ZBNIF - Nickel Miners News For The Month Of October 2023

2023-10-31 11:17:36 ET

Summary

• Nickel spot prices were lower the last month.
• Nickel market news - INSG forecasts a third consecutive year of nickel surplus. China's massive stimulus package marks bullish shift for commodities after prolonged bear market.
• Nickel company news - Vale board approves a 4th buyback program to repurchase up to 150M shares over the next 18 months.
• Nickel Industries reports positive final investment decision for ENC HPAL Project. Canada Nickel Crawford Nickel Sulphide Project BFS results in a $2.5 billion after-tax NPV8% and IRR of 17.1%.

Welcome to the nickel miners news for October.

The past month saw lower nickel prices. Despite the negative commodities sentiment of 2023, a CNY 1 trillion yuan (US$137 billion) China stimulus (sovereign bond issuance) announcement targeting infrastructure gives some hope for a better 2024.

Nickel price news

As of October 30, the nickel spot price was USD 8.11/lb , lower than USD 8.47/lb last month. LME shows the price at USD 17,975/tonne . Nickel inventory at the London Metals Exchange [LME] was higher the past month at 45,564 tonnes (41,628 tonnes last month).

Nickel spot price 5 year chart - Current price = USD 8.11/lb

Nickel demand v supply chart

Nickel Business Environment: Supply-Demand Balance (as of May 2023) ( source )

Benchmark Mineral Intelligence forecasts deficits for lithium, nickel & cobalt to increase from 2027 onwards ( source )

Trend Investing v IEA demand forecast for EV metals ( Trend Investing ) ( IEA )

2021 IEA forecast growth in demand for selected minerals from clean energy technologies by scenario, 2040 relative to 2020 - Increases Of Lithium 13x to 42x, Graphite 8x to 25x, Cobalt 6x to 21x, Nickel 7x to 19x, Manganese 3x to 8x, Rare Earths 3x to 7x, and Copper 2x to 3x ( source )

2022 - IEA forecasts 60 new nickel mines needed by 2030

BMI forecasts we need 330+ new EV metal mines from 2022 to 2035 to meet surging demand - 72 new 45,500tpa nickel mines needed by 2035

Lithium & Nickel are the two "high importance to energy" critical materials in the medium term (2025-2035) ( source - page 29)

Nickel Market News

On October 5 Reuters reported :

INSG forecasts a third consecutive year of nickel surplus. Global nickel production will outpace demand to the tune of 239,000 metric tons next year, according to the International Nickel Study Group ((INSG))...The INSG, which held the second of its twice-yearly meetings in Lisbon this week, estimates the market was in a 104,000-metric ton surplus last year with the figure set to rise to 223,000 metric tons this year.

On October 25 Reuters reported :

China's new bonds to help economic recovery, official says, as budget deficit rises... China's top parliament body has approved a 1 trillion yuan ($137 billion) in sovereign bond issuance to help rebuild areas hit by this year's floods and improve urban infrastructure to cope with future disasters, state media said on Tuesday...Analysts at UBS expect the government to raise its budget deficit and special local bond quotas for 2024, alongside further cuts in interest rates and bank reserve requirement ratios. China's parliament has also approved a bill to allow local governments to front load part of 2024 local bond quotas. Local governments had been told to complete the issuance of the 2023 quota of 3.8 trillion yuan in special local bonds by September to fund infrastructure projects.

On October 27 Crux Investor reported (emphasis added):

Nickel News: China infrastructure spending to re-ignite commodity markets. China's massive stimulus package marks bullish shift for commodities after prolonged bear market. Nickel and lithium prices could bounce violently on short covering. China announced a 1 trillion RMB infrastructure spending package to stimulate its economy. This could support commodity prices.

