Nickel Mines has acquired an additional 30 per cent interest in Angel Capital for $US210 million ($288 million), lifting its stake in the Angel nickel project in Indonesia ahead of production starting at the site next year.
Following the acquisition, Nickel Mines owns 80 per cent of the Angel project with the remaining 20 per cent held by Shanghai Decent Investment, which is Nickel Mine’s largest shareholder and strategic partner.
According to Nickel Mines managing director Justin Werner, the company’s 80 per cent control over Angel will significantly increase its nameplate production capacity.
“Through this acquisition, Nickel Mines is now set to more than double its nameplate nickel production capacity, placing it firmly in the top 10 global nickel producers and diversifying its operating bases,” Werner said.
“The 380 megawatt captive power plant is expected to deliver a 20 per cent cost saving on power, resulting in lower operating costs than our existing Hengjaya nickel and Ranger nickel operations, which already sit at the bottom of the NPI (non-process infrastructure) cost curve.
“With commissioning on track for the second half of 2022, we congratulate our partners Shanghai Decent on the progress made despite a resurgent COVID-19 delta variant which has impacted global supply chains and logistics, and with this transaction we have further strengthened our strong strategic relationship.”
Nickel Mines confirmed it has no capital expenditure risk relating to Angel after paying its part of an agreement with Shanghai Decent to not surpass $US700 million in costs at the project.
The company will start commissioning the Angel project by no later than October 2022 with the additional production expected to increase the company’s output from 30,000 tonnes to 66,000 tonnes of nickel per year.
“With continued strong performance from our RKEF (rotary kiln electric furnace) operations, Nickel Mines is well positioned to capitalise on the strong forecast nickel growth over the next decade,” Werner said.
Nickel Mines also holds 80 per cent interests in the Hengjaya and Ranger projects in Indonesia.