Mwana Africa to Spend US$26m on Re-opening Zimbabwe Nickel Smelter
Some US$26.5million is to be spent on restarting a Zimbabwean smelter after nickel prices soared following a ban in January of Indonesian exports.
The Bindura Nickel Corporation (BNC), which operates the smelter, hopes to have its operation up and running by the first half of 2015.
Parent company, AIM-listed Mwana Africa announced the decision to reopen following the conclusion of an independent study, which found it to be both a beneficial and viable option.
The study carried out by Hatch Goba also found that as well as financial benefits, restarting the nickel smelter would lower transport costs and enable higher revenues through the sale of higher-value nickel leach alloy.
Half of the capital costs are expected to be funded through debt finance while the rest will be met by BNHC’s cash flow and company cash balances.
Kalaa Mpinga, Mwana Africa’s Chief Executive, said: “I am pleased to announce completion of the independent study of the accelerated smelter restart plan. This paves the way for us to capitalise on the opportunity presented by a favourable nickel market.
“We can grow our revenue stream by moving rapidly up the value chain from current production and sale of concentrate, with the associated transportation saving cost of this, to production and sale of higher value nickel leach alloy.
“This study outlines the costs and key milestones required to restart the smelter, and we look forward to updating the market on financing and development of the accelerated smelter restart plan as it evolves over the coming months.”
While Indonesia is planning new investments in nickel smelters, this is anticipated it will take some time before coming to fruition.
Mwana Africa is a pan-African resources company and also has operations in South Africa. It also has a broad range of exploration projects and interests in the Democratic of Congo, Angola, Ghana and Botswana. Its diverse asset base includes gold, nickel, copper, cobalt and diamonds.
Vale invests $150mn to extend life of Manitoba operations
Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.
Global energy transition is boosting the market for nickel
The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.
“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.
“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”
Vale continues drilling program at Manitoba
Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.
“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.
“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”
The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history. Mining of the Thompson orebody began in 1961.
“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.