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(An item published at 1203 BST misstated the stake Nyota holds in KEFI Minerals. The correct version follows.)
LONDON (Alliance News) - Rio Tinto said Monday it is considering options for its stake in the operator of a mine on Bougainville Island in Papua New Guinea, after the miner was stripped of all its exploration and mining licenses on the island when the central government handed regualtion power to the island's autonomous legislator.
Rio Tinto said it would review all options on its 53.83% stake in Bougainville Copper Ltd, the operator of the Paguna mine on Bougainville Island, which has a potential gold and copper resource worth over USD60 billion.
Earlier in August, the Papua New Guinea government handed the power to regulate mining activities on Bougainville to the island's autonomous legislator. When the island's government passed its new mining act, Rio was stripped of all exploration and mining licences, prompting the mining group to start taking legal advice on its stake.
The news comes a working day after rival BHP Billiton said it was swaying towards demerging some assets as it continues to weigh up options for simplifying its big portfolio of assets. It's going to focus on iron ore, copper, coal, oil and possibly potash, meaning it would be demerging aluminium, nickel and bauxite assets if that option is chosen.
BHP Billiton's board is due to meet this week to consider the asset demerger.
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Markets: The London equity markets have bounced back Monday on relief that a lid was kept on geopolitical tensions over the weekend.
US stock futures are currently pointing to a higher start on Wall Street. The DJIA, S&P 500, and Nasdaq are all currently indicated to open up 0.5%.
FTSE 100: up 0.7% at 6,732.52
FTSE 250: up 0.6% at 15,761.93
AIM ALL-SHARE: up 0.3% at 758.24
GBP-USD: up at 1.6725
EUR-USD: down at 1.3388
GOLD: down at USD1,302.17 an ounce
OIL (Brent): down at USD102.32 a barrel
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Other Top UK Corporate News
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Prudential will spend around GBP100 million on developing further business initiatives in the UK as the group attempts to offset a drop in annuity sales as a result of the overhaul of the pension system in Britain, the Financial Times reported. The investment, which the life insurer is set to make in the next two years, is being led by Jackie Hunt, drafted into the company from rival Standard Life a year ago to head up Prudential's UK business. It will cover spending on developing an online investment platform and Prudential ISAs, the FT said, citing a plan outlined to investors.
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Barclays is being investigated for failing to keep clients' money separate from its own, the Financial Times reported online on Friday. The latest probe by the Financial Conduct Authority could result in the bank incurring a financial penalty, the report said, citing people familiar with the situation. FT said that Barclays and the FCA declined to comment.
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Bovis Homes raised its dividend threefold, after pretax profit more than doubled in the first half, as the UK housing market continues to perform "robustly". The Kent-based firm increased its interim dividend to 12.0 pence, from 4.0 pence, as pretax profit rose to GBP49.4 million for the six months ended June 30, from GBP18.6 million a year earlier. Revenue jumped 75% to GBP322.1 million from GBP184.4 million a year earlier. The company is targeting a total dividend of 35 pence per share for 2014, which would be a significant increase from the 13.5 pence it shelled out in 2013.
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Carillion, which is at loggerheads with Balfour Beatty over their possible merger, said its cost-base savings outlined last week has not been audited in the technical sense, but rather an independent accounting firm provided public assurance that the cost-base of the combined group could be reduced by at least GBP175 million a year by the end of 2016. Monday's statement follows a remark by Carillion Chairman Philip Green' in the Sunday Times. Green said: "Our synergy numbers have been audited, and at GBP1.5 billion it is virtually the same as the current market value of either company." In a separate announcement Monday, Carillion said it has signed a GBP90 million contract with HUB Residential to deliver a residential development project in London's Royal Docks.
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UDG Healthcare said it has sold its 50% stake in UniDrug Distribution Group to its joint venture partner Alliance Boots in a cash deal worth GBP66 million. UDG said the disposal proceeds will be used for general corporate purposes and to pay down debt.
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WS Atkins said it has reached an agreement to sell off its Polish business to a Norwegian consultancy and design company in a GBP2.8 million cash deal. The engineering and consulting firm said it has sold the business to Multiconsult AS in a deal that is set to complete in September 2014. The Polish business employs 77 people and reported revenue of GBP5.0 million in the year to March 31, 2014, said WS Atkins.
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AIM MOVERS
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Sirius Minerals is up after it signed an additional binding take or pay offtake agreement for polyhalite from the York Potash Project in North Yorkshire. Richland Resources is also up after it said it has started work on the refurbishment of its Sapphire project in Queensland, Australia. Orosur Mining is another gainer after it swung into profit in its last financial year, on the back of significantly lower impairment costs compared with a year earlier. Nyota Minerals is up after KEFI Minerals unveiled an updated mineral resource report on the Tulu Kapi gold deposit in Ethiopia. Nyota Minerals has a 10.3% stake in KEFI Minerals, and a 25% stake in KEFI Minerals (Ethiopa) which owns the whole of the Tulu Kapi project. Nyota is preparing for a shareholder vote on selling its remaining stake in the operator of the project to KEFI Minerals. Kea Petrolium has lost more than half its value after it said that its Puka-3 well is being plugged and abandoned. LiDCO Group is also down heavily after it warned its revenue is expected to drop to GBP3.7 million in the half year to end-July, from GBP4.2 million a year earlier, due to some de-stocking in the UK and a lack of sales to its distributor in Japan. Red24 is another faller after it warned its pretax profit in the current financial year will take a big hit from the decision by a key customer to review their product range in the UK. The group said the decision will cost it about GBP500,000 in revenue and about GBP250,000 in pretax profit.
