Rio Tinto to Sell Mozambique Mines to India Coal Group
Mining behemoth Rio Tinto (LSE:RIO) is expected to sell three of its coal mines in Mozambique to a group of Indian state-run metal and mining companies for $108 million.
According to reports, India’s International Coal Ventures Private Limited (ICVL) will purchase 65 percent of the Benga coal operation in the Tete province of Mozambique, and 100 percent in the other two coal projects – Tete East and Zambeze.
"We expect the deal to be signed over the next three to four days," said a government official involved with the negotiations.
The acquisition will be the first for ICVPL, which was set up in 2009 to buy assets abroad by government-run companies including Steel Authority of India Ltd., Coal India Ltd. and power producer NTPC Ltd.
The proposed deal isn't surprising. Existing coal mines in India have been failing to meet targets, forcing the country to import coal. India’s electricity shortage climbed to 7,000MW in May.
Output for the three mines, including metallurgical coal and thermal coal, came to 733,000 tons in the first half of 2014. If the proposed deal goes through, the acquisition will assist ICVL in achieving its 2019-20 target of owning 500 million tons of coking coal reserves five years in advance.
Rio Tinto originally purchased the mines in 2011 when it acquired Riversdale Mining Ltd for $3.7 billion. Ironically, ICVL made a bid to acquire the Benga mine but lost out to Rio Tinto in the process.
Newmont acquires Canada’s GT Gold in $325mn deal
Newmont, the world’s biggest gold miner, has acquired Canada’s GT Gold in a deal worth $325mn. The gold giant now controls the Tatogga gold-copper project in the Traditional Territory of the Tahltan Nation.
“With the acquisition of GT Gold and the Tatogga project in the highly sought-after Golden Triangle district of British Columbia, Canada, Newmont continues to strengthen our world-class portfolio,” commented Newmont President and CEO Tom Palmer.
“We look forward to continuing to build a respectful and meaningful relationship with the Tahltan Nation, including the community of Iskut. The relationships we have with Indigenous communities, First Nations and host communities are critical to the way we operate. We will partner with the Tahltan Nation at all levels, and with the Government of British Columbia to ensure a shared path forward as the Company understands and acknowledges that Tahltan consent is necessary for advancing the Tatogga project.”
Newmont’s acquisition includes the Tatogga project, comprised primarily of the Saddle North deposit, which has the potential to contribute future significant gold and copper annual production. There are also further exploration opportunities beyond the known deposits at Saddle North within the land package. The Tatogga project adds to Newmont’s existing interest in the prospective Golden Triangle through the company’s 50% ownership in the Galore Creek project.
Newmont is the world’s leading gold company and a producer of copper, silver, zinc and lead. A world-class portfolio of assets, prospects and talent is anchored in favourable mining jurisdictions in North America, South America, Australia and Africa. The American miner is celebrating its 100th anniversary this month.
With gold prices on the rise, the last six months has seen gold industry M&A activity accelerating. A recent Mckinsey report, advises that the industry need to be mindful of mistakes made during the previous gold price boom, when growth was chased unidirectionally by several companies.