Minerals and Metals

Ukrainian Ferroalloy Production Doubles

noreply@blogger.com (hamilton) — Thu, 12 Aug 2010 12:10:00 +0000

Ukrainian Ferroalloy Production Doubles

Ukraine doubled its ferroalloy output in the first seven months of this year, according to figures released by Ukrainian Ferroalloy Producers' Association.

Output for the period grew to 871,500 tonnes. Silicon manganese production grew 83.1 per cent to 573,700 tonnes, ferromanganese rose 260 per cent to 173,000 tonnes, ferrosilicon 45 output rose 71.7 per cent to 116,400 tonnes and manganese metal production was up 7.7 per cent to 8,400 tonnes.

The country’s largest producer, Nikopol Ferroalloy Works (NFW), raised silicon manganese production 65.8 per cent year-on-year in the seven months to 421,000 tonnes while ferromanganese production was up 460 per cent to 132,500 tonnes. Overall ferroalloy output at Nikopol rose 140 per cent year-on-year to 554,000 tonnes.

Zaporizhia Ferroalloy Works (ZFW) saw silicon manganese production more than double to 103,100 tonnes with output of ferrosilicon 45 rising 120 per cent to 33,800 tonnes. ZFW’s ferromanganese was up 64.4 per cent to 40,500 tonnes and manganese metal production rose 7.7 per cent to 8,400 tonnes. Total ferroalloy output at ZFW doubled to 185,800 tonnes.

The Stakhanov Ferroalloy Plant (SZF), doubled its total production to 131,700 tonnes, while the country's two manganese concentrate producers, the Ordzhonikidze and Marhanets mining and beneficiation plants, produced 846,500 tonnes of concentrate between them in January-July - more than double the production in the same period of last year.

Bowen Basin Coal Mine Approved

noreply@blogger.com (hamilton) — Thu, 12 Aug 2010 11:58:00 +0000

Bowen Basin Coal Mine Approved

The government in the Australian state of Queensland has approved the development of a A$4 billion coal mine in the state’s Bowen Basin region that will create over1500 new jobs. However, the government also announced said the development was subject to a raft of strict development and operating constraints.

The Caval Ridge project is proposed by the BHP Billiton Mitsubishi Alliance and plans an open-cast mine that straddles the Peak Downs Highway, near Moranbah, 170 kilometres south-west of Mackay.

State treasurer Andrew Fraser said the government's decision was based on the coordinator-general's evaluation, which followed over 18 months of environmental impact assessments.

The state’s conditions set clear principles and procedures with respect to air quality monitoring, dust and water management, community consultation and the mitigation of potential social impacts of the mine.

The Federal Minister for Environment will assess the report under Commonwealth environmental legislation.

Around 1200 construction jobs and 495 ongoing operational jobs will be created for up to 30 years.

Construction of the mine could start in 2011, with first coal exports by 2014.

Atlas, Aurox Merger Clears Final Hurdle

noreply@blogger.com (hamilton) — Thu, 12 Aug 2010 11:39:00 +0000

Atlas, Aurox Merger Clears Final Hurdle

The merger between Australian iron ore miners Aurox Resources and Atlas Iron have cleared its final regulatory hurdle on Thursday when the country’s Federal Court approved the $A143 million deal.

As a result of the approval, shares in Aurox will cease to be traded on the Australian Securities Exchange on Friday with shares in the merged entity set to be traded from Monday.

Under the merger deal, shareholders in Aurox will receive one Atlas share
for every three Aurox shares held, a deal that values Aurox at 74 cents a share, a 173 premium to Aurox’s share price prior to the deal being announced on 9 March 2010.

The merged entity will have up to 33 million tonnes per year of allocated port capacity in Western Australia’s Pilbara region.

Atlas commenced DSO mining at its Wodgina iron ore project in the Pilbara region
on 20 June. Atlas plans to export iron ore from Wodgina and its Pardoo project in the Pilbara at an annualised rate of 6 million tonnes by the end of the year and 12 million tonnes by 2012.