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Top Economics And General
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The Bank of England would not wait for real wages to rise before raising the bank rate from its current 0.50% level, Governor Mark Carney said in an interview. "We have to have the confidence that real wages are going to be growing gradually" before raising rates, he told the Sunday Times. "We don't have to wait for the fact of that turn to do so," he added. In the quarterly Inflation Report, released on August 13, the bank said future developments on wages would have a greater influence on interest rate decision. The bank suggested that the rates will not rise soon as wage growth remain subdued and the economy faces challenges from external environment.
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The average asking price for a house in the UK was down 2.9% on month to GBP262,401, property tracking website Rightmove said. That's the largest monthly decline ever observed in August, the site noted, and it follows a 0.8% contraction in July. On a yearly basis, house prices were up 5.3% - slowing from the 6.5% increase in the previous month. A slowing market in London was the main cause for the decline, tumbling 5.9% on month but still adding 10.3% on year. The North was the only region to see an increase in prices in August, advancing 0.5% on month.
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Kurdish Peshmerga forces, aided by US airstrikes, Sunday regained control of Iraq's strategic Mosul Dam from the Islamic State militants, media reports said, citing Kurdish officials. "The Peshmerga troops have imposed full control on the dam," the independent Iraqi site Alsumaria news quoted an unnamed Peshmerga official as saying."The US warplanes continue to bombard positions of the Islamic State insurgents around the dam." US Central Command confirmed that it conducted 14 strikes against Islamic State forces near Mosul Dam on Sunday "using a mix of figher, bomber attack and remotely piloted aircraft."
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Russian Foreign Minister Sergei Lavrov said that a political settlement of the conflict in Ukraine was possible only if the government in Kiev halted its military campaign against separatist rebels in the east. "As long as Kiev seeks a forceful solution, international efforts ... won't have success," Lavrov told reporters in Berlin, according to Russian news agencies. Lavrov added that four-party talks with his colleagues from Ukraine, Germany and France late on Sunday made no progress on the issue of a ceasefire, because the Ukrainians "keep making vague demands." It was unclear Monday if the talks would continue.
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Pro-Russian separatists claimed Saturday that they had opened up a supply line between the besieged eastern Ukraine areas of Donetsk and Luhansk. Their next aim in fighting with Ukrainian government forces is to break the army blockade of the city of Luhansk, separatist leader Andrei Sakhartshenko told Russia's Interfax news agency. Residents in Donetsk city reported heavy fire in numerous areas of the metropolis of 1 million people. Ukraine's National Security and Defence Council reported from Kiev that the military operations would continue for some time because the taking of areas held by separatists could not be accomplished in a few days.
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Eurozone's trade surplus increased unexpectedly in June, data showed. The trade surplus rose to EUR 16.8 billion in June from EUR15.4 billion in May, Eurostat reported. Economists had expected the trade surplus to decrease to EUR15.1 billion. Exports increased 3% year-over-year and imports grew 2% in June.
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New home prices in most Chinese cities fell in July, data from the National Bureau of Statistics showed. Average new house prices in 64 out of the total 70 cities declined in July from the previous month. Property prices in Hangzhou dropped the most, by 2.5% month-over-month in July. Prices in major cities like Shanghai and Shenzhen fell 1.4% and 0.6%, respectively.
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Liberia's armed forces were given orders to shoot people trying to illegally cross the border from neighbouring Sierra Leone, which was closed to stem the spread of Ebola, local newspaper Daily Observer reported. Soldiers stationed in Bomi and Grand Cape Mount counties, which border Sierra Leone, were to "shoot on sight" any person trying to cross the border, said deputy chief of staff, Colonel Eric Dennis. The order comes after border officials reported people continued to cross the porous border illegally. Grand Cape Mount county had 35 known "illegal entry points," according to immigration commander Colonel Samuel Mulbah. Illegal crossings were a major health threat, said Mulbah, "because we don't know the health status of those who cross at night."
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WikiLeaks founder Julian Assange said he "soon" would leave the Ecuadorian embassy after spending two years in the London mission while facing a Swedish arrest warrant. The 43-year-old Australian did not give a date for his departure or details about his plans thereafter. News reports have indicated he is ill. Assange said his health has deteriorated during his time in the embassy.
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Afternoon Watchlist (all times British Summer Time)
15:00 US NAHB Housing Market Index
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Tuesday's Key UK Corporate Events
H&T Group Half Year Results
Castings Interim Management Statement
Mears Group Half Year Results
Imperial Tobacco Group Interim Management Statement
BHP Billiton Full Year Results
Cairn Energy Half Year Results
John Menzies Half Year Results
Persimmon Half Year Results
TT Electronics Half Year Results
John Wood Group Half Year Results
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Tuesday's Key Economic Events (all times British Summer Time)
07:00 Japan Machine Tool Orders
09:00 EU Current Account
09:30 UK Consumer Price Index
09:30 UK DCLG House Price Index
09:30 UK Producer Price Index
09:30 UK Retail Price Index
13:30 US Building Permits
13:30 US Consumer Price Index
13:30 US Housing Starts
13:55 US Redbook index
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