Canadian company to supply Palawan nickel to 3 countries
A Canada-based mining company operating in Narra, Palawan is anticipating to complete nickel supply deals with Sinosteel Raw Materials Co. (SRMC) of China, BHP Billiton’s QNI in Australia, and Nippon Yakin Kogyo Co. Ltd. (NYKC) of Japan .
Toronto Stock Exchange-listed MBMI Resources Inc. reported that its supply deal with SRMC, a subsidiary of one of the largest steel companies in China, is for a 35,000 to 40,000 dry metric tons (DMT) of nickel ore from its Alpha nickel project. The ore has a minimum grade of 1.8 percent nickel and 17 percent iron.
"The cargo is being prepared currently for shipment, and the buyer is presently securing the carrying vessel," said MBMI in a statement.
The Alpha nickel project in Palawan is covered by three small scale mining (SSM) permits, although it has yet to obtain other documentary requirements of government to be able to start commercial operation.
The company’s agreement with BHP is for its QNI operations in Queensland, Australia and which also involves 35,000 to 40,000 DMT with a minimum grade of 1.6 percent nickel and more than 20 percent iron.
Both shipments to China and Australia are expected to be completed in the near term.
MBMI’s supply agreement with NYKC has been done through Mitsui & Co. Ltd. Shipment will be for 6,000 to 8,000 DMT at a grade of more than 2.3 percent nickel and less than 12 percent iron.
"Representatives of Nippon Yakin and Mitsui have visited the Alpha property and Nippon Yakin is currently evaluating the metallurgical characteristics of samples of materials being prepared for shipment in the stockpile area," according to MBMI.
The agreements with NYKC and BHP Billiton will initially be trial contracts which will determine "metallurgical performance" of the metal. However, the goal of the companies is for a long-term sales agreement particularly when MBMI’s project will have achieved a full-scale mine development stage.
The company even warned that it has not yet declared a reserve in the Narra project that complies with Canada ‘s mining reserve estimate regulations.
"It should be noted that the company has not yet established NI 43-101 compliant mineral resources or mineral reserves that would support a commercial mining operation and there is no guarantee that the sales agreements referred to above will be economic."
The SSM permit allows the company to export 50,000 DMT yearly for two years from each 20-hectare permitted area.
Other agreements are hoped to be struck by the company including with the Hubei Jin Hui of China for a 35,000 to 40,000 DMT of nickel at a grade of more than 1.7 percent nickel and more than 17.0 percent iron.
The company is optimistic of the project’s viability, anchoring its hope on the demand for nickel ore for all grades (of one to above two percent).
MBMI’s local subsidiary already introduced environmental programs particularly a tree nursery project that will revegetate permitted claim areas and provide local inhabitants with cash crop seedlings, supplement government’s vegetation program, and assist the community in education.
"MBMI and its Philippine partners are committed to establishing an environmentally-compliant operation that will stand as a model for responsible mining in the region."
MBMI holds a major interest in a joint venture with Olympic Mines and Development Corp. over three nickel laterite properties in Palawan . Its objective to produce direct shipping ore nickel laterite to generate cash flow to minimize capital cost.
"Two of the Olympic properties are contiguous to Sumitomo Metal Mining Ltd’s Coral Bay project which has been operating a successful direct shipping ore facility for many years," said MBMI.
The company revealed it also has four additional nickel properties in Samar . All its prospects cover a total area of more than 22,000 hectares. Exploration in Bethlehem and Alpha properties began in 2005.
Records indicate that exploration in the 1970s and 1980s show a historic resource of about 64 million metric tons at a grade of 1.7 to 2.3 percent nickel in Olympic’s prospect which has a potential resource of nine to 10 million MT consisting of two percent plus nickel saprolite material suitable for direct shipping. – Manila Bulletin |
