Alliance has advantages for both Anglo and African Nickel

29th January 2010 By: Jonathan Faurie

THE nickel alliance agreement between min- ing junior African Nickel and one of the world’s largest diversified miners, Anglo American, is proving to be mutually beneficial to both companies, reports African Nickel.

According to the agreement, African Nickel has access to, and carries out exploration work on, a number of projects that are held by Anglo American.

African Nickel director Richard Hornsey reports that African Nickel benefits because it has exclusive access to an extensive database of some of the world’s best nickel projects, as well as access to facilities that would take years for African Nickel to establish.

According to the agreement, African Nickel will conduct exploration work and feasibility studies on selected Anglo American projects.

African Nickel funds these exploration and feasibility studies.

“The findings of these projects will then be presented to Anglo, which has a claw-back agreement to then initiate production on the project. Should Anglo not wish to initiate production, the project is handed over to African Nickel, which will have the option of developing the project,” says Hornsey.

He adds that should Anglo wish to develop a project, African Nickel has a similar claw-back agreement.

Although this alliance ends in 2011, Hornsey says that access to the database provides African Nickel with a potentially inexhaustible pipeline of profitable projects.

Hornsey points out that the alliance came about because Anglo American had scaled back its exploration activities as a result of the global economic crisis. Anglo adds that it has limited interest in large projects, but will focus its efforts on developing giant projects. African Nickel will focus its efforts on small to medium-size projects as well as large projects.

The countries that the Anglo American database covers include Angola, Botswana, Mozambique, Namibia, Malawi, Zimbabwe, Tanzania and Burundi. African Nickel has already acquired projects through the alliance in Namibia, Botswana and Tanzania.