Wed, Apr. 15, 8:24 AM
- Barrick Gold (NYSE:ABX) says it welcomes the decision by Zambia's government to set its mining royalties at 9% for both open-pit and underground mines, but that it will review the details before reconsidering plans to shutter its Lumwana copper mine.
- Zambia's January decision to increase royalties for open pit mines to 20% from 6% and those for underground mines to 8% from 6% had rattled unions, miners and investors, forcing the government to review the plan; companies such as Glencore (OTCPK:GLCNF, OTCPK:GLNCY) and First Quantum Minerals (OTCPK:FQVLF) stopped expansion plans worth $1.5B.
- The new 9% rate still would be considered on the high end compared to other mining jurisdictions, but it might make more mines viable.
Fri, Apr. 10, 4:58 PM
- Credit Suisse sees potential for a near-term rally in gold prices, and expects copper prices to do well this year.
- The firm upgrades First Quantum Minerals (OTCPK:FQVLF) to Outperform from Neutral on positive copper and stock re-rating catalysts in H2 2015, and likes HudBay Minerals (NYSE:HBM) and Tahoe Resources (NYSE:TAHO); it downgrades Teck Resources (NYSE:TCK) to Neutral from Outperform based on a weaker outlook for coking coal and valuation.
- Among gold miners, CS prefers Agnico Eagle Mines (NYSE:AEM) for its lower cost assets, operational consistency, strong free cash flow and organic exploration and growth opportunities, and Goldcorp (NYSE:GG) for its growth and relatively strong balance sheet; Yamana Gold (NYSE:AUY) and Detour Gold (OTCPK:DRGDF) provide leverage to a gold price rally.
Tue, Mar. 10, 3:45 PM
- Peabody Energy (BTU -5.6%) slides sharply after Jefferies downgrades shares to Hold from Buy with a $6 price target, cut from $10, on continued concerns about domestic thermal coal fundamentals due to low natural gas prices, weakening exports, MATS related coal plant closures and increased renewable capacity.
- BTU's Australian coal business is more likely to improve in the near-term due to higher seaborne thermal coal prices, the firm says, but operating costs have not declined nearly as much as competitors due to its extensive hedging program.
- Jefferies is bearish on mining shares in the near-term, and the firm revised many of its commodity price forecasts lower, but it has placed four metals and mining stocks above the rest: Freeport McMoRan (FCX -3.5%), Rio Tinto (RIO -2.6%), First Quantum (OTCPK:FQVLF -6.8%) and Angofagasta (OTCPK:ANFGY -5.8%).
Fri, Feb. 20, 8:02 AM
Wed, Feb. 4, 11:21 AM
- Zambia's newly elected president has directed the government to expedite talks with miners and promptly resolve the impasse over the new mining tax regime to ensure the smooth running of the mining industry.
- In January, the country began implementing a new tax regime, requiring open-pit mines to pay as much as a 20% royalty on their revenue, up from 6%, while underground mines would pay an 8% royalty, up from 6%.
- The plan prompted Barrick Gold (ABX +1.2%) to announce it would suspend operations at its Lumwana copper mine, which supports nearly 4K direct jobs in the area, and other miners such as Glencore (OTCPK:GLCNF, OTCPK:GLNCY) and First Quantum Minerals (OTCPK:FQVLF) to shelve expansion projects.
Tue, Jan. 27, 10:58 AM
- First Quantum Minerals (OTCPK:FQVLF -8.5%) says it has substantially reduced planned capital spending in 2015 for its Cobre Panama copper project to $600M, while projecting total capital spending for the year of $1.2B-$1.4B.
- Says Q4 copper production fell 8.3% Y/Y to 105.1K metric tons while copper sales fell less than 1% to 94.8K metric tons; gold output fell 9% to 57.5K oz.
- For 2015, the company expects copper output of 410K-440K metric tons and gold production of 218K-247K oz.
Wed, Jan. 14, 12:49 PM
- As TD Securities analysts test free cash flow for Canadian copper producers at US$2.50/lb. for copper, every company in their coverage area except Copper Mountain Mining (OTCPK:CPPMF -13.5%) is found to have negative free cash flow.
- First Quantum Minerals (OTCPK:FQVLF -11.4%) might have the biggest problem, the TD analysts say, calculating that its free cash flow is negative US$1.2B at $2.50 copper due to a royalty hike in Zambia and major spending commitments at the Cobre Panama project.
- The favorite names in a low price environment are Lundin Mining (OTCPK:LUNMF -12.7%), HudBay Minerals (HBM -13.7%) and Nevsun Resources (NSU -4.7%), thanks to their solid balance sheets and low capital spending requirements in 2015.
Dec. 23, 2014, 12:58 PM
- The new tax laws in Zambia could turn out to be a positive for First Quantum Minerals (OTCPK:FQVLF) even as high-cost producers such as Barrick Gold (NYSE:ABX) begin to close operations, CIBC analyst Tom Meyer says.
