Strong first quarter production and solid sales at the Ban Phuc Nickel Project have demonstrated Asian Mineral Resources’ (AMR) resilient operation even in a tough nickel pricing environment. The company has also made significant progress with exploration which continues to add greater understanding to the structural controls on high-grade zones within the disseminated resource base.
AMR mined 116,099 tonnes and produced 2111 tonnes of nickel metal, 1028 tonnes of copper metal and 69 tonnes of cobalt metal in concentrate in the quarter compared to 101,372 tonnes mined and production of 1307 tonnes of nickel and 729 tonnes of copper in the first quarter of 2014.
Continued operational optimization has resulted in a further increase in process plant nickel recoveries to 87% and copper to 94%.
Four product shipments were completed in the quarter in line with expectations, for a total of 20,874 tonnes dry concentrate, up from 13,156 tonnes in the corresponding quarter of 2014. The average realized nickel price for the quarter was US$6.18/pound (US$13,625/tonne).
AMR continued its strong cost performance in the quarter. Unit C1 (all in) operating cash costs, including royalties and export taxes, were reduced to US$4.63/pound. The company was in a strong cash and trade receivables position of US$9 million at March 31 and during the quarter a further US$2 million of debt was re-paid to LienViet Post Bank, bringing the total outstanding debt balance to US$14.0 million.
The declining trend in cash costs is expected to continue into the current quarter, as work on mine development is progressing ahead of schedule and the initial ramp-down in contractor equipment and manpower costs is planned to commence.
Near-mine exploration continued steady progress with key structural mapping and ongoing soil sampling activities. The combination of EM work and structural mapping by OREFIND consultants has continued to develop AMR’s knowledge of the region and the structural controls on mineralization. This has enabled a revision to AMR’s strategic targeting and re-prioritization of exploration targets.
Construction of the embankment on the tailings dam remained on track at March 31 at 92.5% complete and 3.5% ahead of planned volumes. Final completion is expected during the current quarter. Outstanding work is primarily focused on placing concrete in the spillway.
Upon completion, the tailings dam will have capacity for the entire life of the Ban Phuc MSV. A further expansion to increase dam capacity to accommodate an extended mine life forms part of the overall design and capacity within the tailings dam valley itself with the potential to store an additional one million tonnes of material.
AMR’s CEO Evan Spencer says, “Robust plant performance and cost management, combined with a strong focus on delivering upon key business improvement initiatives, have continued to realize key cost savings. AMR has maintained its ongoing operational focus at Ban Phuc while at the same time being able to maintain momentum and progress with its near-mine exploration program.”