Riscos de Oro, Brown said.
While exploration has so far focused on the immediate area around and beneath the past producing mine, Brown has two main reasons to hope mineralization is more pervasive. First, Calibre Mining geologists have traced the Riscos de Oro low-sulphidation vein system for over seven kilometers, at least two kilometers of which lie on its Riscos de Oro concession.
And second, Brown said from reviewing drill core Calibre Mining geologists intrepret multiple phases of mineralization and brecciation. "From this, as well as the intensity of alteration, we are interpreting a long-lived and active structure," he said.
That hypothesized long-lived nature of the structure could bode well for the possibility of gold-silver mineralization in other areas of the vein the system, Brown said.
Magna and Mitsubishi-backed explorer Lithium Americas made the case for a lithium brine mine in Jujuy province, Argentina, in its first scoping study of the Cauchari project, which it reports contains the third largest such deposit in the world.
Lithium Americas would construct a 40,000-tonne per year lithium carbonate mine in two phases, the first generating revenue in 2014 and the second in 2018, at a capital cost of $399 million. The first 20,000-tonne phase would cost $217 million to build, and construction would begin in 2012.
Waldo Perez, president and CEO of Lithium Americas, said the scoping study shows that Cauchari has the "potential to become one of the lowest cost lithium operations in the world."
With massive measured and indicated resources at Cauchari, standing at 5.3 million tonnes lithium carbonate, the Cauchari scoping study forecasted production at 40,000 tonnes per year would only deplete about half the resource after 40 years.
Assuming Lithium Americas secures approval for Cauchari, it has two key investors, Magna and Mitsubishi, lined up to potentially help it finance mine building. Both hold sizeable stakes in Lithium Americas, about 13% and 4% respectively, and options to exercise off-take agreements.
The off-take agreements would give Magna the right to up to 25% of Cauchari's lithium carbonate, and Mitsubishi up to 12.5% of lithium carbonate. If they opt in, both agreed to lend or arrange interest-free loans to Lithium Americas equal in proportion to their off-take.
Vancouver's Capstone Mining and Far West Mining had made an agreement in which Capstone will acquire explorer Far West for $9.19 per share for a total cash-and-share transaction of Cdn$725 million.
Capstone also entered an agreement with state-owned Korea Resources Corporation (KORES), which engages directly or indirectly through joint ventures or in the form of minority investments, in overseas exploration, development and production of strategically important mineral resources, and managing Korea's stockpile of rare mineral resources.
Capstone and KORES have agreed to form a long-term strategic partnership for development of Far West's Santa Domingo copper-iron-gold development project located in Region III of Chile. The companies say "Santa Domingo has the potential to be a long lived significant copper and iron ore producer, based on an indicated mineral resource of 486 million tonnes at a copper-equivalent grade of 0.57%..." A Preliminary Economic Assessment (PEA) completed in 2008 projected a life-of-mine average annual production of 65,000 tonnes of copper and 4 million tonnes of iron concentrate.
A pre-feasibility study, based on a current mineral resource that has more than doubled, is scheduled to be completed in Q3 2011.
The boards of Capstone and Far West, which include Quadra FNX Mining, have endorsed the takeover bid. Far West's directors, senior management, Quadra FNX and certain other shareholders in total represent 38% of Far West's shares and have agreed to vote their shares in favor of the transaction.
Capstone owns two producing copper mines, the Cozamine copper-silver-zinc-lead mine located in Zacatecas State in Mexico and the Minto copper-gold-silver mine in the Yukon in Canada.
Upon completion of Far West, KORES will acquire a 30% interest in the San Domingo project for C$210 million to Capstone. KORES will also arrange for debt financing to provide funding for 65% of the capital costs of the project and also fund 30% of the balance of the capital requirements at the project.
KORES will enter into an off-take agreement for half of all copper concentrate and iron concentrate produced over the life of the Santo Domingo mine.
After completion of the acquisition KORES will subscribe for an 11% interest in Capstone to become Capstone's largest shareholder, and will appoint one representative to Capstone's board.
With the acquisition, Capstone anticipates a 200% growth in copper production from 2011 to 2016 and a more than 125% increase in measured and indicated copper contained in mineral resources.
Mining group Rio Tinto is to spend $238 million on a feasibility study on Kennecott Utah Copper's Bingham Canyon Mine in Salt Lake City.
The study will look at extending the mine's life from 2019 to 2028 through pushing back the south wall and constructing supporting infrastructure and equipment, the company said recently.
Vedanta Resources Plc has bought an 11 percent stake in Cairn India, a source said, pushing ahead with plans to take control of the Indian oil and gas company despite regulatory delays plaguing the $9.6 billion deal, according to a report by Reuters.
Vedanta's move to acquire Cairn India is part of London-based mining magnate Anil Agarwal's plans to grab a slice of India's oil reserves and get exposure to surging demand.
