Peabody operations and project update

Since the beginning of 2012, Peabody has continued to progress its key operations initiatives and mine projects. The company advanced improvement activities and increased equipment utilization at the Coppabella and Moorvale mines, which were acquired in October 2011.

Employees at the high quality hard coking coal mine, North Goonyella, overwhelmingly accepted a new employee bargaining agreement;
Peabody favorably resolved a dispute regarding the MDL 162 project in Queensland, and now retains a 90% equity ownership position in the development license.

Peabody continued to generate strong cash flows during the quarter, while investing in key projects to meet rising Australian volume targets for 2012 and beyond. The combination of cash flow generation and modest sustaining capital expenditures gives Peabody the ability to fund previously approved organic growth projects and reduce debt.

First quarter capital investments totaled USD 238.6 million, and the company has reduced its planned capital spending to USD 1.1 to USD 1.3 billion in 2012. Since the beginning of the year, Peabody Continued development of the low vol PCI Codrilla Mine, which is expected to produce first coal in late 2013 and reach approximately 3.5 million tons per year (2.6 million tons attributable) at full production.

Shipped first coal from the Middlemount Mine through Abbot Point port. Middlemount sales are expected to reach 4.4 million tons per year (2.2 million tons attributable) at full production;
Advanced expansions at Millennium, Burton and Metropolitan metallurgical coal mines, which are expected to contribute an additional 3 to 4 million tons at full production.

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New Age Exploration commence La Miel Phase 1 drilling

New Age Exploration Limited announced that it has commenced its Phase1 Drilling Program at theLa Miel thermal coal project locatedintheCesar Basin, northern Colombia.

Highlights

1. Drilling contract recently signed with local Colombian drilling contractor LTGeoperforacionesYMineríaLtda for 3 open holeboreholesalongwithwirelinegeophysicallogging.

2. Drilling rig and support equipment being mobilized to LaMiel.

Estimated schedule for drilling completion is:
1st borehole(LM2) Mid June2012* 2nd borehole(LM3) End July 2012* 3rd borehole(LM1) EarlySeptember2012*

Based on seismic interpretation, the La Miel Project has a Conceptual ExplorationTarget of 50.

Source - New Age Exploration

(www.steelguru.com)

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10 mining deaths in first quarter of 2012 - MSHA

The Mine Safety and Health Administration recorded 10 mining deaths, six in coal mines, in the first quarter of 2012.

Coal mine deaths occurred in the following categories: exploding vessels under pressure, drowning, handling materials, rib fall, machinery and electrical. MSHA noted an "uncharacteristic trend" of five of the fatalities occurring in five consecutive weekends. Three involved mine supervisors.

MSHA issued an accident prevention alert to the mining industry after the fourth consecutive death, but the fifth occurred after the notice had been issued.

Mr Joseph A Main assistant secretary of labor for mine safety and health said that "Fatalities are preventable. Many mines operate every shift of every day, year in and year out, without a fatality or a lost time injury."

Main specifically noted the importance of implementing safety and health programs within the workplace.
Mr Main said that "Workplace examinations for hazards pre-shift and on-shift, every shift can identify and eliminate hazards that kill and injure miners. Providing effective and appropriate training will ensure that miners recognize and understand hazards and how to control or eliminate them."

According to the MSHA release, the federal regulators have take "a number of actions" to identify particular mines with health and safety problems.

The manner of death for each miner varied and occurred individually. One coal miner died when a 1 ½ inch bronze ball valve failed and propelled a steel manifold into the miners face. Another man drowned when he fell off a coal barge. A rib fall or collapse killed another miner operating a continuous mining machine and another was trapped under two pieces of mining equipment.

Source - www.statejournal.com

(www.steelguru.com)

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Plan underway to allow private companies to mine coal

ET reported that under pressure from the PMO to increase coal production, Coal Secretary Alok Perti has convened a meeting between private coal mining companies and government-owned Coal India Ltd to identify projects that could be outsourced to private coal miners.

