The controversial $10.6 billion Minerals Resource Rent Tax is facing fierce opposition from Fortescue’s Andrew Forrest and WA Premier Colin Barnett. Resources and mining companies making news include BHP Billiton cautioning Chinese demand for iron ore is flattening, New Hope’s profit falls due to the sale of Arrow Energy shares, Sundance Resources signs a MOU with Equatorial Resources, Lynas notes reports the Malaysian government plans to establish a parliamentary committee in relation to its rare earths refinery and Leighton Holdings accepts infringement notices and is ordered to pay penalties of $300,000.
Resources NewsThe controversial $10.6 billion Minerals Resource Rent Tax (MRRT) was passed by the Senate on Monday night. The 30 per cent tax will be levied on the “super profits” from iron ore and coal mining from July 1. Companies will pay the tax when annual profit reaches $75 million. The tax is expected to affect more than 300 companies. Revenue is earmarked to pay for a cut in the company tax rate from 30 per cent to 29 per cent from July 2013.
The tax has faced fierce opposition, with Andrew Forrest’s Fortescue Metals Group Limited
(ASX:FMG) saying it is finalising a legal case against the levy. WA Premier Colin Barnett says he will join any High Court challenge launched by Fortescue, or the industry.
Iron ore outlookBHP Billiton Limited
(ASX:BHP) has cautioned Chinese demand for iron ore is flattening, but affirmed it has no plans to pull back from its $10 billion Pilbara expansion. Fellow miner Rio Tinto Limited
(ASX:RIO) offered a more bullish outlook for the steel making commodity at the Global Iron Ore and Steel Forecast conference in Perth. Fortescue Metals Group Limited
(ASX:FMG) CEO Nev Power recently forecast iron ore prices will trade between $US120 and $US150 in the short term.
New Hope profit falls after Arrow saleNew Hope Corporation Limited’s
(ASX:NHC) first half net profit has fallen around 75 per cent to $101.1 million. The coal miner's latest result compares to a higher net profit reflected in last year’s first half figures due to the sale of its shares in Arrow Energy. On an underlying basis, profit rose 25 per cent on the back of higher coal production and exports. A fully franked interim dividend of six cents per share has been declared.
Sundance inks MOU with Equatorial Iron ore developer Sundance Resources Limited
(ASX:SDL) has inked a memorandum of understanding (MOU) with mineral explorer Equatorial Resources Limited
(ASX:EQX). Under the agreement both companies will explore how Equatorial may utilise Sundance's rail and port infrastructure associated with its Mbalam project in West Africa in addition to assessing opportunities for regional cooperation. Sundance also entered into a memorandum of understanding with West African iron ore group Core Mining earlier this month, regarding the provision and use of future infrastructure facilities. Sundance says discussions with neighbouring project operators highlight the growing options coming onto the table for future project development and infrastructure use and funding.
Malaysia to report on Lynas’ plant Lynas Corporation Limited
(ASX:LYC) has noted reports that the Malaysian government plans to establish a parliamentary committee in relation to its rare earths refinery in Malaysia, the Lynas Advanced Materials Plant (LAMP). The rare earths developer understands the committee has been formed to help raise awareness concerning the project and will not decide on approvals and plant operations. The committee is expected to report by the end of June. Lynas has advised it is continuing to consult with community representatives in Malaysia and has confirmed its belief in the project’s safety for employees and surrounding communities. Lynas secured a temporary operating licence for its plant last month and is targeting first feed to kiln and first production in the second quarter of this year.
Leighton to pay ASIC fine Leighton Holdings Limited
(ASX:LEI) says it has accepted three infringement notices issued by the Australian Securities and Investments Commission (ASIC) for not disclosing earning losses to the market last year. The construction company has been ordered to pay penalties of $300,000. Leighton’s chairman Stephen Johns says they will be implementing an independent review of their systems.
"We take our continuous disclosure obligations very seriously and have undertaken to ASIC to implement an independent review of our systems," Mr Johns said.
Melissa Beaumont Lee
