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Glencore coal production bounces back after Oaky North industrial action

Glencore's annual coal production of 129.4 million tonnes for 2018 was 8.8Mt or 7% higher than in 2017, reflecting the recovery in Australia from weather-related and industrial action disruption and the acquisitions of interests in Hunter Valley Operations in New South Wales and Hail Creek in Queensland. Glencore coal production bounces back after Oaky North industrial action
Glencore's Newlands mine in Queensland. The good Australian result was partially offset by lower production at Glencore's Prodeco mine in Colombia as equipment there was reallocated to additional overburden removal and mine development activities. Australian coking coal production of 7.5Mt was 23% higher than in 2017, with the company recovering production level following industrial action at its flagship Oaky North mine in Queensland.

During the year the company also sold its Tahmoor longwall coal mine in NSW. Turning to Australian thermal and semi-soft production, the company reported annual production of 72.7Mt, which was up 20% up on 2017.

This higher result reflects the production constraints experienced in 2017, which included both both weather-related events and industrial action, and the incremental tonnes from Glencore's acquired interest in the HVO joint venture.

Glencore's coal production guidance for 2019 is an increase of about 145Mt, which includes a full year's contribution from HVO and Hail Creek, and some planned ramp up and business improvement initiatives at existing operations.

Source : Mining Monthly
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SEMAD cancels Vale licenses at two mines

Vale informed that the State Secretary for Environment and Sustainable Development canceled the Provisional Operational Authorization of the Laranjeiras dam as a consequence of the public civil action nº 5013909-51.2019.8.13.0024, filed by the Public Prosecution Office of the State of Minas Gerais. Vale also informs that SEMAD also determined the immediate suspension of the Jangada mine due to the understanding the Operational License of this mine is unified with the Operational License of the Córrego de Feijão mine, despite the fact that these mines have distinct authorization acts. The Jangada mine has not been operating since the halting of the Córrego de Feijão mine.

As per the Press Release reported on February 4th, 2019, Vale informed the stoppage of disposal of tailings in several dams, among which the Laranjeiras dam used by the Brucutu mine operation.

Vale had requested the Operational License for the Laranjeiras dam on August 11th, 2015 and SEMAD granted the Provisional Operational Authorization on April 1st, 2016, while it evaluated the issuance of the LO. The Laranjeiras Dam was built using the conventional method and has reports of stability in force. Therefore, Vale reinforces its understanding that there is no technical and/or legal basis, nor risk assessment to justify the cancelling of the Provisional Operational Authorization.

The resumption of the Brucutu operation is conditioned to the reversal of the preliminary ruling of the above-mentioned ACP and the granting of the Operational License to the Laranjeiras dam. The cancellation of the APO has an estimated impact of approximately 30 million tons of iron ore per year, as previously informed in the above-mentioned PR.

Source : The Canadian Press
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Mijnbouwgigant pleit voor toezicht op dammen

Gepubliceerd op 19 feb 2019 om 08:12 | Views: 1.863

ArcelorMittal 16:03
19,87 -0,17 (-0,82%)

SYDNEY (AFN/BLOOMBERG) - De Australische mijnbouwgigant BHP Billiton pleit voor een onafhankelijk en internationaal orgaan dat toeziet op de veiligheid van dammen. Topman Andrew Mackenzie wil onder meer samenwerken met branchegenoten om beter om te gaan met mijnafval.

's Werelds grootste mijnbouwer is nog steeds bezig met de verscherping van zijn interne controles na een grote ramp bij een van zijn mijnen in Brazilië. In 2015 brak de Samarco-dam waardoor negentien mensen omkwamen en ernstige milieuschade werd aangericht.

BHP Billiton is niet de enige mijnbouwer die kampt met damrampen. In januari bezweek een dam bij een ijzerertsmijn van de Braziliaanse mijnbouwer Vale. Een enorme stroom modder en afval bedolf delen van het terrein en naburige wooncomplexen in de staat Minas Gerais, met honderden slachtoffers tot gevolg. Ook het in Amsterdam genoteerde ArcelorMittal evacueerde onlangs omwonenden nabij een dam in Brazilië.

BHP zette in de zes maanden tot en met december een winst in de boeken van 3,8 miljard dollar. Dat was een jaar eerder nog zo'n 2 miljard dollar. Die winst viel toen lager uit door kosten die moesten worden gemaakt in de nasleep van de Samarco-ramp. De omzet van het mijnbouwbedrijf bleef ongeveer gelijk op zo'n 22 miljard dollar.
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BHP welcome South Australian Government major development declaration for Olympic Dam

BHP has welcomed the South Australian Government’s decision to declare Olympic Dam’s growth plans a major development as an important step towards lifting its Australian copper production. The declaration is the first step in a comprehensive State and Federal process that includes assessment of potential social, economic and environmental impacts associated with an increase in mining and production at Olympic Dam from 200 kilotonnes per annum to up to 350ktpa.

