The Finnish mining and metallurgical technology company Outotec Oyj has announced a €93 million takeover offer for Larox Corp, the industrial filter manufacturer. Under the offer, Larox shareholders will be receive 0.45 Outotec shares per each Larox series A share and 0.40 Outotec shares per each Larox series B share that they hold.

Outotec says that Larox’s filtration technologies complement its own technology portfolio and that the transaction supports Outotec’s industrial water treatment and energy sector activities. Larox also gives Outotec access to the chemical industry market.

"Our aim to supplement the technology portfolio became achievable through this share exchange arrangement. Larox’s products and services fit seamlessly into Outotec’s technology portfolio. The transaction also supports our objective of profitable growth. By combining our respective sales and service networks and product portfolios we can provide even more comprehensive solutions and services for minerals concentrators and metallurgical plants and generate more added value to our joint customer base,” said Tapani Järvinen, CEO of Outotec.

“I believe that this arrangement will provide Larox's employees with more diverse opportunities to develop their careers and all shareholders will be offered an opportunity to continue to invest in a strong company within the same industry. Also the customers will benefit from the increased resources, which will allow Larox to persistently develop and increase the filtration business,” said Timo Vartiainen, chairman of Larox.

BHP to Look for More Joint Ventures

Miner BHP Billiton Plc/Ltd is considering more joint ventures like its 50-50 iron ore deal with Rio Tinto Plc/Ltd as it seeks to increase production while keeping costs under control.

BHP's stance as the world's biggest mining company means takeovers would be rare since it is only seeking huge assets, Chief Executive Marius Kloppers told the group's annual meeting of shareholders in London.

Earlier this year, the world's second- and third-biggest iron ore miners agreed to combine their iron ore assets in Western Australia. Production will be marketed separately.

Kloppers said BHP planned about $10 billion in capital and exploration spending during the current financial year to end June 2010, little changed from the previous year when spending was $10.7 billion. On Oct. 21, BHP declared force majeure at Olympic Dam, the world's No. 4 copper mine, and reported near-flat quarterly output of iron ore.

Australia Approves Felix Resources Takeover

Australia approved Chinese firm Yanzhou Coal Mining Co's $2.9 billion takeover of coal-miner Felix Resources Ltd, but said the local firm's assets must be run by an Australia-based company.

The deal is also conditional on listing the local unit on the Australian market and trimming Yanzhou's holding, but it does not change Australia's declared bias against takeovers of greenfield resource projects or major mining companies.

"I won't say this is a dramatic shift in government policy," said Ian Ramsay, a law professor of University of Melbourne.

"We are seeing government policy evolve in relation to foreign investment decisions and that is certainly the case in relation to investments by Chinese companies in Australian resources sector."

Chinese state-owned companies have been looking to buy up Australian mining assets to secure supplies of raw materials for its rapidly growing economy, the world's third largest.

The Australian government has stipulated that Yanzhou Coal must list the local unit on the Australian stock market by 2012 and cut its ownership to less than 70%, Assistant Treasurer Nick Sherry said in a statement.

Sherry said Yanzhou had already accepted these conditions, as well as promised to base the local unit's chief executive and chief financial officer in Australia.

Yanzhou further agreed to market coal produced at all of its Australian mines "on arms-length terms with reference to international benchmarks and in line with market practices."

Felix, which has mines in Queensland and New South Wales states, produced 4.8 million tonnes of coal in the year to June. Analysts expect the deal to boost Yanzhou's output by about 10%.

ASIA

China Investment Corp to Invest $700m in Second Mongolian Mining Deal

China Investment Corp, a near-$300 billion sovereign wealth fund, plans to invest $700 million in Hopu-backed Iron Mining International Ltd, Reuters recently reported.

The investment would be the Chinese fund's second involvement this week in a Mongolian mining deal as it shifts its investment strategy to natural resources from financial institutions.

CIC's investment in Iron Mining follows a recent $500 million deal with SouthGobi Energy Resources.

