Mining Breaks

Global miner Anglo American maintained FY2019 Australian metallurgical coal production guidance despite March qtr (Q1) output falling to 4.16Mt due to planned longwall moves at two Qld mines, compared to 5.65Mt in the Dec qtr.
Australian thermal coal production also slipped to 339,000t (Q4FY2018: 428,000t).
South African thermal coal exports were 4.54Mt (4.42Mt) while divesting Eskom-tied operations cut domestic thermal coal sales to 2.29Mt (3.29Mt). Colombian thermal coal exports also declined to 2.2Mt (2.36Mt).
South African Kumba iron ore guidance remains 43-44Mt despite Q1 output falling to 9.52Mt (10.17Mt). Minas-Rio in Brazil ramped-up to 4.91Mt (0.23Mt), maintaining FY outlook at 18-20Mwmt.

Canadian explorer ePower Metals will take on development of the Guadalupe de los Reyes gold property after signing a binding letter agreement with Minera Alamos to acquire option rights over the potential low-capex heap leach operation in Mexico’s Sinaloa state.
ePower will issue 19.8% of its shares to fellow Canadian Minera Alamos and pay the remaining $US4.5M in instalments to exercise the purchase option from Vista Gold Corp.
The company will focus its resources on the immediate development of Los Reyes and intends to change its name to Prime Mining Corp.
Minera Alamos says the deal allows it to focus on its Santana development in Sonora.

Canadian-based Capstone Mining president-CEO Darren Pylot remains focused on long-term aims of lowering costs and increasing production after posting copper production of 41.4Mlb at C1 cash costs of $US1.56lb in the March qtr (Q1).
While slipping from the 42.3Mlb production in the previous period, cash costs improved from $1.70/lb.
Pinto Valley in Arizona, USA contributed 32.7Mlb at $1.79/lb (Q4FY2018: 25.2Mlb at $2.41/lb) and Cozamin in Zacetacas, Mexico delivered 8.7Mlb at $0.70/lb (9.4Mlb at $0.71/lb).
Revenue improved to $108.9M ($1093.7M), resulting in adjusted EBITDA of $41.8M ($30M).

Mining giant Vale has commenced its claim against Israeli billionaire Beny Steinmetz’s BSG Resources to seek payment of a $US1.2B arbitration award. With interests and costs, the claim will be worth more than $2B.
A London Court of International Arbitration tribunal found for Vale this month on its claims arising from Vale’s $500M acquisition of a 51% interest in BSGR iron ore concessions at Simandou in Guinea.
Vale is also taking legal proceedings in other countries to enforce the award against BSGR and other parties.

Higher throughput and the anticipated improved grades particularly at its 70%-owned Centinela mine have helped Chilean copper major Antofagasta meet expectations with total production of 188,600t in the March qtr (Q1).
The result was below its Q4FY2018 production of 220,000oz, but CEO Iván Arriagada says that was a reflection of the large increases through the prior year.
“We are on-track for another record-setting year with full year production expected to increase by up to 9% to 750,000-790,000t,” he says.
Q1 net cash costs rose to $US1.24/lb (Q4: $0.99/lb) on lower grades and throughput.

Centamin remains confident of meeting its FY2019 production guidance of 490,000-520,000oz at AISC of $US890-950/oz for its Sukari gold mine in Egypt after exceeding guidance in the March qtr.
Q1 output was 116,183oz, above its 105,000-115,000oz forecast but down from its 137,600oz in Q4FY2018.
CEO Andrew Pardey says Q1 was expected to be the weakest for the year, and stronger performance will be driven by higher openpit contributions as grades improve with depth and further underground optimisation.

Leading Russian gold producer Petropavlovsk continues to benefit from its late 2018 management-led turnaround, reporting March qtr (Q1) sales slightly above expectations at 107,700oz.
Although lower than Q4FY2018 output of 118,800oz, it keeps Petropavlovsk on track for FY2019 guidance of 450,000-500,000oz including processing of FY2018 concentrate stockpiles.
Total cash cost guidance is $US850-950/oz, reflecting additional costs from the ramp-up of its flagship POX Hub.

South African miner Wescoal has declared force majeure on deliveries to power utility Eskom due to a forecast shortfall of up to 20% in FY2020 production at its Vanggatfontein mine in Mpumalanga following the sacking of all its 274 contract mining employees.
Wescoal says its new mining contractor at VGF dismissed the workers over unlawful industrial action that turned violent last week, resulting in damage to equipment and a blockade.
The contractor has begun hiring new staff, but Wescoal expects little or no production during the recruitment process.
The declaration applies only to VGF, other Wescoal projects will continue scheduled deliveries.

Tanzanian thermal coal producer Intra Energy credits its preparations for the rainy season for its 70%-owned Tancoal mine in the March qtr (Q3FY19) lifting production to 192,722t from 181,336t in the Dec qtr.
Sales were 202,726t compared to the record 211,147t in Q2, while Intra Energy and 30% partner National Development Corporation of Tanzania retain stocks to meet demand during wet months.
New equipment deliveries will enable Tancoal to lift production over 1Mtpa to service Tanzanian infrastructure growth, regional and export markets while higher cash flow will be used with the intention to retire all debt within months.

Despite electing a new board two months ago, Australian bauxite developer Metallica Minerals is still struggling to find a route to commence mining at its long-delayed, 50%-owned Urquhart project on Qld’s Cape York Peninsula.
Metallica says negotiations on gaining access to the Hey Point barge loading facility 15km from the mine have got nowhere and it's now unlikely to reach a commercial deal with owner Green Cross Resources.
The new board is now seeking a more secure logistics option that would involve building a new loading facility, which could delay production to end-2020.