Laura Tyler, Asset President Olympic Dam, said: ‘BHP is aiming to achieve stable operations and sustainable growth at Olympic Dam through a staged and capital-efficient approach over the long term. Olympic Dam is a world-class resource with the potential to deliver value to BHP and South Australia for many decades to come, especially given our positive outlook for global copper demand. We are pleased the South Australian Government has declared Olympic Dam’s growth plans a major development, recognising our significance to the State. Our team continues to refine the scope for targeted underground development in the Southern Mine Area, strategic investment surface processing facilities, new technology and supporting infrastructure.’

BHP continues to progress growth studies for Olympic Dam as it works towards seeking Board approval for a capital project in mid-to-late 2020.

Source : Strategic Research Institute
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Vale informs about the Public Prosecutors of Minas Gerais operation

Vale SA informed that, on this date,the Public Prosecutors of the State of Minas Gerais triggered an operation with the goal to fulfill new warrants served for search and seizure and temporary arrests related to the dam breach of the Dam I of the Córrego de Feijão mine. Vale informs that it is fully cooperating with the authorities. Vale will continue to support the investigations in order to determine the facts, in addition to the unconditional support to the families.

Eight employees of Brazilian mining giant Vale were arrested on Friday as part of an ongoing criminal investigation into the deadly dam disaster in the town of Brumadinho, which killed at least 166 people with over a hundred still missing.

Four people from the German consulting group Tüv Süd, the company that certified the safety of Vale’s dams, were also detained. All of the Vale employees arrested, including two executives, were responsible for the security and stability of the Brumadinho dam and will remain in prison for 30 days, GloboNews TV channel reported. Those arrested were responsible for the security and stability of the Brumadinho dam and will remain in prison for 30 days.

This follows the arrest of five people last month, including three employees and two other engineers working on behalf of the company, deepening a crisis for the company after another deadly disaster at one of its mines.

Source : Strategic Research Institute
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Fire shuts down Vale’s distribution center in Malaysia

Iron ore mining giant Vale issued a statement that there was a fire in one of the transfer houses of the belt conveyor system at its distribution center in Malaysia. The fire reportedly caused material damage only and the company expects operations to resume in 10 to 15 days. Vale expects reduced impact on its shipments, since a 10-day preventive maintenance was already scheduled at the terminal during the same period.

Wood Mackenzie senior research analyst Mr Alex Griffiths weighed in on what the Malaysian distribution center shutdown means for the market. The announcement came on the same day that eight Vale employees were arrested in Brazil as part of the ongoing investigation into the deadly dam collapse that left 166 people dead and over a hundred still missing. "A 10 to 15 day unexpected shut-down translates to a 0.6 Mt to 1.0 Mt reduction in exports. But we do not think average export volumes will suffer,” Griffiths said in an email.

Vale ships on average around one vessel every two days from Malaysia but the distribution centre is capable of discharging one vessel daily.

Mr Griffiths said that “The center should be in a position to increase March shipments to make up for this loss. The capacity of the import berth (10,500 tonnes per hour) exceeds that of the export berth and so stocks can rise during normal operations. As Vale indicated a 10-day shutdown was coincidentally planned for this period the most likely outcome is that the company can make up any lost tonnages in March.”

He said that should the outage exceed the 10 to 15 day estimate, then Vale will have to make up around 0.06 Mt per day in lost shipments.

He added that "The majority of material from the Malaysian distribution center is Brazilian Blend fines destined for China. A significant delay in restarting operations would add to pressure on this segment of the market – already likely to suffer in response to reduced supply following the tragic dam disaster on January 25th.”

Source : Strategic Research Institute
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Winstval voor Glencore

Gepubliceerd op 20 feb 2019 om 08:46 | Views: 1.168

Glencore 11:13
304,45 +1,70 (+0,56%)

LONDEN (AFN/RTR) - Grondstoffenhandelaar en mijnbouwer Glencore heeft de winst afgelopen jaar zien kelderen. Dat kwam door afschrijvingen op twee mijnen in Congo en Zambia, zo kwam woensdag naar voren uit een handelsbericht.

