The Asia Miner

OCT-DEC 2018

The ASIA Miner - Reporting Important Issues to Mining Companies in the Asia Pacific Region

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the asia miner • volume 15 • issue 4 26 FEATURE: Nickel per cent in 2Q18 relaঞve to 2Q17, while EV sales worldwide grew 69 per cent in 2Q18 relaঞve to 2Q17. Demand for nickel in other applicaঞons conঞnues to be posiঞve, parঞcularly in the super-alloy and plaঞng sectors", where supply increased by approximately 6 per cent in 2Q18 relaঞve to 2Q17. The Office of the Chief Economist, however, notes that the situaঞon with stainless steel is rather complex. Although it predicts that the demand growth for stainless steel will ease from the current yearly 5 per cent due to inventory build, it accepts that changes in stainless steel composiঞon may in fact buck this trend. "Chinese state-owned Tsingshan, which recently opened a new stainless steel producঞon facility in Indonesia, is now producing a stainless steel alloy with more than 8 per cent nickel: well above the typical raঞo of less than 2.5 per cent", it stated in the quarterly update. AUSTRALIA Australian producঞon is expected to rebound from a low point following several faciliঞes and mine closures in 2016 and 2017. According to the Australian Government figures, mine producঞon is expected to rise from an esঞmated 163,000 tonnes in 2017-18 to 166,000 tonnes in 2018-19, and to 178,000 tonnes in 2019-20, with exploraঞon for nickel and cobalt increasing from AU$46 million to AU$65.4 million. This compares to a quarterly spend of around AU$10 million dollars early in 2016. Producঞon growth will be driven primarily by the new Mincor mine at Kambalda in Western Australia, as well as Poseidon Nickel's new mine at Mount Windarra, also in Western Australia. Several older mines are also expected to contribute through modest ramp-ups in producঞon. INDONESIA According to a report released by Wood Mackenzie, Indonesia will play a central role in the nickel market, from "ore producঞon and export to stainless hot-rolled coil sales". Nickel supply from Indonesia grew rapidly over the year to June 2018, with the country now accounঞng for almost one quarter of global mine producঞon, with a large proporঞon than ever being processed locally to nickel pig iron. The rise in Indonesian output was driven in part by significant Chinese capital investment. Indonesian nickel ore is being largely directed to Chinese nickel pig iron producers. GEM, Brunp JV to develop Indonesian nickel-cobalt project A joint venture comprising Tsingshan Group, GEM, Brunp Recycling, PT Indonesia Morowali Industrial Park (IMIP) and Hanwa Co Ltd will invest $700 million to develop a nickel- cobalt project in Indonesia. The project, located in Morowali County, Central Sulawesi in Indonesia, has a target producঞon capacity of 50,000 tonnes per year of nickel and 4,000 tpy of cobalt. It will be able to produce 50,000 tpy of nickel hydroxide intermediates, 150,000 tpy ba•ery- grade nickel sulfate, and 20,000 tpy ba•ery-grade cobalt sulfate, ba•ery recycler GEM said late last week. GEM, steel mill Tsingshan, and ba•ery-maker CATL's recycling arm Brunp will hold 36 per cent, 21 per cent and 25 per cent of the shares of the joint venture respecঞvely. The remaining 10 per cent and 8 per cent shares will be owned by Indonesian joint venture IMIP and trading company Hanwa. Xu Kaihua, Chairman of GEM believes that the energy source for electric vehicles has entered into an era of nickel- rich ba•eries, with the new energy industry undergoing a drasঞc reshuffle. PHILIPPINES In a new environment protecঞon drive, the world's second largest nickel producer – Philippines – has announced that it will limit the land that miners can develop at any given ঞme. As reported in local media and Reuters, the new rules – set to protect the environment and backed by President Rodrigo Duterte – target 29 of 48 mines operaঞng in Philippines, that are nickel producers supplying ores to the world's leading market, China. Industry analysts expect any boost in EV range to depend on advances in high-tech cathode chemicals, for which cobalt and nickel are key ingredients Nickel LME spot prices and stocks. Source: Bloomberg (2018) London Metal Exchange; Internaonal Nickel Study Group (2018); Department of Industry, Innovaon and Science (2018). Licensed from the Commonwealth of Australia under a Creave Commons Aribuon 3.0 Australia Licence.

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