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[Ferro-Alloys.com]GLOBAL Ferronickel Holdings Inc. (FNI) said over the weekend it plans to put up a processing plant in the country to add value to the nickel ore it extracts from its mining operations.
FNI Senior Vice President for Investor Relations Ramon Peter E. Adviento told reporters in a group interview the company is currently assessing the possible sites where it can erect its new facility.
He said Claver, Surigao del Norte, where the company’s existing Cagdianao mine is located, will not be an ideal site for the processing plant as there is no power source in the area.
“We’re now evaluating to put up a processing plant for value adding. At this point, we’re studying where to put it. The problem, if you put it in Surigao, is the province doesn’t have any power. We’re evaluating other parts of the Visayas and Mindanao. It’s under study,” Adviento said.
The FNI official said the company is targeting to operationalize its newly acquired Palawan mine by the fourth quarter of 2016.
FNI last year acquired Southeast Palawan Nickel Ventures Inc. (SPNVI), which owns at least 90 percent of Ipilan Nickel Corp., a company engaged in nickel mining in Brookes Point, Palawan.
“We are targeting to make the mine operational by the fourth quarter. It would depend on the ability of the government to process the permit. We have already completed the documentation for the permit. We are just waiting for the final approval,” Adviento said.
The company’s nickel reserves in the Palawan facility stands at around 28 million tons, with 50 percent being high-grade, 30 percent medium-grade and 20 percent low-grade nickel.
“The quality of the nickel ore in the Palawan mine is high,” he said.
FNI earlier disclosed the Ipilan mine is projected to have an annual production rate of up to 3 million metric tons, which would increase the company’s annual production capacity by 50 percent.
The company said the new facility will also complement the existing Cagdianao mine as the weather condition in Palawan is the opposite of Surigao’s. Cagdianao mine operates from April to October a year, while the mining season in Palawan typically begins in November and lasts until July.
“Putting this mine into operation will help to assure continuity of medium- and high-grade saprolitic ore supply to the stainless steel market when the Surigao mines are in the off-season and are temporarily shutdown due to bad weather conditions,” the company said.
Meanwhile, the Philippine Nickel Miners Association earlier agreed to cut nickel production in 2016 by 20 percent from last year’s levels.
“The choice of the Philippine Nickel Miners Association to reduce nickel production by 20 percent is just basically trying to accelerate the drop in supply so that prices will recover. It hopefully helps, but it’s not a guarantee,” Adviento said.
He said the FNI would still be profitable in 2016, given the company’s cost-cutting strategies and the tumbling prices of fuel, but their 2016 earnings are not expected to be as good as their 2014 earnings since the prices of minerals in the world market continues to tumble down.
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