Twitter
Boston-Bay-Mines-Announcement

Rio Tinto

Does Anglo American’s departure doom the Pebble prospect? – by Alex DeMarban (Alaska Dispatch – September 21, 2013)

http://www.alaskadispatch.com/

Anglo American’s pullout from Pebble is hardly a death knell for the promising but beleaguered mineral prospect in Southwest Alaska. But the move increases the chance of an important shift in the project, one that could lead to a less environmentally risky design than the massive, open-pit option that has sparked widespread opposition.

That’s the opinion, anyway, of Paul Metz, a longtime mineral economics expert from the University of Alaska Fairbanks.

With Anglo departing, Rio Tinto is now the only major mining company invested in the project. Rio Tinto, headquartered in London, holds 19.8 percent of Northern Dynasty Minerals, the junior mining company from Canada that has long led efforts to develop the prospect.

Rio Tinto has said it would support an underground mine at Pebble, while rejecting the open-pit approach that many believe will play a large part of Northern Dynasty’s eventual plans.

The Pebble Partnership, once owned half by Anglo American and half by Northern Dynasty, is now working on a transition plan as Anglo backs out, as was publicly announced earlier this week, an official with Pebble said.

Read more

UPDATE 1-Ousted Rio boss Albanese makes comeback at Vedanta – by Clara Ferreira-Marques (Reuters India – September 16, 2013)

http://in.reuters.com/

LONDON, Sept 16 (Reuters) – Former Rio Tinto boss Tom Albanese has taken on a senior advisory role at Indian mining group Vedanta just eight months after being ousted as chief executive of the world’s No. 3 mining group.

Albanese was one of several top mining chief executives who took the blame for their companies’ relentless pursuit of growth during the boom years that ended in 2011, and for acquisitions that soured and turned into billions of dollars of writedowns.

He is the only one to have returned to a full-time role at a major mining group, albeit a smaller one. Out of the world’s top six miners, only one still has the same chief executive as it did at the beginning of 2011.

Albanese, who held the top job at Rio for almost six years, is now chairman of Vedanta Resources Holdings, a subsidiary wholly owned by the oil and gas and mining group. He will act as adviser to both the operations and the main group board, providing advice on everything from operational troubles and expansion to reputational concerns and relations with investors.

It was unclear what weight Albanese would have in a company almost 65-percent controlled by its founder and chairman, Indian scrap dealer turned metals tycoon Anil Agarwal.

Read more

INTERVIEW-Rio keeps focus on exploration while cutting costs – by Clara Ferreira-Marques (Reuters U.K. – August 23, 2013)

http://uk.reuters.com/

LONDON, Aug 23 (Reuters) – Big miners such as Rio Tinto can slash exploration spending and still make valuable finds but they must resist the temptation to stop searching entirely or they will pay later, the company’s head of exploration said.

The secret of successful exploration on a budget, according to Rio’s Stephen McIntosh, is prioritisation and planning.

“If something is not making it, we will get out quickly or divest that opportunity, so we can reinvest into something that will be of value to Rio Tinto,” McIntosh said.

Total withdrawal from exploration – attractive as it has no impact on current production – could hit earnings in decades to come especially at a time when smaller explorers and miners cannot raise cash to fill the gap left by big players.

“If you stop your most fundamental greenfield exploration, for the majors you won’t miss it for a very long time. But you will wake up one day, want to the go to the cupboard of future options and find it a little bit bare,” McIntosh said in a telephone interview from Singapore.

Read more

INTERVIEW-Rio keeps focus on exploration while cutting costs – Clara Ferreira-Marques (Reuters India – August 23, 2013)

http://in.reuters.com/

LONDON, Aug 23 (Reuters) – Big miners such as Rio Tinto can slash exploration spending and still make valuable finds but they must resist the temptation to stop searching entirely or they will pay later, the company’s head of exploration said.

The secret of successful exploration on a budget, according to Rio’s Stephen McIntosh, is prioritisation and planning. “If something is not making it, we will get out quickly or divest that opportunity, so we can reinvest into something that will be of value to Rio Tinto,” McIntosh said.

Total withdrawal from exploration – attractive as it has no impact on current production – could hit earnings in decades to come especially at a time when smaller explorers and miners cannot raise cash to fill the gap left by big players.

“If you stop your most fundamental greenfield exploration, for the majors you won’t miss it for a very long time. But you will wake up one day, want to the go to the cupboard of future options and find it a little bit bare,” McIntosh said in a telephone interview from Singapore. Cutting exploration, has proved an easy win for miners under pressure, as prices and demand cool, to reduce costs that ballooned during the boom years.

