BNC rationalises, revises mining plan

Oliver Kazunga, Senior Business Reporter
TROJAN Nickel Mine has been forced to revise its mining plan in response to the declining nickel prices on the international market.

In its unaudited group financial results for the half year ended September 30, 2015 released on Tuesday, Bindura Nickel Corporation, which owns Trojan, said the mine would remain with a leaner labour structure when it completes the ongoing rationalisation and retrenchment process.

“In response to the declining nickel prices, the mining plan of Trojan Mine has been revised. The revised plan entails reducing the original tonnage by 50 percent while maximising higher grade massives and minimising lower grade disseminated ore,” said BNC.

“The company will remain a leaner and more effective labour structure when it completes the ongoing rationalisation and retrenchments process in the second half of the year ending March 31, 2016.”

All the above measures, BNC said had started showing a positive impact on the company’s performance during the second half of the year.

It said the months of September and October were profitable and the nickel producer anticipates to have recovered in the first half’s loss situation and would become profitable by the end of the financial year in March next year.

Production in the second quarter of the year under review was lower than in the quarter ended June 30, 2015 mainly as a result of the planned shutdown

The shutdown was meant to allow for equipment upgrades.

The mine milled 231,224 tonnes compared to 310,000 tonnes in the prior year.

On capital projects, BNC said the shaft re-deepening programme continued, although at a slower pace, given the cash flow constraints induced by unfavourable nickel prices.

“Commissioning of this project is now planned for the 2016/17 financial year. Two key projects were completed and commissioned during the second quarter. The smelter restart project is progressing well. Expenditure of $12 million and commitments of $5 million have been made to date respectively,” said BNC.

The company during the period under review incurred an operating loss of $4 million compared to a profit of $12.5 million in the prior period.

Loss after tax was $3.4 million versus $8.5 million profit after tax recorded in the comparative period in the prior year.

“The reduced profitability has resulted in a retained profit of $3.1 million compared to $3.8 million in the prior period,” said the nickel producer.