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Monday, June 22, 2009.

From Creamer Media in Johannesburg, I'm Shannon O'Donnell.

Making headlines today:

Mining giant Xstrata wants talks with mining rival Anglo American about a proposed merger of equals worth about 68-billion-dollars. It would seek increased scale and cost synergies.

A source close to the situation said that Anglo is likely to resist the attempt by Xstrata to forge a larger mining group better able to compete with bigger competitors BHP Billiton, Vale and Rio Tinto.

The approach by Xstrata comes after sector number one BHP agreed on June 5 to combine its Australian iron ore operations with those of Rio in a joint venture. Xstrata has regarded Anglo as an attractive partner for several years.

Xstrata said that the combination would create a premier portfolio of operations diversified across multiple commodities and geographies, with enhanced scale and financial flexibility to fund future growth.

The unnamed source said that Anglo's board would examine the value for shareholders in a combination with Xstrata, compared to the value by remaining independent.

Gold major Gold Fields' Driefontein mine, near Carletonville, remained closed on Monday, following the death of two employees at the weekend.

Gold Fields spokesperson Willie Jacobsz explained that a seismic event, measuring 3,5 on the Richter scale, had occurred in the region on Saturday morning at about 10:00.

This caused a hanging wall failure at the Number 5 shaft at the mine.

A group of five employees, who were working in the area where the failure occurred at that time, were trapped underground. Three of the employees had been rescued throughout Saturday. The two deceased had died of their injuries.

Mine management and the authorities would conduct an inspection throughout Monday.

Also making headlines:

ASX-listed PanAust reports a mill failure at its Laos gold/copper mine.
London-listed silver producer Fresnillo withdraws its offer to buy all the shares in Canada's MAG Silver.
A Parliamentary committee chair says that illegal miners are ‘robbing' the South African economy.
And, production at Geovic Mining's Cameroon project is now set for 2012.

That's a round up of news making headlines today. For more on these and other stories please visit miningweekly.com.