Mozambique Port Accident Deals Blow to Vale Coal Project
A coal stacker has collapsed at the Mozambique port of Nacala, dealing a blow to Brazilian miner Vale's effort to start coal shipments from the African nation in the third quarter, sources told Reuters on Monday. The giant piece of machinery, which is used to handle coal and other bulk materials, buckled last week, according to a mining industry source with knowledge of the situation. "The contractors are investigating and an official report is expected within a couple of weeks…
X2 Turns to Coal for First Deal
X2 Resources, the private equity fund set up by former Xstrata boss Mick Davis, is now in initial bi-lateral talks to buy some of Rio Tinto's Australian coal assets, a source close to the situation said on Tuesday. Davis, whose X2 fund has yet to clinch its first deal, is turning his attention to Australian coal after being outbid in a race to buy a copper mine in Chile. The mining industry veteran is also considering buying some coal mines Anglo American has put up for sale in Australia, sources close to X2 said.
Marex Spectron Reportedly for Sale
Marex Spectron Group Ltd is up for sale, four years after the global energy and metals broker was formed from two different entities, four sources close to the company said. The firm, which is majority-owned by private equity investment firm JRJ Group, emerged in 2011 from the merger of metals dealer Marex Financial and energy broker Spectron Group. Sources said JRJ Group has considered selling Marex Spectron for some time. It has appointed an investment bank to follow the process…
BHP: Deeper Cuts to Battle Low Pricing on Tap
BHP Billiton said on Tuesday it would slash its iron ore production cost further and cut spending to better withstand a downturn in commodity prices that is testing even mining industry heavyweights. Giant iron ore producer BHP, the world's largest mining company, and rival Rio Tinto are locked in a battle to become the lowest cost iron producer. At the same time, they are increasing production of the steel ingredient, hoping to squeeze out competitors and gain market share.
BHP Billiton Shareholders Approve Demerger of South32
BHP Billiton shareholders approved the spin-off of the global miner's smaller assets into South32 on Wednesday, paving the way towards a listing on May 18. More than 98 percent of the votes cast by shareholders in Australia and Britain were in favour of the demerger of South32 from BHP Billiton, the company said. (Reporting by Silvia Antonioli)
Cheap Oil Drives Trading Volumes
Some of the world's biggest oil trading houses say they expect increased volumes this year as a fall in oil prices ties up much less capital for trading than a year ago. Trading oil is expensive and requires big players to have billions of dollars of credit lines with dozens of banks, but a steep drop in oil prices means the value of a mid-sized cargo of crude oil has fallen from $115 million to $60 million and has therefore become cheaper to finance.
Ex-BP Chief Sees Higher Oil on Near Horizon
Low crude prices will trigger consolidation in the oil industry but a new bull market might arrive much sooner than expected given the huge scale of capital and workforce withdrawal in the sector, a former boss of oil major BP said. "The actions the industry is taking to withdraw capital are laying the seeds for the next bull market," Tony Hayward told the FT Commodities Summit. "The peak of U.S. shale supply has arrived - earlier than anticipated ... The supply chain in the U.S. has been decimated ...
BP Calls on EU to Exempt Oil Trading from Capital Regulation
BP called on Tuesday on European regulators to refrain from imposing stricter capital requirement and greater disclosure measures on oil trading, saying they could ultimately hit consumers. The head of BP's trading division, one of the most active and biggest among oil majors, Paul Reed, told the FT Commodities Summit some markets could be exposed to severe stresses if companies and trading houses were forced to disclose too much.
Trafigura Up Oil Trades with Russia
Swiss commodities trader Trafigura said on Tuesday it had increased its exposure to Russia but that new trading activities were fully in line with U.S. and EU sanctions. Reuters reported from trade sources last month that Trafigura had emerged as the leading trader of Russian oil, expanding its deal with Rosneft to export $500 million worth of crude in April. "We have been in Russia historically. We have increased activity of late because, based on commercial business, we have seen a niche and obviously (operate) within the sanctions.
Top Trading Houses Weigh in on Energy
Top executives from the world's largest trading houses discuss trends in commodities trading at the FT Commodities Global Summit in Lausanne, Switzerland, this week. Said Trafigura had recently increased its exposure to Russia but in line with U.S. and EU sanctions. "We have been in Russia historically. We have increased activity of late because based on commercial business we have seen a niche and obviously (operate) within the sanctions. We understand the sanctions and comply with them.