The fund's investments in Mongolian mining companies come after a recent change in Mongolian mining laws that have paved the way for foreign investment. Iron Mining International, part-owned by private equity firm Hopu and Singapore state investor Temasek, plans to list shares in Hong Kong late this year or early next year, hoping to raise up to $1 billion.

CIC's deal with Iron Mining International involves a $500 million convertible loan, with an option to increase the loan to $700 million, according to the Wall Street Journal.

CIC has asked Iron Mining, which owns and operates a Mongolian iron ore mine, to add partly-owned China International Capital Corp as an underwriter for the IPO, along with Credit Suisse, which was an early investor, the Journal reported.

Hopu, a China-focused private equity firm run by Fang Fenglei, chairman of Goldman Sachs' securities joint venture in China, jointly invested $300 million with Temasek in International Mining, previously known as Lung Ming Investment Holdings Ltd.

Credit Suisse invested $120 million in the company at the time and private equity firm Clarity invested $20 million, according to a source who was not authorised to speak publicly about the deal.

China's robust economic growth and commercial property boom has made it the world's largest iron ore buyer, consuming more than half its traded ore.

Indonesia Says Newmont Batu Hijau Gold Output To Decline Over 5 Years

Indonesia's Department of Energy and Mineral Resources says production at PT Newmont Nusa Tenggara-more commonly known as the Batu Hijau gold mine-will decline by 7% over the next five years.

Bambang Setiawan, director general of mineral, coal and geothermal within the department, said, "The output correction is not significant. The state revenue from NNT will not necessarily significantly decrease because it will also be influenced by the price of copper."

NNT spokesman Rubi W. Purnomo told the Jakarta Post, "We estimate the production output target will be corrected by between 1.5 and 2% per year in four to five years." The company's parent, Newmont Mining, announced on September 22nd that operations at the Batu Hijau mine had been suspended because of a geotechnical failure in the west wall of the mine.

Newmont originally set production target of 355 million pounds of copper and 486,000 ounces of gold this year at Batu Hijau. The company is currently processing stockpiled lower-grade ore at the mine.

Bambang said it will take five months for Batu Hijau, Indonesia's second largest copper mine, to get back to normal. He added, "NNT must design the mine and obtain a new permit based on an environmental impact analysis."

Mine production is expected to resume in February.

AUSTRALIA

Desert Uranium Discovery Considered to Have Good Potential

Manhattan Corporation Ltd told the Mining 2009 Mining Convention in Brisbane recently that the new Stallion discovery has opened up the potential of the Ponton uranium project - 180 kilometres east of Kalgoorlie -- in the remote far south west of Western Australia.

Manhattan's chief executive Alan Eggers said that about $4 million will be ploughed into a new exploration programme on Stallion and Stallion South which are seen as linking up with the company's Double 8 discovery which surprised the market in mid 2009. Eggers said Double 8 was now ranked as the 22nd largest deposit in Australia and the ninth largest in Western Australia.

Double 8 now has a resource of 10.9 million lb of U308 and Eggers said the immediate quest was to double Ponton resources. The project abuts Energy & Minerals Australia Ltd's Mulga Creek project, based on large sedimentary uranium discoveries made decades ago by a Japanese power utility.

Eggers said that the deposits at Ponton would be amenable to in situ leach recovery.

Eggers, one of the Australian uranium sector's strongest advocates, said it was time for the Queensland Government to lift its ban on uranium mining as it made no sense and deprived the State from becoming a major player, like Western Australia which lifted its ban with a change of Government late last year.

Another presenter at Mining 2009, Greg Hall of Toro Energy Ltd said it was time the host state woke up and joined the rest of the uranium-prone Australian States in mining uranium.

Uranium Explorer on Kalgoorlie's Doorstep

Atom Energy Ltd is embarking on a drilling programme at the Excelsior and Zoroastrian deposits at Bardoc, immediately north of Kalgoorlie - two projects secured by the company recently after it decided to add gold to its exploration portfolio.

