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Nickel Laterites

Vale’s Onca Puma ferro-nickel plant operates through court-ordered mine closure – by Luc Cohen (Reuters U.S. – December 1, 2015)

http://www.reuters.com/

NEW YORK – Dec 1 Brazilian miner Vale is operating a nickel processing plant at the Onca Puma project, an Amazon mine where a court has ordered mining activities halted, the company’s nonferrous metals chief told Reuters on Tuesday.

While the plant continues to process ore into ferro-nickel, Vale has stopped operations at the open pit mine where it obtains the nickel ores, Jennifer Maki, Vale’s head of base metals, said on the sidelines of the annual “Vale Day” event.

Vale, the world’s largest producer of nickel, has said in recent days it is in full compliance with the order to halt mining operations at the key nickel facility.

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Nickel’s hiatus may be brief without output cuts, stronger demand – by Pratima Desai (Reuters U.S. – November 27, 2015)

http://www.reuters.com/

LONDON, Nov 27 Nickel’s spectacular fall since the middle of last year may have come to a halt, but without significant, enduring output cuts and stronger demand from China’s stainless steel mills the reprieve could be brief.

Benchmark nickel on the London Metal Exchange fell to $8,145 a tonne earlier this week, less than half the level seen in May last year and its lowest since the middle of 2003.

Funds reversing their bets on lower prices on the expectation that Chinese producers may cut output since then pushed prices back up to near $9,000 a tonne.

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China’s Nickel Smelters Agree 20% Production Cut for 2016 (Bloomberg News – November 27, 2015)

http://www.bloomberg.com/

Nickel smelters in China, the largest producer, plan to cut output next year by at least 20 percent in a bid to shore up prices after the metal plunged to its lowest in 12 years.

Eight producers, including the largest refined metal supplier Jinchuan Group Co. and nickel pig iron maker Tsingshan Holding Group Co., also agreed to cut output next month by 15,000 metric tons, according to a statement circulated by the group on Wechat.

The smelters didn’t say how much of China’s total supply the 20 percent reduction would account for, but their statement suggests cuts of about 120,000 tons next year, according to Celia Wang, general manager at Tianjin Zhongwei Group Co.’s investment department.

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UPDATE 1-Nickel smelter developers shelve Indonesia projects amid credit squeeze – by Fergus Jensen (Reuters U.S. – November 18, 2015)

http://www.reuters.com/

JAKARTA, Nov 18 Nickel smelter developers are putting projects on hold as they struggle to get financing with metal prices near their lowest in more than a decade, industry and government stakeholders said on Wednesday.

Indonesia was the world’s top exporter of nickel ore until 2014 when it banned shipments in an effort to push miners to develop downstream, or mineral processing, industries.

With abundant reserves of relatively high quality ore investors say there is potential for developing nickel smelters in Indonesia, but the current market is challenging.

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Iron Ore Crisis Could Be Followed By A Nickel Crisis For BHP Billiton And Vale – by Tim Treadgold (Forbes Magazine – November 13, 2015)

http://www.forbes.com/

The last thing two of the world’s biggest mining companies, BHP Billiton and Vale , need today is speculation that after the disaster at their jointly owned Samarco iron ore mine in Brazil they might also have to close big nickel-mining operations to stem a tide of heavy losses.

That, however, is precisely what has been suggested by research analysts at the investment bank Credit Suisse who have painted a depressing picture of demand for the metal which is largely used to make stainless steel.

Vale, as well as being the world’s biggest iron ore miner is the world’s biggest nickel producer thanks largely to its 2006 takeover of Canada’s Inco.

BHP Billiton is also a big nickel producer via its Australian business unit, Nickel West. The attraction of nickel to both is that buyers are essentially the same, with companies that buy iron ore also buyers of nickel to make stainless steel.

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Sherritt widens loss as lower commodity prices weigh – by Henry Lazenby (MiningWeekly.com – October 28, 2015)

http://www.miningweekly.com/page/americas-home

TORONTO (miningweekly.com) – Diversified miner Sherritt International has increased its net loss by C$158.7-million during the third quarter ended September, as lower prices for nickel, cobalt and oil and gas products weighed on its bottom line.

The Toronto-based firm reported a net loss from continuing operations of C$210-million, or C$0.72 a share, compared with a loss of C$51.3-million, or C$0.17 a share, in the prior-year period.

Excluding special items, the company reported an adjusted loss of C$91.4-million, or C$0.31 a share, missing analyst expectations of a loss of C$0.30 a share, on revenue of C$91.9-million.

Consolidated revenue declined 19% to C$246.5-million for the period, mainly owing to lower nickel and oil prices, which were partly offset by a weaker Canadian dollar relative to the US dollar. The gross working interest (GWI) oil output in Cuba was also lower as oil output from new development wells was not able to offset natural reservoir declines, the company stated.

