Gascoyne Resources raises funds for Dalgaranga gold project in WA
Exploration and development firm Gascoyne Resources has raised A$19m ($13.89m) through an oversubscribed placement to finance its Dalgaranga gold operation in Western Australia (WA).
The placement involved the issuance of 50 million shares at 30 cents each, with the Hong Kong-based fund manager LIM Advisors leading the oversubscription with A$10m.
Both existing and new investors participated in the placement.
The company is also planning to undertake a share purchase plan (SPP) to raise up to a further A$5m ($3.65m).
According to the firm, the proceeds will provide additional financial flexibility as Dalgaranga expands.
Commercial production from the project is expected to be achieved in late September/early October.
Gascoyne Resources managing director Mike Dunbar said: “We are also pleased to give our shareholders an opportunity to participate on the same terms as the placement through the upcoming SPP.
“While initial mining rates have been slower than anticipated, our processing facility is running extremely well and mining rates are now within 10% of scheduled maximum rates.
“We are targeting commercial production and a 100,000oz per annum run rate late in the current quarter or early next quarter and look forward to keeping our shareholders up to date throughout our ramp-up.”
Under the planned SPP, the existing eligible shareholders can subscribe for up to a maximum of A$15,000 worth of shares.
Gascoyne will use the funds raised from the SPP to fund exploration at both Dalgaranga and the Glenburgh gold project.
The exploration activities will include RC and diamond drilling of recent discoveries at Dalgaranga to allow conversion to ore reserves, as well as RC drilling on existing geochemical and structural targets at Glenburgh.
Orefinders acquires McGarry Mine & Larder-Lake project in Canada
Canada-based Orefinders Resources has completed the acquisition of the McGarry Mine & Larder-Lake project in Virginiatown, Ontario, from gold development and exploration company Kerr Mines.
As part of the deal, Orefinders offered the purchase consideration of eight million common shares to Kerr Mines, formerly known as Armistice Resources.
The McGarry Mine & Larder-Lake project is located within the Abitibi Greenstone Belt and spread across 3km on the Cadillac Larder-Lake Break gold structures.
The property contains 46 patented mining claims and five mining licences of occupation. It also features infrastructure including a head frame, shaft with compartments, hoist, offices and a fully functional core shack for on-site operations.
Orefinders CEO Stephen Stewart said: “We were able to acquire the McGarry Mine & Larder-Lake projects that were previously tied up in litigation and environmental issues and we have since come to an agreement with the province, which effectively eliminates the issues impeding the development of the region.
“With this acquisition, Orefinders has acquired a very high-grade resource, which has substantial exploration upside. We’ve also acquired the data from over 100,000m of drilling along with substantial geophysics.
“In the near term, we will be releasing our new interpretations, geological model and exploration plan for this asset and others. This is the type of acquisition that falls directly in line with our philosophy of finding new deposits on old mines.”
As outlined in a PEA study in 2011, the McGarry property features a total of 112,000oz of gold in the indicated category and an additional of 29,000oz in the inferred category.
The mine has been in production since 2013 through underground workings and an ongoing underground exploration by Kerr.
Orefinders also expects significant potential at the McGarry mine as it hosts numerous gold mineralised zones, many of which have been drilled to relatively shallow depths.
Anglo Pacific buys 4.25% stake in Labrador Iron Ore Royalty
Anglo Pacific Group has acquired a 4.25% stake in Labrador Iron Ore Royalty (LIORC) for around $50m to gain exposure to the company’s iron ore assets and the high margin pellet market.
With a market capitalisation of around C$1.5bn, LIORC has an indirect exposure to a 7% gross revenue royalty (GRR) and a C$0.10 per tonne commission on all iron ore products sold by the Rio Tinto-operated Iron Ore Company of Canada (IOC).
LIORC also has a 15.1% equity position in IOC, which has mining and processing operations located in Labrador City, Canada.
IOC is a major producer of iron ore and seaborne iron ore pellets, with standard and low silica acid pellets, flux pellets, direct reduction pellets and iron ore concentrates among its primary products.
The company also sells an iron ore concentrate product based on the 65% Fe index.
At existing production rates, IOC’s ore reserves are expected to last for around 25 years.
The transaction is anticipated to further diversify Anglo Pacific’s income profile, commodity and geographic exposure.
Anglo Pacific Group CEO Julian Treger said: “This transaction continues Anglo Pacific’s growth trajectory, and is in-line with Anglo Pacific’s stated strategy of diversifying its sources of income and commodity exposure.
“The transaction is expected to be immediately accretive to adjusted earnings and free cash flow per share, and based on Anglo Pacific’s current shareholding and LIORC broker consensus 2019 dividend forecasts (Bloomberg), the company expects to receive between C$4.7m-C$5.7m of royalty related revenue during the 2019 calendar year via LIORC dividends.”
