Mincor fully funded for nickel restart

Mincor Resources has secured $55 million in funding from two banks to progress the restart of its Kambalda nickel operations, expected early next year.

A loan facility will be provided by BNP Paribas and Societe Generale, which Mincor said would be enough to complete Kambalda's $68 million development.

Total capital required during the five-year operation is expected to be $179 million.

Mincor had produced about 180,000 tonnes of nickel from its Kambalda operations before placing the mine on care and maintenance in 2016, due to low nickel prices.

Today, Mincor managing director David Southam said the company expected to make its first drawdown under the loan facility during the September quarter. 

Until then, $60 million in existing cash reserves - placed into a proceeds account last year - would be used to fund ongoing mine development and construction activities.

“The achievement of financial close is another significant milestone in Mincor’s journey to restart mining at Kambalda and to become a clean, efficient and modern nickel sulphide producer ready for the new era of nickel demand from the EV [electric vehicle] and renewable energy sectors,” Mr Southam said.

Kambalda holds a pre-tax net present value of $305 million and is expected to generate $585 million in underlying earnings, according to a definitive feasibility study released in March last year.

The mine is forecast to produce a total 71,000t of nickel and 5,000t of copper, at an average all-in sustaining cost of $4.47 per pound.

Its restart is supported by an agreement with BHP Nickel West, under which Mincor will use BHP’s nearby processing plant and sell nickel concentrate to the company.

Shares in Mincor were trading 1.8 per cent higher at 2:54pm AEDT to 98 cents.