Bindura Nickel Corporation says it will keep its Shangani Mine under care and maintenance due to high restart costs and weakening commodity prices as the group focuses on raising $26 million to restart its base metal smelting complex and other projects.
BNC managing director Batirai Manhando said that the group would require $50 million to restart the mine but would however shelve plans to do so in the short term due to an unfavourable operating environment.
The company says it will finance half of its budget for the smelter through internally generated funds with the remainder being funded through debt, amid indications that the funds would be repaid between 18 and 24 months. The smelter was built in 1968 and stopped operations at the height of the country’s economic crisis in 2008.
Manhando said BNC is working with a South African company called Hatch to refurbish the smelter, which he said has capacity to process platinum group metals mined in the country.
“Our focus right now is to really bring this plant back on line. The mine is running well so we now want to add another process and value add. After this we are looking at the refinery and Hunters Road project and get this business back to where it was or even better…where we producing a final nickel cathode,” Manhando said.
“Shangani Mine is still under care and maintenance as we speak basically because it requires money to bring it back into production and secondly at obtaining metal prices, the mine does not make money because the grades are relatively low compared to Trojan. The mine would require in excess of $50 million.”
He said the mining group, a unit of Mwana Africa, will, however, hold on to the asset in anticipation of improved demand and firming prices of the commodity. The BNC boss said the company would also consider bringing its Hunters Road mine on line ahead of the Shangani due to its better ore grades.
“We will keep it (Shangani) for the future because the nickel demand and supply fundamentals are going to support a much higher price in the long term,” he said.
Manhando said the group is also in discussions with a Zambian mining company which seeks to process its base minerals at the BNC facility.- The Source
(45 VIEWS)
0 Comments