- Zambia's budget, which included a revision to the mining tax scheme that would require open pit miners to pay a 20% mineral royalty tax, was passed on Dec. 17 and First Quantum’s stock has come under pressure since ~40% of the company’s operating base is located in the country.
- "As a low cost producer in Zambia, First Quantum could be a net beneficiary of the new system,” Meyer says, adding that a comparison of effective tax rates under the two systems "shows that the new system is increasingly favorable for the miners when the copper price is rising.”
Dec. 15, 2014, 3:11 PM
- First Quantum Minerals' (OTCPK:FQVLF) Ravensthorpe nickel mine in Australia has been temporarily shut after a processing plant rupture late Sunday resulted in a chemical spill.
- The company says a structural failure occurred in the atmospheric leach tank at the 38K metric tons/year mine, adding that the spill was contained and no adverse environmental effects are expected.
- First Quantum does not yet know if a declaration of force majeure would be invoked protecting the company from interruptions to sales obligations.
Oct. 13, 2014, 10:37 AM
- Zambia plans to more than triple royalties on open-pit mines, underscoring a growing trend across Africa where governments are changing tax regimes and adjusting ownership structures to get a bigger share of natural resources.
- The finance ministry says in a budget report that starting in Jan. 2015 royalties will increase to 20% from 6% for open-pit copper mines and to 8% from 6% for underground mines.
- Mining companies with open-pit mines in Zambia include Barrick Gold (NYSE:ABX) and First Quantum Minerals (OTCPK:FQVLF), while Glencore (OTCPK:GLCNF, OTCPK:GLNCY) and Vedanta Resources (OTCPK:VDNRF) operate underground mines.
- Zambia has withheld $600M of tax refunds from miners since last year, already straining the relationship between the government and mining companies.
Oct. 1, 2014, 9:43 AM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) says it has suspended some of its planned $800M in copper projects in Zambia after the government withheld at least $200M in tax refunds.
- The dispute is a major setback for Glencore, which has invested more than $2B in projects in Zambia and is in the process of upgrading its copper assets in the country to boost output by at least 50% over the next two to three years.
- First Quantum Minerals (OTCPK:FQVLF), whose Kansanshi mine is Zambia's largest copper mine by output, made a similar move in July to freeze its $1.5B in investments in the country over withheld tax refunds.
Aug. 26, 2014, 10:21 AM
- Zambia's government says it plans to relax tax rules on copper exports, good news for the country's copper miners that have been seeking more than $600M in unpaid tax refunds
- The government had said earlier it would pay the refunds only if the companies produced import certificates, but mining executives argued that producing the import certificates is next to impossible because companies sometimes sell their minerals to middlemen.
- Companies such as Glencore (OTCPK:GLCNF, OTCPK:GLNCY), Vale (NYSE:VALE), First Quantum Minerals (OTCPK:FQVLF) and Vedanta Resources (OTCPK:VDNRF) invested ~$6B in Zambia during the global commodities boom, which peaked in 2011.
Jul. 30, 2014, 7:08 PM
Jun. 27, 2014, 10:11 AM
- First Quantum Minerals (FQVLF) says it has suspended work at its $6.4B Cobre Panama copper project because of a labor dispute with some of its construction workers.
- Opposition to a new work schedule sought by First Quantum's Minera Panama subsidiary during the project’s construction phase sparked the conflict, which has included blocking area highways.
- The project aims to produce ~320K metric tons of copper, 100K oz. of gold and 1.8M oz. of silver per year.
Jun. 17, 2014, 12:34 PM
- First Quantum Minerals (FQVLF -0.2%) agrees to acquire Lumina Copper (LCPRF +19.6%) for $470M in a cash and stock deal that values Lumina at $10/share, a 28% premium above Lumina's Monday closing price.
- The dea; gives First Quantum the Taca Taca project in Argentina, one of the world’s most promising undeveloped copper deposits with more than 28B lbs. of copper resources and another major project in Latin America to go with Cobre Panama and Haquira.
Jan. 28, 2014, 7:52 AM
- First Quantum Minerals (FQVLF) says it expects to incur $6.4B in development costs for its Cobre Panama copper project in Central America, unveiling its revised capital cost estimate for its key project after a month's delay.
- The figure is ~3% higher than estimates released before First Quantum took over the project last year.
- Production is now pegged at ~320K metric tons/year of copper, up ~20% from original plans, and completion is now seen in H2 2017 instead of H1 2016.
FQVLF vs. ETF Alternatives
First Quantum Minerals Ltd. is a growing mining and metals company engaged in mineral exploration, development and mining. The Company produces LME grade "A" copper cathode, copper in concentrate, gold and sulphuric acid.
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