Tag Archives: metals and mining

Polymetal raises stake in Kazakh mine

ALMATY, JUNE 1 2017 (The Bulletin) — Russian gold miner Polymetal increased its stake in the Kazakh mine Dolinnoye to 50% by buying a 25% stake for $1.6m.

Polymetal bought its original 25% stake in the gold mine, based in northern Kazakhstan, in 2015. Polymetal is one of Kazakhstan’s biggest mining companies.

“This transaction further expands and strengthens our Varvara hub concept,” said Vitaly Nesis, Group

CEO of Polymetal. “We expect first ore to go through the mill in Q3 2017.”

The so-called Varvara hub is the collective term that Polymetal uses to describe its group of gold mines in Kazakhstan centered around the processing plant of the same name.

Polymetal’s assets in Kazakhstan include, the Kyzyl project in north- eastern Kazakhstan. In 2015, it bought the Kyzyl project for $620m from Sumeru, a private group owned by Timur Kulibayev, son-in-law of Kazakh President Nursultan Nazarbayev.

In the first quarter of the year, Polymetal said that its gold production had increased by 8% compared to the same period in 2016, helped partially by a rise output at the the Varvara hub.

It also said, though, that its Kazakh operations had required more capital investment than expected.

ENDS

(News report from Issue No. 331, published on June 5 2017)

Stock Market: KAZ Minerals

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JUNE 5 2017 (The Bulletin) — KAZ Minerals, the Kazakhstan- focused copper producer, has had a bumper year and it looks like it is going to get better. A Credit Suisse stock upgrade to ‘outperform’ from ‘neutral’, helped fuel more excitement around its share price.

The London-listed stock may have ended the week down just over 2% but analysts reckon that it will hit 630p this year. That’s an increase of more than 25% from its current share price of 495p.

Credit Suisse said in its note that over the past few years the share price has been held back on concerns over its profitability, worries that have now evaporated with the Bozshakol mine coming on-stream and the Aktogal mine increasing production at a faster rate than expected.

“The funding risk is now limited even under bearish copper price assumptions,” Credit Suisse wrote in its note. “We think this justifies KAZ moving to a more de-risked valuation and thus upgrade.”

In mid-Feb, KAZ Minerals looked to be set to breakthrough the 600p barrier, hitting 589p before falling back. That was the end of a bull run that had started in mid-2016 when its share price was around 126p, partly pushed up by an increase in copper prices.

Still, there is still some way to go before it can hit the heights to 2012 and 2013 when its shares were valued at over 800p.

ENDS

(News report from Issue No. 331, published on June 5 2017)

Stock market: Georgia’s TBC, Kaz Minerals

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MAY 28 2017 (The Conway Bulletin) — Profit at Georgia’s London-listed TBC Bank rose by two-thirds to nearly 100m lari ($40m) highlighting the increasingly upbeat assessment of the Georgian banking sector.

The bumper results also pushed up TBC’s share price to an all-time high of 1,695p. This is nearly an 18% increase from the start of the year and is an increase of roughly 65% from when TBC listed in August.

The main driver of this improvement has been an overall strengthening of Georgia’s economy. The region has been hit hard by a downturn in economic conditions, linked to a collapse in oil prices and also a recession in Russia.

TBC’s main rival, the London- listed Bank of Georgia, has also been hitting similar all-time highs. As well as boosting its stock price, Bank of Georgia also gain a PR boost when it issued 500m lari debt, the first corporate issue in lari.

Elsewhere, KAZ Minerals has been performing well. It’s been yoyo-ing around and has regained much of the ground lost in March. KAZ Minerals is a major copper producer and its share price follows copper prices to a large extent.

It is now trading at 506p, up from 430p at the beginning of the month but down from highs of 589p hit in mid-February.

KAZ Minerals used to by known as Kazakmys, which was linked by transparency campaigners to Kazakh Pres. Nursultan Nazarbayev.Stock market: Georgia’s TBC, Kaz minerals

Kazakhstan to open uranium bank

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MAY 15 2017 (The Conway Bulletin) — Kazakhstan will open its much-vaunted uranium bank on Aug. 17, media reported quoting MP Kanat Bozumbaev. The uranium bank has been authorized by the International Atomic Energy Agency (IAEA) and is designed to act as a resource for countries that want to develop nuclear energy. Kazakhstan is the world’s largest uranium producer.

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(News report from Issue No. 329, published on May 20 2017)

Kazakhstan wants to act as OPEC of uranium

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MAY 2 2017 (The Conway Bulletin) — Kazakhstan wants to act as the OPEC of the uranium world, manipulating prices with its supply- side dominance, Samruk Kazyna director Berik Beisengaliyev said in an interview with Bloomberg News. Samruk Kazyna is the Kazakh sovereign wealth fund which owns 100% of nuclear agency Kazatomprom. Kazatomprom mines 40% of the world’s uranium. Earlier this year it said it would cut output, sending depressed uranium prices up.

