Global Wrap: COVID-19, Rio, Barrick and more

IN Global Wrap: a look at how the coronavirus outbreak is impacting London and Toronto-listed miners.
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Vale has flagged an impact on sales of about 800,000 tonnes of iron ore this quarter if it has to shut its Malaysian distribution centre until March 31 to comply with government restrictions to tackle coronavirus.

"Vale is communicating with the authorities to clarify supposed restrictions imposed by the local government on transportation between cities, what could limit the access of workers to TRMT," it said.

In the event of a closure, Vale said vessels headed to Malaysia would be redirected and redistributed among its blending facilities in China with no expected impact on full-year production and sales volumes.

"An immaterial cost increase is expected due to additional logistics," it said.

Vale last month maintained 2020 iron ore fines production guidance of 340-355 million tonnes, but cut March quarter guidance by 5Mt to 63-68Mt on account of bad weather. 

The Malaysian terminal handled 23.7Mt of iron ore shipped in 2019.

The Brazil-based miner also said it would suspend its Voisey's Bay nickel operation in Canada for four weeks due to its remoteness, and had sent the majority of its corporate office staff to work from home, among precautionary measures in the face of the coronavirus pandemic.

Meanwhile, the Peruvian government announced a 15-day mandatory social isolation order, impacting the country's mining operations.

Newmont said it would be required to ramp down mining operations at Yanacocha, while gold production from leach pads and managing critical safety and environmental activities would continue.

Yanacocha only accounts for 3% of 2020 guidance, but the company said it was too soon to determine the impact.

"While we have no confirmed COVID-19 cases among Newmont's workforce or any major disruptions to production at our other sites at this time, we are proactively taking steps to protect our people and the continuity of our business during this global pandemic," Newmont president and CEO Tom Palmer said.

Anglo American has significantly slowed construction of its Quellaveco copper project in Peru, and withdrawn workers and contractors.

"We are in the process of safely demobilising most of the 10,000 strong construction workforce at our Quellaveco copper project, in support of the government of Peru's measures to control the spread of COVID-19," CEO Mark Cutifani said.

"Our development of this world-class project has progressed ahead of schedule and within our budget and we would expect to be able to accommodate this slowdown within our market guidance on both timing and costs at this stage."

The Quellaveco copper project is expected to begin production in 2022, with an expected capital cost of US$5-5.3 billion.

Freeport-McMoRan has also put its 53.5%-owned Cerro Verde copper mine in Peru on care and maintenance for 15 days.

Teck Resources has temporarily suspended construction activities at its Quebrada Blanca Phase 2 (QB2) project in Chile, impacting 15,000 workers.

This suspension will be for an initial two-week period, at which point Teck will reassess the status of the project in light of the rapidly evolving COVID-19 situation.

"Considering the significant size and scale of the QB2 project, and the fact that workers on the project commute in large numbers from all over Chile, this is the right decision to protect the health and safety of workers and their families, and to support the Chilean government efforts to halt the spread of COVID-19," president and CEO Don Lindsay said.

Glencore has postponed its May 6 annual general meeting in Zug due to the restrictions around public meetings. The company has to hold an AGM by the end of June.

A Toronto employee of IAMGOLD tested positive for coronavirus, prompting a one-week closure.

An employee at Endeavour Mining's Houndé mine in Burkina Faso tested positive for COVID-19 after returning to work from the UK, while Reuters reported a worker at AngloGold Ashanti's Obuasi mine in Ghana also tested positive.

In news not related to COVID-19, Rio Tinto has temporarily halted its large Kennecott copper mine in Utah due to a 5.7 magnitude earthquake.

The company said all employees were safe and damage was limited, but operations would remain suspended while an inactive tailings storage facility was inspected.

Finally, Barrick Gold is eyeing the potential for its Veladero joint venture gold mine in Argentina to become a "tier one" asset as it extended its mine life to at least 10 years following a comprehensive review.

The company also said it was investigating the potential in the "Veladero-Lama district" to add to Veladero's mine life.

Its nearby Pascua Lama project, which straddles the Chile-Argentine border, remains under review and does not currently meet Barrick's internal filters for a tier one or tier two asset.