Industry NEWS

11 December 2019

Barrick to sell Senegal gold project stake to Teranga for $430m

Barrick Gold and its Senegalese joint venture (JV) partner have signed an agreement to sell their 90% stake in the Massawa project to Teranga Gold in a deal valued at $430m.

The Government of Senegal will hold the remaining 10% stake in Massawa, a high-grade undeveloped open-pit gold reserves project in Senegal, Africa.

It is located within trucking distance of Teranga’s flagship Sabodala gold mine and has mineral reserves of 2.6Moz from 20.9Mt at 3.94g/t.

The deal includes an upfront payment of $380m, which comprises $300m in cash and approximately 20.72 million Teranga common shares.

It also includes a contingent payment of up to $50m based on the average gold price for the three-year period when the deal closes.

Barrick Gold president and chief executive Mark Bristow said: “It is gratifying to continue the value-creating consolidation of assets in the gold mining sector which started a year ago with the merger between Barrick and Randgold, followed shortly thereafter by the merger of the Nevada assets of Barrick and Newmont Goldcorp.

“In the case of Massawa, Teranga has the appropriate infrastructure and processing facilities approximately 25km away, and combining the orebodies and the geological prospectivity will add further benefits.”

The transaction, which is expected to close in the first quarter of next year, is subject to receiving the Massawa exploitation license and residual exploration license from the Senagalese government as well as other customary closing conditions.

Teranga president and CEO Richard Young said: “The Massawa acquisition is transformational for Teranga and – by creating a top tier gold complex – the first in the country – an important milestone for the gold mining industry in Senegal.”

Barrick Gold said that it will receive 92.5% of the total consideration for its interest in Massawa, while the remaining balance will be received by the company’s local Senegalese partner for its minority interest.

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10 December 2019

Lynas to build rare earths plant in Kalgoorlie, Western Australia

Rare-earths mining firm Lynas has selected Kalgoorlie, Western Australia as the strategic location to build its new cracking and leaching plant for rare earth minerals processing.

The new plant, which is expected to create many jobs, is a first step to make the mining town a critical minerals hub in the Goldfields region.

Lynas noted that the Goldfields region was one among the two finalists being considered as a location for the plant following extensive due diligence.

The region was selected because of its close proximity to the company’s Mt Weld mine and Kalgoorlie’s existing skilled labour, as well as the region’s history in the mining and processing industries.

Lynas CEO and managing director Amanda Lacaze said: “Kalgoorlie is a terrific city and an ideal location for our new cracking and leaching plant. Lynas was built from the ground up as an environmentally responsible Rare Earths producer and we will take the same approach to our facility in Kalgoorlie.

“We also acknowledge the support from the Western Australian government and the Australian government to enhance the critical minerals industry in the Kalgoorlie region.”

The company has signed an option to sublease an industrial zoned property from the City of Kalgoorlie-Boulder, with the terms of the lease now being finalised.

Mt Weld’s rare earth concentrate, which is currently exported to Malaysia for processing, will be upgraded through the cracking and leaching plant.

This plant is a further step to advance the Australian government’s critical minerals strategy and enables more downstream processing.

City of Kalgoorlie-Boulder CEO John Walker said: “This is a fantastic step forward in the work we have been doing to diversify our local economy and expand the number of skilled residential jobs available in our city.

“There are so many exciting opportunities that this partnership brings about, and we look forward to working with all of the key stakeholders, including the State and Federal Governments to further support downstream processing here in Kalgoorlie-Boulder.”

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10 December 2019

Matilda Minerals wins first Mutamba mining licence in Mozambique

Exploration and development firm Savannah Resources’ subsidiary Matilda Minerals has secured mining licence 9735C, which forms part of the Mutamba project in Mozambique.

The Jangamo Matilda concession was awarded by the Mozambique Minister of Mineral Resources and Energy for the Mutamba Heavy Mineral Sands project.

It is the first of three contiguous concessions to be issued that will result in the full tenement permitting of the project and is located close to the Port of Inhambane.

The company said that the mining concession is well served by road and air transport.

Mutamba contains an indicated and inferred resource of 4.4 billion tonnes (Bt) grading 3.9% total heavy minerals.

