- Nickel production increases to 95 518 tonnes
- Nickel sales surges to 1 153 tonnes
- Head grade decreases to 1.45 percent
HARARE - Zimbabwe Stock Exchange listed mining counter Bindura Nickel Corporation has recorded a 4.14% growth in nickel production to 95 518 tonnes for the second quarter ended 30 June 2021 despite encountering production stoppage for most of April 2021.
The increase in production was from a 2020 comparative of 91 717 tonnes.
Nickel sales spiraled to 1 153 tonnes during the period under review compared to 27 tonnes achieved in the second quarter of the prior year.
“In the latter period, the insignificant sales tonnage was attributed to the temporary suspension of sales, which was necessitated by the need to conclude a more favourable new off-take agreement with Zopco SA, a Switzerland based trading house, in place of the agreement with Glencore,” company secretary Conrad Mukanganga said in a trading update.
Average nickel price on the London Metal Exchange surged to US$17 343 per tonne in the second quarter of 2021 from US$12 197 per tonne achieved during the same comparable period last year owing to higher demand for clean energy.
The company said higher nickel prices are expected to improve the profit performance for the year compared to prior year through increased nickel production level.
Nickel in concentrate production scaled up from 1 162 tonnes during the previous second quarter ended 31 June 2020 to 1 187 tonnes during the period under review.
“Production was propelled by the completion of Shaft re-deep Tie-in Project and refurbishment of major components of the Concentrator Plant which increased milled tonnage,” said Mukanganga.
Head grade was lower at 1,45% in the reviewed period from a comparative 2020 second quarter of 1,49% while the recovery rate stood at 86% due to the improved plant performance compared to 85% achieved during the previous year in the second quarter.
Meanwhile, production costs increased to US$10,525 per tonne from US$8,440 per tonne incurred in prior year.
“However, the unit cost of production increased significantly due to high cost of maintaining aged mobile mining plant, non-recurring costs of refurbishing the concentrator plant during the planned shutdown and higher labour costs arising from the adjustment of employees’ wages and salaries to align with industry levels as well as payment of performance bonuses,” Mukanganga said.
“In addition production for both Q1 FY2022 and Q1 FY2021 was approximately 15% lower than average, hence the fixed cost burden per tonne of nickel produced was higher than normal, thus contributing to the higher unit costs,” said the secretary.
The company is expecting development metres, tonnes mined, tonnes milled and nickel in concentrate production for the quarter ending September 2021 to be higher than achieved during the quarters ended 30 September 2020 and 30 June 2021.
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