Mining capital raisings and write-downs

Resources Corner

Resources and mining companies making news include Fortescue raising $US2 billion to expand into the Pilbara, Nexus Energy writes-down the value of its Longtom gas field, OneSteel gets set to close its gas pipe business in Kembla Grange, Lynas confirms its Malaysia rare earths refinery is 96 per cent complete and Rio’s plans to expand its mine near the Great Barrier Reef are put on hold.
 
Fortescue raises $US2 billion
Fortescue Metals Group Limited (ASX:FMG) has raised $US2 billion as part of its plans to expand into the Pilbara region of Western Australia. Only a day before the iron ore miner launched a $US1 billion bond offering of senior unsecured notes. The latest upsize in capital raising follows an increase in demand.
 
Nexus Energy write-down
Nexus Energy Limited (ASX:NXS) has written-down the value of its Longtom gasfield, announced CEO developments and flagged investor interest in its Crux gas liquids resource off Western Australia. The oil and gas producer revealed an expected $163 million write-down in Longtom’s value, bringing the carrying value of the field to $148 million. Nexus is currently undertaking a CEO appointment process and says it expects to be announcing its new CEO in the short term. The company has also advised it has received approaches from several industry players interested in Crux equity.
 
OneSteel to close Kembla Grange
OneSteel Limited (ASX:OST) has announced the closure of its oil and gas pipe business in Kembla Grange NSW at the end of May. OneSteel said in a statement that the result will be a write- down of assets valued at $13 million inclusive of goodwill and a restructuring charge of $5 million, before tax. As a result almost 60 jobs will be lost.
 
Lynas Malaysia refinery almost complete
Lynas Corporation Limited (ASX:LYC) has confirmed its Malaysia rare earths refinery is 96 per cent complete. Lynas also affirmed it is on track for first feed to kiln and first production in the second quarter of this year. The miner says it has intensified its community consultation and engagement following the International Atomic Energy Agency review.
 
Rio's mine delays
Rio Tinto Limited’s(ASX:RIO) proposal to expand its mine near the Great Barrier Reef will be reassessed. Environment Minister Tony Burke said new information had emerged relating to shipping activities in the Great Barrier Reef Marine Park.
 
“The reconsideration decision means the significant new information provided about shipping can be fully taken into account to ensure the protection of the Great Barrier Reef before the proposal is assessed,” Mr Burke said.
 
The review could see Rio’s plans delayed for more than twelve months, according to The Australian.
 
Resources News
Iron ore prices have tracked higher thanks to Premier Wen Jiaboa signalling China will support the creation of affordable housing and boost private sector lending.
 
Britain and the United Stated have agreed to release strategic oil stocks, according to sources, in an attempt to prevent high fuel prices dampening economic growth. According to Reuters, the move is in an effort to keep the economy on track during a US election year.
 
Melissa Beaumont Lee