Law ministry officials have also been invited to attend this meeting which will be held this week. The meeting will deliberate on the legal framework under which private mining companies can enter the sector though the competitive bidding route. Mining is limited to government owned companies under the Coal Nationalisation Act though end-users such as power, steel and cement companies can mine for their own use.

A source in the PMO said that increasing coal production in the country has been identified as a top priority as the shortfall in the fuel has taken a toll on the growth story. The source said that "Possibilities of whether and how private mining companies could be roped in to help expand capacities and increase production had also been flagged at the inter-ministerial meetings held between January and March.”

CIL, accounting for over 80% of India's coal production missed its revised production target as it produced only 435.84 million tonnes of coal in fiscal 2011-12 against the target of 447 million tonnes. The shortfall has resulted in several power projects being starved of coal. The government has been exploring several options of bringing in new players into the coal mining area within the restrictions of the nationalization Act.

While corporatisation of some of the CIL subsidiaries was one option that is under consideration, the government is also exploring if the state owned miner can outsource mining to private companies selected through competitive bidding.

There is already a model for this as CIL has outsourced two mines to Essel Mining, an AV Birla group company under a long-term contract as part of a pilot project.

Speaking to ET, former CIL chairman Partha Bhattacharjee said that these projects were awarded based on MDO (mining development and operations) agreements. Most large mining companies do this globally as it helps increase production and efficiency.

The Planning Commission had written to coal minister Sri Prakash Jayaswal in March asking it to explore development of projects on a public private partnership basis to expand operations and expedite coal production.

According to this model, bids are invited for a particular coal block that has to be mined . While the ownership of the block remains with CIL, the mine is given out on a long term agreement and the coal produced is bought back by CIL at a fixed price. The bids are ranked on the basis of cost per tonne and these have to be lower than the notified cost of CIL.

Source - (www.steelguru.com)

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Centaurus Metals update on Jambreiro project

Centaurus Metals has intersected 106 metres at 30.7% iron in the latest drilling at the Jambreiro Iron Ore Project in Brazil, where the company is targeting a resource upgrade next month.

In fill reverse circulation drilling has been completed at the Tigre and Cruzeiro deposits, which will form the basis of initial development at Jambreiro.

Highlight assays from the drilling programs include:

1. 106 metres at 30.7% iron, 3.6% alumina and 0.03% phosphorous from 27 metres;
2. 87 metres at 32.3% iron, 4.3% alumina and 0.04% phosphorus from 23 metres; and
3. 59 metres at 32.9% iron, 3.8% alumina and 0.03% phosphorus from 15 metres.

Jambreiro hosts a JORC Resource of 116.5 million tonnes at 26.8% iron. Centaurus is aiming to release a resource update by the end of May, with a focus on upgrading the respective categories of the resource, rather than increasing the quantity.

This revised resource will form the basis of the Bankable Feasibility Study, which is underway, with Centaurus targeting production in 2013.

Source - (www.steelguru.com)

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Composition of Metso nomination board

13 times viewed. Tuesday, 04 Oct 2011Metso Annual General Meeting decided on March 30, 2011 to establish a Nomination Board to prepare proposals on members of the Board of Directors and their remuneration for the next Annual General Meeting which is planned to be held on March 29, 2012. The representatives of the four largest shareholders registered in Metso shareholder register as of October 1, 2011 are elected to the Nomination Board along with the Chairman of the Board of Directors Jukka Viinanen as an expert member.

According to the shareholders register, Metso Corporation four largest shareholders on October 1, 2011 were:
1. Solidium Oy
2. Cevian Capital II Master Fund LP
3. Ilmarinen Mutual Pension Insurance Company
4. Varma Mutual Pension Insurance Company
These shareholders have named the following persons as their representatives for Metso's Nomination Board:
1. Kari Järvinen, Managing Director
2. Lars Förberg, Managing Partner
3. Harri Sailas, President and CEO
4. Matti Vuoria, Managing Director, President and CEO
Mr Kari Järvinen has been elected the Chairman of the Nomination Board.

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Queensland Galilee Basin could generate 6000 jobs

It is reported that a new coalmine in central Queensland Galilee Basin could generate 6000 jobs during construction and 1500 places during the mine life.

