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Zimbabwean mining company Bindura Nickel Corporation (BNC) has resumed production in its smelter after selling 7,129 tonnes of nickel this year
The company said that its revenue increased to US$65mn for the financial year ending March 2014 due to an increase in sales of nickel, copper and cobalt. In 2013, the company’s revenue was only US$1mn.
Since end of 2013, the group has embarked on the project to restart BNC’s smelter (subject to securing funds) with the aim of starting production of nickel alloy in Q1 2015.
Mwana Africa, parent company of the mine, said that significant cash-flow improvement that stemmed from higher nickel prices was complemented by solid production outcomes, following the shift to mining the ore's higher-grade massives.
Kalaa Mpinga, chief executive of Mwana Africa, said, “While I am certain that the price will be volatile in the near term, we are expecting it to have strengthened by 2017. At the start of 2013, we were contemplating having to ask shareholders for additional funding, but we took an early decision to change direction.”
The improved cash flow from BNC has enabled the parent company to reverse US$28mn of the previous year’s US$43.7mn BNC assets impairment. Operationally, Mwana Africa undertook a fundamental restructuring to cut corporate costs, added Mpinga.
An increase in sales and production would take the company up the value chain, as higher prices would offset the smelter’s operating costs. It also gives Mwana Africa the option of lowering transportation cost of nickel than the concentrate, stated the executive.