On October 27 Hellenic Shipping News reported :

Nickel price could hit $20,000/T on short covering, supply risk – Citi. Nickel prices on the London Metal exchange [LME] could rally to around $20,000 a metric ton on stretched fund short positioning, supply risk in top producer Indonesia and potential further Chinese easing, Citi said in a note on Thursday. Benchmark three-month nickel on the LME CMNI3 was at $18,145 a ton at 0756 GMT... “We think nickel is vulnerable to a short-covering rally likely up to (but potentially beyond) $20,000 a ton amid stretched fund short positioning, Indonesia supply risks and potential further China easing,” Citi analysts said.

Nickel Company News

Producers

Norilsk Nickel (LSX: MNOD ) ( OTCPK:NILSY )

On October 23, Norilsk Nickel announced :

Nornickel announces consolidated production results for 9 months of 2023...In 3Q 2023, consolidated nickel output increased 21% quarter-on-quarter (q-o-q) to 54 kt...

Vale SA (NYSE: VALE )

Vale Voisey's Bay Mine is a key Canadian and global source of nickel. Vale plans a refinery at Bécancour in Québec to supply GM with battery grade nickel sulfate with deliveries targeted to commence in H2 2026.

On October 17, Vale SA announced :

Production and sales report 3Q23...Nickel production decreased by 19% y/y, in line with plan, mainly due to the continued transitioning of Voisey’s Bay to underground operations and additional maintenance at the Sudbury refinery in Q3. Nickel sales decreased by 12% y/y, in line with production.

On October 26, Vale SA announced :

Financial results 3Q23...Proforma adjusted EBITDA from continued operations of US$ 4.5 billion in Q3, up 12% y/y and 8% q/q..Free Cash Flow from Operations of US$ 1.1 billion in Q3...Today, the Board of Directors has approved the distribution of US$ 2.0 billion in dividends and interest on capital, scheduled to be paid December 1st. In addition, the Board of Directors has approved a 4th buyback program to repurchase up to 150 million shares over the next 18 months. The new program will essentially cover the remaining shares from the 3rd buyback program.

Glencore [HK:805] [LSE:GLEN] ( GLCNF )

On September 27, Glencore announced :

Glencore announces funding decision on Koniambo Nickel...Glencore has informed the Board of KNS that it will only provide funding for the operations of KNS until 29 February 2024...

BHP Group [ASX:BHP] (NYSE: BHP )

BHP's Nickel West (includes the Mt Keith nickel mine in Australia) has a Measured and Indicated Resource of 4.1Mt contained nickel with a Total Resource contained nickel of 6.3Mt , with an average grade of 0.58% Ni in sulphide ore. Nickel West produced 80 kt of nickel in FY 2020. Stage 1 production of the Kwinana Nickel Refinery is aimed to be 100ktpa nickel sulphate.

On October 18, BHP Group announced :

BHP Operational Review for the quarter ended 30 September 2023...Nickel West 20.2 kt down 2%. Production decreased marginally in line with higher stripping activity at Mt Keith mining operations. Guidance remains unchanged at between 77 and 87 kt for FY24. The refinery shutdown planned for October 2023 will now largely be completed in February 2024, and as a result production is expected to be relatively flat across the remainder of the year.

BHP's Nickel West operations

Anglo American [LSX:AAL] ( OTCPK:AAUKF )

On October 24, Anglo American announced :

Q3 2023 production report...Nickel production decreased by 7%, mainly reflecting the impact of lower grades...

