Mon, Aug 10, 2009

Featured, Nickel Articles

By Leia Michele Toovey- Exclusive to Nickel Investing News

Speculation, combined with threatened supplies due to strikes at Vale Inco, has sent the price of nickel on a much needed upswing. On the London Metal Exchange, nickel closed t at US$ 19,100 per tonne in the previous session. Over in India, on the MCX, nickel for delivery in August contract remained weak for the second straight session and lost another 1.31 per cent at Rs 917.40 per kg in a turnover of 1,990 lots. Similarly, nickel for delivery in September contract moved down by 1.28 per cent to Rs 921.20 per kg with a turnover of 79 lots.

Vale Inco declared force majeure Friday because of ongoing strikes at its nickel operations in Sudbury, its nickel refinery in Port Colborne, and its nickel, copper and cobalt operations in Voisey’s Bay, Newfoundland and Labrador. In Greater Sudbury, more than 3,000 members of Local 6500 of the United Steelworkers have been on strike since July 13 in a dispute over pensions, bonuses and job security. Wayne Fraser, the United Steelworkers union’s Ontario and Atlantic Canada director, said that negotiations with Vale Inco are at a standstill. “This could be a long strike,” he said. “It could be four or five months before we even return to the (negotiating) table.” Vale, who is coping with the huge drop in nickel values has claimed that operations at the mines at the current price of nickel are not “sustainable.”

Company News

Mincor has no intentions of reactivating its Miitel mine in west Australia due to volatile nickel prices. Mincor idled its Miitel mine in west Australia in late December, halting production of between 4,000 and 5,000 tonnes of nickel per year indefinitely as world prices for the stainless steel alloying metal plummeted. “It’s not in our plans to restart it this calendar year,” Mincor Managing Director David Moore said on the side of the Diggers and Dealers mining conference. Mincor is one of several nickel miners to shutter operations in the face of uncertain commodities markets. Nickel sells for around $19,000 a tonne, down from record highs above $51,000 a tonne two years ago, though above this year’s lows of less than $10,000.

Jinchuan Mining Plc of China plans to secure 50 per cent equity in Albidon Ltd’s nickel mine in Mazabuka in southern Zambia and resume operations next month, according to Mines Minister Maxwell Mwale. Jinchuan, China’s largest producer of many metals, including nickel, copper and platinum is holding talks with the Zambian government about the terms of the planned acquisition of the mine, which is currently under care and maintenance, Mwale said today by phone from the capital, Lusaka. “The company has indicated its desire to raise equity in the mine to 50.3 per cent by converting its debt into shares,” Mwale said without giving details.

Ji Lin Ji En Nickel Industry Co Ltd. plans to acquire 14.7 per cent equity interest in Canadian miner Victory Nickel Inc. Ji Lin Ji En said in a statement filed with the Shanghai Stock Exchange that its wholly-owned subsidiary in Canada will spend US $2.7 million to buy 38.5 million common shares of Victory Nickel from Nuinsco Resources Limited. Meanwhile, the subsidiary will also subscribe up to 9.62 million units of Victory Nickel’s rights offering before Aug. 17. A two-year loan worth US$2.8 million will also be provided to Nuinsco, with an annual interest rate of 8 per cent. Upon the completion of the acquisition, Ji Lin Ji En will hold a total of 49.72 million common shares of Victory Nickel and become the largest shareholder of the Canadian firm.