1. Bloomberg.com: Rio Said to Consider $15 Billion Share Sale, Reject Chinalco
Rio Tinto rejects a $19.5 billion investment from Chinalco, now looks to raise funds through a stock sale. Rio is expected to make an announcement about the rights offer today, causing its market activity in New Zealand and Australia to be halted. The miner’s largest shareholder Legal & General Group Plc largely criticized the proposed Chinalco deal.
2. The Australian: China’s iron ore stockpile will reach 120m tonnes
Ships loaded with iron ore start to queue outside China’s harbors; China’s stockpile expected to reach as high as 120 million tonnes by the end of June. As much as 60 million tonnes entered the country in May, with nearly 30% coming from major iron ore producers such as BHP Billiton and Rio Tinto.
3. AFP: Death toll in S.Africa mine tragedy rises to 76
Illegal gold mining accident death toll rises to 76. South African police are not sure all victims were illegal miners. Twenty miners died in a March accident at another mine. Illegal miners often live months underground in search of the precious metal.
4. Reuters: Grupo Mexico can use share guarantee in offer-court
Court grants Grupo Mexico the right to post noncash guarantees to secure their bid for bankrupt Asarco. The Mexican miner will place shares of its mining unit Southern Copper Corporation in escrow instead of cash. Grupo acquired Asarco in 1999, but lost control in the company’s 2005 bankruptcy proceedings.
5. The Moscow Times: Mechel Posts $500M Q4 Loss, Breached Loans
Russian miner Mechel posts a $496.9 million net loss in 2008 after suffering a $4.2 billion fourth-quarter loss and breached covenants. Mechel’s chief said most lenders have been understanding of the tough economic conditions.
6. The Australian: Rio Tinto takes first steps in Congo
Rio Tinto explores Congo mining opportunities. The Australian miner is exploring for iron ore in northern Congo and partnering with smaller miners in search of diamonds. Rio is planning on spending between $56-57 million on exploration in Congo this year.
7. Living in Peru: Doe Run Peru shut operations
Doe Run Peru shuts its La Oroya smelter after failing to reach an agreement with banks and suppliers. The Peruvian miner says it needs more time to settle debts and comply with required environmental cleanup.
8. Reuters: UPDATE 2- BHP offers iron ore indices to China steelmakers
BHP Billiton tries to rid its industry of the annual pricing system: offers China’s steel sector index-linked prices for iron ore. None of China’s major steelmakers have agreed to BHP’s terms; however, a few smaller mills have reportedly signed up. BHP’s CEO Marius Kloppers has stated his desire for a change in pricing mechanisms towards an index system.
9. Mount Shasta Herald: Senate passes bill to temporarily halt recreational mining
California’s Senate pass bill to place a moratorium on recreation suction dredge mining. The lawmakers are halting the mining activities until a scientific study can determine its impact on fisheries, water quality and public health. Recreational miners are still allowed to use other techniques that are less environmentally destructive.
10. The Australian: Weak iron ore prices bring $91m deficit in April trade
Australia caught off guard by significant trade deficit in April following a surplus one-month before. The Australian Bureau of Statistics published the month’s $91 million deficit. Analysts were expecting a $1.7 billion surplus in April following a $2.3 million surplus in March.
