JOHANNESBURG (miningweekly.com) – Canada-based Sherritt International Resources is forecasting higher nickel production in 2017, especially from its 40%-owned Ambatovy nickel and cobalt joint venture (JV), in Madagascar.
The diversified miner on Tuesday provided a nickel production guidance (100% basis) of 81 000 t to 86 000 t for 2017, which compares with 2016’s output of 75 033 t.
Cobalt production is forecast to increase from 6 967 t in 2016 to between 7 300 t and 7 900 t in 2017.
Sherritt said the Ambatovy JV had delivered a “strong” performance in the fourth quarter, producing 12 778 t of finished nickel, contributing to the operation’s yearly production of 42 105 t.
The mine’s production guidance for 2016 was lowered twice last year, owing to some glitches in the April-to-June period, which was followed by a maintenance shutdown in June and July. Originally, the JV partners, which also include Japanese trading house Sumitomo (32.5%) and Korea Resources (27.5%), expected Ambatovy to produce 48 000 t to 50 000 t in 2016. In August, the guidance was lowered to between 42 000 t and 45 000 t.
The Ambatovy mine produced 3 273 t of cobalt in 2016, which is expected to increase to between 3 800 t and 4 100 t in 2017.
At the 50%-owned Moa JV, in Cuba, Sherrit reported nickel production of 32 928 t and cobalt production of 3 694 t in 2016. This was in line with the company’s guidance for the year.
For the first time, Sherritt also provided a 2017 outlook for unit operating costs. The company provided a guidance of $3.14/lb to $3.70/lb for net direct cash costs. The Moa JV’s costs are expected to be similar to 2016 levels and the Ambatovy JV’s costs are expected to be lower, owing to higher production rates at the operation.
The miner will provide its 2016 unit operating costs and capital spending in the fourth quarter and year-end 2016 report, which it plans to publish on February 16 after the markets close.