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Debswana, a Botswana-based company, will approach the capital markets to finance Jwaneng underground Project
Debswana Diamond Company in Botswana is turning to the international capital market to fund its $6 billion Jwaneng Underground Project, said a director on Monday. The company's declining revenues have made it difficult to finance capital projects. Andrew Motsomi, managing director of the company, said that despite the decline in the global market for diamonds since the second half 2023, it is still pressing forward with its plan to convert its flagship Jwaneng Mine into an underground operation in order to extend its lifespan to 2054. This was revealed at a mining event in Gaborone, the capital. Debswana will reduce production by 27% between 2024 and 2025. Last week, the company announced that it would further reduce production by 16% in 2025 to 15 million carats. Debswana is a joint venture 50-50 between Botswana’s government and De Beers. It has previously funded its capital projects mainly with funds generated internally or from investors. Motsomi stated that the company was now working to acquire an international credit score to allow it access to capital markets. Motsomi did not specify how much money the company was looking for. "With revenues decreasing, the company faces escalating requirements for capital." Debswana anticipates an increase of capital expenditures from 5 billion pula (373.3 million dollars) per year for the last five years to 8 milliards pula per year over the next five years," he stated. Debswana began the underground Jwaneng project in May of last year, as open pit operations are expected to reach their limit by 2034. Bogolo Joy Kenewendo, Botswana’s Minister of Minerals and Energy, also spoke at the conference. She expressed her optimism for a recovery in sales of diamonds starting in 2026. This will be supported by structural changes and long-term investments. Since January, the market has begun to show positive signs. "While we're not where we want to, the upward trend gives us hope that we can have a stronger recovery in the second half of the year," said she. ($1 = 13,4048 pulas). (Reporting and editing by Nellie Peyton, Alison Williams.
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TMC secures $85 million investment from Korea Zinc amid US mineral push
The Metals Co, a deep-sea miner, announced on Monday that South Korean refiner Korea Zinc would invest $85.2 millions. This will give the company a boost in its plans to supply vital minerals for the U.S. Energy Transition. The deal includes warrants that allow Korea Zinc to purchase more shares. TMC shares rose 7% during pre-market trading. TMC is seeking a U.S. license to harvest commercially polymetallic nodules on the seafloor. These nodules contain nickel, cobalt, copper and manganese, metals that are used in electric cars, grid infrastructure, and defense. Gerard Barron is the CEO of TMC. He said that Korea Zinc was the only company in the world capable of converting TMC USA materials into the metal products required by the United States. Both the Biden and Trump administrations are pushing to reduce China's reliance on these minerals. Korea Zinc is buying 19.6 million shares for $4.34 per share and receiving a 3-year warrant that allows them to buy 6.9 million at $7 each. TMC expects the transaction to close by June 26.
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Norway's parliament approves a new scheme of power subsidies for households
The Norwegian parliament passed on Monday a bill introducing fixed-price power contracts with subsidies for householders, which is the second scheme in the country to alleviate consumers' concerns about high and volatile power prices. Norway is holding a general elections in September. The cost of living, and the competitiveness of industry are expected to be key topics. The model, called Norway Price, offers consumers the opportunity to sign a contract with a fixed rate of 0.40 Norwegian crowns (0.041 USD) per kilowatt-hour (kWh), excluding fees. This initial period will run from Oct. 1, 2026 until Dec. 12. Payments are limited to 5,000 kWh/month per household and 1,000 kWh/month per holiday home. Norway Price aims to give consumers a predictable cost and is an alternative to the existing subsidy program introduced to respond to the rising costs during the energy crisis of 2022, which covers 90% all costs over 0.7 crowns/kWh. The new model is expected to be adopted by 60% of households in southern Norway and 80% holiday home owners. It could cost up to 6.6 billion crowns by 2026. Hydropower, which is abundant and inexpensive, has historically kept electricity rates low in Norway. Since the 2022 European energy crises, however, consumers in southern Norway who are connected to other European markets by cross-border cables have faced higher and more volatile costs. Former coalition partners Centre Party and Socialist Left have lent their support to the Norwegian Price law, introduced by the ruling Labour Party. The far-left Red Party also supports the law. The government's proposal, according to critics, was too expensive, took away power-saving incentives, and increased prices for those who were not eligible. This included businesses. ($1 = 9.8811 Norwegian crowns)
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Brent Oil Futures Structure Changes Due to Israel-Iran Conflict
Investors priced in the increased likelihood of Middle East supply disruption as they traded Brent crude futures contracts for first-month delivery and those for six-month delivery on Monday. Spread between Brent August contract and February 2026 contract On Monday,, the price of a barrel reached $6.00, just a little higher than the high of $6.95 on Friday. This was the highest price since October 2023. The spread was at its lowest level since December 2023, at a discount of 29 cents. Investors priced in an increased geopolitical premium for oil contracts that are due to be delivered after Israel struck targets in Iran on Friday. David Wech, Vortexa’s Chief Economist, said that the change in structure was a result of the spike at the front. The risk of disruption of the 18-19 million barrels of oil per day (bpd), which flow through the Strait of Hormuz, increases if the regional conflict between Israel & Iran intensifies. Janiv Shah, vice president for commodity markets at Rystad Energy, said that the Strait could squeeze up to 15 million barrels per day of crude oil exports, and 4 million barrels per day of product exports. This, in the current season of demand growth, may cause front-month accounts to fall into a deficit. The "backwardation", or the trading of contracts above those for future deliveries, is a common sign of tightening oil markets. Its opposite, "contango", signals a weaker market in the short term. Brent's front-end curve was already tightening as we entered the summer months in the northern hemisphere, albeit with a more shallow backwardated structure. Market participants anticipated a strong peak fuel demand, before a decline later this year, when OPEC, and non-OPEC, supply increases and demand decreases. The fact that the price of oil hasn't changed much in the past few months suggests that participants in the market do not expect the market to change over the long term. Vortexa's Wech added that a healthy fuel demand for the Atlantic Basin also contributed to the higher oil prices.