The company is also developing the Balla Balla project in the West Pilbara area with a mineral resource of 456 million tonnes and ore reserves of 238 million tonnes.

The company will also benefit from Aurox’s allocation of 6 million tonnes a year at the Utah Point berth at Port Hedland.

Iron Ore News; Chhattisgarh Chief Minister Calls For Export Ban

noreply@blogger.com (hamilton) — Tue, 20 Jul 2010 12:34:00 +0000

Iron Ore News; Chhattisgarh Chief Minister Calls For Export Ban

The Indian state of Chhattisgarh is to seek a ban on the export of iron ore.
The state’s Chief Minister, Raman Singh, told the IANS news agency that he was re-iterating calls for a ban, which he first made six years ago.

“It is not a wise decision at all to hand over the country's limited natural resources,” Chief Minister Singh said.

“Export of iron ore is a kind of crime against the nation because the country's limited stocks are getting exhausted everyday. It must be preserved for domestic steel industry which is on a massive expansion.”

The call came ahead of a meeting of a 10-member ministerial panel headed by the country’s Finance Minister Pranab Mukherjee this Thursday to consider a new bill for the development and regulation bill of mines and minerals.

India is the world’s third-largest iron ore supplier, exporting around half of its 226 million tonne annual output but calls for a ban have grown in the wake of reports of illegal exports of iron ore, especially from Karnataka. Left-wing parties this week called for a ban while the country’s Steel Minister, Vir Bhadra Singh is also in favour of a ban.

Steel Minister Vir Bhadra Singh last week came out in favour of a ban, saying the country should conserve its precious minerals and export value-added products.

Lead News: Bulgaria's Intertrust Seeks $150m

noreply@blogger.com (hamilton) — Mon, 19 Jul 2010 13:38:00 +0000

Lead News: Bulgaria's Intertrust Seeks $150m

Bulgarian lead and zinc producer Intertrust Holdings is seeking $150 million to upgrade its smelters and double output and sales.

The company’s Olovno Tzinkov Komplex AD smelter will be completed by 2013 and will help almost double annual sales to $220 million.

Bulgaria’s Environment Ministry approved a 40 million-euro ($51.7 million) upgrade of the lead smelter a week ago and the company now has to raise the funding said Chairman Valentin Zahariev.

Intertrust is also building an 80 million-euro galvanized steel plant near Sofia on the site of an old pipe factory, with planned output of 600,000 tons of galvanized steel a year.

“We need to raise a total of $150 million to complete our investment projects,” said Mr Zahariev. “We have applied for financing from U.S. funds for part of it. We will also consider other forms including an IPO, corporate bonds or bank loans. It all depends on the cost.”

Intertrust has already borrowed 85 million euros in loans from Swiss banks to upgrade its zinc smelter, he said. Asturiana de Zinc SA, a Spanish zinc producer, designed the project and supplied the equipment.

The modernised zinc smelter will increase output from 24,000 tons in 2009 to 45,000 tons, while the lead smelter will double output to 60,000 tons.

“The modernization of the two units will help cut pollution, reduce greenhouse emissions, improve the quality of all of our products, double output and cut costs,” said Mr Zahariev.

Apart from the Gorubso mines in Madan in southern Bulgaria, Intertrust also runs five metal, tool and engineering plants in Serbia. Eight-five percent of its output is exported, mostly to Italy, Germany, Austria and Turkey.

Ferrochrome News: IFM Sees Q4 Contract Price At Current Level

noreply@blogger.com (hamilton) — Mon, 19 Jul 2010 13:29:00 +0000

Ferrochrome News: IFM Sees Q4 Contract Price At Current Level

South African ferrochrome producer IFM says it does not see ferrochrome contract prices falling below current levels for the fourth quarter. Earlier this month contract prices for the third quarter were set at USD1.30 a pound, a fall of 4 per cent on the second quarter price but a smaller fall than had been expected. Spot market prices are around USD1.18 a pound, down from a level of around USD2.50 a pound in April 2009.

