MWANA Africa Plc, a producer of nickel, gold and diamonds, is considering restarting its nickel smelter in northeastern Zimbabwe after a drop in prices eroded profit margins on supplying the metal as concentrate.
Bloomberg/Business Reporter
“Nickel at this level is putting a lot of stress on the system, particularly when exporting concentrate,” chief executive officer Kalaa Mpinga said in an interview at the African Development Bank annual meeting in Marrakesh, Morocco yesterday.
“It will increase pressure on us to restart our smelter and refinery as soon as possible.”
Mwana’s Bindura site is the only integrated nickel mine, smelter and refinery operation in Africa, according to the London-based company’s website.
The price of nickel for delivery in three months has dropped 13% to $14 840 a metric tonne since the start of 2013 in London Metal Exchange trading.
“In the next three to four months, we will be able to make a decision,” said Mpinga. “It is one of our foremost priorities.”
Last October Bindura Nickel Corporation (BNC) majority shareholder Mwana Africa expressed renewed confidence in its Trojan mining operation after completing a drilling programme which confirmed that the mine has high quality ore concentrate.
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In September 2012, BNC carried out a restructuring and recapitalisation exercise which has allowed it to restart its Trojan Nickel Mine.
BNC completed a $21 million rights offer that was underwritten by Mwana in a bid to kick-start operations at the nickel mine as liquidity constraints continued to bite the domestic market.