Eramet [FRA:ERA] ( OTCPK:ERMAY )

On October 26, Eramet announced : "Eramet: Adjusted turnover of €980m in Q3 2023, supported by growth in mining operations." Highlights include:

• • "Adjusted turnover of €980m in Q3 2023, down 26% versus Q3 2022, including the strong decrease in selling prices (-27% vs. Q3 2022), partly offset by the growth in volumes for mining operations (+7%).
  • Positive intrinsic performance over the quarter: Continued exceptional growth at the Weda Bay mine in Indonesia, with 8.3 Mwmt in volumes of nickel ore sold (+184%). Record production in Gabon at 2.1 Mt (+4%) and stable transported volumes (2.0 Mt). Reduction in fixed costs.
  • Decrease in the price of reductants and lower freight prices.
  • Sale of Norwegian subsidiary Eramet Titanium & Iron (“ETI”) at end-September with a positive impact of around €200m on the Group’s cash position.
  • 2023 adjusted EBITDA revised to around €800m, reflecting: A decline in average manganese ore price estimated at around $4.7/dmtu over the year. A volume target for nickel ore at Weda Bay revised to 30 Mwmt (-5 Mwmt) in the absence of an approval obtained to date. Despite the solid intrinsic performance expected in Q4, combined with a higher ore grade and a premium on prices for nickel ore at Weda Bay, as well as lower input costs (particularly reductants)."

Sherritt International ( OTCPK:SHERF )[TSX:S]

No news for the month.

IGO Limited [ASX:IGO] ( OTC:IIDDY )

On October 3, IGO Limited announced : "Massive sulphides at Dogleg Ni-Cu-Co Prospect, West Kimberley Project, Western Australia." Highlights include:

• "6.57 m of massive (>80%) sulphides intersected in hole 23WKDD003 at the Dogleg Prospect from 179.1 m, within a 14.7 m zone of mineralization from 176.45 m (Table 1).
• Visually logged Ni and Cu sulphides (Table 1) are supported by pXRF analyses...
• Assays are expected within 4-8 weeks."

On October 19, IGO Limited announced :

Second hole intersects semi-massive sulphides at Dogleg Ni-Cu-Co Prospect, West Kimberley Project, Western Australia...

Panoramic Resources [ASX:PAN] ( OTCPK:PANRF )

Panoramic's Savannah mine and mill has a forecast life of mine average annual production rate of 10,800t of nickel, 6,100t of copper and 800t of cobalt metal contained in concentrate.

On October 5, Panoramic Resources announced : "Savannah Nickel Project 2023 Mineral Resource and Ore Reserve Statement." Highlights include:

• "Total Savannah Project Mineral Resources (including Savannah North) as at 1 September 2023 increased to 14.57Mt @ 1.49% Ni, 0.67% Cu and 0.10% Co for 216.9kt Ni, 97.6kt Cu and 14.0kt Co contained metal.
• The focused drilling carried out in Savannah (above and below the 900 fault), resulted in a 42% increase of contained nickel metal in Mineral Resources at Savannah (excluding Savannah North)...
• The Savannah and Savannah North orebodies remain open along strike and at depth, providing the potential to bring additional material into future Mineral Resources and Ore Reserves as exploration continues into FY24."

On October 6, Panoramic Resources announced : "Preliminary September quarter production results." Highlights include:

• "...Jumbo development down 10% to 829m with underground development ahead of plan.
• Ore mined up 5% to 185,213t (best quarter since restart in 2021).
• Ore milled up 25% to 184,009t (best quarter since restart in 2021).
• Nickel recovery stable at 78.4%.
• Concentrate production up 56% to 23,411dmt (best quarter since restart in 2021).
• Contained nickel production up 56% to 1,684t (best quarter since restart in 2021).
• Contained copper production up 42% to 932t (best quarter since restart in 2021).
• Contained cobalt production up 76% to 135t (best quarter since restart in 2021).
• Cash at quarter end of $42.6M (after $4.96M in debt and interest repayments)."

On October 19, Panoramic Resources announced :

Quarterly activities report for the period ending 30 September 2023...Cash at the end of the quarter of $42.6 million, following successful completion of Placement and Share Purchase Plan. Debt repayments for the quarter total A$3.43 million.

Nickel 28 Capital Corp. [TSXV:NKL] [GR:3JC]

On October 10, Nickel 28 announced : "Ramu pauses operations following earthquake in Madang Province..."

