Resources and mining companies making news include BHP closing the Norwich Park Mine, Lynas scores a victory for its plant in Malaysia, Leighton Asia’s awarded a multi-million dollar mining contract in Borneo, Woodside pushes back the deadline to make a final investment decision on its Browse LNG development in the Kimberley region and Kagara shares sink to record lows.
BHP closes Norwich Park MineA coal mine run by BHP Billiton Limited (ASX:BHP, NYSE:BHP) and Mitsubishi in Queensland is ceasing production indefinitely. The alliance says the decision to close the Norwich Park Mine follows a seven week review.
BHP Billiton Mitsubishi Alliance asset president, Stephen Dumble said, “This decision was not made lightly. However, the impact of last year’s floods, combined with lower coal prices and high costs, has resulted in an operation that is not currently viable. While recent industrial action has had an impact on production, the mine has been unprofitable for some months.”
Separately, BHP plans to invest $US708 million into expanding its Mad Dog joint venture with BP and Chevron in the Gulf of Mexico.
Resources NewsThe International Monetary Fund has predicted a fall in commodity prices within the next year.
Ahead of releasing its World Economic Outlook the IMF has warned, ''The weak global economic outlook suggests that commodity prices are unlikely to increase at the pace of the past decade ... Commodity prices are forecast to decline somewhat during 2012-13. Sizeable downside risks to global growth also pose risks of further downward adjustment.''
Earlier this year the IMF lowered its forecast for global growth from 4 per cent to just 3.3 per cent for this year.
Economic growth in China has fallen to its lowest level in almost three years. The economy expanded at a lower than expected pace of 8.1 per cent in the first quarter.
Thomson Reuters GFMS has forecast gold could drop under $US1550 an ounce within the next two months before rebounding to last year’s record highs. The consultancy says, “A push on towards $2,000 is definitely on the cards before the year is out”, underpinned by fears Europe’s sovereign debt crisis could intensify.
Lynas plant scores Malaysian court winLynas Corporation Limited
(ASX:LYC) has scored a victory in Malaysia with the High Court knocking back an attempt to delay the rare earths developer’s processing plant. Lynas secured a two-year operating licence for its plant in February, from Malaysia's Atomic Energy Licensing Board. The court has denied the request for a judicial review of the decision and also noted an appeal against the licence is in process, expected to be heard this month, and the court believes it is not appropriate for it to intervene.
Lynas executive chairman Nicholas Curtis says every safety box has been ticked for the plant's development and the controversy is being stoked by campaigns based on misinformation.
“It is disturbing that this baseless scare campaign has created unnecessary anxiety and fear in the community,” said Mr Curtis.
The company is targeting first feed to kiln and first production at its plant in the current quarter.
Leighton awarded Indonesian mining contractLeighton Holdings Limited’s
(ASX:LEI) subsidiary Leighton Asia has been awarded a seven-year $420 million mining contract on the island of Borneo in Indonesia. The contract is for providing mining services including project management, mine planning, surveying, labour, transportation and site infrastructure. Leighton Contractors Indonesia is currently involved with two coal and two gold mining projects in Indonesia. Leighton says the latest contract is significant as it represents the first strategic move into coking coal mining in the emerging Central Kalimantan region.
Woodside pushes back deadlineWoodside Petroleum Limited
(ASX:WPL) has pushed back the deadline to make a final investment decision on its Browse LNG development in Western Australia's Kimberley region. The oil and gas producer was expected to make a decision mid this year but will now make a decision on the $30 billion project in the first half of next year. Woodside says the extension will enable it to better evaluate front-end engineering and design work outcomes and tender processes for the development’s major contracts.
Kagara shares sink to record lowShares in Kagara Limited
(ASX:KZL) have sunk to record lows after the base-metal mining company said it would suspend a mine in Queensland to cut costs. Kagara says its short term cash flow has been impacted because of a restructure of its banking arrangements. As a result the miner has decided to suspend operations at the Baal Gammon copper mine as it completes the restructure of its business and working capital. Just last month Kagara announced job cuts, and the resignation of its founding chairman Kim Robinson, and offloaded its nickel assets to Western Areas NL
(ASX:WSA). Kagara shares have slumped more than 50 per cent this year.
Melissa Beaumont Lee