The licence covers 11,948ha and is valid until April 2044. It includes a 25-year extension option.

Savannah Resources CEO David Archer said: “We are delighted with the issue of the first concession by the Government of Mozambique, and now look forward to the issue of the remaining two mining licences, 9229CC and 9228C.

“When combined, these three concessions contain an Indicated and Inferred Mineral Resource of 4.4Bt at 3.9% total heavy minerals; this makes Mutamba one of the most attractive undeveloped mineral sands deposits in the world. Notably, given that global demand for titanium feedstocks is strong, the award of these licences will facilitate the development of a globally relevant project.

“Our focus is now on progressing the pre-feasibility study (PFS) at Mutamba towards completion, which, upon delivery, will trigger the increase in our interest in the project from 20% to 35%.”

Savannah noted that the project is operated under a joint venture (JV) with Rio Tinto.

Last month, the company conditionally secured third mining concession (9228C) for the Mutamba project in Mozambique.

The concession covers an area of 11,807ha and is contiguous with 9735C and 9229C concessions, which were secured by Savannah in September.

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9 December 2019

Works restart at Forrestania Nickel Operation in Western Australia

Nickel mining firm Western Areas has resumed normal operations at its Forrestania project in Western Australia, following a bush fire incident last week.

The Forrestania Nickel Operation is located 400km east of Perth.

Western Areas noted that the bush fire incident, which likely took place due to a lightning strike, led to the temporary suspension of Forrestania operations last week.

The company added that the mains power was interrupted during the weekend as a result of damage to three power lines. The power was restored by the weekend and mining operations were restarted on site using back-up power generation.

Operations at the Cosmic Boy mill were suspended until the power transmission was restored.

The incident, however, does not have any impact on the company’s nickel production or cost guidance for the 2020 financial year.

At the time of the incident, Western Areas said: “No mining or infrastructure assets have sustained damage and normal operations are expected to resume imminently.”

Forrestania Nickel Operation (FNO) Response Team and various firefighting teams have assisted towards the safe resumption of operation at Forrestania.

Constructed and designed by GR Engineering Services, the Cosmic Bay concentrator uses conventional flotation technology to process ore into nickel concentrate with an average grade of 14% nickel.

Flying Fox is the first mine to be developed at the Forrestania project, which contains some of the highest grade nickel in the world.

Western Areas opened the Forrestania Nickel Concentrate Plant in March 2009. The nickel concentrator at Cosmic Boy treats high-grade nickel ore from Flying Fox.

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9 December 2019

Rock collapse at gold mine in South Africa kills four workers

A rockfall at the Village Main Reef’s Tau Lekoa gold mine in Orkney, North West province of South Africa, has claimed the lives of four workers.

It was reported that one mineworker survived the incident and is in a serious but stable condition as he was rescued soon after the rockfall at the mine.

The seismic incident followed at least one earth tremor, reported Reuters.

The National Union of Mineworkers (NUM) said in a statement that ‘there was no escape route in the working area where the four mineworkers were found dead’.

NUM further added that Tau Lekoa gold mine’s proto team, which includes a group of trained workers to perform underground rescues, did not act spontaneously to save the four miners.

Furthermore, the team had intentionally stopped the team leaders and winch drivers from rescuing the four mineworkers, the union said.

The news agency cited Tau Lekoa mine spokesman James Duncan as saying: “There were two seismic events and then a rockfall occurred.

“Investigations on the causal factors are ongoing and we will be able to comment only once those are complete. We won’t be commenting at all on the accusations by NUM.”

Meanwhile, Village Main Reef declined to comment on the evacuation procedures until the completion of an investigation.

The Congress of SA Trade Unions (COSATU) was quoted by African News Agency as saying: “COSATU and National Union of Mineworkers (NUM) leadership have been observing efforts by the rescue team to recover bodies.”

According to the March estimates of the Mineral Resources Ministry in South Africa, the death toll in the country has fallen to 81 fatalities last year from 90 in 2017.

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6 December 2019

Alcoa-Rio Tinto JV sells first carbon-free aluminium to Apple

Rio Tinto and US aluminium producer Alcoa’s joint venture (JV) Elysis has sold the first commercial batch of carbon-free aluminium to technology giant Apple.