Het Brits-Zwitsers concern zette een winst in de boeken van 3,4 miljard dollar, tegen bijna 5,8 miljard dollar een jaar eerder. De opbrengsten dikten met bijna 7 procent aan tot 219,8 miljard dollar. Glencore lanceert een nieuw aandeleninkoopprogramma van 2 miljard dollar, dat loopt tot eind 2019. Mogelijk wordt het programma nog opgevoerd als de marktomstandigheden dat toelaten, aldus de onderneming.
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Vale ratifies settlement proposal for the people affected in Brumadinho

Vale reiterated its commitment to reach an amicable solution in the meetings with the Attorney's Office of the State of Minas Gerais, the Public Prosecution Office of the State of Minas Gerais, the Public Defender's Office of the State of Minas Gerais, the Federal Attorney's Office, the Federal Public Prosecution Office, the Federal Public Defender's Office, and the people affected by the breach of Dam I at Córrego do Feijão mine in Brumadinho, ultimately seeking to expedite the emergency response to the accident.

In another meeting held this afternoon, February 18, Vale confirmed the Preliminary Adjustment Agreement (TAP) proposal which, among other measures, will provide the following:

- One-off payment to those who resided or carried out rural or commercial activities in the Self-Rescue Zone (ZAS) of the dam, as well as in the Córrego do Feijão and Parque da Cachoeira communities. This payment includes the cumulative R$5,000.00 sums per household, to be paid in a lump sum; R$12,000.00 per adult, paid in 12 monthly installments; R$3,600.00 per dependent residing at the same address, also paid in 12 monthly installments; plus a basket of staples from the Inter-Union Department of Statistics and Socioeconomic Studies (DIEESE) per family, every month, for 12 months; all without prejudice to future compensation or indemnities, to be evaluated individually.

- Reimbursement or direct payment of the extraordinary expenses incurred by the State of Minas Gerais - by both directly involved and indirect administrative agencies -, including payment of expenses related to transport, accommodation and meals supplied to the civil servants involved in the rescue work and other emergency actions.

- Ratification of the various obligations already undertaken by Vale before public authorities and the affected communities, such as provision of housing, social and psychological assistance; supply of water for human and animal consumption and agricultural activities; rescue and protection of animals; among other commitments.

- Continuing the ongoing emergency measures for mitigating and repairing the environmental damage resulting from the breach, including containment and subsequent handling of waste, surveillance of the remaining structures of the Córrego do Feijão mine, and ongoing monitoring of the quality of water.

The proposal reinforces Vale's commitment to repair the damages caused by the Dam I breach. The company will continue all efforts to ensure that this repair occurs quickly, with isonomy and adequately.

Source : Strategic Research Institute
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BHP update on tailings facilities

BHP has significantly increased the rigour of its assessment and management of tailings storage facilities since the failure of the Fundão dam at Samarco in 2015.

Following that event, BHP completed Dam Risk Reviews for active, inactive and closed tailings storage facilities across our business. These reviews included a thorough evaluation of risks, and identified no significant deficiencies to the stability or management of our tailings storage facilities. The risk reviews also highlighted new opportunities to improve the design, construction and operation of our facilities. In total, more than 400 actions were assigned to BHP Assets. These actions are 93 per cent complete, with the remaining actions considered low priority such as administrative actions and long-lead items regarding closure and climate change impacts. None of these actions is overdue.

Dam Safety Reviews were then completed following the guidelines recommended by the Canadian Dam Association (CDA) – widely regarded as the most rigorous in the industry.

Monitoring and alarm systems at all sites were reviewed, and supplemented where new opportunities to improve were identified. All significant tailings storage facilities have emergency response plans in place.

As part of our ongoing process of continuous improvement, external Dam Safety Inspections are conducted annually and risk-based Dam Safety Reviews every three to seven years, in line with CDA guidelines.

BHP’s tailings storage facilities are located at seven operated sites in Australia and Chile, with a further seven closed sites throughout North America, and four non-operated joint ventures in North America and South America.

We have a number of facility designs within our portfolio, and we have an assurance process in place that seeks to identify and manage the risks associated with each.

In total, there are 115 tailings storage facilities across these sites (including non-operated joint ventures) of which 20 are active. In total, 47 of these storage facilities have been constructed using the upstream method, of which 13 are active.

Those 13 operational upstream tailings storage facilities are located at the following operated sites: one at Mt Whaleback (Western Australia), two at Olympic Dam (South Australia), two at Goonyella and one at Blackwater (Queensland), and seven at Nickel West (Western Australia).

We have 26 upstream facilities at our closed sites in North America, and a further eight inactive upstream facilities at our operated sites.

The number of tailings storage facilities is calculated based on the definition used by the Responsible Dam Engineers at our sites. We keep this definition under review.

BHP will continue to accelerate its work with the industry to advance the science and technology required to improve the safety of tailings storage facilities. This includes existing workstreams such as early warning technologies, better models and monitoring of possible modes of failure, tailings dewatering options, and dry tailings storage viability at scale.

