Global Wrap: Vale, Barrick and more

IN Global Wrap: Vale restarting ops; Barrick sells shares; gold M&A; Ivanhoe’s Platreef reaches milestone; Pretium raising; and South African COVID-19 update.
Global Wrap: Vale, Barrick and more Global Wrap: Vale, Barrick and more Global Wrap: Vale, Barrick and more Global Wrap: Vale, Barrick and more Global Wrap: Vale, Barrick and more

Staff reporter

Vale is maintaining full-year iron ore guidance of 310-330 million tonnes after being granted approval to restart its Itabira Complex.

Itabira was halted on June 5 after 188 workers tested positive for COVID-19.

The company said the production impact was below 1Mt.

Vale also announced it would restart its Voisey's Bay mine in Canada by early July, with full production expected by early August.

The operation has been suspended for three months due to the pandemic, though there have been no cases at the site.

Vale is partnering with a private testing lab in Newfoundland & Labrador to provide extensive PCR testing of all employees entering the site.

The Voisey's Bay expansion project will also be restarted.

Barrick Gold Corporation has sold 79.2 million shares in Shandong Gold for proceeds of US$210 million.

The company bought the shares in the December 2018 for HK$10.50 per share, and sold them for $20.50 per share.

Barrick still holds 2.05% of Shandong and has a long-term partnership with the company at the Veladero mine, where they have a 50:50 joint venture.

Zijin Mining will acquire Guyana Goldfields for C$323 million after beating out an offer by SilverCorp Metals and more than tripling the original bid made for the company in April.

Zijin also agreed to provide a US$30 million secured loan facility to finance ongoing operations of the Aurora gold mine in Guyana and to fund its other liquidity needs, which now include a C$9 million break fee payable to SilverCorp.

Gran Colombia Gold also bid for Guyana, but it decided to stick with SilverCorp at the time.

"We believe that the Aurora mine is a high-quality gold asset with significant upside potential which we believe will be highly complementary to Zijin's existing mining asset portfolio," said chair Chen Jinghe.

The offer continues Zijin's penetration into gold production in Latin America and follows the US$1 billion acquisition of Continental Gold for its Buritica mine development project in Antioquia, Colombia, which closed in March.

Ivanhoe Mines has completed the sinking of Shaft 1 at its Platreef platinum group metals project in South Africa.

The shaft has reached a final depth of 996m after work started in 2016, with final level development expected to be completed by July.

Underground mine development work will now focus on construction of the 996m level station at the bottom of the shaft, which is expected to be completed ahead of schedule by the end of July. A new auxiliary winder is scheduled to be delivered to Platreef later this year and will be used for equipping the shaft.

The company is preparing an updated definitive feasibility study, which is expected to be finalised in the September quarter and will update project economics for current metal prices, which have moved significantly since the 2017 DFS, foreign exchange rates, updated capex and development progress to date.

Artemis Gold has upsized a placement by C$20 million to $175 million to enable its acquisition of the Blackwater project in British Columbia from New Gold.

The company will pay New Gold $140 million in cash up front, $50 million payable a year after closing, $20 million in Artemis shares, and an 8% gold stream at a price equal to 35% of the gold spot price, reducing to 4% once 279,908oz had been delivered.

Artemis describes Blackwater as one of the world's largest environmentally approved gold development projects.

It could produce 7 million ounces of gold and 30 million ounces of silver over a 17-year mine-life according to a 2014 feasibility study, however due to a US$1.87 billion development price tag, New Gold opted at the time to advance its lower cost Rainy River project instead.

Artemis spun out of Atlantic Gold as part of Atlantic's acquisition by St Barbara last year.

Canada's Pretium Resources has filed a prospectus to raise up to US$600 million as it seeks to bolster its balance sheet following a difficult start-up of the Brucejack gold mine in British Columbia.

Over the past 12 months the company has been battered by bad news including a guidance downgrade in October 2019, which shaved C$600 million off its market capitalisation, a grade haircut in March which snipped 2.2 million ounces from reserves, a new mining plan, and a new CEO, Jacques Perron.

The company reported it had $4.6 million cash at the end of the first quarter and it subsequently drew down $16 million from the revolving portion of its loan facility to improve liquidity. Pretium has run a working capital deficit for at least the past nine quarters and had current debt of $121.6 million at the end of the first quarter and negative working capital of $43.3 million. The company also carries long-term debt of $382.8 million.

The updated life-of-mine plan is focused on the exploitation of the Valley of the Kings and West Zone to deliver average annual production of more than 366,000oz during the first five years, and average annual production of over 357,000oz over the first 10 years, far below the initial aim of more than 400,000ozpa production.

The number of mineworkers who have tested positive for COVID-19 in South Africa passed 1000 last week and is now at 1229.

There have been three deaths, according to the latest figures from the Minerals Council South Africa overnight.

It said almost 262,000 miners had been screened, 12,835 had been tested, there were 622 active cases and 458 recovered.

The council said there were 622 results pending.