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Indonesia’s Nationalism – by Neil Chatterjee (Bloomberg News – October 19, 2015)

http://www.bloombergview.com/

Indonesia has been plundered since the Dutch collected nutmeg and cloves from the archipelago they called the East Indies 400 years ago. With treasures strung across 17,000 islands, it’s home to the world’s largest gold mine and exports the most power-station coal, palm oil and tin.

Indonesia’s identity was forged by a half-century of sometimes savage dictatorship that sold its riches overseas. Now the country wants to keep more of its wealth at home. The pull of protectionism has characterized the presidency of Joko Widodo, who came to power in October 2014 as the country’s second freely elected leader.

A rising tide of economic nationalism is threatening to undo the formula that for many years brought much-needed investment to the world’s fourth-most-populous nation and its 250 million people.

The Situation

Widodo, better known as Jokowi, represents a new generation of Indonesian politicians: a self-made furniture seller and can-do bureaucrat focused on cutting graft and red tape.

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Sumitomo Faces Possible Loss on Nickel Project – by Atsuko Fukase (Wall Street Journal – October 16, 2015)

http://www.wsj.com/

Commodities slump has hammered profits and stock prices at many global traders and producers

TOKYO– Sumitomo Corp. faces a potential loss on its multibillion-dollar stake in a Madagascar nickel project, as the global commodities slump takes a heavy toll on Japanese trading houses.

Japanese firms that invested in oil, iron ore and other commodities have booked billions of dollars in losses over the past year and likely face more to come as a result of the long slide in global energy and commodities prices, analysts say.

Sumitomo, Japan’s fourth-largest trading house by revenue, will likely be forced to take a loss on the Madagascar project because nickel prices have dropped below the cost of production, said Akira Morimoto of SMBC Nikko Securities. Nickel prices are near a six-year low.

A Sumitomo spokesman said Friday that the company’s risk exposure to the project is about $2.4 billion, and it would consider whether to book a write-down based on mid- to long-range price projections and production plans.

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Nickel to rise above $20,000/tonne by 2017 – Alto Capital (Mineweb.com – October 8, 2015)

http://www.mineweb.com/

A longer-term perspective supports price appreciation.

A bullish outlook that will see nickel climb out of its current price slump and double in value to in excess of US$20,000 a tonne before March 2017, has been forecast today by market observer, Alto Capital.

Addressing the Paydirt 2015 Australian Nickel Conference in Perth today, Alto Capital research analyst, Mr Carey Smith, said that while the sector was under substantial cost and price pain, nonetheless the trend factors and outlook were far more substantial than they appeared.

“The nickel market has been dismal due to a recipe of stockpiles are up, production is up and demand is down,” Mr Smith said.

“However, going forward, stockpiled Indonesian high grade laterite nickel in China has all been consumed, China Nickel Pig Iron (NPI) production is in decline, global nickel supply is decreasing with only Independence Group’s Nova Bollinger project on the horizon and most producers/miners are losing money – so they will minimise their operations and/or get out of the game,” he said.

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Nickel crisis rocks French islands in Pacific – by Claudine Wery (AFP/Yahoo.com – October 4, 2015)

https://en-maktoob.news.yahoo.com/

Plunging nickel prices and the market woes of world mining giants have shaken the French territory of New Caledonia, a tropical archipelago in the Pacific that is hostage to the metal’s fortunes.

Though best known for its stunning lagoon, pristine beaches and diverse wildlife, New Caledonia’s economy actually relies heavily on nickel, discovered here in the 19th century.

The price of nickel — essential to the manufacture of stainless steel — has plunged 35 percent so far this year to a six-and-a-half year low of less than $10,000 (9,000 euros) a tonne.

A slowdown in economic growth in China, the world’s biggest consumer of nickel, and stockpiles of the metal amounting to more than 450,000 tonnes, have depressed the market.

“We were already in a deteriorating situation when the crisis hit because every sector was in a slowdown. I think we are not far from zero economic growth,” Catherine Wehbe, director of the employers’ federation Medef in New Caledonia, told AFP.

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NEWS RELEASE: SNC-Lavalin exercises its option to sell its interest in Madagascar’s Ambatovy Nickel Project

MONTREAL, Sept. 30, 2015 /CNW Telbec/ – SNC-Lavalin (TSX: SNC) announced today that it has exercised its option to divest its five percent ownership interest and the balance of its loans in the Ambatovy Nickel Joint Venture Project, a laterite nickel mine operation and a hydrometallurgical processing plant in Madagascar, to Sumitomo Corporation, an existing partner, for a cash consideration of approximately CDN$600 million.

The Company was initially awarded an EPCM contract for the Ambatovy nickel and cobalt operation in 2007. The mine―the largest capital project in Madagascar’s history―has a capacity to annually produce 60,000 tonnes of refined nickel, 5,600 tonnes of refined cobalt and 210,000 tonnes of ammonium sulphate fertilizer for a minimum of 29 years. On September 21, 2015, the Ambatovy project achieved financial completion. Accordingly, SNC-Lavalin has chosen to exercise its put option and has received its proceeds.