More details on Waratah Coal USD 8.3 billion Galilee Coal project became available recently when the company released its environmental impact statement. The project involves a series of new thermal coalmines near Alpha, west of Emerald a 468 kilometer railway from the mine to the coast and a port at Abbot Point, north of Bowen.

Mr Rachel Nolan acting Development Minister said ''If the Galilee Coal project proceeds, it could generate around 6000 jobs during construction and 1500 jobs during the operational life of the mine which is expected to exceed 25 years.”

Mr Keith Davies Co-ordinator-general said community concerns about the impact of the railway would be looked at along with formal submissions when considering the project.

Premier Ms Anna Bligh said the project presented another big leap forward for Queensland's economy, provided the company met all environmental impact requirements. She said ''The Galilee Basin is a very rich coal seam. If it can be developed appropriately, then it means jobs, prosperity and growth, and a very bright future for our state.”

The project impact statement will be available for public comment until November 7. The proposed port at Abbot Point will be subject to a separate approval process.

(Sourced from www.brisbanetimes.com.au)

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Zimbabwe deadline for foreign firms looms

It is reported that foreign companies operating in Zimbabwe had until Sunday to hand in plans to sell majority stakes to local blacks under a law that has alarmed investors who are uncertain how the rules will work.

The government order for the transfer of 51% ownership has been called the final phase of economic emancipation after controversial land reforms targeting white owned farms a decade ago. But analysts are skeptical.

Mr Anthony Hawkins a University of Zimbabwe economics professor said "There is no way the local and the government has the money to buy shares in the companies. Everybody knows that."

He said that the indigenization drive could hurt the economy in the same way as the land reforms which sparked an economic nose-dive after supporters of President Mr Robert Mugabe violently seized white-owned farms.

Mr Hawkins about polls expected next year said "My concern is that this is much more of a political policy and it will have an economic harm just like the land reforms. It looks like they are doing this for the elections."

He said that "This will reduce the amount of investment in the country as the new owners will not have the money to, for example, expand projects. The community does not have the money, as well as the workers and the government is broke."

The push is without the violence of the land seizures which Mr Mugabe said was a way to correct colonial-era wrongs, but there is mixed signals on how the law will be implemented.

Mr Saviour Kasukuwere Indigenization Minister has warned that non-compliant companies risk nationalization. But certain firms have arranged their own deals and deadlines ahead of Sunday cut-off date making the government appear flexible on how the law is implemented.

(Sourced from AFP)

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Mongolia high plains herders warily eye coal truck road

Reuters reported that a lone cement ribbon bisecting hundreds of miles of shale and scrub on the high plains of Mongolia Gobi Desert may be a talisman or curse for nomadic herders that trace their lineage to the empire of Mr Ghengis Khan.

Carved into the Gobi by the Hong Kong listed Mongolian Mining Corporation the 147 mile and two lane roads is due to open next month, allowing the company to speed up cargoes of coal to China from its expanding Ukhaa Khudag mine.

The freshly paved highway is one of the first glimpses of a mining boom that will transform Mongolia fortunes. But many including President Mr Tsakhia Elbegdorj are worried that mining has already put the country fragile pastoral economy under strain and left a million nomads behind.

Mr Puntsag Tsagaan president senior adviser said "Hundreds of rivers, streams and lakes have disappeared because of deforestation, climate change and also partly because of irresponsible mining."

He said that "Our challenge is how to diversify our economy. I don't want my children and my grandchildren to live in a different country called Minegolia it has to be Mongolia. Therefore we have to manage the mineral wealth in a better way."

The road will remove a major logistical hurdle for MMC.

Mr Adilbish Gankhuyag MMC's chief financial officer said "We will start using it next month and it will have a total throughput capacity of about 18 million tonnes per annum this year our total production will be 7 million tonnes so we no longer have logistics and transportation problems."

Mr Shurka Baigalmaa MMC's onsite manager at Ukhaa Khudag said it is also a key part of the company commitment to protect the region's ecosystem which has been damaged by hundreds of overloaded coal trucks churning up grazing land.