BHP will meet with a number of global bodies this month to expedite this work. BHP welcomes a common, international and independent body to oversee integrity of construction and operation of all tailings storage facilities across the industry.

In addition, BHP supports calls for greater transparency in tailings management disclosure and will work with the industry to make sure the disclosure is consistently applied and informs better tailings dam stewardship.

Source : Strategic Research Institute
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Monadelphous secure major construction contract at BHP’S South Flank Project

Engineering company Monadelphous Group Limited announced it had been awarded a major construction contract at BHP's South Flank Project in the Pilbara region of Western Australia. The contract, which is valued at USD 108 million, includes structural, mechanical, piping and electrical and instrumentation works associated with the project's outflow infrastructure. Work will commence immediately, and is expected to be completed by May 2021.

Monadelphous Managing Director, Mr Rob Velletri, said the contract award demonstrated the strength of the Company's long-term relationship with BHP, as well as its proven track record of reliably and safely delivering large, multidisciplinary construction projects. BHP has been one of our core customers, for both construction and maintenance projects, for more than 20 years. We are looking forward to partnering with them on this strategically important project, and continuing to build on our proven construction capability within the iron ore sector in the Pilbara,1. Monadelphous continues to provide a broad range of community support initiatives throughout the Pilbara, including offering local employment and supply opportunities'.

Source : Strategic Research Institute
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BHP announces results for H1

BHP Chief Executive Officer, Andrew Mackenzie, said “The collapse of the Brumadinho dam in Brazil is a tragedy and we offer our heartfelt sympathy to all those affected. At BHP, we are committed to learn from what happened, and as an industry we must redouble our efforts to make sure events like this cannot happen. Our focus on portfolio simplification, cash generation and capital discipline delivered higher cash returns to shareholders in the December 2018 half year. Our strong balance sheet and fully funded capital investment plans allowed us to return the US$10.4 billion net Onshore US proceeds to shareholders in the form of a US$5.2 billion off-market share buy-back completed in December 2018 and a US$5.2 billion special dividend paid in January 2019. The Board has also today determined to pay an interim dividend of 55 cents per share, which equates to a payout ratio of 75 per cent. Since the beginning of 2016, we have reduced debt by US$16 billion, reinvested US$20 billion in the business and returned more than US$25 billion to shareholders. A strong second half is expected to partially offset the impacts from operational outages in the first half, with unit costs across our business forecast to improve. We have a portfolio of attractive development opportunities and have recently approved the West Barracouta and Atlantis Phase 3 projects in petroleum and had early success in our oil and copper exploration programs. We are confident in our plans to increase shareholder value and returns.”

Highlights

Tragically we had a fatality at Saraji in December 2018, despite improvements in our safety performance indicators.

Maximise cash flow: Solid free cash flow generation and margin above 50%

Attributable profit of US$3.8 billion and Underlying attributable profit of USD 3.7 billion down 8% from the prior period.

. Underlying EBITDA of US$10.5 billion at a margin(i) of 52% from continuing operations.

Net operating cash flow of US$6.7 billion and free cash flow of US$3.6 billion from continuing operations with volumes and commodity prices broadly in line with the prior period.

Productivity(i) guidance is now expected to be broadly flat for the 2019 financial year largely reflecting the unplanned production outages at Olympic Dam, Western Australia Iron Ore, Spence and Nickel West.

Capital discipline: Net debt reduced to US$9.9 billion and to remain at the lower end of the target range

Capital and exploration expenditure(i) of US$3.5 billion. Guidance unchanged at below US$8 billion per annum for the 2019 and 2020 financial years. This includes investments in the high returning West Barracouta (Bass Strait) and Atlantis Phase 3 (US Gulf of Mexico) projects approved in December 2018 and February 2019, respectively.

Source : Strategic Research Institute
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Glencore to take 200,000 tonnes of aluminium from ISTIM Port Klang warehouses

First Post quoted Malaysia, five sources familiar with the matter as saying that mining giant Glencore has bought 200,000 tonnes of aluminium on the London Metal Exchange and will take delivery of the metal from warehouses owned by ISTIM UK in Port Klang.

Glencore wants the aluminium for delivery to clients but sources said the move was also a direct challenge to ISTIM, which is preventing companies from taking LME warranted metal when needed from its warehouses in Port Klang.

Cancelled aluminium - material earmarked for delivery - in ISTIM's Port Klang warehouses stood at 309,800 tonnes at the end of January, up from 30,000 tonnes at the end of December.

Commodity trader Glencore is a major player in the aluminium market outside China, though it doesn't produce any itself.

