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Vast finalises financial deal for Chiadzwa diamond venture

NEWS

January 24, 2020

Vast finalises financial deal for Chiadzwa diamond venture

AIM-listed mining group, Vast Resources Plc Monday disclosed it had finalised a financial deal it negotiated with international financial institutions for its Chiadzwa diamond venture in Manicaland Province.

Last year, the United Kingdom based Vast Resources announced that it had agreed a joint venture deal with Chiadzwa community to create a company called Katanga, which in turn partnered State-owned Zimbabwe Consolidated Diamond Company (ZCDC).

The company’s chief executive Andrew Prelea has said the deal to mine Heritage concessions is, however, awaiting the finalisation of the agreement with government through ZCDC.

Prelea did not disclose the size of the financial package required for the diamond project in Chiadzwa.

It is, however, understood that the new company requires about US$10m for exploration.

“The Company has arranged financing which it has prioritised for the Baita Plai Polymetallic Mine (“BPPM”) in Romania and the Chiadzwa Community Concession in Zimbabwe,”Prelea said

The delay to finalise the Chiadzwa deal is said to be due to technical issues, according to well-placed sources in the Ministry of Mines and Mines Development.

Discussions, however, Prelea said were underway to finalise the joint venture deal, which will enable the concession to procure a special grant for the mining of diamonds.

He said: “Discussions continue regarding the conclusion of the company’s diamond joint venture with its Zimbabwe stakeholders. These discussions are in line with previous expectations, save on timing.”

Vast’s portfolio includes an 80% interest in the Baita Plai Polymetallic Mine in Romania, where work is currently underway towards developing and recommissioning the mine and the Community Concession Block in Chiadzwa, Zimbabwe.

Vast Resources also owns the Manaila Polymetallic Mine in Romania, which was commissioned in 2015, currently on care and maintenance.

Business Times

Oil slides

NEWS

TEPE

January 24, 2020

Oil prices fell more than 2 percent on Wednesday as a market surplus forecast by the International Energy Agency (IEA) and demand worries outweighed concern over disruptions to Libya’s crude output.

Brent crude was down $1,39, or 2,2 percent, at $63,20 per barrel. US West Texas Intermediate crude fell 2,8 percent, or $1,64, to settle at $56,74 per barrel.

The head of the IEA, Fatih Birol, said he expects the market to be in surplus by 1 million barrels per day (bpd) in the first half of this year.

“Oil prices remain heavy on oversupply concerns and after the Saudi Energy Minister Price Abdulaziz did not offer any hints of optimism that the OPEC+ production cuts would be extended beyond March,” said Edward Moya, senior market analyst at OANDA in New York.

“China’s coronavirus will likely see travel restrictions that could end up hurting demand for crude during a peak travel time in China.” — Reuters.

Russian company wants to supply fuel for diamonds barter trade

NEWS

TEPE

January 24, 2020

Russian company wants to supply fuel for diamonds barter trade

The head of Tatneft, Nail Maganov, said on the sidelines of the current Davos Forum that his company is working on fuel supplies to Zimbabwe as part of a deal to exchange fuel for diamonds, Finmarket reported on Wednesday, citing Interfax.

“We are dealing with this topic. This is a commercially long scheme. I want to say that this is a real story… I know that the fuel supply is real,” Maganov said, noting that the sales arm of Tatneft is engaged in this.

In November last year, the Zimbabwean mass media, and in particular The Business Times, announced that the government of this African country intended to enter into a three-year deal to exchange diamonds for fuel worth about $ 1.4 billion with Russian diamond producer ALROSA and Swiss-based Tatneft. It was noted that Zimbabwe was experiencing intermittent fuel supplies.

According to Zimbabwean insiders at that time, ALROSA was to receive diamonds from the state-owned Zimbabwe Consolidated Diamond Company (ZCDC) every month with an estimated value of $40 million as a result of this deal.

“Due to fluctuations on the global market, Tafneft will have the liberty to reduce the value of the diamonds by 30%,” a source told The Business Times last November. “The diesel will be supplied via the Port of Beira. Under this arrangement, Tatneft is expected to deliver high-quality diesel 50 ppm [parts per million].”

In this regard, ALROSA’s spokesperson said in November last year that this information had nothing to do with reality and the company had no relation to the activity described in the published article. Source: Rough Polished

UK firm raises USD1.8m for Zim coal project

NEWS

TEPE

January 24, 2020

UK firm raises USD1.8m for Zim coal project

United Kingdom-based investment company Contango Holdings has raised USD 1,836,821 million, before expenses, through a conditional placing of 28-million new ordinary shares at £0.01 each to new and existing investors at 5p a share.

Following the completion of the conditional placing, the company anticipates being in a position to shortly issue a final prospectus setting out details of its purchase of the Lubu coal project, in Zimbabwe, from Consolidated Growth Holdings (CGH).

The Lubu project is expected to be a near-term metallurgical coal producer.

About $20-million was spent on the project by previous owners, including 12 000 m of drilling.

In 2019, CGH and Contango completed an extensive work program including additional drill holes and assays to better understand the range of coal products from a small proportion of Block B2 at or near-surface.

Upon closing of the acquisition, Contango will focus on developing a targeted area of the B2 Block, which is amenable to mining from surface down to a maximum depth of 47 m that contains seams of metallurgical coal product.

Contango will also look to finalise an agreement with contract miners and enter into an offtake agreement to sell metallurgical coal in the Southern Africa region. SOURCE: Creamer Media

Palladium rallies

NEWS

TEPE

January 23, 2020

Palladium looked set to extend its record-breaking rally even as investors mulled whether the metal has rallied too high, too fast.

Prices flipped to gains after initially falling almost 3 percent on Monday, despite technicals continuing to signal that a pull-back may be due. The metal reached a fresh all-time high of $2 548.20 as tight supply conditions show little signs of easing.

The metal’s surge is rooted in positive fundamentals, with production trailing demand as stricter emissions standards boost consumption by car-makers, and as uncertain power systems in South Africa worsen supply constraints.

Another factor is that producers don’t have the capacity to boost output easily in response to price increases because palladium is largely mined as a by-product.

The cost to borrow palladium has jumped to the highest in over a year.

Palladium is in a “real sweet spot” of recovering industrial production globally, improving demand due to strong car sales, and constrained mine supply, said Wayne Gordon, executive director for commodities and foreign exchange at UBS Global Wealth Management.

Also, the level of substitution has been less evident than expectations given its price relative to platinum, he said. — Bloomberg.