El Capitan secures ore deal with AuraSource

El Capitan Precious Metals has announced that it has executed its agreement with AuraSource, for the sale of up to 600,000 metric tonnes of head ore over the next 12 months. This agreement is renewable for five additional one-year terms.
The revenue to ECPN would be US$180 million per year at a cost of approximately US$30 per tonne for mining and loading. The agreement is contingent upon Right of Way road access and AuraSource’s ability to secure its buyer and financing for the prepayments to El Capitan. The Company is confident it will be able to provide the road access required.
At the Shareholders’ Meeting in New Mexico last week, shareholders were presented with a description of the precious metals recovery process, including samples of the processed precious metals product.
The votes of those shareholders’ present and those represented by proxy re-elected the entire slate of directors. The shareholders also authorised an additional 100 million shares of common stock and ratified the appointment of MaloneBailey LLP as the company’s auditors.
The shareholder meeting included a trip to the mine site and approximately 80 shareholders saw, firsthand, the operations, the road, and the site that is producing the ore and concentrates.

BHP Billiton celebrate the export of one billionth tonne of iron ore to Japan

BHP Billiton has celebrated a significant milestone after shipping its one billionth tonne of iron ore to Japan.

BHP iron ore boss Jimmy Wilson was joined by joint venture participants ITOCHU Corporation (ITOCHU) and Mitsui & Co., Ltd (Mitsui) to mark the milestone in front of the Saiko bound for Japan.

Speaking at the event in Port Hedland on Wednesday, Wilson said Japan was a driving force behind the development of iron ore mining in the Pilbara.

BHP shipped its first tonne of the steelmaking ingredient to Japan nearly half a century ago in 1966.

“We also owe much to Japan for their role in growing the iron ore industry in the Pilbara. Our joint venture participants ITOCHU and Mitsui contributed capital, and as trading companies they were a key link into Japanese markets," Wilson said. 

“Over the past decade, we have invested US$24 billion in Western Australia’s mines, rail and port infrastructure and continue to adopt new technology to ensure our operations remain world-class."

BHP Billiton President HSE, Marketing and Technology Mike Henry said that the ore exported to Japan came back to Australia as high-quality manufactured products like motor vehicles and the rolling stock and rail equipment used within the mining industry.

“Today the high-quality iron ore we export from the Pilbara is an essential ingredient for Japan’s high-tech steel industry which leads the world in technology and efficiency,” Henry said.

Last year BHP agreed to sell 15 per cent of its stake in the Jimblebar iron ore mine to ITOCHU and Mitsui for $US1.5 billion.

The deal was aimed at aligning Itochu and Mitsui’s interests across BHP’s Pilbara iron ore operations so assets could be operated in a straightforward and flexible way.

As part of the deal, the Japanese firms will receive an annual output of over 5 million tonnes, plus shares of future production increases.

Jimblebar mine officially opened earlier this year.

The $US3.6 billion project delivered first production in the quarter ending September 2013 and is expected to deliver phase one capacity of 35 million tonnes per annum (Mtpa) per year by the end of the 2015 financial year.

This will increase BHP’s Pilbara supply chain capacity to more than 220 Mtpa.

A low cost option to expand Jimblebar to 55 Mtpa in the longer term would increase this to approximately 260 Mtpa to 270 Mtpa.

Wilson said as the company enters its next phase of growth, improving productivity, optimising capacity and working assets harder would deliver greater benefits to BHP customers.

“The good relationships we have between customers, employees, Indigenous land owners, ITOCHU and Mitsui have been and continue to be crucial to the success of the Western Australian business,” Wilson said.
 

Image: Perth Now

Padbury’s Oakajee plan ‘unrealistic’: WA Premier

West Australian Premier Colin Barnett said there is “very little prospect” Padbury Mining’s $6 billion plan to develop the Oakajee rail and port project would gain his government’s backing.

In what comes as a blow to the seemingly shaky deal, Barnett told reporters “there is little substance behind Padbury.”

He said he had not meet with representatives of the junior mining company and did not intend to, The Australian reports.

The strongly worded comments come as Padbury is today preparing to announce to the market the funding arrangements for the deal.

Yesterday, Padbury revealed Sydney businessman Ronald Breyer was tied to the two companies involved the development, Superkite and Alliance Super Holdings.

Bleyer this week told the media he was ''chairman of the finance committee” for the companies.

Asked if he would support a ­realistic proposal put forward by Padbury, Barnett said:

“I don’t believe it’s realistic — simple as that.”

Padbury Mining first announced it had backing for the Oakajee project on April 11.

ABC reports the Australian Securities and Investments Commission is looking into Padbury's disclosure and share trading in relation to the deal.

Bleyer has been involved in a number of failed business ventures of late.