Read more

COLUMN-Diversified miners’ short-term challenges at odds with long-term views – by Clyde Russell (Reuters U.S. – August 21, 2013)

http://www.reuters.com/

Clyde Russell is a Reuters market analyst. The views expressed are his own.

LAUNCESTON, Australia, Aug 21 (Reuters) – The world’s top diversified mining companies are starting to resemble choir boys singing the same hymn about cutting projects and costs.

The recent financial results of BHP Billiton, Rio Tinto, Glencore Xstrata and Anglo American were remarkably similar, as were the accompanying comments by their chief executives.

All reported lower earnings, but not dramatically so, which may be a bit of a surprise given weaker commodity prices in the first half of 2013 and widespread concern of worse conditions to come.

And all four also repeated the mantra of cost cutting and slashing capital expenditure, while at the same time trying to give equity investors more of what they want in the form of dividends and higher share prices.

The question is whether this unanimity is the right path or whether the diversified miners are going too far in a bid to boost share prices.

Read more

Iron ore prices moving higher as China steel production rises – by Lawrence Williams (Mineweb.com – August 15, 2013)

http://www.mineweb.com/

After a bit of a dip, iron ore prices are on the rise as Chinese steel production begins to increase again and the world’s top diversified miners will be the likely principal beneficiaries.

LONDON (MINEWEB)  – It should not have escaped anyone who follows the global mining sector’s attention that the world’s three biggest mining companies by a long way, BHP, Rio Tinto and Vale, are also the three biggest miners of high grade iron ore.

There had been much discussion of how these would fare in a Chinese downturn, given that China is by far the world’s largest importer of iron ore and there was comment that iron ore prices would fall dramatically, thus decimating the big three’s revenues and profits – exacerbated perhaps by the fact that they are all growing production with the inevitable additional costs that involves.

What the observers seemed to have failed to take into account is that China, in a recession, is still the equivalent of anyone else in a mega growth phase! Growth falling perhaps from 10% plus per annum to maybe 6 or 7% – figures western economies would give their eye teeth for!

Read more

UPDATE 1-Job cuts ahead as Rio puts Mongolian expansion on hold (Reuters India – August 14, 2013)

http://in.reuters.com/

LONDON, Aug 14 (Reuters) – Rio Tinto said on Wednesday it would have to cut up to 1,700 jobs in its Mongolian operation, after a more than $5 billion underground expansion of the giant Oyu Tolgoi copper mine was suspended.

The expansion was put on ice last month as the global miner said the Mongolian government wanted parliament, currently in recess, to approve financing for the project. Mongolian Prime Minister Norov Altankhuyag said last week that Rio did not need to seek parliamentary approval for the development’s package.

The delay marked the latest bump in the road for Rio at one of its biggest projects – and one of the world’s largest untapped copper deposits – which started exporting from an open pit mine in July after two last-minute hiccups in securing government approval.

Mongolia has raised concerns about the costs of the Oyu Tolgoi expansion and the potential that rising expenditure will delay when it starts receiving its share of profits.

The government has also complained that locals are not well represented in the management of the project. A Rio spokesman said that the delay was now being implemented.

Read more

Rio Tinto Coal Fight Burns in Australia – by Rebecca Thurlow and Robb M. Stewart (Wall Street Journal – August 12, 2013)

http://online.wsj.com/home-page

Court Hearing Approaches on Whether to Allow Mine’s Expansion BULGA, Australia—For 30 years, the coal mined in this remote Australian town has fired power plants as far away as Tokyo and Shanghai. More recently, it has been generating heat of a different kind: local opposition to a mining project that would feed Asia’s demand for resources.

Rio Tinto RIO.LN +0.77% PLC is fighting to salvage plans to expand a coal mine near Bulga in New South Wales state—among the company’s biggest in the country—after losing the first round of a legal challenge brought by residents who claimed dust and noise from the project would wreck their community. Rio Tinto has warned that 1,300 jobs could be at risk if its appeal—due to be heard from Wednesday—fails in a Sydney court.

Mining officials say more than Rio Tinto’s proposed investment of 600 million Australian dollars (US$552 million) is at risk in the dispute. Australia accounts for one-third of global coal exports, but the industry is under stress as China’s cooling economy sends prices of the fuel to three-year lows. Already 10,000 coal-mining jobs have been lost as companies such as BHP Billiton Ltd. BHP.AU +2.42% and Glencore Xstrata GLNCY +0.80% PLC respond to weaker demand by closing mines or cutting output.