Oil Storage at Sea Stalls as Profit Play Fades
Traders are cutting plans to use tankers to store oil at sea as the price incentive recedes, the global head of oil at mining and commodities group Glencore's said on Tuesday. In January, the price of spot oil was around 50 percent lower than a peak hit in June, enabling traders to potentially make money by storing crude for delivery months down the line, when prices were expected to recover. Tanker industry sources estimated in late January that the volume of oil booked for floating storage had reached up to 50 million barrels.
Glencore 2014 Profit Falls on Commodity Prices
Glencore took an impairment charge of $1.1 billion on lower commodity prices on Tuesday as the miner and commodity trader posted a 2 percent fall in 2014 core profit, meeting analysts' forecasts. Core adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) totalled $12.8 billion, said Glencore, which has a large trading division in addition to mining and oil assets. Earnings from its marketing division rose 15 percent to partially offset a fall in profits from its industrial division.
Rio Tinto Energy Chief Let Go
Mining firms aim for simplification rather than growth; Rio's coal division worth at least $3.6 billion-Jefferies. In its latest effort to slash costs as commodity prices fall, Rio Tinto is letting go its energy chief and rolling its coal and uranium businesses into two other units, a move that could signal its intention to divest its coal assets. The world's second-largest mining company said on Friday it will fold its coal mines…
Glencore Spinning Off Lonmin Stake, Cutting CapEx
Lonmin shares down 6 pct, Glencore shares little changed. CAPE TOWN, Feb 11 (Reuters) - Miner and commodities trader Glencore will spin-off its stake in troubled platinum producer Lonmin and cut capital spending to help it cope with a plunge in commodity prices, it said on Wednesday. Like peers, Glencore has been hit by a rout in prices of commodities such as copper, coal and oil in recent months. Its shares have fallen by about 9 percent this year.
BHP Tipped to Cut US Shale Spend
BHP Billiton Ltd may be forced to slash its planned $4 billion spending this year on U.S. shale wells and book writedowns on its shale assets as it battles plunging prices for its biggest earners iron ore, oil and copper. The mining giant, which has cut capital spending for the past two years, needs further savings to have enough cash to meet a promise not to reduce its dividend, analysts and investors said, with some tipping it could slice its U.S. onshore drilling budget in half.
Low Oil Price a Lifeline for Small Iron Miners
Efforts by big iron ore producers to put smaller, higher-cost rivals out of business by oversupplying the market are not paying off yet, and it's mainly due to price falls in another commodity - oil. The ploy by Australian majors Rio Tinto and BHP Billiton has pushed iron ore prices to their lowest in more than five years. That should have squeezed out smaller producers, helping the majors to increase market share and the price to rebound.
Anglo American to Cut About 60,000 Jobs by 2017
Global miner Anglo American aims to cut around 60,000 jobs as part of a wider reorganisation, Chief Executive Mark Cutifani said on Tuedsay. The company is aiming to cut the number of direct employees and contractors to a total of about 102,000 in 2017 from about 162,000 in 2013. The chief executive of Anglo American's iron ore subsidiary Kumba also said on Tuesday that he has proposed a 40 percent reduction in jobs at the company's headquarters in Pretoria, South Africa. Reporting by Silvia Antonioli
Weak Metal Prices Hit Anglo American's ROI
Anglo American Plc said persisting weakness in metals prices could limit its growth and return on capital, curbing expectations on the results achievable by a revamp plan under way. After years lagging its peers, Anglo American's boss Mark Cutifani vowed to turn the business around by slashing costs, improving mine operations and selling underperforming assets. Cutifani has said its plan would boost return on capital employed (ROCE)…
Anglo American May Shed Coal Assets
The chief executive of global mining company Anglo American said the company was considering the sale of a couple of coal assets in Australia and talking to stakeholders about its South African coal operations, too. Coal prices have fallen to multi-year lows this year due to a glut of supply and weaker demand growth, pushing some producers to curtail activity at, sell or shut coal mines. "We have indicated a couple of coal assets in Australia will be considered for sale…
Rio Tinto Not Looking at Mergers to Raise Defences Against Glencore
Global mining company Rio Tinto <RIO. L> is not looking to make any major acquisition to protect itself from a potential Glencore takeover, chief executive Sam Walsh said at a meeting with investors on Thursday. "Let me just reassure you ... We are not looking at any major mergers or acquisitions," Walsh said in response to speculation that the company might rush to make an acquisition to raise its defences against a takeover by Glencore. In October, Rio Tinto said that it had rejected a takeover approach from smaller rival Glencore.
