Archive | Rio Tinto

As Good as It Gets: Iron Ore Risks a Reversal as China Cools – by Jasmine Ng (Bloomberg News – August 15, 2017)

https://www.bloomberg.com/

Iron ore in the $70s a ton may be as good as it gets for some time. After rallying hard in June and July, the commodity may see its gains unravel over the second half as steel production in China eases back from a record pace just as global miners pump up volumes.

The robust demand that’s supported gains may fade as steelmakers start to dial back output, according to Capital Economics Ltd., which came out first among forecasters in the second quarter, according to data compiled by Bloomberg. Others expecting a drop include Citigroup Inc., Sucden Financial Ltd., Axiom Capital Management Inc. and hedge fund Academia Capital.

“There was some fundamental support for iron ore’s rally, namely strong growth in China’s steel output,” Caroline Bain, chief commodities economist at Capital Economics, said by email. “Stocks at China’s ports are now stubbornly high and if, as seems likely, steel production and demand eases back later in the year, then we see iron ore prices coming under renewed pressure.” Continue Reading →

Major Miners’ Battle to Get Into Batteries Steps Up a Notch – by David Stringer (Bloomberg News – August 11, 2017)

https://www.bloomberg.com/

The world’s biggest miners’ determination to muscle into the burgeoning battery market stepped up a notch with Rio Tinto Group reporting breakthroughs in cracking the technology needed to unlock its giant lithium project in Serbia that could meet 10 percent of global demand.

Tests at a research facility in a converted shipping container in Australia have successfully produced lithium products from samples from the Jadar deposit, the company said Friday. It’s aiming to bring the mine in Serbia into production as soon as 2023 to tap soaring demand for the metal used in batteries for electric vehicles and power storage.

“There has been, through the phases, a number of breakthrough steps,” Simon Trott, Rio’s salt, uranium and borates division managing director, told reporters at the facility in Melbourne. “The key is that we’re producing lithium carbonate that’s to a specification that we are very confident” will meet customer requirements, he said. Continue Reading →

Rio Tinto doubles first-half profit, offers record dividend – by James Regan and Barbara Lewis (Reuters U.K. – August 2, 2017)

http://uk.reuters.com/

SYDNEY/LONDON (Reuters) – Global miner Rio Tinto more than doubled its first-half profit buoyed by Chinese iron ore demand and rewarded shareholders with a record interim dividend and $1 billion in share buybacks.

Underlying earnings for the six months to June 30 of $3.94 billion missed forecasts for $4.19 billion, according to Thomson Reuters I/B/E/S, but were well above last year’s $1.56 billion following a recovery in iron ore and other commodity prices.

Rio Tinto declared a record-high half-year dividend of $1.10 a share, equivalent to $2 billion, up from 45 cents a share a year ago. The latest buyback comes on top of a $500 million program announced in February. Continue Reading →

Goldman turns bullish on iron ore – for the moment – by Jasmine Ng (Australian Financial Review/Bloomberg – July 28, 2017)

http://www.afr.com/

Goldman Sachs boosted its iron ore forecasts after better-than-expected demand in China raised prices, but warned that it remains bearish on next year amid prospects for plentiful mine supplies and a worldwide glut.

The three-month forecast was raised to $US70 a tonne from $US55, and the year-end target increased by $US5 to $US60, according to a report from analysts including Yubin Fu and Max Layton received on Thursday. Next year, prices are still expected to drop, it said.

Iron ore has surged in recent weeks to top $US70 a tonne on sustained demand from China, the largest user. Steel mills in the country have benefited from rising product prices and strong profit margins after the government shuttered some capacity, and remaining producers are making record volumes. Continue Reading →

[Rio Tinto] How Much for That Fancy Red Diamond? It’s Kind of a Secret – by Micah Maidenberg – New York Times – July 26, 2017)

https://www.nytimes.com/

When the mining company Rio Tinto shows its latest batch of rare naturally colored diamonds — stones with hues of pink, red and even “deep-gray violet” — executives are delighted to go on about their beauty and scarcity.

But details about pricing? That is when the lips draw shut. “It’s quite confidential,” said a laughing Arnaud Soirat, the chief executive of Rio Tinto’s copper and diamond group. Welcome to the exclusive world of the colored diamond trade, a market where the buyer pool is slim, the supply is constricted and a carat can fetch $1 million or more.