Read more

Mining the Gobi: The Battle for Mongolia’s Resources – by Bernhard Zand (Spiegel Online International – August 7, 2013)

http://www.spiegel.de/international/

Mongolia is over four times the size of Germany, with nearly 3 million inhabitants and a GDP of $10 billion (€7.5 billion) in 2012.

British-Australian mining corporation Rio Tinto employs 71,000 people in more than 40 countries and is worth about $60 billion.
These two unequal partners — a poor, potentially rich nation and the second largest mining corporation in the world — have joined together to mine one of the globe’s largest deposits of copper and gold. But will they be capable of distributing this wealth fairly?

The mine in question lies an hour’s flight south of the Mongolian capital Ulan Bator, near the border with China. There is enough copper in the ground here to build the Statue of Liberty more than 800,000 times over. Once the planned mine goes into full operation, it could increase the country’s GDP by a third. It could, at least in theory, bring prosperity to this country where many people still live in simple yurts and huts.

But in practice, the transaction between this global corporation and this country that is poor but rich in raw materials looks quite different. In fact, the project serves as a prime example of what is happening in a growing number of newly industrialized and developing countries.

Read more

Rio Tinto Alcan to close Shawinigan, Que., smelter – (Canadian Press/CBC News Montreal – August 7, 2013)

http://www.cbc.ca/montreal/

425 workers affected by shutdown

Rio Tinto Alcan says weak metal prices have forced the aluminum producer to close its 72-year-old smelter in Shawinigan, Que., about a year ahead of schedule in November, affecting most of its 425 workers.

“With the current difficult market conditions and when we look at the short-term forecasts, the situation became financially unsustainable for Shawinigan, and this despite all the efforts the employees made to help over the past years,” said Étienne Jacques, chief operating officer of Rio Tinto Alcan Primary Metal in an interview.

He said employees couldn’t have done anything to avert the decision because the market finally caught up with the plant’s old Soderberg technology.

“They have done almost everything that was imaginable to do, they have done it,” said Jacques. The announcement was made Wednesday, ahead of environmental regulations that would have forced the facility to close at the end of next year.

Read more

Three bidders out as Rio faces lackluster Canadian sale: sources – by Anjuli Davies and Clara Ferreira-Marques (Reuters U.S. – August 6, 2013)

http://www.reuters.com/

LONDON – (Reuters) – Three big-name bidders for Rio Tinto’s (RIO.L) majority stake in Canada’s largest iron ore producer are now out of the running, sources familiar with the talks said on Tuesday, after offers came in well below the mining group’s targets.

The sources said private equity firm Apollo, which had been working with Canadian pension fund CPPIB, rival Blackstone (BX.N) and commodity trader and miner Glencore (GLEN.L) were no longer in the race after a second round of bids last month. The low offers, at a time when dozens of mining assets are for sale and demand for steelmaking commodities is uncertain, raise questions over the future of a sale that could still take months to tie up – should Rio decide to push ahead.

Rio has a handful of assets on the block as it battles to cut a $19 billion debt burden and meet cost cutting targets. Like other miners seeking to divest unwanted activities, however, it has found buyers unwilling to pay up and in June was forced to scrap the sale of its $1.3 billion diamond business, 15 months after it was first announced.

Rio appointed banks to sell its 59 percent stake in Iron Ore Company of Canada (IOC) earlier this year after deciding to focus its iron ore efforts on assets in Australia’s Pilbara region, where the world’s second-largest iron ore producer has lower costs and higher grades.

Read more

Falling profits for Vale – by Reuters and Star Staff (August 6, 2013)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

Battered by falling iron ore and nickel prices, Vale on Wednesday is expected to report a 30% drop in second-quarter profit to $1.85 billion US from a year earlier, analysts are predicting. If so, it would be Vale’s eighth consecutive quarterly profit fall, according to the average preliminary estimates of seven analysts surveyed by Reuters.

Most of the decline is due to a 12% drop in average iron ore prices and a 38% decline in nickel prices, more than offset-t ing increases in volumes shipped by the world’s No. 1 iron ore miner and No. 2 nickel producer.

Its shares have been the worst performer among the world’s big five mining companies, down 27% this year, despite a rally from nearly four-year lows in July. Of the big five, Rio Tinto, Brazil’s Vale, Glencore Xstrata and Anglo American are expected to report sharp drops in profit.

