Sydney Gains; NSW Treasury Sells Bonds

Chandrasekhar Atreya
21 Jul, 2010
New York City

Stocks in Australia rallied and traded higher. BHP Billiton fourth quarter iron ore output increases 16%. NSW Treasury Corp sells 20-year new bonds at 6%. Conquest Mining receives offers from two Chinese companies for 100% of its concentrate. Sundance shares resume trading.

[R]6:00 PM Sydney, Australia – Stocks in Australia rallied and traded higher. BHP Billiton fourth quarter iron ore output increases 16%. NSW Treasury Corp sells 20-year new bonds at 6%. Conquest Mining receives offers from two Chinese companies for 100% of its concentrate. Sundance shares resume trading.[/R]

Stocks in Australia gained marginally to close higher. The ASX 200 Index added 0.21% or 9.10 points to close at 4,412.70 in Sydney today.

BHP Billiton Ltd, the world’s largest mining company, said the fourth quarter iron ore production rose 16% driven by surging global steel demand.

Iron ore production was 31.2 million tons in the quarter ending June 30 compared to 27.1 million tons a year ago, the company said in a statement. The government had estimated that it will boost sales by 50% as production at BHP and Rio Tinto expanded to meet global demand.

Banks in Australia would be forced to keep more capital in reserve during boom times to protect customers when things turn bad under plans drawn up by global financial regulators.

The decision was taken after a two-day closed door meeting of bank regulators and central bankers held in Basel, Switzerland.

NSW Treasury Corporation sold on Wednesday A$ 150 million of new 6% bonds maturing in May 2030. Deutsche Bank acted as the sole lead manager on the deal.

Resources News

Westfarmers Energy Ltd is paying tens of millions of dollars more under its renegotiated gas contract, as Western Australia businesses fork out some of the highest prices in the country to keep the lights on.

Paladin Energy says it is in talks to take over NGM Resources and is undertaking due diligence. NGM, a diversified mineral exploration company focused on uranium and base metals, is currently in a trading halt, and has a market capitalization of $16.8 million.

“Paladin advises that it is currently undertaking due diligence on NGM Resources Ltd and is negotiating with the board of NGM in terms of a potential takeover bid,” Paladin said on Monday.

Conquest Mining Ltd says it has received interest from two Chinese smelter companies for product from its Mt Carlton gold, silver and copper project in North Queensland. Executive Chairman Jake Klein said the company was working to formalize a long-term offtake contract in the next three to four months.

Conquest said it had provided detailed new concentrate specifications to 14 Chinese smelter companies interested. It has short-listed six firms, two of which had already undertaken due diligence visits to Australia.

BHP Billiton may take longer than expected to reach a final investment decision on its $1 billion Macedon natural gas project after two appeals were lodged against the recommended environmental approval for the project.

Cougar Energy Ltd shares have been further suspended from trade after it learned a Queensland environmental order will not be lifted until it has been reviewed by a panel. Cougar’s trial underground coal gasification project near Kingaroy was suspended last week after tests found traces of carcinogen benzene and the toxic chemical toluene in bores at the site.

The company was forced to suspend the operation by Queensland Department of Environment and Resource Management after the results were reported. Cougar was also directed to take an environmental evaluation.

Iron ore explorer Sundance Resources Ltd says a definitive feasibility study for its Mbalam project in Cameroon is on track for completion this year, and that the market has undervalued the project’s resource.

The Perth-based Sundance’s shares resumed trading on Monday after a month-long trading halt following the death of its entire board in June 19 in a plane crash in the Republic of Congo en route to Mbalam.