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MEG Energy board urges shareholders not to accept Strathcona’s $4.42 billion bid
MEG Energy, a Canadian oil company, urged Monday its shareholders to reject Strathcona Resources' hostile takeover bid of nearly C$6 Billion ($4.42 Billion), calling it inadequate and not in the best interests of their shareholders. The board launched a review of strategic alternatives to MEG's plan to become a separate company. Strathcona Resources, a Canadian oil and natural gas company, announced in May that it would launch a hostile bid to take over MEG Energy. Strathcona Resources valued MEG Energy's shares at C$23.27 each. MEG's closing price was C$25.71. MEG later advised its shareholders not to take any action regarding the unsolicited bid. Strathcona has been one of North America's fastest growing oil companies since 2020. Strathcona is owned by Calgary-based Waterous Energy Fund. MEG Energy stated that if the merger were to be completed, WEF would hold 51% of the combined company. This would allow WEF and its shareholders to gradually sell their ownership. The company stated in a press release that "this selling pressure or even the perceived threat of such pressure will immediately and significantly lower the share price of combined company over a long period of time." Strathcona Resources has not responded to a request for comment. (1 Canadian dollar = 1.3563 US dollars) (Reporting and editing by Pooja menon in Bengaluru)
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Residents are urged to leave the area as a wildfire rages.
On Monday, dozens of Greek firefighters battled to contain a wildfire which raged in a dense forest northeast of Athens and forced the authorities to order evacuations. With the help of 17 aircraft and 30 engines 120 firefighters were sent to Ano Souli village, located about 40 kilometers (25 miles), from Athens. Residents of Ano Souli and nearby Marathonas had to evacuate their homes. Greece, located at the southernmost tip of Europe, has experienced frequent floods and wildfires over the past few years. Scientists say that this has been made worse by a rapidly changing climate. The country spent hundreds of millions to compensate farmers and households for damages caused by extreme weather conditions and to acquire modern and advanced firefighting gear to combat wildfires that have grown more difficult to control due to rising temperatures in the summer. In anticipation of a challenging fire season, Greece has hired an unprecedented number of firefighters. In 2023, one of Europe's biggest wildfires ever recorded burned for several weeks in northern Greece. At least 20 people were killed. A destructive wildfire swept down from a mountain into built-up areas near Athens last year, forcing residents to leave.
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NYSE parent Intercontinental Exchange will dual list on NYSE Texas
Intercontinental Exchange, parent company of the New York Stock Exchange, announced on Monday that it would list both on NYSE Texas. This will add to a long list of listings at the bourse in an effort to stay ahead of its competition. NYSE Texas opened its doors in March. It offers a new trading and listing venue for businesses attracted by Texas' business-friendly environment. According to ICE, in the first three month, 10 companies have listed both on the Dallas-based exchange. These include oilfield services company Halliburton and Trump Media & Technology Group, the parent company of Truth Social, as well as recruitment firm Orion Group. NYSE President Lynn Martin stated earlier this month that NYSE Texas has another dual listing with a double-digit number in the works. He added that conversations with companies have been "extremely positive". Texas is quickly becoming a major financial center rivaling New York, as the Lone Star State tries to attract corporate issuers through its pro-business policy and lower taxes. TXSE Group announced last year that it would launch the Texas Stock Exchange with the backing of Wall Street giants BlackRock Securities and Citadel Securities in an attempt to disrupt New York's dominance over the U.S. Capital Markets. The exchange expects to start trading by early 2026 and list securities at the end of that year. Texas also has the most companies listed on NYSE. ICE announced that it would continue to list its primary stock on the NYSE. The dual listing of ICE on NYSE Texas is effective as of June 17. (Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Shilpi Majumdar)
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Sources say that gold mining companies in Ghana and Ivory Coast are resisting tax increases.