The investment in LIOC will increase the company’s iron ore exposure to 20% from the existing 5%.
The company intends to capitalise on the demand for high quality iron ore products, fuelled by structural changes in the Chinese steel industry.
US seeks public proposals for mining on reclaimed monument land
The US Government is pushing ahead with its plans to open up land formerly belonging to the Bears Ears and Grand Staircase-Escalante national monuments to mining companies, despite lawsuits filed against the Trump administration by environmental groups.
US President Donald Trump rolled back the amount of protected land at the two monuments, in the state of Utah, from 1.35 million acres during the Obama administration to roughly 200,000 acres in December 2017, claiming that a much smaller portion of the land contained ‘objects of historical and scientific interest’ than was originally declared exempt from mining projects.
Trump proclaimed that “the boundaries of the Bears Ears National Monument are hereby modified and reduced to those lands and interests in land owned or controlled by the Federal Government within the boundaries described on the accompanying map,” in a statement in December. “These reserved Federal lands and interests in lands cumulatively encompass approximately 201,876 acres. The boundaries described on the accompanying map are confined to the smallest area compatible with the proper care and management of the objects to be protected.”
The Department of the Interior’s Bureau of Land Management has since invited members of the public, including private companies, to submit proposals for how the land will be used before 15 November. The draft management plan for the Grand Staircase-Escalante monument includes a report that highlights deposits of coal, oil, gas and other resources under the monument; environmental groups fear that private mining companies will be given free rein to disrupt the lands.
A total of 17 groups have launched legal action against the government, claiming the president’s decree is illegal and runs contrary to popular opinion. The Bears Ears monument in particular has ties to Native American culture – five groups with historic ties to the monument, Navajo, Ute, Utah Mountain Ute, Hopi and Zuni, have sued the government independently of the environmental groups – which many have accused the government of ignoring. California-based outdoor apparel company Patagonia is one of the companies opposing the project, having filed a lawsuit against the government last December.
“The administration’s unlawful actions betray our shared responsibility to protect iconic places for future generations and represent the largest elimination of protected land in American history,” said Patagonia CEO and president Rose Marcario. “We’ve fought to protect these places since we were founded, and now we’ll continue that fight in the courts.”
While reducing the area of protected land in the US is not unheard of, taking land from sites that were recently granted protection has raised concern among environmental groups. Grand Staircase-Escalante was declared a national monument in 1996 by the Clinton administration, and Bear Ears was only granted protected status in 2016 by Barack Obama, raising fears that Trump’s policies are reactionary.
Auxilium partners with Inmarsat to deliver smart mining solutions
Australian mining technology solutions company Auxilium has partnered with mobile satellite communications provider Inmarsat to provide smart mining solutions, such as Industrial Internet of Things (IIoT) and communications services, for mining firms.
The partnership will allow Auxilium to deploy Inmarsat’s satellite connectivity in its IIoT solutions offered to mining companies.
The deployment will enable mining businesses to access IIoT and communications services and eliminates the need for investment in building a terrestrial communications infrastructure to connect their mining operations.
Auxilium Systems chairman Nathan Mitchell said: “This partnership between Inmarsat and Auxilium Systems brings the ability to improve our capabilities in delivering real-time, mine-based communications and automation to Australian mining companies and other sectors.
“This will lead to further improvements in efficiencies and real-time decision making that will continue to see Australian mining at the forefront of technological advances and further demonstrates Auxilium Systems’ ability to provide industry-leading solutions to our current and future clients.”
The company, which is engaged in manufacturing advanced mining equipment, technology and services, is focused on offering reliable connectivity to operate remote mines.
Clients in the Australian mining industry will now have access to Inmarsat’s L-band satellite network, which is suitable for remote monitoring and automation applications.
According to Inmarsat, the partnership will allow mining businesses to achieve operational efficiency and enhanced profitability, even if the mines are located at remote sites.
Inmarsat Enterprise Mining director Joe Carr said: “Working with Auxilium is going to enable us to deliver solutions on a managed services model, reducing up-front investment and strain on capital expenditure budgets.”
Unions call for government control following Pakistan miner deaths
The National Labour Council (NLC) and Pakistan Institute of Labour Education and Research have demanded that the country’s government cancel leases given to mining companies in the wake of the recent explosion at a coal mine in Balochistan that claimed the lives of 13 workers.
NLC secretary Karamat Ali said that a lack of safety and rescue measures at Pakistani mines has undermined safety in an industry that sees up to 200 mine workers killed every year. Ali urged the Pakistan Mineral Development Corporation, controlled by the country’s ministry of petroleum and natural resources, to take over mining operations in the country, arguing that the leases granted by the government have failed to safeguard worker health and wellbeing.