The company said there was already an inferred resource at Bardoc of 8 million tonnes grading 1.4 grams/tonne gold for 366,000 ounces - a resource that until earlier this year would have been considered sub economic.

The Kalgoorlie North Project covers 25 kilometres of strike of the Bardoc Tectonic Zone in Western Australia's major gold producing region and is near established infrastructure and processing facilities.

Atom Energy director Bruce Lane said drilling will take in some deep holes to test for strike extensions to the Excelsior deposit.

A recent review by Ravensgate Resource Consultants identified that many of the Kalgoorlie North project resources would benefit significantly from further drilling at depth and on strike extensions.

The Company also plans to undertake drilling at the Bulletin, North Talbot, Jackorite, South Duke and Ajax prospects. Atom Energy has secured a right to some of the old gold mines at the northern end of Kalgoorlie's Golden Mile.

Joining the exploration programme is geologist David Hamlyn who was managing director of Atom Energy for its first year but left after some boardroom disputes.

Atom retains uranium prospects in and around Alice Springs in the Northern Territory and after a new board was appointed early this year it joint ventured its Cleos uranium project in the Pine Creek region, south of Darwin to Thundelarra Exploration Ltd, a Perth company that has made a high grade uranium discovery in that region.

New Western Australian Gold Mine Due by Christmas

John Williams, managing director of A1 Minerals Ltd told the Mining 2009 Resources Convention in Brisbane that everything was on schedule for first gold to be poured at the Brightstar gold project near Laverton in Western Australia.

Williams said the company had been exploring in the historic Laverton mining camp since being formed in 2002 and in the past 11 months it had dramatically increased the resource to 1.7 million ounces and announced a proven reserve of 150,000 oz.

A1 had also established a plant construction contract and the 300,000 tonnes per annum plant was now virtually completed and mine stripping has begun on the first mining target - the Beta deposit.

Initially the operation will have a rated production rate of 30,000 oz per annum of gold and the head grade was expected to be better than 4 grams/tonne.

The company controls exploration permits covering 500 square kilometres in the Laverton region which has a mining history and current mining reserves of more than 30 million oz.

The Beta mine, where the gold plant is established, was expected to have a total mining length of 800 metres and to its known depth of 90 metres has a probable reserve of 350,000 tonnes grading 4 g/t.

Williams told a questioner that the gold plant had been set in place for deliberate expansion with some physical facilities and equipment already in place. The cost to complete expansion, including another ball mill, at up to 750,000 tonnes per annum of ore could cost as little as $A2 million ($US1.79 M).

New Discovery for Sandfire in Murchison Goldfield

Sandfire Resources has discovered a new massive sulphide lode east of its Degrussa and Conductor 1 discoveries at Doolgunna in Western Australia's Murchison goldfield.

Technical director John Evans confirmed that the new target had a 15 metres intersection of massive sulphide mineralisation starting at 631 metres downhole.

Drill hole DGDD-035 was testing a strong off-hole conductor detected by a down hole EM survey and Evans said it provided strong evidence that there is a deeper, separate, massive sulphide mineral deposit about 120m stratigraphically below Conductor 1 at depth to the east.

The new hit correlates with the massive sulphide intersections in hole DGDD-016 (4m of massive sulphides from 670.8m down hole), 80m to the west.

While holes DGDD-016 and DGDD-35 were collared 80m apart, the new intersection was actually 93m east of the intersection in DGDD-016 because of the hole drifting off line to the east.

Sandfire recently started another deep diamond hole, DGDD-043, which has been collared 80m east of DGDD-035, to further test the new Conductor 4 discovery.

The discovery of a new massive sulphide lode at Conductor 4 adds further weight to the geological model for the Doolgunna Project as an emerging VMS (volcanogenic massive sulphide) field comprising multiple lodes of copper-gold mineralisation.

It also confirms the accuracy of the down hole EM survey response and the importance of this technique as a key exploration tool in unlocking the potential of the field.

Sandfire was continuing in-fill resource definition drilling in the north-west sector of the Conductor 1 deposit. This involves short, rapidly completed drill holes and field logging.

