NICKEL MINES IN MASSIVE IPO
INDONESIA-focussed Nickel Mines is officially the second biggest metals and mining initial public offering of 2018 after making its ASX debut on 20 August.
The Australian company, which holds an 80 per cent interest in the Hengjaya nickel laterite mine in Indonesia, raised $200 million selling shares at 35 cents each.
Nickel Mines will use the cash to diversify into downstream nickel pig iron (NPI) processing and production, acquiring a further 35 per cent interest in the Rotary Kiln Electric Furnace (RKEF) project to increase its interest to 60 per cent.
In September last year, the miner entered into an agreement ( CSA) with Shanghai Decent, a subsidiary of the world’s largest stainless steel producer Tsingshan Group.
The CSA included the terms on which a two-line RKEF plant within Tsingshan’s neighbouring Indonesia Morowali Industrial Park (IMIP) operations and refining centre would be funded and constructed.
“Nickel Mines is now on the cusp of becoming a significant player in the global nickel industry having established a financial, operational and strategic partnership with China’s Tsingshan Group, the world’s largest stainless producer,” Nickel Mines chairman Robert Neale said.
“Our collaboration will not only serve to contribute to Tsingshan expanding its stainless steel production at the IMIP to a targeted 3 million tonnes per annum, but will provide Nickel Mines with a platform to reap the significant economic benefits of becoming a downstream nickel producer.”
Mr Neale said construction of the two RKEF lines were progressing well, with most foundation works completed by mid-August, and about 40 per cent procurement and 20 per cent of civil works now completed.
“We are optimistic our two RKEP lines will be ready to start commissioning early in the June quarter of 2019,” he said.
The company also signed an MOU with Shanghai Decent in June to construct, own and operate two additional RKEF lines.
With the option of moving to 100 per cent of four RKEF lines with total output of about 33,000t of nickel metal per annum, “Nickel Mines could lay claim to being the largest list pure-play nickel producer in the world”, Mr Neale said.
“Nickel Mines could lay claim to being the largest list pure-play nickel producer in the world.”
The Hengjaya nickel laterite mine in Indonesia, which is in close proximity to the Indonesia Morowali Industrial Park operations and refining centre.