IFM sells much of its output through contracts and into the spot market in Europe and the USA.

Mr David Kovarsky CEO of IFM said that "We are happy with the price. At the moment we're going through a de stocking cycle but it doesn't reflect end consumption. By the end of this quarter we'll start seeing a revival in demand as stainless steel production starts increasing. I wouldn't expect it Q4 price to be lower than USD 1.30."

Mr Kovarsky said that "We are seeing a contraction in global steel production globally, particularly in China and Europe. The immediate challenge is volume in this quarter but I think they will pick up in the next quarter."
He added that IFM’s output for 2010 will be lower than its capacity of 265,000 tonnes due to the global economic downturn.

Coking Coal News: Aquila Project Could Produce 1.5m tpy

noreply@blogger.com (hamilton) — Mon, 19 Jul 2010 13:16:00 +0000

Australian coal miner Aquila Resources hopes to produce hard coking coal in 2013 from its Washpool project in Queensland’s Bowen Basin.

A feasibility study for the mine has just been completed and the miner is hoping production costs will be an at port price of around A$106 a tonne, although this price excludes royalty payments.

“The feasibility study confirms the status of the Washpool hard coking coal project area as a major coking coal resource and provides confirmation that this resource is economically recoverable with opencut mining methods,” said Aquila executive chairman Tony Poli.

Aquila said it would require A$320m of capital investment in the project with construction commencing in 2012. Washpool would be able to produce 1.6m tonnes of high-quality hard coking coal for a period of 25 years. Expected future cash flows from the mine over its expected life span would be $364m a tonne with an internal rate of return of 30 per cent.

Coal from the project will be exported via the Wiggins Island coal terminal at the port of Gladstone, Queensland.

The Washpool product would be hard coking coal with very strong coking coal properties and a higher-than-specification ash content.

Copper News - Zijin Closes Plant After Leak

noreply@blogger.com (hamilton) — Mon, 19 Jul 2010 13:04:00 +0000

Copper News - Zijin Closes Plant After Leak

Zijin Mining Group Co. has closed a copper plant at Shanghang, in China’s Fujian province, after a “substantial leakage of waste water” was discovered by government investigators.

A plant manager, deputy plant manager and environmental safety officer at the Zijinshan Copper Mine plant were detained by police, the company said in a statement to the Hong Kong stock exchange today. Duties of the deputy plant manager and environmental safety officer have been suspended.

Zijin could face fines of around 500m yuan (US$70m) as well as suffering losses of around 700m yuan (US$100m) as a result of the leak.

Fujian provincial authorities plan to legal action against government officials and Zijin executives, according to the Xinhua News Agency after the company ignored an order issued last September to repair a reservoir leak.

Zijin also plans to invest 100 million yuan (US$14m) in a water plant the state is building near to its mine.

The company could be fined 500m yuan by the China Securities Regulatory Commission for not immediately disclosing the pollution, while lost production could cost it another 350m yuan with compensation to local fishermen affected by the leak costing a further 350m on top of that.

Queensland Miners To Bid For Rail Network

noreply@blogger.com (hamilton) — Wed, 26 May 2010 11:25:00 +0000

Bid Worth Over $A4 billion

A group of 13 Australian coal miners have made a joint A$4.85 billion bid for the Queensland rail-track network in a bid to prevent the system being sold on to the stock market as part of the state’s privatisation programme.

The group, the Queensland Coal Industry Rail Group (QCIRG), is headed by BHP Billiton, Rio Tinto and Xstrata and says its bid was conditional on the state government dropping its plan to sell both the track network and the coal haulage business in an initial public offer.

The miners are concerned that if both the tracks and trains are sold together the new private owner would exert too much power over the coal industry.

Most of Australia's coal ports are dogged by infrastructure constraints and suffer from endemic congestion, with the bottlenecks resulting in lengthy queues of ships waiting for berths.