But its agreement to buy a 40 percent to 51 percent stake from Cairn Energy is yet to be cleared by the Indian government. Vedanta is also aiming to buy a further 20 percent through an open offer.
Analysts said Vedanta's $1.5 billion share purchase in Cairn India would be useful if it fails to get a big response from minority shareholders for its open offer.
Spokesmen for Cairn India and Vedanta in India did not respond to calls by Reuters seeking comment on the block deal. Petronas confirmed it had sold its stake.
Vedanta's deal to buy a majority stake in India's No. 4 oil and gas company hasn't received approval from the Indian government, eight months after its announcement, due to a dispute in royalty payments.
Vedanta will join BHP Billiton as the only miner with large oil interests.
Vedanta had said Cairn India had the potential to almost double current production to about 240,000 barrels of oil per day, around a quarter of India's output, allowing it to benefit from rising demand amid industrialization, economic growth, and an expanding population.
Australian mining giant Rio Tinto has received the green signal to undertake mining activities in India, with the Orissa government granting a proposal for a fresh agreement on April 7.
State-run Orissa Minerals Development Company (OMDC), a part of the Bird Group of Companies under the Indian government's ministry of steel had been in discussions with the world's biggest mining company, Rio Tinto, for a joint venture in the state for some time now.
Orissa state steel and mines minister Raghunath Mohanty confirmed that a fresh agreement was in place. Rio Tinto had signed an agreement with the state owned Orissa Mining Corporation (OMC) for the exploration of minerals in 1995, but had failed to go ahead on its plans due to a slump in the international market.
The deal envisages the entire value chain, right from prospecting and development to extraction. OMC would use Rio Tinto's expertise for mining its reserves in Orissa.
A joint venture company in the name of Rio Tinto Orissa Mineral was formed for the exploration of 15 million tonnes of iron ore per annum from the Gandhamardan and Malangtoli mines.
OMC has access to almost 206 million tonnes of iron ore reserves and 44 million tonnes of manganese ore reserves spread across six mines aggregating 4,365.262 hectares in Barbil of Orissa's Keonjhar district.
Rio Tinto has gradually been warming up in India. Besides plans to work with OMC, the company also plans to invest a sizeable amount in Madhya Pradesh for mining diamonds there.
Rio Tinto had begun exploring for diamonds across various sites in India in the mid-1990s. In 2004, the company had located some finds in the Bunder area.
During drilling and prospecting at Bunder in Madhya Pradesh, the company discovered a web of pipes which it claims could hold the biggest diamond find in the world in the past 10 years.
According to Stefanie Loader, Rio Tinto's Bunder project director, the Bunder project was granted a prospecting licence in 2006. ``Since then, we have progressed to what is known as a pre-feasibility stage. Early studies have proven an inferred resource of 27.4 million carats of diamonds,'' she told newswire agencies.
Analysts maintain that this translates to an annual value of roughs in the region of $300 million, assuming a life span of 15 years for the mine.
Indian infrastructure major Punj Lloyd recently announced that its Singapore-based subsidiary, Sembawang Engineers and Constructors, has entered into an agreement to acquire 50% stake in a thermal coal mine company in Indonesia.
The Indonesian company is based in Central Kalimantan, Indonesia and the acquisition is to be done through Sembawang Development Pte Ltd, a unit of Sembawang Engineers, the company has informed the Bombay Stock Exchange.
The company did not disclose the size of the deal.
The mining firm, based in Barito Utara District of Indonesia, has currently estimated resources of 134 million tonnes. Company officials said that its potential in situ reserves are estimated at 57 million tonnes.
Another Indian firm, Steel Authority of India Ltd is also actively examining coal opportunities in Indonesia.
The Indonesian government has allowed Indian geologists to conduct surveys of three to four coal assets. Indonesian ambassador Lt-General Andi M Ghalib was in the country at the start of the month and has actively encouraged investments and deals between the two countries.
India is expected to be producing 447 million tonnes of coal by the end of the 11th plan of the government. According to the government's estimates, the coal shortage is expected to be 85 million tonnes by the end of 2011-12.
To aid this, India and the United States have decided to pursue an alliance in the coal sector and equity partnerships is to be the new path.
Officials said that India's premier coal producer Coal India has already identified 142 new projects, comprising 35 underground and 107 opencast for ultimate capacity of 380.22 million tonnes with an estimated capex of $7.7 billion.
Mongolia's massive Oyu Tolgoi copper-gold project is expected to begin production in August 2012, sooner than forecast, said Temuulen Ganzorig, Deputy Director of Erdenes MGL which partners with Ivanhoe Mines and Rio Tinto in developing the site.
Ganzorig said expedited construction helped to move the production date ahead. Ivanhoe Mines had earlier said commercial production would begin in the first half of 2013.