On October 25, Nickel 28 announced : "Ramu back to full production levels following earthquake..."

Nickel Industries Limited [ASX:NIC] ( NICMF )

On October 9, Nickel Industries Limited announced :

Execution of binding agreement for IMIP Solar Project...the development, installation, operation and maintenance of a 200MWp + 20MWh battery solar project within the Indonesia Morowali Industrial Park (‘IMIP’). This project is designed to supply power to the Company’s existing RKEF operations, along with the future ENC HPAL project, and represents a transitioning of the Company’s operations to renewable energy sources and its commitment to a more sustainable future for Indonesia’s mining industry.

On October 11, Nickel Industries Limited announced : "Positive final investment decision for ENC HPAL Project, supported by Indonesian Bank Loans." Highlights include:

• "Positive final investment decision for the ENC HPAL Project, accelerating the Company’s transition to battery-grade nickel.
• Comprehensive construction guarantee again provided by Shanghai Decent, covering capex, nameplate performance and timing of commissioning...
• Nickel Industries has also entered into five year, US$400m financing facilities with Indonesian Bank, BNI, leaving the Company comfortably positioned to fund the ENC Project.
• ENC construction is advancing and the Project has received a 15 year tax holiday from the Indonesian Government – production expected to commence in Q4 2025.
• ENC, like the HNC HPAL Project, will be one of the lowest-carbon emitting HPAL projects globally, supported by the Company’s recent SESNA solar project (the largest solar project in Indonesia)."

Other nickel producers

First Quantum Minerals [TSX:FM] ( FQVLF ), Franco/Nevada [TSX:FNV], MMG [HK:1208], South32 [ASX:S32], Lundin Mining [TSX:LUN], Nickel Asia Corporation [PSE:NIKL], Platinum Group Metals’ [TSX:PTM] ( PLG ), Sumitomo Metal Mining Co. ( OTCPK:SMMYY ).

Nickel juniors

Horizonte Minerals Plc [TSX:HZM] [AIM:HZM]

Horizonte is developing its 100% owned Araguaia Nickel Project (Araguaia) as Brazil’s next major ferronickel mine.

On October 2, Horizonte Minerals Plc announced :

Horizonte Minerals provides update on its Araguaia Nickel Project construction...the nickel company developing two Tier 1 assets in Brazil, announces today that it has made good progress in completing the final detailed engineering and construction design for Line 1 of its 100%-owned Araguaia Nickel Project (“Araguaia” or “the Project”). This work, along with a comprehensive cost review, has resulted in changes to the design and execution scope, which are expected to increase the overall capital expenditure requirement by at least 35% (of current capex budget) and delay first production to Q3-2024.

On October 23, Horizonte Minerals Plc announced : "Horizonte Minerals provides Q3-2023 construction update." Highlights include:

• "Construction progress continues to be made at Araguaia:
• ...Rotary Kiln sections have been installed on the support piers.
• The furnace shell is complete with roof installation underway.
• All critical equipment packages have been contracted and are either on site or en route to site.
• As of 30 September, 138,000 tonnes of ore averaging 1.92% Ni has been stockpiled.
• Commissioning of the 126 km (230kV) power transmission line underway.
• US$429 million has been spent at Araguaia as of 30 September 2023.
• As stated on 2 October 2023, Reta Engenharia has been retained to complete a detailed capital cost and schedule analysis which is expected to be completed by mid Q4-2023.
• The Company is continuing to progress construction activities while advancing financing discussions with its cornerstone shareholders and lenders.
• Araguaia Nickel Project Line 2 Feasibility Study (“FS”), which aims to double nickel production from 14,500 tonnes per annum to 29,000 tonnes per annum, to be published in mid Q4-2023."

Poseidon Nickel [ASX:POS] ( OTC:PSDNF )

On October 10, Poseidon Nickel announced : "Lake Johnston drilling underway."

On October 20, Poseidon Nickel announced : "2023 annual report."