Sources in the industry say that gold miners in Ghana and Ivory Coast refuse to pay higher taxes this year because they feel it violates their licence agreements. West African countries have taken advantage of the soaring gold price to raise mining taxes, and generate additional revenue in order to close budget deficits. The six sources in the industry said that mining companies in the area have mostly complied with the rules, except in Ghana and Ivory Coast. Ghana is Africa's largest gold producer and Ivory Coast is Africa's seventh biggest. Sources say that mining companies have agreed to negotiate with Ivory Coast or Ghana governments in order to cancel the tax increases, and to not pay them while doing so. Gold Fields and Newmont are among the producers in both countries. Barrick, Endeavour, Allied Gold, Perseus, AngloGold Ashanti and Barrick. All of them declined to respond or didn't reply to requests for comments. Ivory Coast implemented a flat tax on royalty of 8%, up from the previous 3%-6%, depending on a miner's agreement. Ghana, which is in default on its debts and is going through a debt restructuring process, increased a tax from 1% to 3% on the annual gross production of gold miners in March after appealing to companies to help plug revenue gaps. If people invest for the long-term and the rules are changed midway through, this can have a negative impact on the project. "New rules can be applied to new projects," stated an executive from a major international miner operating in Ivory Coast who requested anonymity. Requests for comments from the mines and finances ministries of Ghana and Ivory Coast were not answered. Two other sources said that Burkina Faso, a military-run country in the region, introduced a sliding-scale royalty regime in early February. The system linked royalties with gold prices and the miners have mostly complied, they added. The new mining codes have introduced aggressive regulations that are mostly followed by the miners of Mali, Niger, and Guinea. ONGOING NEGATIONS Gold prices are up nearly 30% in this year. This has led to higher profits for gold miner in the first quarter. However, sudden regulatory changes can be a major obstacle when doing business in Africa. Barrick and Mali's military-ruled Government have been locked in a standoff for two years over new mining laws aimed at increasing state revenue. The dispute has led to the closure of Loulo-Gounkoto, detentions of executives, and a plunge in Barrick's share price. Barrick, a company that also operates in Ivory Coast did not reply to a comment request. A mining executive revealed that the Ivory Coast miners are in talks with the finance and mines ministries to resolve the issue of the new taxes. Ghana's companies, under the Ghana Chamber of Mines, have asked for the government to reconsider their measures. In the event that the talks do not succeed, the companies may be penalized for late tax payments. Unnamed Ghanaian mining company said that the tax authority had the right to close a company and impose fines. Companies could sue the tax authority if they prove that their contracts are exempt from tax increases. Denis Gyeyri is Africa Senior Program officer at the nonprofit Natural Resources Governance Institute. He said that governments raise taxes too quickly when prices rise, but do not lower them when they fall. Gyeyri stated that loyalty rates should be progressive, compensating mines with low prices while maximising government revenue through high prices. He said that countries should keep their tax rates as competitive as possible. For example, royalty rates in Western Australia vary from 2.5% to 7.5%, depending on how much processing is done. Maxwell Akalaare Adombila (reporting) Loucoumane Coulibaly and Emmanuel Bruce, in Accra and Abidjan. Editing by Veronica Brown & Susan Fenton
Japan's Nikkei ends higher despite Middle East conflict; Advantest soars
The Nikkei 225 index rose more than 1% in Japan on Monday. This was largely due to the 9% increase by Advantest following an upgrade of its brokerage target price. Traders also shrugged off geopolitical tensions with Iran and Israel.
The Nikkei closed at 38,311,33, up 1.26%. The Topix rose by 0.75%.
Shuutarou Yasuda is a market analyst with Tokai Tokyo Intelligence Laboratory. He said that Japanese shares are strong despite concerns about geopolitical risk in the Middle East.
He said that investors were relieved because oil prices did not spike today, which would have affected the local economy.
Global investors closely monitored the Israel-Iran dispute for signs that it could escalate into a wider regional conflict.
Advantest shares in Japan jumped 9.63% on Friday after JPMorgan Securities raised its target price from 10,500 to 11,000 yen. The Nikkei gained the most from the shares.
SoftBank Group, the technology investor, and Uniqlo brand owner Fast Retailing both rose 2.5%.
Yasuda, Tokai Tokyo, also cited a weaker yen as a factor that influenced sentiment.
Last week, the yen fell as investors looked for safe havens such as the US dollar. This trend continued on Monday. The dollar was up by 0.1% last against the Japanese yen, at 144.235.
Exporters benefit from a weaker yen, since it increases the value of overseas profits when they are returned to Japan.
Nippon Steel shares rose 1.5% on Friday after U.S. President Donald Trump approved the $14.9 billion offer for U.S. Steel.
Steelmakers' sector grew by 1%.
Shipping sector rose 1% as a result of expectations that freight rates will rise amid the Middle East conflict. Kawasaki Kisen shares rose by 1.38%.
On the TSE's Prime Market, out of more than 1,600 shares traded, 69% were up, 26% were down, and 3% were flat.
(source: Reuters)