QCIRG is chaired by former New South Wales state premier Nick Greiner, who said the offer represents a substantial premium to what is likely to be achieved under the government's proposed listing plan.

"We have considered the alternative model under the IPO ... and strongly believe it does not represent an optimal or even reasonable basis for assuring the future of the state's major export industry," Greiner said in a statement.

"Importantly, our offer is able to be settled with the government prior to the IPO and will not be dependent on volatile equity markets, removing major risk for the state while also providing early settlement."

Polo To Sell Stake In Mongolian JV

noreply@blogger.com (hamilton) — Mon, 24 May 2010 15:04:00 +0000

Polo To Sell Stake In Mongolian JV

Polo Resources is to sell its 50 per cent interest in its Mongolian joint venture with Peabody Energy to Winsway Coking Coal Holdings for the sale of Polo's 50% interest

The JV was formed to hold all of Polo's coal and uranium assets in Mongolia.

Winsway will pay a non-refundable deposit of $1.75m to Polo, which has granted exclusivity to July 20.

Polo chairman Neil Herbert said, 'We are pleased to be executing the divestment of our non-core holding in the joint venture in Mongolia.

'Polo is focused on maximising shareholder value through its uranium and coal interests in Extract Resources Limited, GCM Resources plc and Caledon Resources plc and currently has approximately $23m in cash.'

Polo, Peabody and Winsway will negotiate the terms of a sale of Polo's interests in the JV for $15m in cash, including the deposit, and $20m payable within 12 months.

In addition Polo will receive a 1% royalty for coal sold from the licences.

WISCO Buys 2bn Tonnes Of Iron Ore Reserves

noreply@blogger.com (hamilton) — Mon, 24 May 2010 14:51:00 +0000

Reserves Bought In Madagascar

Chinese steelmaker, Wuhan Iron and Steel, has purchased reserves of two billion tons of iron ore, according to the country's National Development and Reform Commission. The purchase increases the company's reserves of iron ore to four billion tons.

The iron ore were acquired from the Soalala Iron Ore Deposit in Madagascar and the reserves were purchased the in conunction with Guangdong Foreign Trade Group and Kam Hing International Holdings

Chinese Anger At Q3 Iron Ore Prices Rise

noreply@blogger.com (hamilton) — Sun, 23 May 2010 21:57:00 +0000

Further 23 Per Cent Asked For Iron Ore

Chinese steel mills have expressed outrage as Vale and BHP propose an iron ore price of $160 per tonne for the third quarter.

"BHP has recently informed us that they will raise third quarter iron ore prices, including freight, to 160 U.S. dollars a ton, which is unacceptable for us," according to an official from a large steel mill.

"We will become unprofitable with such prices on the back of a persistent fall in steel prices," the source said.

The price is 23 percent higher than that in the second quarter.

One source suggested that the price was unreasonable given the fall in spot prices in recent weeks.

"We will see a complete loss in the steel industry if the much-talked-about price is inked, and most small-sized mills will go bankrupt," said Chu Xueliang, an analyst at China Jianyin Investment Securities.

"We estimate that the acceptable price for Chinese steel mills is around 130 U.S. dollars per ton in the third quarter," Chu said.

Gold Price Spurs Kenyan Exports

noreply@blogger.com (hamilton) — Sun, 23 May 2010 21:48:00 +0000

Output Trebles As Price Rockets

Official data released by the Kenyan government shows that metal minerals performed better in 2009 than non-metal minerals.

Earnings from gold rose almost four times to Sh2.3 billion ($276 million) against Sh593 million ($72 million) in 2008 as the price of gold – traditionally a safe haven in times of recession – rose sharply on the international market. Production more than trebled from 0.3 tonnes to 1.1 tonnes.

Fluorspar brought in Sh123 million ($14.5 million).

The price of gold rose from $834 per ounce at the end of 2008 to $1095 per ounce at the end of 2009. The current price is around $1179 per ounce.