Sources said Glencore bought more than 1 million tonnes from Russia's Rusal last year and takes the bulk of production from Century Aluminium, in which Glencore has a more than 40 percent stake. Century's output in 2017 was more than 740,000 tonnes.

Glencore's agreements to buy aluminium from smelters around the world would take its total to about 3 million tonnes, sources say. That is about 10 percent of supply outside China, which accounts for 56 percent of the total at 65 million tonnes.

One aluminium industry source said that "They've (Glencore) cancelled 200,000 tonnes in Port Klang. It's moving out slowly and unlikely to go back into the LME system adding that the impact of Glencore's purchase could be seen in higher physical premiums.”

Source : First Post
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Fatale ongelukken smet op resultaten Anglo

Gepubliceerd op 21 feb 2019 om 09:44 | Views: 667

LONDEN (AFN/RTR) - Mijnbouwgigant Anglo American heeft vorig jaar een hogere winst geboekt dan een jaar eerder. Het concern voerde naar eigen zeggen de productiviteit op en profiteerde van hogere prijzen voor veel grondstoffen. De resultaten werden evenwel overschaduwd door een dodelijk ongeluk dat recent bij een kolenmijn in Australië plaatshad.

Vorig jaar betreurde Anglo American vijf fatale ongelukken bij zijn mijnen. ,,Geen enkele mate van financieel succes is een mensenleven waard'', aldus topman Mark Cutifani. ,,Het is onze meest urgente opdracht om nul schade te bereiken en vol te houden.'' De werkzaamheden bij de Australische mijn zijn stilgelegd na het fatale ongeluk.

Anglo American sloot 2018 af met een omzet van 27,6 miljard dollar, een stijging van 5 procent ten opzichte van het voorgaande jaar. De totale productie van ertsen en andere grondstoffen steeg met 6 procent, met uitzondering van problemen bij een ijzerertsmijn in Brazilië. Door lekkages in een pijpleiding lag het werk daar maanden stil, wat volgens Anglo American een hap van 600 miljoen dollar uit het bedrijfsresultaat (ebitda). De nettowinst steeg met 12 procent tot 3,5 miljard dollar.
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Barrick Gold doet vijandig bod op Newmont

Gepubliceerd op 25 feb 2019 om 13:17 | Views: 1.326

TORONTO (AFN/BLOOMBERG) - Het Canadese Barrick Gold, 's werelds grootste goudproducent, heeft een vijandig overnamebod uitgebracht op de Amerikaanse branchegenoot Newmont Mining.

Het bod heeft een waarde van bijna 18 miljard dollar en bestaat geheel uit aandelen. De aandeelhouders van Barrick krijgen dan bijna 56 procent van het fusiebedrijf en de aandeelhouders van Newmont de rest. Volgens Barrick kan de combinatie leiden tot meer dan 7 miljard dollar aan financiële voordelen, waaronder door het samenvoegen van activiteiten in Nevada.

In januari werd nog bekend dat Newmont en het Canadese Goldcorp willen fuseren in een deal ter waarde van 10 miljard dollar om zo beter de concurrentie met Barrick aan te gaan. Als de overname van Newmont door Barrick slaagt dan wordt deze deal waarschijnlijk afgeblazen.

Vorig jaar nam Barrick nog zijn kleinere rivaal Randgold over in een miljardendeal. In het verleden was er vaker toenadering tussen Barrick en Newmont, maar deze onderhandelingen leidden tot niets. In 2014 werd voor het laatst gesproken tussen de bedrijven over een fusie.
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Rio Tinto keert speciaal dividend uit na winstsprong

(ABM FN) Rio Tinto is van plan een speciaal dividend ter waarde van 4 miljard dollar uit te keren, nadat de winst afgelopen jaar met 56 procent steeg. Dit maakte de Brits-Australische mijnbouwgroep woensdag bekend.

In het afgelopen jaar realiseerde Rio Tinto een nettowinst van 13,6 miljard dollar tegenover een winst van 8,8 miljard dollar een jaar eerder. De forse stijging van de winst hing samen met de verkoop van een belang van 3,5 miljard dollar in de Grasberg-kopermijnen van Freeport-McMoRan in Indonesië.

Rio Tinto wil de opbrengsten uit de verkoop gebruiken voor de uitkering van een speciaal dividend van 2,43 dollar per aandeel. Het bedrijf kondigde een slotdividend aan van 1,80 dollar per aandeel, waardoor het totaaldividend over 2018 uitkomt op 3,07 dollar per aandeel. In 2017 was het dividend nog 2,90 dollar per aandeel.

De winst voor eenmalige posten steeg met 2 procent tot 8,8 miljard dollar, geholpen door stabiele grondstofprijzen. Daarmee presteerde de mijnbouwgroep beter dan de 8,5 miljard dollar die door analisten geraadpleegd door The Wall Street Journal werd voorzien.

