Western Areas sees strong competition for its nickel – by Brad Thompson (Australian Financial Review – August 20, 2019)


Western Areas has flagged hot competition for its nickel when off-take agreements with BHP expire early next year and says the mining giant has only a small window to make premiums from its new battery-focused nickel sulphate plant.

Dan Lougher-led Western Areas said on Tuesday that the rise in electric vehicles was driving keen interest in nickel concentrate from its operations in Western Australia in the countdown to off-take agreements with BHP Nickel West and China’s largest stainless steel maker, Tsingshan, expiring early in 2020.

The company has invited 19 parties to tender for new off-take agreements and says it favours short-term deals based on optimism that nickel prices will continue to strengthen on the back of demand from makers of batteries and battery precursors.

Western Areas, which has forecast nickel concentrate production of 21,000-22,000 tonnes in 2019-20, sells about 55 per cent of its product to Nickel West.

Nickel West is trying to breathe new life into its own mines in WA. It has allocated $US50 million to brownfields exploration and launched a big greenfields exploration program as it looks to boost supply to the Kwinana nickel refinery where it is completing a 100,000-tonne-a-year nickel sulphate plant to meet growing demand from the battery sector.

For the rest of this article: https://www.afr.com/companies/mining/western-areas-sees-strong-competition-for-its-nickel-20190820-p52ive

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