On Wednesday, Rio Tinto came to Manhattan to introduce its latest and best colored diamonds, in the start of a tour that will include a stop in Hong Kong and another one in New York. The company’s latest cache, 58 stones, sparkled in glass cases on the 21st floor of a Chelsea skyscraper. With names like the Argyle Liberte and Argyle Isla, the total weight of all the stones was 49.39 carats, suggesting a collective value in the tens of millions — even though they all could fit in a pants pocket. Continue Reading →

Glencore snaps up 49pc of Hunter Valley Operations in $US1bn deal – by Matt Chambers (The Australian – July 27, 2017)

http://www.theaustralian.com.au/

UPDATE: Glencore has confirmed it had struck a $US1.139 billion deal to buy 49 per cent of the Hunter Valley Operations coal mines from Yancoal Australia and Mitsubishi.

The deal, which is conditional on approvals and the completion of Yancoal’s acquisition of Rio Tinto’s operating stake in HVO as part of a $US2.69bn deal struck last month to buy all of Rio’s Australian thermal coal, is expected to be completed within six months.

Under the deal, revealed by The Australian this afternoon, Glencore has also agreed to subscribe for $US300 million of Yancoal shares in an equity raising to fund Yancoal’s Rio purchase. Continue Reading →

UK Serious Fraud Office launches probe into Rio Tinto over Simandou – by Frik Els (Mining.com – July 24, 2017)

http://www.mining.com/

The UK’s anti-fraud investigating body said Monday it is probing Rio Tinto’s dealings in Guinea involving the giant Simandou iron ore project.

“The Serious Fraud Office has opened an investigation into suspected corruption in the conduct of business in the Republic of Guinea by the Rio Tinto group, its employees and others associated with it,” the SFO said in a statement on Monday.

In November last year Melbourne-based Rio fired two executives involved in the project after an internal investigation uncovered a $10.5m payment in 2011 to a French national acting as a go-between with the West African nation’s government. Continue Reading →

Rio Tinto moves big Jadar lithium and boron deposit in Serbia to the front burner – by Matt Chambers (The Australian – July 25, 2017)

http://www.theaustralian.com.au/

Rio Tinto has upgraded the status of the big Jadar lithium and boron deposit in Serbia to that of its most likely growth project, revealing that if it gets approvals and the economics support it, it will start construction in 2020 and reach first production in 2023.

The announcement, made in Serbia on Monday night, makes Jadar (a potential top-three global lithium producer) the only unapproved medium-term growth project in Rio’s portfolio.

The supply it could bring to the market may be a concern for Australian lithium producers and hopefuls, whose shares have been running hot lately on expected growth in demand for lithium-ion batteries as intermittent renewable power and electric cars take more market share. Continue Reading →

Mining Giant Hunts for Diamonds in the Canadian Forest – by David Stringer (Bloomberg News – July 18, 2017)

https://www.bloomberg.com/

Rio Tinto Group’s pursuit of new diamond output to tap rising demand in Asia is focusing on an unheralded exploration project in the Canadian forest.

The world’s second-biggest miner on Tuesday added the Fort a la Corne joint venture, about 60 kilometers (37 miles) east of Prince Albert in Saskatchewan, to its published list of advanced projects after striking an agreement last month to take as much as a 60 percent stake.

The venture’s Star-Orion South project holds an estimated diamond resource of 55.4 million carats and has potential development costs of about C$2.5 billion ($2 billion), according to 2015 filings by developer, Saskatoon-based Shore Gold Inc. Continue Reading →

Rio Tinto shareholders okay $2.69 billion coal assets sale to China-backed Yancoal – by James Regan (Reuters U.S. – June 29, 2017)

https://www.reuters.com/

SYDNEY – Rio Tinto shareholders approved the sale of a suite of Australian coal assets to China-backed Yancoal Australia for $2.69 billion, ending a bidding war with commodities trader Glencore.

The sale was approved by 97 percent of shareholders of Rio Tinto’s UK and Australian-listed shares, Rio Tinto said on Thursday in a statement to the Australian stock exchange.

Rio Tinto Chairman Jan du Plessis said funds from the sale had yet to be allocated within the company amid some calls by shareholders to use the money to boost dividends or buy back shares. Continue Reading →

How Yancoal and Glencore Can Bury the Hatchet – by David Fickling (Bloomberg News – June 27, 2017)

https://www.bloomberg.com/

The world’s biggest coal consumer and the largest commodity trader are fighting over a rich seam of the black stuff. They’d be better off working together.