Eind december had Rio Tinto een kaspositie van 255 miljoen dollar, ondanks dat de vrije kasstroom met 27 procent daalde. Een jaar eerder was er nog sprake van een schuld van krap 3,9 miljard dollar.

Door: ABM Financial News.
pers@abmfn.be
Redactie: +32(0)78 486 481

© Copyright ABM Financial News B.V. All rights reserved.
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Moody's downgrades Vale to Ba1; negative outlook

Moody's America Latina Ltda downgraded to Ba1 from Baa3 (on the global scale) the senior unsecured notes (Debentures de Infraestrutura) issued by Vale SA and confirmed the Aaa.br national scale rating. At the same time, Moody's has withdrawn Vale's Baa3/Aaa.br issuer rating and assigned a Ba1/Aaa.br corporate family rating to Vale. The outlook for all ratings changed to negative from rating under review for downgrade. These rating actions conclude the review for possible downgrade for Vale's ratings initiated on 29 January 2019 in response to the collapse of the tailings dam at the C'rrego do Fei'o mine in the city of Brumadinho, state of Minas Gerais.

Vale's downgrade to Ba1 reflects heightened credit risk after its January 25 tailings dam collapse at Brumadinho and the considerable uncertainties associated with the full impact and long-term implications of this labor and environmental disaster for Vale's overall credit profile, as well as the significant overhang of litigation exposure and financial liability that is likely to persist in the years to come. While Vale's robust financial position provides a good cushion against the potential financial impacts, the accident raises concerns from a social, environmental and corporate governance perspective, in particular considering that it occurred a little over three years after Samarco's tailings dam collapse.

Following the accident, Vale has articulated a comprehensive response effort to provide humanitarian assistance and emergency financial aid to those affected, as well as to reinforce the monitoring and inspection of dams. However, it remains uncertain at this stage the full extent of costs, claims and the overall business impact of this accident on Vale's reputation, operations and financial results.

Even though the decommissioning of upstream tailings dams and the suspension of the Laranjeiras dam operating license will lead to temporary interruption of iron ore production of about 70 million tons per year, Vale has operating flexibility that allows the company to partially offset such loss with additional production in other areas.

Vale's Ba1 ratings continue to be supported by the company's diversified product base and low cost position, and substantive portfolio of long lived assets of iron ore, nickel, copper and coal. The enhanced production profile with S11D and significant reduction in debt levels are also important factors for the Ba1 ratings, which better position Vale to withstand volatility in the prices for its major products and now provides some cushion to the costs associated with the accident.

Vale remains exposed to iron ore and base metals market fundamentals. More robust economic growth rates in 2017 and earlier in 2018 contributed to greater base metal and iron ore consumption and a price rally, but there could be a moderate correction in iron ore prices in the medium term, supported by slower global economic growth, in particular in China, and lower price premiums. Besides, Samarco continues to represent a contingent liability, while the potential costs associated with Brumadinho's accident will remain a constraint for the ratings in the foreseeing horizon.

The negative outlook incorporates the uncertainties around the amount and timing of future cash outlays related to the accident. Moreover, it also reflects the risks of ongoing investigations about the cause of the accident and responsibilities.

Source : Strategic Research Institute
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Rio Tinto announces record returns to shareholders

Rio Tinto chief executive J-S Jacques said that “We have once again announced record cash returns to shareholders of $13.5 billion on the back of $18 billion of underlying EBITDA and a Return on Capital Employed of 19%. These strong results reflect the efforts of the team to implement our value-over-volume strategy as we continued to strengthen the portfolio and invest in future growth. “Our world-class portfolio and strong balance sheet will serve us well in all market conditions, and underpin our ability to continue to invest in our business and deliver superior returns to shareholders in the short, medium and long term.”

Annual results 2018 highlights
Sadly, we had three fatalities in 2018, two workplace related, one security incident. All Injury Frequency Rate (AIFR) of 0.44 (2017: 0.42).

$6.3 billion of cash returns from operations, comprising the $1.0 billion share buy-back announced in August 2018, and record $5.3 billion full year ordinary dividend (equivalent to 307 US cents per share) – 72% of underlying earnings3, including final dividend of $3.1 billion (equivalent to 180 US cents per share), announced today.

$7.2 billion of supplementary cash returns from divestments, comprising a special dividend of $4.0 billion announced today, equivalent to 243 US cents per share, and $3.2 billion of share buy-backs, $1.1 billion of which remains outstanding in Rio Tinto plc shares, to be completed no later than 28 February 2020. This brings total cash returns declared in respect of 2018 to $13.5 billion.