Last month the NSW Supreme Court ordered Superkite and Alliance Super Holdings repay money to aged care company Craigcare after a $500 million funding deal failed.

While last year, a $260 million deal with junior mining company Fairstar Resources also fell through.

Padbury is expected to announce the funding deal rests on the support of a Korean construction company fronting up 20 per cent of the project costs.

The company’s shares remain suspended.

$6 billion Oakajee port and rail deal funding partner revealed

Padbury Mining has again failed to reveal the identity of its $6 billion funding partner for the Oakajee port and rail project, but Sydney business man Roland Bleyer has claimed responsibility for the deal.

Following days of speculation as to who the mystery backer was, Bleyer reportedly revealed limited details to the Sydney Morning Herald.

The paper reports Bleyer said a number of private companies including Superkite and Alliance Super Holdings were working on a deal to fund the project.

Bleyer said he was a ''chairman of the finance committee'' for the companies.

The revelation comes as Padbury Mining, which first announced it had backing for the project on April 11, again failed to reveal details of the funding partners’ identity as ordered by the ASX.

Padbury first said it would update the market last Tuesday, but then extended the trading halt to Thursday stating it was seeking information from the backers of the deal “in respect of their capacity to meet their funding obligations.”

It also said it was seeking consent to disclose the agreement in its entirety with the announcement.

However the company had sought an extension again, this time promising to make an announcement tomorrow.

The delay has fuelled industry chatter that the deal won’t go ahead amid concerns over its viability.

Managing director Gary Stokes said the announcement was legitimate.

Stokes said the project would open up the Midwest region to the 21 companies operating in it.

The original announcement said funding for the project will come in three tranches with the first delivering $US470 million ($501.2 million) to complete design and construction plans.

Bleyer said further details would be made available shortly after lawyers for Superkite and Alliance Super Holdings had given the go ahead for Padbury to release a copy of the ''counter-signed shareholders agreement''.

Bleyer has been involved in a number of failed business ventures of late.

Last month the NSW Supreme Court ordered Superkite and Alliance Super Holdings repay money to aged care company Craigcare after a $500 million funding deal failed.

While last year, a $260 million deal with junior mining company Fairstar Resources also fell through.

An online blog claims Bleyer started his career in New Zealand as a hair and skin treatment specialist while also developing interests in fashion and manufacturing.

Union talks with BHP over train driver pay to recommence

Pay deals between BHP and its rail drivers have recommenced after the miner failed to meet union demands of pay rises, cheap rent in the Pilbara and extra annual leave.

The CFMEU said BHP’s three-year pay offer was rejected by about 60 per cent of 350 rail drivers in April this year.

Pay negotiations with BHP Billiton started last year, representing the continuing strengthening of CFMEU presence in the Pilbara.

The union negotiations are the first major talks with BHP in the Pilbara for more than a decade.

Wood told Australian Mining negotiations were set to recommence in the coming weeks.

Wood said the offer was rejected because the company did not meet a key demand for guaranteed annual pay rises of “ideally between 4 or 5 per cent.”

Wood also said workers were distrustful of BHP Billiton's offer for performance-based annual increases, adding that the miner failed to meet other key demands including for FIFO workers to be awarded an extra four hours of annual leave per swing to compensate for travel time to and from site.

This has the potential of adding an extra week or two to annual leave per year, depending on each employee‘s roster, The West Australian reported.

Wood said that the drivers should be able recoup time when travelling to and from site during their R&R leave.

The third key demand was for 50 Port Hedland-based train drivers to gain access to BHP-owned housing.

In return, the staff would give up an existing $1800 weekly allowance for offsite accommodation.

Wood said rental homes cost more than $2000 a week in Port Hedland and with workers fearing rents could increase further.

In 2011 Rio Tinto lost a High Court battle over bypassing unions in negotiations with workers on its Pilbara iron ore operations with the decision sparking fear that the unions return would see outrageous demands fly.

However Woods said the union demands were proof it was being responsible.

He told ABC News the CFMEU entered the bargaining in good faith.

"We are not going into the discussions trying to turn the world upside down, what we are trying to do is hopefully get an agreement which accommodates both the employees and the employer," he said.

Image: abc.net

Mineralogy to lose right as port operator

Clive Palmer’s company Mineralogy could lose its right to operate a new multi-billion dollar port in Western Australia amid concerns about the miner's ability to run the facility.

The Department of Infrastructure and Transport is reportedly moving to strip Mineralogy as operator of Cape Preston port near Karratha.

The port has been built to ship iron ore from a $7 billion mine being developed by the Chinese company CITIC Pacific, with Palmer’s company granted operations rights to the port in January.

However The Australian reports the West Australian government is pressing for the rights to be revoked amid concerns over the company’s credentials with insiders claiming Mineralogy should not have been granted legal permission to run the port.

