Bindura Nickel Corporation incurred awful loss

Leafias Mazviro

The Victoria falls Stock Exchange Listed mining firm, Bindura Nickel Corporation has said high operating costs and low production caused the company to run loss despite the fact that it had registered 8 percent increase production of ore Nickel.

According to a trading update, the company said it had experienced increased unit costs at the back of the high cost of maintaining aged underground mining mobile equipment and the increase in local operating costs which was driven by exchange rate disparities.

“The lower Nickel in concentrate production had a negative impact on unit costs.”

The firm said cash cost (“C1”) for the quarter, was US$14,425 per tonne representing 2 percent decrease as compared to the comparative period last year while the all-in-sustaining cost (“C3”), was US$18,812 per tonne indicating 15 percent increase compared to the previous year.

The average London Metal Exchange (“LME”) Nickel price of US$21,933 per tonne was 1 percent higher than the US$21,783 per tonne which was forecasted for the quarter and 24 percent lower than the US$29,029 per tonne which was achieved in the comparative period in the previous year.

“The price decline was attributable to a surge in global Nickel supply which was outpacing demand. Nickel in concentrate sales for the period, at 799 tonnes, were 19 percent lower than the 989 tonnes sold during the same period last year. The sales decrease was in line with the decline in production.”

The company said the run-of-mine ore was still low due to the deterioration of the Sub-Vertical Rock (“SVR”) winder bull gear which subsequently resulted in a 70 percent decline in SVR capacity.

“The decline in SVR capacity also constrained development work planned for the quarter as ore hoisting was prioritised over waste hoisting. This consequently caused a delay in the unveiling of planned mining areas,” company said.

In addition, the ore head grade in the was at 1.02 percent Nickel, showing 2 percent decrease as compared to the 1.04 percent Nickel grade achieved in the same period last year, due to the unavailability of high-grade massive ore sources.

“Ore milled was relatively the same as the milled tonnage in the corresponding period last year,” company added.

Furthermore, company said the concentrator plant performance was compromised by intermittent breakdowns driven by the unavailability of critical spares for various components of the Plant.

“Nickel in concentrate produced, at 823 tonnes, was 9 percent lower than the 902 tonnes produced in the same period last year, reflecting the adverse impact of the lower grade of ore processed.”

However, the firm said the ore mined in the quarter surpassed the number of ore which was produced previous year despite the lowered demand for Nickel in the quarter.

“Ore mined for the quarter, at 117,249 tonnes, increased by 8 percent, in comparison to the 108,632 tonnes achieved for the same period in the previous year due to the introduction of new underground Load, Haul and Dump (“LHD”) equipment,” Company said.

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