Mining Breaks

West Australian iron ore major Fortescue Metals Group has appointed materials handling equipment company RCR Mining Technologies to design and construct the primary crushing plant and overland conveyor for the $US287M Queens development project at its Solomon Hub in the Pilbara region.
Combined value of the contract is about $80M.
RCR has named Primero Group to provide engineering support and construction services, while the civil division of RCR’s parent company NRW Holdings handles civil construction and earthworks.
Another NRW subsidiary, DIAB Engineering, will support engineering and project management.
The contract award follows RCR's delivery of the Hopper 9 crushing facility at Fortescue's Cloudbreak mine last year.

West Australian miner Matsa Resources has outlined significant financial potential for the proposed development of a 600,000tpa gold ore treatment plant at its Lake Carey project 70km south of Laverton.
While its exact location is not finalised, Matsa says it would be central to the company’s Red October, Devon and Fortitude mines and offer potential to unlock other mining opportunities and low-grade stockpiles that are currently uneconomic.
A scoping study by CPC Project Design outlines a $A35.4M capital cost for the plant and $13.6M for associated infrastructure, plus ore processing costs of $32.26/t. Its development could increase projected cashflow to $55.4M from $21.8M at Matsa’s proposed Fortitude Stage 2 mine.

Eldorado Gold has launched a mutually agreed $C132M bid for all the shares of TSX-listed QMX Gold it does not already own.
Eldorado currently owns 17% of QMX. Under the deal, each QMX shareholder will get $0.075 cash and 0.01523 of an Eldorado common share for each QMX share held.
The ultimate success of the agreement significantly increases Eldorado’s footprint/landholdings in Canada’s Abitibi Greenstone Belt by about 550%, the QMX properties being immediately adjacent to Eldorado’s current Lamaque operation in Quebec, along with associated exploration projects in the heart of the Val d’Or gold district.
QMX’ special committee of independent directors has recommended the agreement. A meeting shareholders is expected in Mar 2021 to seek shareholder approval.

Americas gold-silver miner Yamana Gold has completed its mutually agreed $C152M cash/shares takeover bid for the shares it does not hold in Monarch Gold and its 1.8Moz gold reserves Wasamac underground gold project in the Abitibi region of Quebec, Canada.
Wasamac consists of 5 well developed ore shoots within a single, continuous shear zone with a consistent grade distribution and wide mining widths, making it amenable to simple, productive and cost efficient, underground bulk mining methods. The current mineralization down to about 800m offers the opportunity for low relative up-front development costs over a relatively short development time frame.
The deal also includes the Camflo property, 15km NW of Val-d’Or, Canada, which includes the old Camflo mine, which closed in 1992, and a permitted mill.

Lynas Rare Earths has reached agreement with the US government for construction of a $US60M commercial light rare earths separation plant, with the costs shared by the world’s only non-Chinese commercial separated rare earths producer and the Defense Department.
The plant is expected to produce about 5,000tpa rare earths products including 1,250tpa NdPr using material directly from Lynas’s under-development cracking and leaching plant in Kalgoorlie, Western Australia.
The plant could be co-located with the proposed heavy rare earths separation facility for which Lynas and the Defense Department agreed Phase 1 funding in July.
Lynas says the timetable for the proposed plant fits its $500M growth strategy to boost production by 2025.

International diamond miner Lucapa has set a production record of 23,669ct in FY2020 while posting solid operational performances in the Dec qtr (Q4) at its Lulo project in Angola and Mothae project in Lesotho as the market recovery from late 2020 continues into the new year.
Its 40%-owned Lulo alluvial project delivered 6,447ct (Q3: 4,170ct) at 9.9cphm (6.7cphm), including two 100ct-plus gem quality stones among 231 diamonds over 4.8ct and 70 specials of over 10.8ct.
The 70%-owned Mothae project produced 6,603ct (9,845ct) at 2.4cpht (3.2cpht), including 124 above 4.8ct and 42 specials.

Australian-based explorer Blackstone Minerals plans to upscale the proposed downstream refining operation it proposes as an adjunct to its Ta Khoa nickel-copper-PGE project in Vietnam after signing a non-binding supply agreement with global commodities trader Trafigura.
The letter of intent relates to a potential agreement for Trafigura to supply nickel and cobalt products for processing to supply the lithium-ion battery industry.
Blackstone’s scoping study in Oct 2020 proposed a capacity of 200,000tpa concentrate for the refinery to be sourced entirely from the Ta Khoa mine, 160km W of Hanoi.
It plans to expand capacity through the staged construction of additional refining capacity to accommodate third-party material.

