Norilsk Nickel might shut down one Tati Nickel mine, launch second in 2 yrs - source
MOSCOW. Oct 22 (Interfax) - Norilsk Nickel is winding down the development of the Phoenix copper and nickel mine, one of the two divisions of Tati Nickel, a source close to the Russian mining giant told Interfax. Tati Nickel's other mine, Selkirk can only be launched in two years.
Tati Nickel in Botswana, of which Norilsk Nickel owns 85%, produced 3.8% of the Norilsk Nickel group's nickel and 2.7% of its copper in the first half of 2012.
Phoenix has been mined since 1995 and its ore has been depleted. Recent exploration did not find additional reserves, the source said.
With operations winding down at Phoenix, Norilsk Nickel is preparing to launch mining at the Selkirk nickel mine. The Selkirk deep mine was mothballed in 2002 due to depletion of cooper and nickel ore reserves suitable for deep mining.
Norilsk Nickel now plans to build an open-pit mine at Selkirk to mine disseminated ore, the source said. The new mine, which will take up to two years to launch, will extract 12 million tonnes per year, as the Phoenix mine currently does. The details of the Selkirk project will be set out in the bankable feasibility study, which is now being prepared.
Norilsk Nickel does not plan to build additional processing facilities in Botswana, the source said. Selkirk's concentrates will be processed under a tolling arrangement at the BCL smelting plant, which now processes product from Phoenix. Norilsk Nickel ships the matte produced by this plant to customers who process it into refined metal.
Norilsk Nickel's press service told Interfax that the company is studying various options for Tati Nickel's operations in 2013-2014. The company is profitable at current metal prices, a Norilsk spokesman said. The head of Norilsk Nickel's department for foreign production assets, Roman Panov said earlier that the company's African operations stop being profitable only if the nickel price falls below $10,000 per tonne.
Norilsk Nickel acquired the 85% stake in Tati Nickel in the course of its acquisition of LionOre in June 2007. Botswana's government owns the other 15%.
Tati Nickel produced 5,440 tonnes of nickel in concentrate and 4,950 tonnes of copper in concentrate in the first half of 2012, respectively 7% more and 2% less than a year earlier. The company also produced 37,000 ounces of palladium and 7,000 ounces of platinum, respectively 11% and 6% less.
Norilsk Nickel plans to produce 295,000-305,000 tonnes of nickel in 2012, including 60,000-65,000 tonnes outside of Russia - in Australia, Botswana and Finland; 364,000-370,000 tonnes of copper, including 9,000-10,000 tonnes abroad; 2.6 million-2.65 million ounces of palladium, including 95,000-100,000 ounces abroad; and 670,000-685,000 ounces of platinum, including 20,000-25,000 ounces at the operations of Norilsk Nickel International (Lake Johnson in Australia, the Harjavalta nickel refinery in Finland and 50% of Nkomati in South Africa).
