Nickel Mines has checked a box off its to-do list with the first production of nickel pig iron at its Ranger nickel assset in Indonesia.
Nickel Mines (ASX:NIC) has checked a box off its to-do list at the Ranger nickel project in Indonesia with the first production of nickel pig iron (NPI).
According to the company, the asset produced its first NPI from one of the project’s two rotary kilns in a maiden production run. Ranger is currently in the commissioning process for the two kilns, with Nickel Mines anticipating that the second kiln’s commissioning will start in early July.
Both kilns would likely take about two months to ramp up to 80 percent capacity.
While Nickel Mines is currently a minority shareholder in Ranger at this time with a 17 percent stake, it recently signed a binding term sheet for US$80 million in funding to bump that share to 60 percent.
The funding will come from Decent Investment International, an associate of Ranger’s operating partner and majority shareholder, Shanghai Decent Investment.
“With a 60 percent interest in both the Hengjaya Nickel and Ranger Nickel projects, Nickel Mines will have achieved a production profile of approximately 20,000 tonnes of nickel metal per annum in just over 15 months, with further optionality to increase our interest in both projects to at least 80 percent over the next 12 months,” Nickel Mines’ Managing Director Justin Werner said in a statement.
Contrary to previous guidance, Ranger’s commissioning has begun much sooner than the originally docketed September quarter midway point; the company highlighted this progress as a factor that “underpins” the decision to increase its stake in the asset.
The company also provided an update on the production ramp up taking place at its Hengjaya nickel asset. As of May 30, monthly production at the asset had reached 1,518 tonnes of nickel metal at an average NPI grade of 13.4 percent. Werner added that Ranger is set to replicate Hengjaya’s performance.
As of May 31, nickel was trading at US$12,035 per tonne on the London Metal Exchange.
Due to a trading halt, Nickel Mines’ share price remained unchanged on Monday (June 3), resting at AU$0.42 on the ASX.
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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.