Piedmont Lithium continues to build its namesake project in North Carolina, USA into one of North America’s large hard-rock lithium projects, announcing an initial mineral resource of 2.8Mt @ 1.34% Li2O at its Central property.
The JORC-compliant resource lifts total mineral resources at Piedmont to 19Mt @ 1.15%.
It’s been calculated by CSA Global on just 18 diamond core holes and the mineralisation is open in all directions.
The company has three rigs operating as it works towards a resource update on the project’s Core property in June and an updated scoping study in July.

Nearly 4-1/2 years after the collapse of a seawall forced it into a premature shutdown, Mount Gibson Iron’s Koolan Island mine today dispatches its first cargo of high-grade iron ore to customers in China.
The shipping of about 72,000wmt of hematite iron ore averaging 65% Fe restores Mount Gibson’s status as the highest grade Australian exporter of direct shipping hematite iron ore.
Koolan’s Main Pit retains ore reserves of 21Mt @ 65.5%, expected to support another 5.5 years of mining.

It’s going to take a record fourth quarter performance, but Australian-based Northern Star is maintaining its FY19 group guidance at 850,000-900,000oz after March qtr (Q3) production slipped to 186,255oz, from 193,252oz in the previous period.
The key will be the Pogo gold project in Alaska, USA, where exec chairman Bill Beament says NST is seeing a turnaround following its introduction of new mining methods and equipment.
Pogo is expected to lift Q4 output to about 50,000oz, from 39,750oz in Q3, while strong performances should continue at its Jundee (81,089oz in Q3) and Kalgoorlie (84,492oz) operations in Australia.

More than 50 people are dead in Myanmar when jade miners and machinery were buried under a mound of tailings, Reuters reports.
3 bodies had been pulled from the debris, according to a lawmaker representing the jade-rich Hpakant area of Kachin state in the north Tin Soe.
54 workers for 2 mining companies, along with 40 machines and vehicles, were trapped when the large refuse pile collapsed. Soe believes they won’t survive because they are buried under mud.
Hpakant’s fire brigade chief Aye Thein says rescue efforts are continuing. Myanmar’s Ministry of Information has confirmed that 54 workers are still missing. It identified the companies involved as Shwe Nagar Koe Kaung and Myanmar Thura.

West Australian explorer Bauxite Resources has established a maiden resource of 10.7Mt @ 99.8% SiO2 at the Maralla Road silica sand deposit in Perth’s northern suburbs. Washed, screened and density separated samples returned results up to 99.93% silica.
Under an agreement announced in Jan, BRL will handle marketing and sales for production from the quarry owned and operated by private construction sand producer Urban Resources.
BRL will also fund up to $A1.25M of additional equipment to enable Urban Resources to deliver higher-grade material required by international markets including PV solar cells, specialty glass, semiconductors and high quality foundry sands.

Increased ore mined/processed at Russia’s biggest gold miner PJSC Polyus’ 6 operations has failed to avert a 6% gold production fall to 601,000oz in the Mar 2019 qtr (Q1 19) from Q4 18’s 640,000oz.
Ore mined jumped 16% to 13.9Mt, with ore processed up 11% to 10.3Mt and recoveries up to 81.4% from 80.6%.
The production fall reflects a seasonal slowdown in production at the Alluvials operation and lower refined gold volumes at Olimpiada and Blagodatnoye, due to changes in gold in inventory at the refinery, and at Kuranakh. The decline, however, was partially offset by growing output at Natalka, following ramp-up completion, of 85,000oz. Estimated gold sales were also down 3% to $US741M with estimated weighted-average gold selling price up 6% to $1,308oz. At Mar 31, 2019, Polyus had net debt steady at of $3B.

Ukrainian iron ore pellet producer Ferrexpo’s Dec 2018 (FY/CY18) profit has fallen 15% on FY/CY17 to $US335M, despite a 6.4% revenue increase to $1.27B and output up 1.6% to 10.6Mt, albeit with average cash costs up to $43.3t from $32.3t due to higher energy prices and increased mining costs.
Underlying EBITDA fell 8.7% to $503M, with net cash flow from operations down 17.3% to $292M, but not enough to offset a 40% increase in dividends to a record US23.1c.

Australian explorer Victory Mines is sweating on the success of a $1.2M partially underwritten rights issue to finally begin exploration on its Malamute and Husky cobalt, scandium, nickel and/or PGE projects in NSW.
After its prolonged ASX suspension – which ended on Feb 28 – scuppered a planned placement, Victory ended the March qtr (Q1) with net cash of $A143,000 while facing likely costs of $510,000 in the coming period.
If the rights issue delivers sufficient funds in May, as planned, Victory says its delayed and revised inaugural drilling program should start late in the June qtr.

Improved dragline performance at Curragh mine in Australia and a revised mining plan at Logan in the USA helped metallurgical coal giant Coronado lift March qtr (Q1) ROM production to 7.8Mt, from 7.5Mt in the previous period.
Rock intrusions and adverse roof conditions reduced clean coal yields at its Buchanan mine complex in USA, although overall saleable production rose to 5Mt (Q4FY2018: 4.9Mt).
Hopes of increasing sales volumes were thwarted by industrial disruption on Australian rail freight operations, although it expects to recover the lost sales in the June qtr.
It maintains FY2019 production guidance at 21.6-22Mt and EBITDA forecast at $US737-807M.