Miner may build processing plant following finds at nickel mines in Surigao del Norte

Exploration by Canadian miner Mindoro Resources, Ltd. indicates an estimated nickel resource of 50 million-70 million dry metric tons (MT) at a nickel property in Surigao del Norte.

This, along with nickel resources in the nearby Agata nickel project also in Surigao del Norte, have encouraged Mindoro Resources to put up a nickel processing plant, the miner told the Canadian bourse in a disclosure.

Results of the exploration “substantially augments [Mindoro Resources’] plans to evaluate the feasibility of establishing a local processing plant,” the miner said.

“We now have a level of comfort because the long-term plan is [nickel] processing,” Edsel M. Abrasaldo, vice-president of MRL Gold Phils., Inc., said in a phone interview.

MRL Gold is the subsidiary of Mindoro Resources in the Philippines.

“With that, we believe we have a world-class deposit. We are geared for processing,” Mr. Abrasaldo added.

A study, to be completed next month, will look at the feasibility of initially exporting nickel ores as well as using them as feedstock when for the planned processing plant.

The miner explored 900 hectares of its nickel property in Surigao del Norte.

In November, Mindoro Resources said the total resource estimate for the Agata nickel property rose by 40% to 26.92 million dry MT of ore equivalent to 657 million pounds of nickel and 24 million pounds of cobalt following additional exploration.

“Most of the laterite areas are within two to three kilometers of the ocean, and limestone, important for any acid processing technologies, is abundant in the projects,” Mindoro Resources said in the disclosure.

Mr. Abrasaldo said in Filipino: “Our focus right now is nickel ...

because of the significant results in the exploration target and there is still a market for medium- to low-grade [nickel ores].”

Nickel prices for cash buyers closed at $8.32 per pound late last week, up from the average price of $5.64 and $4.75 per pound in the second and first quarters of last year, respectively, data from the London Metal Exchange showed.

The nickel-rich Surigao region has at least ten direct shipping ore nickel laterite mines either in production or under development. The miners in the area sell ores to processing plants in Japan, Australia and China.

Mr. Abrasaldo said main market for medium- and low-grade nickel ore is China.

Mindoro Resources is looking for an investor to help it finance the Agata project, from which it expects to produce 7,000-10,000 MT of nickel per year for at least 25 years.

Mindoro Resources, which has been exploring the county for nickel, iron, gold and copper mineral deposits since 1996, also has exploration projects in gold and copper properties in Batangas. -- Neil Jerome C. Morales, BusinessWorld

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