MMC is also committed to using the parched region water supplies efficiently with Baigalmaa saying that 95% of water used at the mine washing plant would be recycled.

The open-cast mine is already 70 metres deep and will eventually descend 300 metres but she said the company would limit the impact by refilling exhausted seams using peat excavated from new mining areas further west.

(Sourced from Reuters)

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Avonlea Minerals appoint Non Executive Chairman

Avonlea has appointed Mr David Macoboy as Non Executive Chairman effective immediately.

Mr Macoboy brings to the Board a wealth of experience across a range of industries especially in the areas of corporate strategy, finance, project evaluation and development, and management. Mr Macoboy has over 20 years in the resources sector joining Avonlea following roles at Board level with a range of successful ASX listed exploration and mining companies.

Mr David is currently Non-Executive Chairman of Vital Metals Limited, and has held previous Directorships with Ammtec Ltd, Ironclad Mining Limited, Grange Resources Limited, Territory Iron Limited and Consolidated Minerals Limited.

Mr Macoboy holds a Bachelor of Economics and a Bachelor of Commerce from the University of WA. David is a Fellow of the Australian Institute of Company Directors and a Certified Practicing Accountant.

Mr David Riekie Avonlea Managing Director said "We welcome Mr Macoboy as a valuable addition to the Avonlea Board. His extensive corporate and resources experience provides a complementary skill set to the existing Board. Mr Macoboy joins the Company at a pivotal time in the Company's growth as we continue to develop our portfolio of projects in Namibia, and will assist to drive our corporate agenda to realize the full potential of our asset base."

Mr Roger Steinepreis will as a consequence step down as Chairman, but will remain a Non-Executive Director of the Company. The Board thanks Roger for his significant contribution to the Company in his capacity as Chairman since listing on the ASX in 2007.

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Rio Tinto is holding an investor seminar in London and New York on September 20th 2011

1. Rio Tinto's growth program is well underway with work progressing on $ 27 billion of major capital projects, and a $35 billion pipeline of high quality, unapproved projects currently in the advanced-study phase.

2. Growth projects are well balanced between Brownfield expansion of existing assets such as iron ore in the Pilbara and newer, world class quality projects including coal in Mozambique and copper gold in Mongolia.

3. Rio Tinto's order books are full and commodity prices remain robust. However, customer sentiment is now more cautious and physical markets are softer than they were six months ago, reflecting concerns over the health of the OECD economies and persistent volatility in financial markets.

4. Rio Tinto's estimated net debt as at August 31st was $ 7.6 billion, a reduction of $ 1 billion since June 30. This has been achieved despite the accelerated share buyback program and continued investment in growth.

5. More than $ 4 billion of Rio Tinto's $ 7 billion share buy back program has now been completed.

Mr Tom Albanese CEO of Rio Tinto said that "We've been saying for quite some time that we expected to see patterns of increased price volatility amidst turbulent financial markets and that scenario is playing out. Our order books are full and pricing is strong, but it is noticeable that markets are somewhat weaker than they were six months ago. We are realistic and well positioned for any number of scenarios our high quality growth program is in full swing to capture the expected increases in longer-term demand, and our balance sheet is very strong and well able to withstand any near term decline. Our long term view of demand growth is unchanged. As the metal hungry developing economies grow, demand for copper, aluminium and iron ore will double over 15 to 20 years. But challenges on the supply side are limiting the speed of new supply to market. Project finance is tight because of the current market jitters. Permitting delays, labour and equipment shortages, and technically challenging ore bodies are all contributing factors. With Rio Tinto's exceptional growth projects in a range of countries and commodities, coupled with our leadership in new technologies, we are in an advantageous position."

Mr Guy Elliott CFO of Rio Tinto said that "Our balance sheet is robust, monthly cash flow generation remains high and we are able to access debt markets at competitive rates, as we demonstrated just last week with an attractively-priced bond issue. Our prudent balance sheet and single A credit rating are highly beneficial, particularly in challenging markets. This approach means we have been able to pursue our strategy of targeted acquisitions and shareholder returns without interruption, successfully completing the Riversdale acquisition in August."

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