BCI Minerals has gained a record $A10M EBITDA for the Dec qtr (Q2FY21) from its stake in the Iron Valley iron ore project as it nears a final investment decision on its proposed Mardie salt and potash development in Western Australia.
The Iron Valley mine, operated by miner and mineral services company Mineral Resources, shipped 1.6Mt in the period when iron ore prices averaged about $130/t. The profit result included an $0.7M positive adjustment for a prior period.
BCI held a cash balance of $78.5M at end-Dec, up from $55.6M 3 months earlier, and remains debt-free.

West Australian miner Mount Gibson Iron is facing six months of lower sales as it completes overburden stripping at Koolan Island and accelerated development of the Shine project after posting Dec qtr (Q2FY21) total sales of 930,000wmt, down from 1.37Mt in the previous period.
Despite heavy overburden stripping, excessive wet season rains and the Nov 2020 rockfall that requires additional ground support measures in the Main Pit footwall, Koolan Island delivered 400,000t with the remaining 500,000t from the completion of its Mid-West low-grade sales program.
CEO Peter Kerr says strong iron ore prices delivered significantly higher than planned cashflows at Koolan Island, which generated $A12M net site cashflow. He expects H2 sales to stay within annual guidance before increasing significantly.

Western Australia’s Gruyere gold mine has met its revised production and costs guidance for the year to end December, posting FY2020 output of 258,173oz gold at AISC of $A1,265/oz for 50-50 JV partners Gold Fields and Gold Road Resources.
The forecasts for the NE Goldfields mine were reduced to 250,000-275,000oz at $1,250-1,350/oz last September, from the original 250,000-285,000oz at $1,150-1,250/oz, after a mechanical breakdown.
Dec qtr (Q4) gold production recovered to 70,794oz (Q3: 55,919oz) at $1,265/oz ($1,488/oz). The companies expect to announce their FY2021 guidance late this quarter.
Gold Road ended the year with cash and equivalents of $132.9M, up from $103M at the end of Q3.

Australian contractor Primero Group has been named to provide engineering support and construction services for the primary crushing plant and overland conveyor for $US287M Queens Valley development at iron ore major Fortescue Metals Group’s Solomon Hub in the WA Pilbara.
The subcontract awarded by RCR Mining Technologies covers works valued at about $A30M and lifts Primero’s total committed order book for FY21 to about $310M.
MD-CEO Cameron Henry says it’s the second subcontract of its type for an FMG project with RCR, demonstrating Primero’s working relationship with the NRW Holdings subsidiary.

The possible fast-track development of the Mount Mason DSO hematite project in Western Australia is set to be the first priority of under plans outlined by Jupiter Mines for the demerger of its Central Yilgarn Iron Ore assets.
Newly created subsidiary Juno Minerals aims to raise up to $A20M through a public offer of up to 80M shares, and issue 120M shares to Jupiter in exchange for the demerged assets and $5M seed capital.
CEO Priyank Thapliyal, who chairs the new company, says the IPO is well timed amid strengthening iron ore markets and continued focus by steel mills to lock higher-grade ore to reduce pollution.

Continuing plant improvements and the move from a 3-day to 4-day week have enabled W Resources to lift total tungsten and tin concentrate production at its La Parilla mine in SW Spain to 133.4dmt in the Dec qtr (Q4FY2020), up from 77.6t in the prior period. Total contained metal was 85.8t (Q3: 48t).
The mine moved to a 5-day working week this month, with the target of achieving 24/7 operation from April.
Chairman Michael Masterman says W is nearing completion of its improvement plan, with production continuing to rise as it accesses the lower orebodies in coming months.

Chaarat Gold Holdings has withstood COVID-19 disruptions and cross-border military hostilities to exceed production guidance for the December 2020 year at its 100%-owned Kapan automated underground mine in SE Armenia.
FY2020 production was 58,178oz gold equivalent at AISC of $US1,034/oz, improving on the previous year’s 56,513oz at $1,040/oz and FY2020 guidance was 55,000oz. Kapan treated 50,000t of third party ore during the year.
Production comprised 30,837oz gold (FY2019: 32,791oz), 587,718oz silver (557,001oz), 2,154t copper (1,719t) and 7,625t zinc (6,476t). FY2020 sales totalled 48,387oz (55,255oz).
Chaarat says effective management protocols in place since Feb limited the pandemic impact, and a peace deal signed between Armenia and Azerbaijan in Nov resulted in an earlier than expected return to stability.
Chaarat forecasts Kapan’s FY2021 mine production of 57,000oz. It aims to close project funding in H1 for its potential 95,000ozpa Tulkubash project in the Kyrgyz Republic to allow construction to begin in 2021.