Prices of gold in the international market have leapt from $834 per ounce by close of 2008 to $1,095 by end of last year.

Chinese Steel Mills Receive Rio Tinto Price Offer

noreply@blogger.com (hamilton) — Sun, 23 May 2010 21:38:00 +0000

Price Is Double 2009 Benchmark

Rio Tinto has delivered its official iron ore price offer for the second quarter of this year to Chinese steel mills. According to sources within the Chinese steel industry, the offer was received on Friday.

The free-on-board price for fine ore with grade of 63.5 per cent was about $US123 per tonne and around $US138 per tonne for lump ore. With ocean freight added on, the price is around $US135 per tonne – around double the 2009 benchmark price agreed with Japanese and Korean steelmakers.

The China Iron & Steel Association admitted last month that the country's mills and the large iron ore miners had reached private price deals on iron ore supply, even as negotiations continued.

The offer means the end of the annual benchmark system and a move to quarterly pricing.

Cyclone Set To Hit India's East Coast

noreply@blogger.com (hamilton) — Wed, 19 May 2010 12:14:00 +0000

Refineries, Gas Fields And Ports on Alert

A cyclone over the Bay of Bengal is set to hit India's east coast on Thursday, putting on alert refineries, the country's biggest gas field and facilities for iron ore exports and coal imports.

The storm – known as Laila - would lash the coastal state of Andhra Pradesh in the early hours of 20 May with gusts of up to 135 kilometres per hour.

Officials at the Gangavaram port in Andhra Pradesh, a major hub for coal imports, said they were watching the situation although they were hopeful that operations wouldn’t be much affected.

Officials in Orissa state have also issued an alert although the cyclone is likely to be weaker by the time it reaches the Paradip port.

Fortescue To Review New Projects

noreply@blogger.com (hamilton) — Wed, 19 May 2010 12:07:00 +0000

Miner Blames Super Tax

Australian iron ore miner Fortescue Metals Group Ltd. has put two of its three expansion projects on hold.

The company has said that it wants to review the potential impact of the 40% tax on mining profits proposed by the Australian government. The tax is due to come into force in July 2012

Fortescue is to review its US9billion Solomon hub and its $6billion Western hub projects. Between them the two projects were set to employ up to 30,000 people.

"The uncertainty in the financial markets caused by the proposed tax and the cash impost that RSPT payments will place on future business revenues has necessitated an urgent review of the economics surrounding the development of Fortescue's major projects," the miner said in a statement on Wednesday.

The company had been aiming to approve Solomon next year but the only work to continue will be the completion of existing studies.

The project was slated to produce 160 million tonnes a year of iron ore.

However Fortescue continues to expand its Chichester hub capacity from 55 million tonnes to 95 million tonnes a year. Unlike the Solomon and Western projects, Chichester is to be financed from internal cash flows.

Macarthur Rejects Reduced Peabody Offer

noreply@blogger.com (hamilton) — Tue, 18 May 2010 13:53:00 +0000

Shares Plunge As Miner Rejects Bid

Macarthur Coal Ltd., the world’s largest pulverized coal producer, has rejected the latest bid from Peabody Energy Corp.’s saying it is too low. Macarthur’s two biggest shareholders, Citic and ArcelorMittal are also expected to reject the bid.

Peabody reduced its offer from A$16 a share to A$15 a share, citing its due diligence review of Macarthur’s finances and the Australian government’s plan to bring in a ‘super tax’ on mining companies’ profits.

Shares in Macarthur fell over 20 per cent on the news to close at A$11.25 a share.

Petrobas In Saudi PetCoke JV

noreply@blogger.com (hamilton) — Tue, 18 May 2010 13:43:00 +0000

Plant To Be Built on East Saudi Coast

Brazil's Petrobras has signed an agreement with Saudi Arabia's Modern Mining Holding Co. to study plans to build a $450 million calcined petroleum coke plant in Saudi Arabia.

