Engineering & Mining Journal

FEB 2018

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

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NEWS-LEADING DEVELOPMENTS FEBRUARY 2018 • E&MJ; 5 www.e-mj.com existing development pipeline to include a de-risked brownfield development asset, located in Canada, as well, we are adding a high-quality, free-cash flow generating roy- alty portfolio," said Scott Perry, president and CEO of Centerra. "The Kemess prop- erty has the potential to be a low-cost, long life, significant gold and copper producer." Immediately following the completion of the arrangement, the wholly-owned Centerra subsidiary and AuRico Metals will form one company, using the name "AuRico Metals Inc." Nutrien Emerges From Agrium, PotashCorp Merger Agrium and Potash Corp. of Saskatchewan (PotashCorp) have completed their merger of equals, creating Nutrien Ltd., the world's largest provider of agricultural crop inputs and services. Plans for the merger were an- nounced in September 2016. The merged company produces and distributes more than 25 million metric tons per year (mt/y) of potash, phosphate and nitrogen products. The company is the world's largest producer of potash, with more than 22 million mt/y of capacity from six low- er-cost mines in Saskatchewan. Its phosphate products portfolio is the most diverse in the industry. The compa- ny has two large, integrated phosphate mining and processing facilities and five smaller upgrading plants in the United States. Its phosphate fertilizer plant in Alberta benefits from an in-market freight advantage to serve the local market. Nutrien is the world's third-largest nitrogen producer, with close to 8 million mt/y of gross ammonia product capacity and operations in five countries, includ- ing joint-venture assets. Nutrien operates a global retail distri- bution network that includes more than 1,500 farm retail centers. The company has nearly 20,000 employees and opera- tions and investments in 14 countries. Nutrien anticipates that the merger will generate $500 million in annual operating synergies, primarily from distribution and retail integration; production; optimization of selling, general, and administration ex- penses; and procurement savings. The company expects to achieve approximate- ly $250 million of these synergies by the end of 2018 and to achieve the full annu- alized run rate by the end of 2019. Nutrien's board of directors has equal representation from Agrium and Potash- Corp. Jochen Tilk is the executive chair and Derek Pannell is the board's indepen- dent Lead Director. Members of the senior leadership team include Chuck Magro, president and CEO; Wayne Brownlee, ex- ecutive vice president and CFO; and Steve Douglas, executive vice president and CIO. Regarding completion of the Agrium/ PotashCorp merger, Magro said, "We are proud to launch Nutrien, a company that will forge a unique position within the ag- riculture industry. Our company will have an unmatched capability to respond to customer and market opportunities, fo- cusing on innovation and growth across our retail and crop nutrient businesses. Importantly, we intend to draw upon the depth of our combined talent and best practices to build a new company that is stronger and better equipped to create value for all our stakeholders." Nutrien common shares began trad- ing on the Toronto and New York stock exchanges on January 2 under the tick- er symbol NTR. Agrium and PotashCorp shares were delisted at the same time. Turquoise Hill announced that Oyu Tolgoi has completed the sinking of Shaft 2, including reaching final depth, shaft bot- tom mass excavation and concrete floor installation, marking an early milestone in the development progress of Hugo North Lift 1. The fit out of Shaft 2 will take place throughout 2018. "The completion of Shaft 2 sinking is the first of a number of key milestones that will lead to production of copper and gold from Hugo North Lift 1," said Jeff Tygesen, Turquoise Hill CEO. "At peak production around 2025, Oyu Tolgoi is expected to be the world's third largest copper mine." Shaft 2 is 1,284 meters in depth, 10 meters in diameter, and will be used for access, production and ventilation. Despite the recent declaration of force majeure at Oyu Tolgoi, there has been no disruption to goods and services arriving for underground development. In related news, force majeure for Oyu Tolgoi concentrate delivery customer con- tracts remains in place. On January 19, trucks, including Oyu Tolgoi concentrate convoys, recommenced crossing the Gan- qimaodu Border Zone. A consistent period of convoy crossing in order to determine a stable concentrate supply chain is re- quired before force majeure can be lifted. Safe and normal mine operations have been maintained and no production im- pact is expected. Oyu Tolgoi Finishes Sinking of Shaft 2 A crew drills holes with a jumbo lowered from a shaft-sinking platform at Oyu Tolgoi in Mongolia.

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