Robust underlying EBITDA of $18.1 billion was just 2% below 2017, despite divestments and input cost pressures in aluminium and alumina. $0.4 billion exit rate from our mine-to-market productivity programme6 was impacted by $0.3 billion higher costs from raw materials.

$11.8 billion operating cash flow, 15% below 2017, driven primarily by the timing of tax payments related to 2017 earnings and higher inventory balances as a result of the increased price of raw materials.

$7.0 billion free cash flow, with lower operating cash flow as described above and increasing investment in capital projects in line with guidance. $5.4 billion of capital expenditure with $2.9 billion invested in high value development projects including AutoHaul™ automated trains, Amrun bauxite and Oyu Tolgoi underground copper/gold mine. Koodaideri and Robe River replacement iron ore mines approved.

$8.8 billion underlying earnings, 2% higher due to a strong contribution from Copper & Diamonds, offsetting lower underlying earnings in other product groups.
$13.6 billion net earnings driven primarily by gains on disposals and foreign exchange movements.

19% Return on Capital Employed (ROCE)7, a rise of one percentage point, as we continue our strategic reshaping of the portfolio.
Strong balance sheet as net debt5 fell by $4.1 billion to a net cash5 position of $0.3 billion, including cash and highly liquid investments of $13.3 billion. Cash flows were bolstered by $8.6 billion of pre-tax divestment proceeds, including our remaining Australian coal assets and Grasberg.

Source : Strategic Research Institute
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Rio Tinto launches climate change report

Rio Tinto published our approach to climate change, which shows how the company plans to contribute to and leverage the transition to a low carbon future. The report uses recommendations from the Task Force on Climate-related Financial Disclosures (TCFD) as a framework to assess the potential risks and opportunities of climate change and related policies. Rio Tinto chief executive officer J-S Jacques said, “Given our decision to strengthen our business and exit coal, we are now the only major mining company with a fossil-fuel-free portfolio, which means we are well-positioned to contribute to a low-carbon future. The materials we produce, from infinitely recyclable aluminium to copper used in electrification to our higher grade iron ore product, all play a part in the transition to a low-carbon economy. At Rio Tinto, we have reduced our emissions-intensity footprint by almost 30 per cent since 2008, putting us on track to beat our targets. Renewable energy is now used to produce nearly three-quarters of the electricity we use. We are aware that we have more to consider on climate change and will work with partners such as the members of the Energy Transitions Commission, Alcoa and Apple, the World Bank and others, to look at further sustainable solutions that enable us to continue to generate profits and contribute to people, the planet and prosperity.”

Rio Tinto has publicly acknowledged the reality of climate change since 2005, signed the Paris Pledge in support of the ambition and commitments set out in the Paris Agreement in 2015 and contributes to the United Nations Sustainable Development Goals.

Mr Andrew Gray, Director ESG & Stewardship, AustralianSuper and Member, Climate Action 100+, said “Last year Rio Tinto supported the recommendations of the TCFD and we welcome their first report under this structure. 2018 saw the company undertake technological breakthroughs in materials that have a key role in the low carbon transition. We are also encouraged that Rio Tinto has joined the Energy Transitions Commission which takes a multi-sector approach to hard-to-abate sectors like steel.”

Kr James Bevan, CIO at charity specialist CCLA, said “2018 saw the completion of Rio Tinto’s strategic exit from coal. Over time the company will face other complex portfolio and operational choices, so it is useful to see initial quantification of the impact of the low carbon transition on different commodities. We look forward to reviewing Rio Tinto’s new targets and metrics for the 2020s: a critical part of the TCFD recommendations and investors’ collective Climate Action 100+ request for Paris alignment.”

Climate risks and opportunities have formed part of Rio Tinto’s strategic thinking for over two decades. The company has outlined it will take action in four key areas:
1. Supply essential metals and minerals for the transition to a low-carbon economy
2. Reduce emissions from its own footprint
3. Identify and assess physical risk exposures
4. Partner to advance climate goals

Source : Strategic Research Institute
voda
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BHP announces executive leadership team

BHP Chief Executive Officer, Andrew Mackenzie, has announced changes to the BHP Executive Leadership Team to reflect BHP’s simplified portfolio and transformation agenda. Joining the Executive Leadership Team are Ms Geraldine Slattery, President Operations Petroleum; Ms Vandita Pant, Chief Commercial Officer; Mr Jonathan Price, Chief Transformation Officer & Ms Laura Tyler, Chief Geoscientist. They join Mr Peter Beaven, Mr Geoff Healy, Mr Mike Henry, Ms Diane Jurgens, Mr Danny Malchuk and Ms Athalie Williams on the Executive Leadership Team.

