Morning News Bite – July 21

Job support for Australians extended at a reduced rate, Western Australia Premier Mark McGowan says mining companies need to stop relying on FIFO and face mask purchases restricted at major supermarket chains.

  • Downer EDI is starting trade in July 21 in a trading halt as an acquisition is on the cards. The company made the announcement about the acquisition and fully underwritten accelerated non-renounceable entitlement offer of ordinary shares on a pro-rata basis to existing eligible shareholders of the Company. The trading halt is expected to last until the earlier of either the Company making an announcement to the ASX in relation to completion of the institutional component of the Entitlement Offer or the commencement of trading on Wednesday, 22 July 2020.
  • BHP has released is quarterly report with Iron Ore in Western Australia achieving record production. Increased petroleum production at Bass Strait due to higher seasonal demand, partially offset by lower volumes at Atlantis due to planned maintenance and preparation work for Phase 3 project commissioning, and lower demand in Trinidad and Tobago was the difference in Mar – Jun Qtr reports. Other highlights included Olympic Dam completing a quarter of higher production due to improved operating sustainability, Higher volumes at Queensland Coal including record production at Poitrel mine and higher nickel volumes due to the ramping of full capacity at the Kwinana refinery and Kalgoorlie smelter during the prior quarter. BHP Chief Executive Officer, Mike Henry also commentated on the impact of COVID19 in its operations  “BHP safely delivered a strong operational performance in the 2020 financial year, achieving record production in a number of our operations, and an improved cost base. This performance, achieved in the face of COVID-19 and other challenges, is a result of the outstanding effort of our people and the support of our communities, governments, customers and suppliers. We have sought to support those who rely on BHP through the pandemic with increased hiring, shorter payment terms for small, local and indigenous suppliers, support for contract workers and community funding for health and social services” He said. “We expect to continue to generate solid cash flow through the cycle and we remain confident in the outlook for demand for our products over the medium to long-term. We continue to focus on becoming even safer, delivering exceptional operational performance, maintaining disciplined capital allocation, creating and securing more options in future facing commodities and building social value. We have learned new ways of working, both internally and with others, through the COVID-19 pandemic. We will seek to embed these in a way that helps to reinforce these priorities.” according to Mr Henry.
  • An expanded drilling program for Gateway Mining is set to be undertaken after a $7m capital raising. Gateway are set to embark on a program of 5,000m of Reverse Circulation (RC) and 10,000m of air-core (AC) drilling to be completed at priority targets around the Montague Dome. CEO at Gateway Mining Peter Langworthy commented on the drill program by saying “We have positioned the Company to the point we can effectively accelerate our drilling programs to unlock the true potential of what we believe to be an emerging large-scale gold system. Having sufficient funding in place means that we can maintain a fast pace of drilling activity, with drill programs set to be maintained continuously right through to the end of the year and into 2021.” “The current program of RC drilling is making excellent progress and already approaching the halfway point of the expanded 4,500m of drilling. This will be followed by one of our biggest programs of air-core drilling to date, before we embark on what will be a crucial program of RC and diamond drilling through to the end of the year.” he said

 

Silver Lake Resources – Rothsay Mine (pic via Silver Lake Resources LinkedIn)

  • Quarterly group production was a record 71,291 ounces gold and 494 tonnes copper with sales of 64,593 ounces gold and 416 tones copper at a sales price of A$2,300/oz and AISC of A$1,344/oz for SilverLake Resources. Mount Monger mining camp produced 45,333 ounces and 42,331 ounces recovered, of this 38,017 ounces were sold at an AISC of A$1,471/oz with record annual sales from Randalls of 154,900 ounces at an AISC of A$1,414/oz. Deflector has a record quarterly gold production of 28,960 ounces and 494 tonnes of copper with record annual gold production of 104,376 ounces gold and 2,356 tonnes copper. Average mill grades at Deflector were also higher for the quarter. Meanwhile the Box Cut for Rothsay has commenced this month as significant approvals progress has taken place with mining camp and occupation taking place on July 1.
  • Image Resources has reported a strong quarter at its high-grade, zircon-rich Boonanarring mineral sands project, located 80km north of Perth. Image has increase to production  in the June quarter of 83kt, on pace with guidance Heavy Minerals Concentrate sales increased substantially quarter on quarter to 65kt and sales volumes are expected to further increase in the second half to achieve guidance. Managing Director and CEO of Image Resources Patrick Mutz said “In the first half of 2020 Image has demonstrated strong operational performance with production of 167kt Heavy Mineral Concentrate, despite the significant adjustments to daily work practices aimed at minimising the potential spread of COVID-19. The June quarter represents a turning point for our sales volumes which were up sharply from the prior quarter. It was therefore particularly pleasing, subsequent to period end, to receive a sales agreement with our off-take partners for 100kt of HMC to be delivered over the next 3-5 months to monetise our HMC inventory, while keeping open the opportunity to sell additional material to others outside of the off-take agreements. The Company remains in a very strong position to achieve our original guidance and we have a strong balance sheet, solid underlying assets and exciting opportunities for future growth.” he said.