The move against Palmer’s company as operator is a major blow as it stood to make millions of dollars through exports at the port.

Palmer and CITIC Pacific are battling in Perth’s Supreme Court over a royalties dispute on the iron ore project, which is yet to export after huge budget blowouts and missed completion deadlines.

Palmer was set to receive royalties from the project after CITIC purchased the original tenements from him in 2006.

The Sino iron ore project has run into a spate of delays and cost blow-outs during the commissioning phase, and late last year the company blamed the skills shortage, bad weather, and the inexperience of its lead contractor for delays on the project.

The West Australian Government first sought to remove Mineralogy as a port operator in February, while CITIC has previously asked for treasons behind the appointment.

"We are aware of the issue and there is a process in place," Vivienne Ryan, a spokeswoman for the WA Department of Premier and Cabinet, said last night.

"We have nothing further to add."

Mineralogy was not available for comment at the time of publication.

Juniors join forces, addressing Pilbara infrastructure issues

Junior miners Brockman Mining and Flinders mines have signed a supply, infrastructure cooperation agreement in the Pilbara, saying they will work together on a transport solution that will get their product to market.

On Wednesday LMH reported Brockman had signed a three year agreement with Aurizon that will see the rail operator develop and operate rail and port infrastructure for the company’s two Pilbara iron ore projects.

Aurizon will operate all rail, rolling stock and related infrastructure required by the mine projects and develop port facilities.

The two deals add to the mounting battle over transport infrastructure in the Pilbara.

Brockman has previously attempted to gain access to Fortescue Metals Group’s railway using third party access laws but according to The West Australian the bid has been bogged down by Western Australia’s regulatory process, forcing the miner to look at alternatives.

But according to WA Premier Colin Barnett the fight over rail access is holding projects up more than government red tape.

Barnett has previously said resource companies fighting over sharing infrastructure is one of the biggest hurdles in keeping projects to time and on budget.

He said the Department of State Development spent more time dealing with disputes between resource companies than it did solving regulatory delays.

BHP Billiton and Rio Tinto’s railways in the region were built before WA introduced third party access laws.

Fortescue is attempting to sell down its stake in its railway, with some expecting Atlas Iron to negotiate a deal to access the infrastructure to accommodate the growth of its projects in the region.

Investors’ calls for Fortescue to reduce its $US10 billion debt are fuelling the company’s move to offload its minority interest in its port and rail assets which are expected to deliver $US3 billion to the company.

The sale, which was expected to be finalised by June 30, has been pushed to the September quarter.

When Brockman asked for access to its Pilbara rail line, the Fortescue owned TPI gave a floor cost of $73.4 million and a ceiling cost of $575.6 million.

Adding to the infrastructure debate in the region is Gina Rinehart’s Roy Hill Holdings, proposing to build its own railway rather than purchase access to someone else’s.

Brockman CEO Russell Tipper said today’s memorandum of understanding with Flinders is a step forward.

"The potential aggregation of tonnages ensures a critical mass that could further enhance the economic viability of any proposed shared infrastructure solutions for junior iron ore miners in the Pilbara," he said.

Flinders executive chairman Robert Kennedy said while the deal is non-binding, its completion will benefit both companies.

"It is Flinders' intention to work with Brockman towards a binding terms sheet that aggregates the Flinders product with the Brockman product," he said in a statement.

BHP fast tracks iron ore modernisation

BHP Billiton is fast tracking the modernisation of its Pilbara iron ore division, coinciding with the launch of its new remote operation centre in Perth.

The move will also attempt to reduce contractor spending, SMH reports.

BHP's iron ore boss, Jimmy Wilson, will open the ''integrated remote operating centre'' with WA Premier Colin Barnett today.

The centre’s launch adds to the growing trend of mine site automisation and remote control initiatives with mining and logistics work in the Pilbara increasingly being controlled in Perth.

Rio Tinto already runs a similar operation out of Perth Airport and Roy Hill Holdings is also developing a remote operation centre for its iron ore mine, port and rail project.

Earlier this year BHP said it will focus on automated equipment and new technology as it moves toward “next generation mining”.

BHP preparing for Port Hedland outer harbour

BHP Billiton hopes to begin pre-construction piling at Port Hedland this Friday, the first step in its $10 billion outer harbour project.

The two-month operation will install three test piles along the route of the proposed outer harbour jetty.

Five other steel piles will be installed to support survey equipment, with the entire project working between 1.7km and 31.5km off the Port Hedland coast.

Earlier this year the company approved close to $1 billion in pre-commitment funding for the Outer Harbour and revised plans for a fly-in fly-out camp to house construction workers.

The company initially proposed a 6,000-person camp but after its rejection the number was revised to 2,000 with the option to add a further 2,000.

BHP’s board is expected to give total approval to the Outer Harbour Development later this year.

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