The company's September quarter report showed that the bonanza grade hits of the previous quarter were not a rarity, for the latest results included deep diamond holes that gained high grades both in DeGrussa and the lower profile Conductor 1.

This Greenfield discovery near old unspectacular gold workings has prompted an exploration rush to the region more than 100 kilometres north of Meekatharra, and several companies holding exploration licences in the Murchison have cited their position near Doolgunna. This prompted business writers to refer to a return to "nearology" which was an unique science of logistics used by promoters during the 1970s nickel boom.

UNITED STATES

USGS Finds Global Rare Earth Metals Reserves Currently Sufficient

The U.S. Geological survey says the long term outlook for rare earth elements "appears to be for an increasingly competitive and diverse group of rare-earth suppliers."

In the advance release of a USGS minerals yearbook article, USGS scientists advised, "As research and technology continue to advance the knowledge of rare earths and their interactions with other elements, the economic base of the rare-earth industry is expected to continue to grow."

"New applications are expected to continue to be discovered and developed, especially in areas that are considered essential, such as energy and defense," the agency said.

Rare earth elements are critical to information and communication, and are an important component of clean and potentially green energy. They are used in magnets in electric motors for electric cars, and allow companies to refine oil.

The world's major supplier of rare earth metals, China, is increasingly withholding rare earth metals for its own needs and reducing export quotas for Europium and Yttrium oxides by 6% and 34% respectively this year.

Meanwhile, in the U.S. the last of government's stock of rare earths in the National Defense Stockpile was shipped in 1998. Rare Earth elements are unique in many electronic, optical and magnetic military applications. The USGS advised that national defense material requirements "may necessitate the inclusion of rare earths, including scandium and yttrium, in the NDS at a future date."

Last month, the publication Defense News warned, "Now armed with its monopoly, China is jacking up prices by cutting production and exports and pressuring high-tech manufacturers to set up shop in China, where supplies are more plentiful."

"The combination of rising costs and tighter control on exports, however, is alarming companies worldwide, including U.S. weapons makers and Pentagon officials."

In 2007, the USGS found that rare earth exports in three out of four trade categories decreased. The principal destinations that year were Japan, Canada, China, Germany, the United Kingdom, Mexico, Egypt, the Republic of Korea, the United Arab Emirates, Hong Kong, Estonia, and the Netherlands.

Interestingly, imports of rare earth metals and alloys into the U.S. decreased 10% that year to 653 tonnes valued at about $6.5 million.

Rare earth producers outside of China are generating less than 5% of the world's supply, the USGS noted. They are expected to continue to struggle to remain competitive with China's lower wages, inexpensive utilities and less restrictive environmental and permitting requirements.

However, the USGS suggests, "Increasing prices, export limits, rising demand within China, and a ban on new mining permits were expected to make rare-earth deposits outside of China more economic."

In the meantime, "Economic growth in several developing countries could provide new and potentially large markets in Eastern Europe, India and Southeast Asia."

The USGS has visited or researched rare earths deposits for Colorado, Idaho and Montana, Missouri, Utah and Wyoming.

The agency also examined deposits and projects, as well as rare-earth metal industrial manufacturing processes in Australia, Brazil, Canada, China, France, Japan, Malawi, Malaysia and Zambia.

Their conclusion: "World reserves are sufficient to meet forecast world consumption well into the 21st Century."

"Several very large rare-earth deposits in Australia and China (for example, Mianning in China and Mount Weld in Australia) have yet to be fully developed," the scientists noted. "Existing production is currently not sufficient to meet world demand, and shortages exist for neodymium and dysprosium for magnet alloys and europium and terbium for phosphors."

"Although the Mountain Pass deposit on the United States contains sufficient resources to meet domestic demand for light-group REEs, the deposit does not contain sufficient heavy-group REEs to meet demand for those elements," the agency asserted.