International miner South32 is weighing the option of divesting its 50% interest in the Eagle Downs metallurgical coal project in the Bowen Basin of Queensland, Australia after concluding developing the potential 4.5Mtpa longwall project would not deliver sufficient returns for the allocation of capital.
The decision has been reached despite its recent feasibility study supporting the potential for a long-life operation at Eagle Downs, its 50-50 JV with Chinese steel producer BauWu’s Aquila Resources.
S32 lifted its Australian Dec half-year (H1FY21) metallurgical coal production to 3.26Mt, from 2.86Mt in the corresponding period, on the return to a 3-longwall configuration at its Illawarra operations. Energy coal output was 834t (836t).
A major furnace refurbishment reduced H1 payable nickel production at Cerro Matoso in Colombia to 16,100t (20,600t), but development of new project areas supports guidance increases to 34,600t in FY21 and 43,800t in FY22.

Global industry bauxite-alumina-aluminum major Alcoa has clawed its Dec 2020 year (FY/CY 20) net loss back to $US170M from the previous year’s $1,125M loss, attributing the $955M improvement to lower restructuring-related charges and a gain from the sale of the Gum Springs waste treatment business in Arkansas, US, offset by lower alumina/aluminum prices.
The adjusted net loss, excluding the impact of special items of $45M, went out to $215M from a $184M loss. The result was on total revenue falling 11% to $9.3B and adjusted EBITDA, excluding specials, falling to $1.15B from $1.65B.
The bottom line came despite production records for both bauxite, up a little to 48M dry metric tons from 47.4Mdmt and alumina to 13.47M metric tons from 13.3Mmt, with aluminium to 2.26Mmt from 2.1Mmt.
Alcoa finished FY/CY 20 with cash of $1.6B, debt of $2.5B and net debt of $935M.

Gold-copper-silver miner K92 Mining is expecting to lift gold equivalent production from its Kainantu Gold Mine in Papua New Guinea 16%-36% to 115,000oz AuEq-135,000oz in the Dec 2012 year (FY/CY 21).
The increase is also expected to be accompanied by lower-cost production, with cash costs of $515oz-$565oz gold and AISC of $825oz-$875oz.
The projections follows record Dec 2020 year (FY/CY20) gold equivalent production of 98,872oz AuEq from the previous year’s 82,256oz AuEq. The result was on gold up to 95,109oz from 79,838oz, copper to 1.85Mlbs from 432t and silver to 36,067oz from 22,984oz. Full financials to follow.

Golden Star Resources has lifted Dec 2020 year (FY/CY20) gold production and sales from its Wassa operation in Ghana to 168,000oz, up 7% on FY/CY 19.
The result was on underground mined grades 20% better to 3.4g/t, with the company forecasting FY 21 production of 165,000oz-175,000oz at AISC $US1,000-$1,075oz.
Golden Star ended FY 20 with $61M cash and net debt reduced $5M to $45M. Full F/Y 20 financial statements scheduled for Feb 24, 2020.

International metallurgical coal producer Coronado has met the top end of its 2020 full year guidance, although a challenging year has ended with higher demand from China and the US domestic market getting its North American operations back on track.
FY2020 saleable production of 17Mt, down from 20.2Mt in the previous year, comprised 12Mt from its Australian operation (FY2019: 12.5Mt) and 5.8Mt from its US mines (7.1Mt). Its revised market guidance was 16.5-17Mt. Mining costs were $US55.60/t ($51.8/t).
CEO Gerry Spindler says strong second-half production and sales have offset the significant disruption to operations, markets and finances from the COVID-19 economic downturn.

Gold and nickel shone for Canadian miner Lundin Mining with Dec 2020 year (FY/CY 20) gold output a 1st up 163,000oz and nickel to 16,718t from FY/CY 2019’s 13,494t, but with copper easing to 230,781t from 235,498t and zinc to 142,744t from 151,515t.
The result saw all metals from the company’s operations, which span Brazil, Chile, Portugal, Sweden and the US, achieve annual production guidance.
Lundin finished FY/CY 20 with net debt of $US65M. Consolidated FY/CY 20 financial results will be published Feb 18, 2021.