OceanaGold Corporation announced a progress report recently on the Didipio gold-copper project which it had to put in mothballs after a major cost overrun on development and a slide in the copper price during the global financial crisis.
Oceana, which produces about 200,000 ounces of gold annually from its Macaes and Reefton operations in New Zealand, lifted the cobwebs off Didipio about a year ago.
Accordiing to Intierra Resource Intelligence the blueprint for production from Didipio from next year was expected to be about 70,000 oz gold and 32 million lbs of copper per annum for the first six years.
Intierra said Didipio has reserves of 1.41 M oz gold and 374 M lbs of copper.
OceanaGold's chief executive, Mick Wilkes, said the company was on track to start final construction activities mid-year.
Much of the key equipment has already been purchased with most long lead time items completed and in storage, including the SAG and ball mill shells and motors, the flotation cells, gravity concentrators and various critical pumps and motor drives.
The jaw crusher is the next key item to be procured with the order to be placed in the current quarter. The crusher was expected to have a 26 week lead time.
Wilkes said the mine plan was being reviewed to identify options for plant expansion post commencement of production.
As well as the on site team OceanaGold's New Zealand technical services team has allocated six personnel to work on issues such as "life of mine", costing the process plant conceptual design, reviewing infrastructure requirements and providing overall environmental guidance.
In a deal nearing $8 billion, Hyderabad-based GVK group is all set to acquire two Hancock Prospecting Pty coal mines in Australia.
The Indian company that is set to make a massive investment in Queensland's Galilee Basin is GVK Power & Infrastructure Ltd (GVK), which is a builder of airports and utilities controlled by Indian billionaire, GV Krishna Reddy.
The firm is said to be in talks with investors and private equity funds for the purchase of the coal assets. GVK was also a serious bidder for Griffin Coal, which is in Western Australia and has reserves of 1.1 billion tonnes.
Officials of the company said GVK and Hancock have already entered into an exclusive negotiation exercise that is to continue till mid next month.
Hancock is owned and managed by Gina Reinhart, touted to be the richest woman in Australia. It has two mines - the Alpha Coal Project and Kevin's Corner, both of which are situated in coal-rich Galilee Basin in Queensland, Australia.
Analysts have noted that the combined reserves of both the mines are estimated to be in the region of eight billion tonnes, with a 30-year life span.
Alpha Coal is the bigger of the duo and is an open-cut mine. It has 3.6 billion tonnes of measured, indicated and inferred compliant coal.
Kevin's Corner can produce around 30 million tonnes per year, according to analysts who call it a tough block to mine. Construction is expected to start this year, while production has been slated from 2013.
While some reports indicated the deal size to be $2 billion for the mines, and approximately $6 billion for the associated infrastructure, an official requesting anonymity said GVK is to make an initial payment of $1.3 billion within the exclusivity period to seal the deal.
This would be followed up with similar payments of $1.3 billion each over the next three years towards equity.
GVK will also have to pay another $4 billion as debt and mining development costs over the next six years, taking the total deal size to around $8 billion, the official said.
Petaquilla Minerals Ltd. announced recently that it received conditional approval by the Toronto Stock Exchange on April 19, 2011 for the acquisition of Iberian Resources Corp. as per the terms previously announced by the Company on April 6, 2011, the Wall Street Journal reports.
Iberian is a private British Columbia company that owns 100% of the Lomero Poyatos mine through its wholly-owned Spanish affiliate Corporacion de Recursos Iberia S.L. Lomero Poyatos is located in Andalusia, Spain about 110 kilometers northeast of Seville, in the heart of the Iberian Pyrite Belt. Iberian also owns several other exploration licenses in Iberia through its wholly-owned Spanish and Portuguese affiliates, and soon expects to receive a mining license for its Banjas concession in Portugal.
Based on the exchange ratio of 1.3 shares of the Company for each 1 share of Iberian, the transaction has been valued at approximately US $41 million.
Mining company Northland Resources AB has selected Metso to supply minerals processing equipment and services for its two process lines in Kaunisvaara, Sweden.
Metso will supply a primary gyratory crusher, a semi autogenous grinding mill, four vertical grinding mills, and equipment for conveying, classification, separation and filtration to the Kaunisvaara project. The equipment package includes several conveyors, screens and feeders, as well as equipment for magnetic separation and pressure filtration.
The Metso contract also covers all works related to the process plant system, excluding the building that houses the system and civil works related to it.
Metso’s equipment deliveries to the Kaunisvaara project will be completed within the second quarter of 2014.
McIlvaine Company
Northfield, IL 60093-2743
Tel: 847-784-0012; Fax: 847-784-0061
E-mail: editor@mcilvainecompany.com
Web site: www.mcilvainecompany.com