Talon Metals [TSX:TLO] ( TLOFF ) Tamarack - (JV with Rio Tinto)

Tamarack is a high grade nickel-copper-cobalt project located in Minnesota, USA, with considerable exploration upside. Talon Metals owns a 51% project share, with potential to further earn-in to a 60% share by 2026.

On September 29, Talon Metals announced : "More high-grade nickel in the USA: Talon Metals reports 139% increase in thickness of nickel-copper mineralization in the Raptor Zone." Highlights include:

• "...Talon’s new drill hole (23TK0483) has successfully resulted in 2.2 meters (7.2 feet) of high-grade massive nickel and copper mineralization (assays pending, see Figure 1), representing a 139% increase in thickness compared to previous drill hole 22TK0430...
• The fact that the mineralization appears to be getting thicker is consistent with how the Company made its last new high-grade nickel-copper discoveries at the Tamarack Nickel Project (CGO East and CGO West). Consequently, the Company is extremely encouraged by the continued positive results in the Raptor Zone, and follow-up drilling continues.
• The new drill hole is over 1 km away from the Tamarack Nickel Project Resource Area and represents significant potential for additional high-grade discoveries within the Tamarack Intrusive Complex.
• On September 12, 2023, Talon and the U.S. Department of Defense announced that Talon has received a grant of US$20.6 million to support and accelerate Talon’s exploration efforts in both Minnesota and Michigan. Funds from the U.S. Department of Defense will be used to support additional exploration drilling and geophysical studies in the Raptor Zone."

On October 17, Talon Metals announced :

Talon Metals announces closing of investment for proceeds of c$21.7 million...The Offered Shares were issued at a price of approximately C$0.27 per Offered Share...

Garibaldi Resources [TSXV:GGI] [GR:RQM] [LN:OUX6] ( GGIFF )

On September 28, Garibaldi Resources announced :

Garibaldi corporate update...Garibaldi has entered into an agreement with De Coors Mining, a private company (“De Coors”) to buy back the remaining 1% underlying Net Smelter Return (NSR) retained by De Coors, for Garibaldi’s 100% owned Palm Springs [PSP] claims within the 180 sq. km Eskay Claim Group in Northwest British Columbia.

St George Mining Ltd. [ASX:SGQ] [GR:SOG]

The Cathedrals, Stricklands and Investigators nickel-copper discoveries (at Mt Alexander) are located on E29/638, which is held in joint venture by Western Areas Limited (25%) and St George (75%). St George is the Manager of the Project with Western Areas retaining a 25% non-contributing interest in the Project (in regard to E29/638 only) until there is a decision to mine.

On September 29, St George Mining Ltd. announced : "Annual report to shareholders."

Queensland Pacific Metals [ASX:QPM]

On September 28, Queensland Pacific Metals announced : "TECH Project debt financing update." Highlights include:

• "Advancing on debt strategy to secure project finance from government backed lenders supported by leading commercial banks...
• Discussions with government backed lenders ($1.4+ billion indicative commitments) regarding loan tenor, interest margin and coverage ratios are in line with debt funding plans.
• Due diligence (including finalization of key reports from Lenders’ Independent Consultants ) required for final credit approval is advancing well in accordance with announced targeted timeline of 1H 2024."

On September 29, Queensland Pacific Metals announced : "Annual report for the year ended 30 June 2023."

On October 18, Queensland Pacific Metals announced : "Closure of Share Purchase Plan...has raised $1,930,850 (before costs)...

Premium Nickel Resources Corporation [TSXV:PNRL]( PNRLF )

No news for the month.

Canada Nickel Company [TSXV:CNC]( CNIKF )

On September 28, Canada Nickel Company announced :

Canada Nickel announces successful completion of Carbon Storage Pilot Plant, confirms value of Carbon Storage Capacity...

For further details see:

Nickel Miners News For The Month Of October 2023