The Colorado-based Molycorp Minerals, the owner and operator of California's Mountain Pass Mine, has formed a U.S. Rare Earth Industry and Technology Association (REITA). The association's executive director Keith Delaney said much of America's rare earth technology and manufacturing infrastructure was moved to China. As a result, there are significant gaps in entire supply chains for rare earth material and products which no longer exist in this country.

Charter members of REITA include General Electric and the Colorado School of Mines among others.

Compass Minerals Q3 earnings Beat Expectations

Compass Minerals International Inc's posted third-quarter earnings that beat analyst estimates, helped by strong pricing and lower costs in its de-icing salt segment.

In the latest quarter, the specialty salts and fertilizer maker posted a net income of $25.7 million, or 77 cents a share, compared with $28.7 million, or 87 cents a share, a year ago.

Revenue for the quarter, however, dropped 23% to $182.3 million.

Product sales of the company's de-icing salts, commonly used to clear snow on the roads during winter, rose 12 percent and average selling prices improved 10 percent, helping offset huge sales and price declines at its other segment which makes sulphate of potash, a key crop nutrient.

Apollo Gold Divests Montana Tunnels

Haywood Securities said the decision of junior gold miner Apollo Gold to sell its 50% interest in the Montana Tunnels project in Montana to joint venture partner Elkhorn Tunnels for US$9 million should help with Apollo's $6.3 million debt payment.

The two companies have entered into a letter of intent for the sale of the 50% interest in Montana Tunnels, the Diamond Hill mine and mill as well as ancillary equipment for US$5 million in cash over the next seven months and a 4% net smelter royalty payable from future production to a maximum of $4 million.

Elkhorn Tunnels is a subsidiary of Elkhorn Goldfields, a private company owned by the Black Diamond Financial Group.

Both companies will continue to review other property owned by Montana Tunnels and Apollo will have the option of forming a joint venture with Elkhorn to pursue other exploration opportunities.

In a recent analysis, Haywood noted that Apollo will receive $750,000 in payments prior to the December 31st debt repayment of $6.3 million. Haywood estimates Apollo's current cash balance to be $5 million.

Located in the Timmins Mining District, Black Fox produced its first gold in May. A feasibility study has estimated total probable reserves of 1,330,000 ounces of gold at Black Fox.

Haywood noted the transaction allows Apollo to concentrate on Black Fox. The company had been spending between $50,000 to $60,000 a month on the Montana Tunnels project, which has been on care and maintenance since April 30th.

Teck Resources Red Dog Mine Expansion on Track

The world's biggest zinc mine is on the verge of growing even bigger, with federal and state approval of a major expansion expected imminently.

The Red Dog Mine in northwestern Alaska, operated by Teck Resources Ltd on land owned by the region's native Inupiat Eskimo people, would be allowed to start processing ore at a new site that would effectively double the 20-year-old mine's lifespan, under the pending permits.

Since the mine opened in 1989, Teck has processed about 1 million tons of zinc and lead annually from ore pulled out of the original Red Dog mine pit. The operation above the Arctic Circle has infused money into a remote region where cash-paying jobs are scarce.

Now Teck and NANA Corp, the Inupiat company that owns the Red Dog property, are seeking to expand mining into an adjacent and relatively newly discovered ore body called Aqqaluk. The name honors Robert Aqqaluk Newlin, the original president of NANA Corp.

That expansion -- contingent on several federal and state permits -- is needed to keep Red Dog from shutting down in 2011, company officials say.

"We need the ore to continue to provide feed to our plant," said Jim Kulas, Red Dog's manager of environmental and public affairs. "After 2011, where we're mining now will be totally exhausted."

The major permits needed for the expansion are a wastewater-discharge authorization from the U.S. Environmental Protection Agency and a wetlands-fill authorization from the U.S. Army Corps of Engineers.

The EPA, after two years of formal review, issued a final report on Oct. 9 saying it planned to approve the Red Dog permit application. The final permit could be issued as early as December, after a 30-day public-comment period and a 30-day administrative appeals period expire, said Patty McGrath, the EPA regional mining coordinator managing the review.

