BINDURA Nickel Corporation nickel in concentrate sales jumped 32 percent to 1 971 tonnes in the second quarter to September 2016, on the back of a 20 percent growth in output.Alternative Investment Market listed parent firm, Asa Resources, said nickel in concentrate production increased notably due to increased head grade and recoveries during the quarter.
The AIM listed multi commodity miner has two producing assets in Zimbabwe; nickel producer BNC and gold producer, Freda Rebecca, which also reported improved performance in the quarter.
Asa said nickel head grade improved by 15 percent during the period while recoveries were 2 percent higher at 89,1 percent. Average net realised nickel in concentrate price, at $6 668 per tonne, was 16 percent better than prior quarter.
The London listed group said BNC’s cash costs (C1 cots) fell by 17 percent to $4 782 per tonne while all-in sustaining costs fell by 21 percent to $5 151 during the quarter under review.
“The decreases in both C1 and C3 costs are attributable to an increase in overall production, cost control measures and a 15 percent higher head grade.
“As the availability of equipment gradually improves, BNC has a reasonable expectation that production will improve from Q3 FY2017 onwards,” said Asa Resources chief executive Mr Yat Hoi Ning.
Nickel price stabilised around $10 000/t for much of the second quarter for financial year 2017 driven by reports that up to 20 top nickel producers face suspension in the Philippines.
Mr Yar Hoi said the restart programme for BNC’s smelter is progressing well, adding once in full production, BNC’s percentage of market price would increase from around 65 percent to about 85 percent, subject to contractual terms.
Higher nickel prices due to the developments in the Asian country contributed to BNC’s Trojan mine achieving a 16 percent improvement in average net realised nickel in concentrate.
Meanwhile, Asa Resources also reported improved performance in the group’s gold mining unit, Freda Rebecca, which registered 10 percent growth in sales to 15 904 ounces in the second quarter to September 2016.
Average head grade surged by 16,3 percent to 2,28 grammes per tonne while tonnes milled rose 13 percent to 363 082 tonnes. Volume of tonnes milled decreased 4 percent to 262 633 tonnes due to cracked journal on mill 1.
The recovery rate increased by 2 percent to 84 percent, as cash costs were declined 5 percent to $944/oz while all-in sustaining fell by 3 percent to $1 115/oz compared to prior quarter. The average gold price was 5 percent higher at $1 341/oz against $1 275/oz in the first quarter of financial year 2017.
“When mill 1 is back online and the new additional mill reaches full capacity this will boost revenues in the second half of this financial year (2017) particularly from Q4 onwards.
“We expect gold sales to improve slightly in Q3 with much improved results in Q4,” group CEO Mr Yat Hoi said.
“When gold output returns to its target of 17 500 oz (or higher) later in this financial year, Freda Rebecca should reach its all-in sustaining and all-important target of $1 000/oz”.