NICKEL NEWS
Mwana eyes new nickel mine
Allan Seccombe
Posted: Mon, 24 Jul 2006
[miningmx.com] -- MWANA Africa will start a six-month bankable feasibility study into developing a mine at its Hunters Road deposit in the next couple of months and is looking for a partner to bring the Zimbabwean project into production, CEO Kalaa Mpinga said on Monday.
“We have completed a feasibility study and metallurgical work at Hunters Road. We are also talking with potential business partners,” Mpinga told Miningmx.
The cost of establishing the Hunters Road mine would be around $100m.
“That’s why we are looking at some joint venture partners,” he said in answer to a question of how the capital would be raised.
talking with potential business partnersThe President Robert Mugabe's government has sent ripples of unease through the mining industry there with its “indigenisation plan” in which it will take 51% of assets. There is no certainty what stake will end up in government hands.
Despite the political risk of investing in Zimbabwe, where the economy is in dire straights, there is still appetite for such a project, he said.
“We have a number of people who have indicated they want to get involved. There is a lot of interest,” he said.
It will be an opencast mine that will produce 7,000 tonnes/year of nickel contained in concentrate to feed into Mwana’s 53% held Bindura Nickel’s smelter and refinery, which is currently treating concentrate from two other Bindura mines as well as concentrate from South Africa and Botswana, he said.
The refinery can handle up to 15,000 tonnes of nickel but it is producing 10,000 tonnes at the moment, including the toll-treated material. Mwana would like the plant to operate at capacity.
The Shangani and Trojan mines are battling with hyperinflation and receiving currency at the official rate, which is a fraction of what the black market rate is. Zimbabwe’s inflation is running above 1,000%, the highest in the world.
Free news alerts: click here to subscribe“Under the circumstances, the operations are running fine,” he said. “Clearly we have a lot of problems at the cost level. They are very difficult to control.”
“Thanks to the high nickel price, we are surviving.”
The two mines produce about 7,000 tonnes of nickel.
The Trojan mine is being expanded, adding another 10 years to its nine-year life. The Shangani mine has a four-year life and a study is underway to prolong it. The Hunters Road concentrate could replace that from Shangani.
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