“We are pleased to have been involved in building the Ambatovy operation with our joint venture partners these past seven years and helping this unique mining project achieve crucial key milestones over this time,” said Robert G. Card, President and Chief Executive Officer, SNC-Lavalin Group Inc. “With nickel being the country’s largest export, Ambatovy will continue to contribute to the country’s future growth and generate long-term economic and social benefits for the people of Madagascar.”

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World Biodiversity Hotspot Worth Much More than a Nickel – by Jim Yuskavitch (Earth Island Journal – September 23, 2015)

http://www.earthisland.org/

Trio of mining proposals threatens Klamath-Siskiyou region

If there were a place in the United States that possessed such biodiversity that it had been designated an “Area of Global Botanical Significance” by the International Union for the Conservation of Nature and also proposed as a UNESCO World Heritage Site and Biosphere Reserve, surely it would be protected from any industrial development that would compromise its ecological integrity. There is, in fact, such a place. But its most recent designation is “endangered” as the area faces threats from three proposed nickel strip mines at its heart.

Spanning the northern California-southwestern Oregon border and encompassing nearly 20,000 square miles, the Klamath-Siskiyou ecoregion includes a complex suite of geology, climate, terrain, and such a remarkable example of temperate climate biodiversity that in 1992 the IUCN recognized the region as an area of global botanical significance. The region is home to 3,500 plant species – 280 of which are rare or endemic. The streams that originate in the Klamath and Siskiyou mountains are among the most productive on the continent, the spawning grounds for wild Pacific salmon and steelhead.

And while the region has the most designated Wild and Scenic Rivers in the US, nearly a dozen wilderness areas, and the 62,000-acre Cascade-Siskiyou National Monument, it also contains the largest area of unprotected forest on the West Coast outside of Alaska.

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Sherritt moves to protect liquidity (Northern Miner – September 18, 2015)

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry.

Sherritt International’s (TSX: S) president and CEO David Pathe did not mince words when he said the firm must take action to protect its balance sheet in order to withstand lower commodity prices at a time when “more than 60% of global nickel production is underwater on a cash cost basis.”

After markets closed on Sept. 17 Sherritt suspended its 1¢ per share quarterly dividend, noting that at current spot prices of US$4.50 per lb., nickel is down 32% since the company last cut its dividend in the first quarter of 2014 from 4.3¢ per share to 1¢ per share.

A world leader in the mining and refining of nickel from lateritic ores and the largest independent energy producer in Cuba with oil and power operations across the island, Sherritt said prices for nickel and crude oil haven’t traded this low since 2009.

Sherritt also said it would cut capital expenditures in 2016 by as much as 25%-35%. Earlier this year the company trimmed its 2015 capex guidance by $15 million to $195 million.

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Indonesia to keep ban on nickel ore exports -govt officials – by Gayatri Suroyo and Bernadette Christina (Reuters U.K./Yahoo – September 1, 2015)

https://uk.finance.yahoo.com/

JAKARTA, Sept 1 (Reuters) – Indonesia will keep its export ban on nickel ore, contrary to recent media reports suggesting the country may relax curbs to prop up its slowing economy, senior government officials said.

Indonesia banned exports of unprocessed metal ores in early 2014 to force firms to develop smelters that would add value to the country’s resources and create jobs. But the curbs cost the country billions of dollars in lost revenue last year.

While there are signs the government is trying to bring more money back into resources, the Chief Economics Minister Darmin Nasution warned against speculation that the country would relax its nickel ore export ban.

Indonesia will seek consistency in its mining policies, he said on Tuesday, a view echoed by Mining Minister Sudirman Said.

“What we’re doing is looking for incentive to boost economic activities in nickel and bauxite business.

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[Philippines Nickel Laterite Mining] King Of Ore: Despite Nickel Asia’s Raids, Zamora Did Not Retreat (Forbes Magazine – August 26, 2015)

http://www.forbes.com/

Jose Anievas still remembers Oct. 3, 2011 quite vividly. Early in the morning that fateful Monday, the chief operating officer of [prisoners of war] was seized by New People’s Army (NPA) rebels who raided the company’s sprawling open-pit mining site in Claver, Surigao del Norte in Mindanao.

“We were being lectured on how POWs [prisoners of war] should behave when we noticed thick smoke rising in the sky,” recalls Anievas, then the resident manager at Nickel Asia’s Taganito mine, the Philippines’ biggest nickel producer last year: About 200 NPA men and women descended on the mine and burned construction cranes, hauling trucks, barges and four buildings.

The rebels did a lot of damage–about $11 million worth of assets went up in smoke. But they failed to destroy the foundation and steel framework of the nickel refinery being built by Sumitomo and Mitsui & Co. in partnership with Nickel Asia.

The NPA members took hostages, including Anievas, an experienced mining engineer who was forced to march with the rebels deep into the forest. The hostages were used as human shields to keep away pursuing government troops. Their agony lasted almost ten hours. It was nightfall when they were released in a densely forested mountain ridge.

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