The metal is being made by Elysis, which was formed to facilitate large-scale development and commercialisation of aluminium smelting.

Elysis secured $144m from the two companies, Apple and the Canadian and Quebec Governments.

The aluminium, which will be used by Apple for many of its electronics such as iPhones, Apple Watches and Mac computers, will be shipped this month from an Alcoa research facility in Pittsburgh.

Elysis CEO Vincent Christ said:  “This sale is an important milestone for Elysis and a sign of our progress over our first year of operation. It confirms the market interest in aluminium produced using our breakthrough Elysis carbon-free smelting technology.”

The first batch was made in Pittsburgh, but Elysis also plans to manufacture at a $50m CAD research facility being built in Saguenay, Quebec, which is expected to become operational in the second half of next year.

Apple environment, policy and social initiatives vice-president Lisa Jackson said: “For more than 130 years, aluminium, a material common to so many products consumers use daily, has been produced the same way. That’s about to change.”

The Alcoa-Rio JV plans to commercialise the technology by 2024 to make aluminium using ceramic anode, which only emits oxygen and eliminates direct greenhouse gas emissions (GHG) from the smelting process.

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6 December 2019

Serious Fraud Office launches bribery investigation into Glencore

The UK Serious Fraud Office (SFO) announced on 5 November 2019 that it has opened an investigation into suspicions of bribery at British-Swiss mining multinational Glencore.

The SFO said in a statement: “The Serious Fraud Office is investigating suspicions of bribery in the conduct of business by the Glencore group of companies, its officials, employees, agents and associated persons.”

The announcement of this investigation was widely expected, following a Bloomberg report in May 2019 that stated the SFO was preparing to open a formal bribery investigation into Glencore’s work with the former leader of the Democratic Republic of Congo (DRC) Joseph Kaliba and Israeli billionaire Dan Gertler.

Glencore is the world’s largest commodities trading company, operating in over 50 countries with significant mining operations for gold, silver, platinum, nickel, iron and aluminium.

In a statement, Glencore said it would co-operate with the SFO investigation, but did not provide further details. Shares in the company fell by as much as 8.6% to a three-year low following the announcement.

Glencore is already subject to an investigation from the US Department of Justice (DOJ) in connection to its operations in the DRC, Nigeria and Venezuela.

The company received a subpoena from the DOJ in July 2018 to produce documents pertaining to its business dealings in these countries from 2007 to 2018, in compliance with the Foreign Corrupt Practices Act and US money laundering statutes.

Commenting on the recent investigation, London-based analyst Hunter Hillcoat told Bloomberg: “It’s more of the same, but now it’s getting attacked from a different angle. Glencore was already trading at a discount because of the DOJ, but when this news comes out it gets whacked again.”

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6 December 2019

Amani ships first gold from Tanzania to Hong Kong refinery

Amani Gold has completed its first shipment of approximately 6.77kg gold from Geita mineral and gem hub in Tanzania to a refinery in Hong Kong.

The company noted that the shipment to Tanzania was made through Amago Trading.

Amani secured a Dealer Licence in Geita, Tanzania through a 60% equity interest in Amago. The licence was granted by Tanzania’s Ministry of Minerals Mining Commission.

Amago is a joint venture (JV) between Amani (60%) and a consortium of local mining industry professionals, together holding 40% in the JV.

The in-country members of the JV played a key role in obtaining the Trading Licence and sourced the 6.77Kg gold, which has a purity of 78%, from small scale producers in the Geita region.

The gold was initially processed in the Geita Hub and securely shipped to Hong Kong for final refining and sale.

The company said that Amago opened an office in the hub as a requirement of being granted a Dealer Licence.

Amani Gold managing director Jacky Chan said: “Amani is pleased that we have completed our first ever shipment of gold to Hong Kong.

“This first trade was nearly eight months in the making and represents a proof of concept. The gold was sourced from small scale producers from the Geita region of Tanzania. Our plan is to increase the size and frequency of shipments as soon as possible.”

The Tanzanian Government had established the Geita mineral trading hub as part of its efforts to curb illegal gold and precious metals trading.

It is designed to serve as a model for other regional precious metals trading hubs and is expected to attract both local and foreign gold investors.

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