Ms Geraldine Slattery will lead BHP’s Petroleum business which includes oil and gas interests and development and exploration programs in the US, Australia, Mexico and Canada, effective 18 March 2019. Geraldine has 25 years’ of experience with BHP, most recently as Asset President Conventional and has led a number of teams across the Petroleum business. She brings a strong combination of in-field technical experience and global leadership experience gained in the UK, Australia and the US.

Ms Vandita Pant will assume the position of Chief Commercial Officer from 1 July 2019. Vandita brings strong global financial market and business development experience to the role. As Group Treasurer and Head of Europe, she has played a critical role in the execution of BHP’s capital allocation framework, strengthened BHP’s balance sheet and led the successful capital management program to return to shareholders the US$10.4 billion of net proceeds from the sale of BHP’s US Onshore assets. Prior to BHP, Vandita held roles within ABN Amro and Royal Bank of Scotland and has lived and worked in Singapore, India and Japan.

Mr Jonathan Price, currently Transformation Director, will assume the role of Chief Transformation Officer effective 1 March 2019 and join the Executive Leadership Team. Jonathan has held senior roles within BHP in Nickel, Marketing, Iron Ore and Finance where he has worked with governments, joint venture partners, customers, industry peers, investors and advisors. He will bring this global business experience and a track record of delivery and change management to this new role.

Ms Laura Tyler will continue in her current role as Asset President Olympic Dam based in Adelaide reporting to Mike Henry. In addition to her direct responsibility for Olympic Dam, Laura will re-join the Executive Leadership Team from 1 March 2019 as Chief Geoscientist and bring a focus on geoscience and resource engineering risk management. She will lead technical experts to meet current and future requirements, given the importance of exploration and strategic resource management to BHP’s transformation agenda.

Mr Arnoud Balhuizen will return to the Netherlands after 25 years with Billiton and BHP. During Mr Arnoud’s time as Chief Commercial Officer, he led the successful integration of BHP’s Marketing and Supply groups into one global commercial team. Through his leadership and vision, BHP’s commercial function has developed strong global partnerships and created significant value.

Following the successful completion of the sale of BHP’s US Onshore assets, Mr Steve Pastor, has decided to leave BHP. Steve’s leadership and oil and gas industry expertise, as President Operations Petroleum, has delivered a world class, strategically focused business.

Source : Strategic Research Institute
voda
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Vale clarification on the Vargem Grande, Grupo and Forquilha I, II and III dams

With regards to recommendation No 21/2019 issued by the Public Prosecutor's Office of the State of Minas Gerais and considering the dynamics of the facts taking place on February 20th, 2019, this press release is intended to replace the previous press releases related with the Vargem Grande, Grupo and Forquilha I, II and III tailings dams, as well as the Vargem Grande Complex and the Fábrica Complex, so as to bring consolidated and updated information.

Vale thus narrates the events in their chronological sequence and presents additional clarification to bring transparency forth to the population and the market.

On February 4th, 2019 (and again on February 20th, 2019), Vale disclosed its intention to advance the decommissioning process of all upstream dams, including the above-mentioned Dams. This decision sought to address the ongoing concerns about overall dam safety in the State of Minas Gerais.

On February 18th, 2019, Brazil's National Mining Agency published the new Resolution No 4, opening it up to public consultation. Conducted by Vale's hired technicians, preliminary analyses of the Dams indicated that some of those dam safety parameters could potentially be lower than what the new Resolution recommended.

Once that possibility was confirmed, and in order to reinforce the previous decision to decommission all upstream dams, Vale decided to promote an orderly evacuation of the Dams' Self-Saving Zones and has therefore raised alert to Level 1 in the morning of February 20th, 2019, and in the afternoon of the same day to Level 2 (according to classification used by the ANM's Information System of Mining Dams, SIGBM - Sistema de Informações de Barragens de Mineração).

Later on the same day, February 20th, Vale proceeded to remove the population from those areas. According to provisions in the Emergency Action Plan for Mining Dams, as alert is raised to Level 2, a sound alert system was triggered during the evacuation process, as indicated to the market on that day.

In face of those events, the ANM promoted inspections to the sites, still on February 20th, 2019, and determined the suspension of activities at the entire Vargem Grande Complex and Fábrica mine, to prevent occasional triggers that could affect Dam stability as a result of ongoing activities on the site. This fact was communicated to the market on February 20th, 2019.

Vale points out that the Dams (Vargem Grande, Grupo and Forquilha I, II and III) are still classified as alert Level 2, though their stability reports remain valid as confirmed by independent auditors, in compliance with ANM requirements
More information.

Source : Strategic Research Institute
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