The plant, to be built in Jubail, on Saudi Arabia’s east coast, is expected to produce 700,000 mt of calcined coke a year using raw petroleum coke – ore ‘green coke’ - produced by Petrobras’ refineries. The plant is scheduled to open in 2012.

The two partners in the joint-venture will provide equal amounts of finance for the project and are looking for capital from government and non-government banks.

Sharp Increase In Great Lakes Iron Ore Shipments

noreply@blogger.com (hamilton) — Tue, 18 May 2010 13:30:00 +0000

Iron Ore Shipments Doubled In April

Iron ore shipments on the Great Lakes in April showed a 146 percent increase over last year, according to figures just released by the Lake Carriers Association.

A total of 5.4 million tons were shipped from U.S. and Canadian Lakes and Seaway ports as a recovery in the steelmaking industry drove demand for iron ore higher.

Shipments from Two Harbors and Silver Bay were higher than they've been in any of the last five Aprils. Duluth shipments topped the five–year average, but Superior's shipments were lower than all of the last five years.

Rare Metal Found In North Queensland

noreply@blogger.com (hamilton) — Mon, 17 May 2010 11:52:00 +0000

Scandium Found Near Townsville

Australian miner Metallica Minerals says it has found deposits of scandium at its Ludrow nickel-cobalt project as Greenvale near Townsville in the Australian state of Queensland.

The element is used to strengthen low-weight aluminium alloys in the aerospace, automotive and sporting industries but supplies have been limited.
Metallica managing director Andrew Gillies says the company hopes to capitalise on that shortage, and subject to a feasibility study, become the world's largest scandium supplier.

"It has got fantastic attributes, and everybody likes quality products," Mr Gillies said.

"We are talking to serious end users that are in need of long term reliable supply. The problem has always been is that there's no long term reliable supply, so the main end users would be reluctant to add it to their plane wings, rocket wings [and] mainstream lighting components.

Mr Gillies said he thought there was around 1500 tonnes of scandium oxide in around 20 drilling holes at the Ludrow site. The Scandium will be processed in conjunction with nickel and cobalt from the project, making the venture worthwhile.

Sahara Chosen For Mali Iron Ore Mine

noreply@blogger.com (hamilton) — Sun, 16 May 2010 20:29:00 +0000

Indian Company Expects 50k MT per year

India’s Sahara Mining has been chosen to mine iron ore deposits at Moribabougou in Mali, the Malian Mines Ministry announced on Friday.

The ministry says iron ore reserves are evaluated at 91 million tons. Sahara says it expects annual output of 50,000 tons which will be exported through Dakar in Senegal, 1,350 km away from the mining site. The site itself is close to the Mali capital of Bamako.

The Moribabougou project requires an investment of US$40.83 million, the ministry’s statement said.

The project will create over 1600 jobs.

BHP, Rio Set Year-End Date For Iron Ore Deal

noreply@blogger.com (hamilton) — Sun, 16 May 2010 08:34:00 +0000

Year-End Deadline for Pilbara Merger

Iron ore giants BHP Billiton and Rio Tinto may re-evaluate plans to merge their Western Australian iron ore operations if the two parties cannot reach an agreement by year end.

The Wall Street Journal quotes BHP chief executive Marius Kloppers as saying the deal was being hampered by the proposed 40 per cent tax on mining profits proposed by the Australian government.

“The tax brings in uncertainty," Mr Kloppers told the paper. Earlier this week he told the Australian Broadcasting Corporation that both parties were keen to complete the joint venture despite the tax and despite opposition to the deal in the EU and China.

Mr Kloppers recently met his counterpart at Rio Tinto, Tom Albanese, and the two agreed on a 31 December deadline to complete the deal.

Mr Kloppers also said that BHP would invest elsewhere if the Australian government approved the deal.