His comments were echoed by the Human Rights Commission of Pakistan (HRCP), which said that both mine workers and rescuers faced significant risks. While nine workers were successfully rescued from the Sanjdi mine in the Sor-range coal field, others were trapped more than 1,000m below the surface. It has also been reported that two rescue workers were killed and trying to reach the trapped miners, while up to ten emergency workers fainted from inhaling poisonous fumes during rescue operations.
“HRCP urges the government to carry out an immediate exercise to estimate and document the workforce employed in the mining sector, given that mining accidents in smaller areas often go unreported,” the commission said. “The regulatory regime must be extended and enforced to all workers employed in this industry, including small-scale mining.”
Mining law in Pakistan is governed by a concession that came into force in 1960, which does not obligate mining companies to provide extensive health and safety services as part of their mining leases. Companies are obligated to allow any officer belonging to the licensing authority to inspect their operations, but are not required to inspect them themselves.
“The state cannot afford to abnegate its role in protecting workers’ right to safe working conditions,” continued the HRCP. “The government must strengthen its inspection and regulatory functions to promote greater transparency, accountability and regular information sharing. Moreover, if such tragedies are not to recur, mine owners and operators must be subject to harsher penalties for failure to comply with prescribed standards and other offences.”
Ivanhoe begins pre-feasibility study at Kamoa-Kakula copper project
Canadian company Ivanhoe Mines has announced that a pre-feasibility study for phase one of its Kamoa-Kakula copper project in the Democratic Republic of Congo (DRC) is currently underway and expected to be completed by the end of the year.
The planned six million tonne per annum (Mtpa) mine at Kakula is estimated to cost $1.2bn.
Ivanhoe plans to fund subsequent expansions and a smelter from cash flows or project finance.
The company and its joint venture partner Zijin Mining are currently exploring options to accelerate construction of the first two mines at Kamoa-Kakula, and the potential to expand production to 18 Mtpa.
During the second quarter of this year, a total of 18,633m of drilling was completed at Kakula and surrounding areas within the Kamoa-Kakula mining licence, increasing the total drilling completed during the first six months to 36,926m.
As part of the exploration programme, which was revised during the second quarter, additional drilling now has been planned to the north of Kakula West, following a narrow but high-grade continuation of Kakula West mineralisation.
During this period, the company completed 6,857m of drilling in 16 holes at the high-grade Makoko area.
In January, Ivanhoe announced that ongoing upgrading work at the Mwadingusha hydropower plant in the DRC has increased power output to 32 megawatts.
Mwadingusha is the first of three existing, state-owned hydroelectric plants that will be modernised by Ivanhoe and Zijin Mining to supply power to Kamoa-Kakula.
Kamoa-Kakula has been conducting project development activities with clean, hydroelectric power drawn from the national grid since late 2016.
Standard Chartered announces new head of metals and mining
British banking and financial services provider Standard Chartered has appointed Richard Horrocks-Taylor to its new position of global head of metals and mining.
A former banker specialising in working with mining companies for over 20 years, Horrocks-Taylor has worked with the Royal Bank of Canada, leading the bank’s European, African and former Soviet metals and mining business since 2008. He has also worked for JP Morgan and Flemings in London, Johannesburg and Hong Kong.
Head of Standard Chartered’s global industries group Ananth Venkat said: “The appointment of Richard into this role will ensure that we continue to keep a granular focus on this sector and build further depth to support the future growth aspirations of our clients.”
The appointment follows reports of falling profit margins in the mining industry, from 25% in 2010 to 4% in 2016, and the news that several other banks are withdrawing their support from mining operations and related industries.
Earlier this month, Lloyds announced that it will no longer fund new coal-fired power stations, instead committing £2bn to its Clean Growth Finance initiative, which is designed to encourage its banking clients, including mine operators, to invest in a lower-carbon future. In the US, the Bank of the West has withdrawn investments from the fossil fuel industry as it plans to invest $6.7m into climate change research projects, and another $113m into energy start-ups by 2020.
However, with the industry’s top 40 companies reporting combined revenues of $496bn in 2016, and the mining equipment market alone projected by Grand View Research to enjoy an annual growth rate of 6% by 2025, Standard Chartered still has some causes for optimism.
Grand View Research noted: “[The] increasing trend of transitioning to digital mining is providing an impetus to industry growth. Mining sites are adopting automated vehicles, drones, and wearable technologies, most of which use Internet of Things sensors to capture data in real time.
“An excellent example is Rio Tinto Group, who has implemented 3D mapping at the West Angelas mine to improve mine exploration activities.”
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