Kulas said the wetlands permit from the Corps is also expected soon, as are associated state and local permits.

The mine operators hope to start working on the Aqqaluk deposit in early 2010, he said.

"As soon as we get the authorization to get into the area, we will," he said. "The sooner we can get into the Aqqaluk, the better."

Red Dog may be able to meet that schedule, McGrath said. "I believe it's realistic if there aren't appeals of our permit or the Corps permit or any of the other permits," she said.

Red Dog, and its planned expansion, has the backing of Alaska's political and business establishment. The mine is cited as an Alaska success story, producing income and creating jobs and careers for indigenous residents who might otherwise be impoverished.

But environmentalists and some neighbors say the mine's record is spotty, inflicting years of harm on the fragile Arctic environment. They point to studies finding that harvests of caribou and beluga in the vicinity of Red Dog have fallen to less than half of pre-mine levels. Red Dog has been cited in the past by federal and state regulators for improperly releasing sediments and metals into the water and air.

In a settlement deal stuck a year ago, Teck pledged to spend up to $120 million on a pipeline to carry wastewater directly to the Chukchi Sea, bypassing the river. The company also pledged to pay for widespread water-system upgrades in Kivalina.

In exchange for those commitments, the villagers are supporting the mine expansion.

AFRICA

Cluff Gold Shares Rise on Ivory Coast Plant Announcement

West Africa-focused gold miner Cluff Gold Plc said it successfully commissioned its Angovia gold mine located 40 kilometres north-west of Yamoussoukro, Ivory Coast.

The commissioning of the Angovia gold mine comes three months after the commissioning of its Kalsaka gold mine, about 150 kilometres north-west of Ouagadougou, Burkina Faso, the company said in a statement.

Cluff Gold expects its aggregate target of annualised gold production of 100,000 ounces for Angovia and Kalsaka to be achievable in the last quarter ending Dec. 31.

Discovery Metals to Spend $150m on Botswana Copper Project

Exploration company Discovery Metals Ltd plans to spend an initial $150 million developing the Boseto copper project in Botswana, managing director Brad Sampson said recently.

Sampson said the company would use the funds to build a concentrator, tails dam and related facilities at Boseto, after completing a bankable feasibility study (BFS) next March.

He said Discovery anticipated gearing the project 50%, while the final project financing would be completed after the feasibility study.

The company said last week that it planned to raise project funds through debt financing and equity.

"Discussions are underway with banks, potential off-takers, existing shareholders and potential new investors and these will continue through the BFS completion and into quarter 2, 2010," Sampson told Reuters.

He said the company was in talks with possible off-takers for copper concentrate from Boseto in North America, Europe and Asia, but declined to name them.

Discovery said it expected the Boseto project's annual copper output to reach 25,600 tonnes and silver production to reach 691,000 ounces starting in mid-2011.

Sampson said the firm would for now concentrate its mining activities in Botswana because it was an A-Credit rated country and internationally recognised as a very low-risk nation and attractive for investment.

He said Discovery, which also had a nickel sulphide project containing copper and platinum group metals at Dikoloti in Botswana, had agreed a joint exploration deal with state-affiliated Japan Oil Gas and Metals National Corporation.

Diamond Demand Stabilizing - De Beers

Demand for diamonds has started to stabilise, Sheila Khama, chief executive of De Beers in Botswana, told the Financial Times newspaper, adding that the company's flagship mines were operating at 80% of capacity.

"Consumption has not improved to anywhere near the levels that we are accustomed to ... but the abrupt rate at which it was dropping has started to stabilise," she said.

The pace of recovery was picking up in rough diamonds, the paper said recently, citing Khama.

"We are seeing an improvement in the level of sales and the availability of finance to our clients," she added.

De Beers, which produces around 40% of the world's rough diamonds, was forced to shut down its Botswanan operations earlier this year in response to a slide in demand for the gem.

McIlvaine Company

Northfield, IL 60093-2743

Tel: 847-784-0012; Fax: 847-784-0061

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