Atlas Consolidated Reports Q1 Profit

noreply@blogger.com (hamilton) — Sun, 16 May 2010 08:26:00 +0000

Carmen Copper is Key To Turnaround

Philippines copper and nickel miner, Atlas Consolidated Mining and Development Corporation, has reported a profit of P164 million in the first quarter of this year, compared to a loss of P393 million for the same quarter in 2009.

The firm said the improved result is due to the improved performance of the company’s majority-owned subsidiary, Carmen Copper Corporation (CCC).

The Carmen copper mine processed over 2.5 million tons of ore during the quarter with production rates expected to exceed 38,000 tons per day during the third quarter of this year.

Total revenues for the quarter were P2.20 billion with net income from operations of P382 million. Five shipments of copper concentrate were made during the quarter amounting to approximately 24,500 dry metric tonnes.

However, Atlas’ nickel-producing subsidiary Berong Nickel Corporation (BNC), reported a loss of P26 million due the continued suspension of operations although the company is continuing to pursue long-term sales in China and Japan.

Last week CCC completed of its seventh shipment of copper concentrate this year by CCC with the delivery of 5,235 wet metric tons of copper concentrate loaded destined for the Jinlong Copper smelter in China.

The copper concentrate is estimated to contain 28.19 percent copper, 2.83 grams of gold per ton and 24.88 grams of silver per ton. The shipment has an estimated value of $9.2 million.

Twenty shipments have been made by CCC – all to China - since the start of commercial operations in September 2008. Approximately 98,520 dry metric tons have been shipped.

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Northern Iron Recommissions Norway Project

noreply@blogger.com (hamilton) — Fri, 14 May 2010 10:26:00 +0000

Sydvaranger Recommissioned Ahead of Schedule

Northern Iron, the Australian company formed to acquire the Sydvaranger Iron Project in northern Norway, has reported Friday that the troubled project in Norway will be re-commissioned ahead of schedule.

Chairman David Griffith informed shareholders at the company's annual general meeting that "the rectification program will be completed four months ahead of schedule and the cost of the rectification program is currently tracking below budget."

The project went live last year four months late last year, which led Northern Iron to seek additional funding but Mr Griffiths said that concentrates were eventually produced and shipped. However, he admitted that there had been some shortcomings on the company’s part as it was not able to produce the quality of concentrate it had previously claimed.

Northern Iron has allocated some $US25 million for development projects that will rectify the project’s operational flaws. Negotiations are under way with UK steelmaker Corus to discuss late deliveries of the mine output.

Kangaroo To Complete Indonesian Coal Acquisition

noreply@blogger.com (hamilton) — Fri, 14 May 2010 10:14:00 +0000

Five More Coal Mines To Be Added To Portfolio

Australian mining company Kangaroo Resources is to acquire five Indonesian coal projects, after completing its due diligence. The company announced its plan to buy the projects late last year.

Drilling will soon commence at Kubah Indah, where the company’s exploration target is for 100-400 million tonnes of coking coal.

The company said this drilling program will be conducted in parallel with the ongoing ramp-up of production at its other Indonesian operations.

Prior to announcing these latest acquisitions Kangaroo already had two coal mines in Indonesia.

Managing Director Mark O’Keeffe said “The completion of due diligence was high on our list of priorities and, as expected, the projects were found to be technically and legally sound.”

“Kubah Indah in particular will become a very important project for us and, in combination with the Mamahak Project, will form the backbone of our coking coal production profile in the future."

“We will now move quickly towards the commencement of an initial exploration programme at Kubah Indah, and over the coming months we expect to be able to delineate a significant JORC resource,” added Mr O’Keeffe.

Kangaroo has issued 300 million shares to the projects’ vendors as consideration for the acquisition and these would be issued once its shareholders approve the deal.

Kangaroo recently announced an export sales contract with Chinese energy company, Yudean Farnon.

The contract involves three trial shipments of a total of 150,000 tonnes of coal over a two-month period. The deal will then be extended with pricing linked by a formula to the Chinese Coal Index.

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