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Business Reporter
BINDURA Nickel Corporation’s revised mining plan has started bearing fruit after a marked increase in recoveries and a decline in costs, figures from parent firm Mwana Africa Plc’ latest trade update show.
“Recoveries have increased markedly to almost 89 percent from 69,7 percent previously, while costs have dropped to US$9 689 a tonne from US$19 251 in the previous quarter,” Mwana said.
Sales from Trojan Mine – BNC’s flagship nickel mine – for the quarter to September more than doubled to 1 505 tonnes of nickel concentrate sold to global commodity trader Glencoe International.
BNC’s new mining plan for Trojan involves targeting of the mine’s high-grade ore deposits know as massives towards increasing sales while reducing per unit cost of production. Mwana chief executive Mr Kalaa Mpinga said that the BNC team completed a new mine plan to maximise returns and improve cash flows by targeting the higher grade “massive” zones.
He said the results so far have been very pleasing with record production months being recorded in this quarter.
Experts have confirmed that the new mine plan is “realistic and achievable”.
The positive production performance augurs well for Mwana Africa as the AIM-listed company has continually relied on its other Zimbabwean unit, gold miner Freda Rebecca, for profitability.
During the quarter under review the gold producer sustained its positive performance with 17 536 ounces from the mine, representing an increase of 19 percent over the previous quarter.
Cash costs of US$837 per ounce for the quarter were down from US$949/oz in the previous quarter while recoveries of 84 percent were achieved, being the highest average recoveries to date in 2013.
“This has been a very pleasing and positive quarter for the company. At Freda Rebecca, the company has enjoyed a significant 19 percent uplift in gold production compared to the previous quarter,” Mr Mpinga said.
While Freda Rebecca remains the cash cow, developments at BNC should be encouraging with all initiatives pointing to brighter prospects that could turn around the nickel miner’s fortunes.
BNC successfully raised US$23 million through a rights issue and share placing to restart mining at Trojan in September 2012 since placing all assets under care and maintenance in 2008.
Africa’s only integrated mining company had earlier completed restructuring which resulted in downsizing of the head count and settlement of some creditors while payment for other was deferred.
The restructuring and recapitalisation set the nickel mining giant’s Trojan Mine on course to resumption of full-scale production through a phased process before global prices affected its plans.
A sharp drop in global prices of nickel from a high of US$17 000 per tonne to about US$13 per tonne forced BNC to reconsider its plans to boost cash inflows and reduce operating costs.
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