They have been slammed by weaker copper, iron ore and coal prices as they struggle to sell off assets. Anglo — the first of the diversified majors to publish results — said last week underlying operating profit fell in the six months to $3.3 billion, ahead of a consensus estimate of $3.12 billion.

Read more

Teck said to bid for Rio’s stake in Iron Ore Co. of Canada – by Matthew Campbell, Brett Foley and Liezel Hill (Bloomberg/Montreal Gazette – June 29, 2013)

 http://www.montrealgazette.com/index.html

TORONTO, VANCOUVER and LONDON (England) — Teck Resources Ltd., Canada’s second-biggest mining company, is among the remaining bidders for Rio Tinto Group’s controlling stake in Iron Ore Co. of Canada, according to a person familiar with the situation.

Rio may decide to keep its Iron Ore Co. stake after being disappointed with the bids it’s received so far, said the person, who asked not to be identified because the talks are private. While London-based Rio has considered selling the unit’s mining and infrastructure assets separately, it decided against the plan, the person said. Spokesmen for Teck and Rio and a spokeswoman for Iron Ore Co. declined to comment.

Buying Canada’s largest iron-ore producer would enable Vancouver-based Teck to diversify its production, which mostly comprises coal, copper and zinc. Rio’s 59 per cent stake in Iron Ore Co. may fetch as much as $3.5 billion, Crédit Suisse Group AG analysts said in a note in June.

An acquisition that size would be Teck’s largest since its C$10.4 billion ($10.1 billion) purchase of Fording Canadian Coal Trust in 2008, a deal completed just as commodity prices were beginning to plunge during the financial crisis. In 2009, Teck’s credit rating was cut to junk by Standard & Poor’s and the company sold a 17 per cent stake to China Investment Corp.

Read more

UPDATE: Rio Tinto Seeks $820 Million From Mine Sale – by Robb M. Stewart (Wall Street Journal – July 29, 2013)

 http://online.wsj.com/home-page

MELBOURNE–Rio Tinto PLC (RIO) agreed to sell its majority stake in an Australian copper-and-gold mine to China Molybdenum Co. (3993.HK) for US$820 million, the U.K. company’s latest step to reduce debt amid shaky demand for commodities.

The world’s second-biggest mining company by sales said it had reached a binding agreement to sell its 80% stake in the Northparkes mine to the Chinese company, which produces molybdenum and tungsten, ingredients used in steelmaking. Sumitomo Corp. (8053.TO) units that hold the remaining 20% of the mine have the right to match the offer, and the deal is subject to Australian regulatory approval. A spokeswoman for Japan’s Sumitomo declined to comment on the company’s intentions.

Rio Tinto acquired Northparkes in 2000 after a hard-fought battle with Anglo American PLC (AAL.LN) to acquire the mine’s operator, North Ltd., for 3.5 billion Australian dollars (US$3.2 billion).

China Molybdenum, which is in a trading halt, hasn’t said why it is seeking to buy Northparkes, from which copper concentrate is mainly sold to Japan, China and India. Two shareholders that together own 69% of the Chinese company have given binding support to the deal, Rio said Monday.

Read more

Rio Tinto-Lundin mark Eagle Mine purchase – by John Pepin (The Mining Journal – July 26, 2013)

http://www.miningjournal.net/

Ceremony at Humboldt Mill finalizes transfer

HUMBOLDT – With the sounds of heavy construction equipment rumbling and beeping in the background, about 200 invited guests attended a ceremony in Humboldt Township Thursday commemorating Rio Tinto’s “handing over” the Eagle Mine and Humboldt Mill to new Toronto-based owner Lundin Mining Corp.

The ceremony was held under a tent at the mill, in a parking lot outside the local administrative offices for the Eagle Mine project. The crowd included employees and local officials and residents who have supported the Eagle Mine project.

Past Eagle Mine President Adam Burley – who is leaving Marquette County for a new Rio Tinto post in Salt Lake City – presented Lundin officials with a piece of polished ore from the mine, symbolizing the ownership transfer.

“The main message I want to get across is one of thanks and appreciation for the (Eagle) team support and the community support over these years and I also want to get across a message of pride,” Burley said. “Rio Tinto is proud of what we’ve achieved at Eagle. We do think we’ve raised the benchmark on industry standards and urge the community to share in that pride because they are the ones that have shaped the direction to a very large extent.”

Read more