Mining

Intel and Rio pull markets in opposite directions

14 Jul 2010

The chip producer is smiling while the miner worries about a double dip. Both cannot be right. Investors are torn, but for now liquidity is ample and there are enough signs of growth to keep up their spirits. Still, it would not take much to change the mood.

Russian-Kazakh gold spat doesn’t look pretty

13 Jul 2010

A plan by Russian oligarchs to turn Polyus Gold into a Londonlisted goliath has hit trouble in Kazakhstan. It's all part of a battle with former owners of KazakhGold, whom the Russians accuse of massive fraud. But no one in this game of subterfuge looks totally unblemished.

Rio Tinto fights to keep growth pipeline whole

13 Jul 2010

Two of the miner's three largest projects are locked in dispute. The latest woe is a legal tiff with Canada's Ivanhoe, Rio Tinto's partner in a coppergold project. There's also a spat in Guinea over licences. Investors will want assurances Rio Tinto can manage the fallout.

BP disaster becomes a little easier to quantify

13 Jul 2010

The UK oil major is getting closer to arresting the flow from its stricken Gulf well, with major progress possible as early as this week. It is easy to see why the market is feeling more positive. But BP still has a lot of damaged market capitalisation to repair.

Latest cash shell bonanza feels bubbly

9 Jul 2010

Banking scion Nat Rothschild has raised some 700 mln stg for his miningfocused acquisition vehicle. He's not the first. The bravura launch, after a troubled period for Rothschild's Atticus hedgefund business, shows how forgiving investors can be when a big brand comes calling.

Miners win, government loses in Aussie tax fight

2 Jul 2010

The miners have clearly come out on top. They will still pay more taxes than before, but the new prime minister has retreated across the board rates, terms and reach. The government says tax revenue won't be badly hit, but probably only because it now expects higher prices.

Deripaska loses battle in war over Norilsk

1 Jul 2010

The indebted Russian aluminium tycoon is fighting to get more cash out of the metals giant. But he was beaten down at the AGM by an old oligarch rival. The still well connected Deripaska will keep trying, but for now his crude attempts to increase his influence have backfired.

Fairfield float offers low risk North Sea oil play

17 Jun 2010

The UK oil company plans to raise $500 mln. With credible reserves, little debt and its privateequity owners staying invested (for now) this North Sea scavenger is a relatively lowrisk producer. There's also the chance of a nice surprise, even in this welltrawled province.

Aussie tax compromise will be hard to find

16 Jun 2010

The big miners have strong and reasonable objections to the proposed tax on their superprofits. The Rudd government is belatedly talking about changes, but it's already counting on the juicy tax revenues. Rudd is stuck between a mining rock and a fiscal hard place.

China could be next superpower in Afghanistan

14 Jun 2010

A putative $1 trn in mineral wealth looks tough for U.S. groups to exploit. But neighboring China needs resources and has the muscle to enforce any rights its companies may take up. After Russia and America, a Chinese invasion commercial if not military could be next.

Afghan mining opportunity is too risky for most

14 Jun 2010

The supposed discovery of $1 trn of mineral deposits may sound like a potentially rich seam for the big listed miners. But the challenges are too great. Even if smaller rivals or the Chinese are tempted, Afghanistan is a generation away from a resourceled transformation.

Rio-BHP Aussie iron ore JV may run out of time

10 Jun 2010

The agreement will lapse if regulators fail to ok the deal by the end of 2010. That looks likely. Rio Tinto probably wouldn't mind, as it might be able to negotiate a new deal with better terms. But a proposed new tax on miner's superprofits could make talks even trickier.

Macquarie pays price for accidental virtue

10 Jun 2010

Because the Australian bank calculates bonuses according to its return on equity, staff will receive lower bonuses than their peers. Macquarie's model is one other banks would do well to follow. But hold the praise: it dates from a time when the bank was a very different beast.

Calm needed in Australian resource tax debate

7 Jun 2010

The knives are out over the proposed 40 percent tax on superprofits. Miners are suspending investments while the prime minister says he won't be a pussy cat. Yet there is broad agreement on the principle. If both sides lowered the tone, they could work out the details.

Aussie super-tax could stabilise commodity markets

4 May 2010

The proposed profits tax on miners makes more sense than the current system of fixed rents. It is just and could help dampen the industry's extremes. As with most countercyclical regulation, the targets will hate it during the good times but be grateful during the bad.

The last (iron) straw for BHP/Rio link-up

21 Apr 2010

BHP's discovery of possible internal corruption seems trivial. It relates to old, small projects. The real impact will be on the miner's proposed joint venture with Rio. The news undermines the companies' claims that the antitrust risks in this contentious deal can be managed.

RUSAL’s results offer little comfort for investors

12 Apr 2010

Costcutting helped the Russian aluminium giant report betterthanexpected results for 2009. Yet the shares are 12 percent below their January IPO price. RUSAL's $12 billion debt load, rising electricity prices and illiquid shares mean any significant recovery is some way off.

Still time to stop Rio and BHP’s iron ore tie-up

7 Apr 2010

Australia's competition watchdog has extended its probe of the mining groups' planned joint venture. The deal would leave just two global suppliers of seaborne iron ore. The runaway price and the end of annual contracts have focused regulators' attention. Just in time.

China’s tough line on Rio should apply at home too

29 Mar 2010

Four employees of the AngloAustralian miner received 714 years for bribery and stealing secrets. Politics will have played a role. Given the perception of persistent corruption in China, it looks worryingly like Western firms have been singled out for exemplary treatment.

Rio trial should give China investors pause

23 Mar 2010

Four employees of the miner have admitted taking bribes. Their treatment may seem harsh, and has a political flavour. But China has never claimed to follow the Western rule of law. Rapid economic growth may have blinded investors and companies to the risks that entails.