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(News report from Issue No. 327, published on May 5 2017)

KAZ Minerals CFO to take over as CEO

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APRIL 28 2017 (The Conway Bulletin) — KAZ Minerals, the Kazakhstan- focused copper produced listed on the London Stock Exchange, said that its current CFO Andrew Southam would be promoted to CEO from Jan. 2018. He replaces Oleg Novachuk who has been CEO for 11 years and is set to become the KAZ Minerals chairman.

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(News report from Issue No. 327, published on May 5 2017)

Copper output boost spurs stock rise in Kyrgyzstan

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APRIL 27 2017 (The Conway Bulletin) — Shares at Kazakh copper miner KAZ Minerals jumped 5% immediately after Q1 results showed that copper production had nearly doubled from a year earlier. KAZ Minerals, listed on the London Stock Exchange, used to be called Kazakhmys. It is focused on mining low-cost open pit mines.

ENDS

(News report from Issue No. 327, published on May 5 2017)

Kazatomprom not impacted by bankruptcy, says agency

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APRIL 26 2017 (The Conway Bulletin) — Kazatomprom, Kazakhstan’s nuclear agency, said that it wouldn’t be affected by the bankruptcy last month of Toshiba’s US unit Westinghouse Electric because it had organised an option to sell its 10% stake back to Toshiba at the price it bought it for. Kazatomprom, the world’s biggest uranium miner, bought a 10% stake in Westinghouse in 2007 for $540m. Westinghouse filed for bankruptcy last month after cost overruns at four nuclear reactors it was building in the US.

ENDS

(News report from Issue No. 326, published on April 28 2017)

Markets: Central Asia Metals

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APRIL 13 2017 (The Conway Bulletin) — Central Asia Metals, which is focused on Kazakhstan, posted turnover up 3% at $69.3m for 2016, helping to push up its share price to a five-week high of 242p by April 10.

This has since come off slightly but Central Asia Metals is still threatening to push past an all-time high of 246p set in mid-February. That’s certainly what analysts think. Most of them reiterated a ‘buy’ rating with Peel Hunt targeting 255p and FinnCap targeting 264p.

One of the main attractions for shareholders is the strong dividend that Central Asia Metals pays out. The Motley Fool, a stock analysis blog, explained.

“Shareholders will reap the benefit of this strong performance.

As much as 31% of last year’s revenue will be returned to shareholders by way of a total dividend of 15.5p. This gives a yield of 6.7% at the current share price of 229p,” the Motley Fool wrote before the share price started rising.

“This isn’t a one-off performance. The company’s dividend policy is to return at least 20% of revenue from Kounrad to shareholders each year.”

Kounrad is Central Asia Metal’s low-cost copper producing site in Balkhash, central Kazakhstan.

To underline the Motley Fool’s point, take a look at previous dividends. In 2015 and 2014, Central Asia Metals paid out 12.5p, in 2013 9p and in 2012 10.7p.

ENDS

(News report from Issue No. 324, published on April 13 2017)f

Stock Market: Tethys, Centerra Gold

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APRIL 6 2017 (The Conway Bulletin) — Shares in oil producer Tethys traded up at 1.73% on Monday despite full year results showing that its revenues from oil and gas sales had fallen by 47% to $11.7m.

It blamed the drop in revenue on the devaluation of the tenge in the second half of 2015 and a drop in oil output. Tethys sells most of its production on the domestic Kazakh market.

Despite the drop in revenues, Tethys said that its losses for 2016 were actually smaller than its losses in 2015, perhaps driving the price up 26% on the London Stock Exchange. Tethys if one of the region’s most illiquid stocks.

Most of the savings came in tight cost-cutting in administrative issues. It said that losses for 2016 were $46.9m compared to $74.6m in 2015. Tethys is pulling out of a project with China’s CNPC and France’s Total in Tajikistan because it couldn’t keep up with its call payments. It is also locked in a commercial dispute in Kazakhstan which has meant that the bank accounts of its subsidiary have been frozen.

Despite hitting a 6-month high of C$7.65, analysts have been lining up to give Centerra Gold’s stock a hefty ‘buy’ rating.

CIBC gave it a target rating of C$10 this year and CSFB went even further with a rating of C$10.25. The consensus target price is C$8.08.

The buy ratings appear to be based on strong gold prices which are enough to shrug off Centerra Gold’s spat with the Kyrgyz authorities. Kyrgyzstan wants a direct stake in the Kumtor gold mine, its largest industrial asset, which is wholly owned by Centerra Gold. Instead it currently holds a 32.7%% stake in Centerra Gold.

ENDS

(News report from Issue No. 323, published on April 6 2017)