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Nickel Industries completes Hengjaya to IMIP haul road

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Global Mining Review,

Nickel Industries Ltd has announced that the haul road linking its 80% owned Hengjaya Mine to the Indonesian Morowali Industrial Park (IMIP) in central Sulawesi has been completed, including the construction of a 70 m double lane bridge with public road underpass near the entrance of the IMIP. The company is ready to commence the haulage of nickel laterite ore from the company’s mining operation directly to the IMIP.

With the haul road complete and haulage and maintenance contracts now awarded, the company expects to commence the trucking of first ore down this road this month. The completion of the haul road represents a landmark development in the history of the company’s mining operations and will allow the mine to rapidly increase total ore sales from current levels of approximately 3.5 million tpy to a targeted 10 million tpy, a run rate which is expected to be achieved by the end of 2023.

The company currently has in excess of 8 million t of limonite ore stockpiled that can now be progressively sold into the IMIP’s two existing HPAL projects – the Huayue Nickel Cobalt Project (HNC, in which the company has recently acquired a 10% equity interest) and the QMB New Energy Project.

An official ceremony to mark the opening of the haul road was held on Thursday 3 August 2023, and was attended by senior Nickel Industries executives; including Deputy Chairman Norman Seckold, Managing Director Justin Werner and Director James Crombie, in addition to Tsingshan Chairman Xiang Guangda, Shanghai Decent Chairman and Nickel Industries Director Huang Weifeng, and Eternal Tsingshan Chairman and Nickel Industries Director Xiang Binghe.

Commenting on the completion of the Hengjaya Mine to IMIP haul road, Justin Werner, Nickel Industries Managing Director, said:

“After several years of hard work, we are delighted to have now completed this transformational piece of mine infrastructure that will enable the Hengjaya Mine to leverage the full strategic benefits of its proximity to the IMIP and see it become the largest single supplier of ore to the industrial park. With jetty capacity and barge availability having been a constraint to selling larger volumes of ore, the completion of this haul road is a game-changer for our mining operations. With haulage and road maintenance contracts now finalised, we look forward to commencing the trucking of ore down this road with the aim of achieving a targeted run rate of 10 million tpy of ore sold by the end of 2023. With the mine having made US$52 million in EBITDA from selling 3.5 million t of ore last year, the ability to increase sales volumes beyond 10 million tpy is set to see Hengjaya Mine deliver a significantly increased financial contribution to our overall group result moving forward. At a cost of approximately US$17 million the increased production and financial contribution will represent an attractive return on investment for the company and its shareholders.

“Finally, I would like to acknowledge our Chief Operating Officer, Tony Green, and our dedicated team of employees and contractors that have worked diligently to deliver this project. Their efforts are greatly appreciated and we now look forward to seeing this haul road deliver long term benefits to the company’s operations.”

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