Shareholders of Rio Tinto Group’s U.K. listing were voting Tuesday on whether to accept a $2.69 billion offer to buy Coal & Allied Industries Ltd. from Yancoal Australia Ltd., which is ultimately controlled by the Chinese government.

Rio Tinto’s management has declared the proposal superior to a bid from Glencore Plc, which has adjacent mines in Australia’s Hunter Valley, north of Sydney, and has coveted Rio Tinto’s deposit for the best part of a decade. Continue Reading →

COLUMN-Fight over Rio’s mines means coal isn’t dead; Adani woes show it’s dying – by Clyde Russell (Reuters U.S. – June 26, 2017)

https://www.reuters.com/

Here’s a question for the anti-coal lobby. If coal is dying, how come there is an increasingly heated bidding war going on for Rio Tinto’s coal mines in Australia? Here’s another question, this time for the pro-coal lobby. If coal still has a viable long-term future as an energy source, how come the world’s biggest planned new mine is now hostage to whether the Australian government decides to loan it money?

Reconciling these two questions may seem like a challenge but both the battle for Rio Tinto’s existing mines and the struggles of India’s Adani to build its Carmichael project neatly show where coal currently finds itself.

Rio’s mines in the Hunter Valley north of Sydney are attractive to both Glencore and China’s Yancoal because they are likely to be profitable for the remaining life of the pits, which is expected to be around 20 years. Continue Reading →

Bidding war intensifies for Rio Tinto’s Hunter Valley coal mines – by David Chau (Australian Broadcasting Corporation – June 26, 2017)

http://www.abc.net.au/

Rio Tinto is currently in a dilemma on who it should sell its Hunter Valley mines to – the Swiss or the Chinese. Late on Friday, Swiss-based company Glencore upped its bid to more than $3.5 billion (US$2.685 billion) for the purchase of Rio’s subsidiary, Coal & Allied Industries Limited.

The assets on the block are Rio’s Hunter Valley operations – the Warkworth/Mount Thorley thermal and semi-soft coking coal mines and a major stake in the Port Waratah coal loading facility in Newcastle.

Glencore said its latest offer is around $297 million ($US225 million) greater than Yancoal’s proposal. “We believe the Glencore offer satisfies the criteria for a ‘superior proposal’: it delivers substantially greater value to Rio Tinto shareholders and low deal completion risk,” Glencore said in a statement. Continue Reading →

Rio Tinto, Canada aluminum’s good guys in Commerce Department probe – by Suzanne O’Halloran (June 21, 2017)

http://www.foxbusiness.com/

The world’s biggest aluminum players want to set the record straight: they say they shouldn’t be lumped in with China, Russia and other alleged “bad actors” whose imports may be a threat to the security of the United States.

Among those Rio Tinto (RIO), the largest producer of aluminum in North America, via its operations in Quebec and British Columbia. “Rio Tinto’s operations, such as those in Utah, California and Arizona are strong contributors to the United States economy and employment” Rio Tinto CEO Alf Barrios said in prepared remarks viewed by FOX Business, to be delivered Thursday during a scheduled hearing.

Barrios also defended the miner’s long history as a U.S. defense ally dating back to World War II. “Our smelters have a long history of supplying U.S. manufacturers – particularly U.S. defense-related manufacturing” he notes. Continue Reading →

Rio Tinto recommends Yancoal coal offer over Glencore – by James Regan and Barbara Lewis (Reuters U.S. – June 20 2017)

https://www.reuters.com/

SYDNEY/LONDON – Rio Tinto (RIO.L) (RIO.AX) selected Yancoal (YAL.AX) on Tuesday to buy its Coal & Allied division in Australia for $2.45 billion, surprising commodities trading giant Glencore (GLEN.L) which had put in a higher bid.

Earlier this month, Glencore offered $2.55 billion cash for Rio’s coal mines in the Hunter Valley region of New South Wales, beating a previous offer from Yancoal, which is based in Australia and owned by China’s Yanzhou Coal Mining Company.

Glencore has long sought Rio’s high-quality thermal coal assets in the Hunter Valley. Despite environmental concerns about the carbon-intensive fossil fuel, Glencore expects continued demand, especially in Asia, as coal can still be the cheapest form of baseload power. Continue Reading →