ASIAN Mineral Resources (AMR) has increased mine production at its Ban Phuc Nickel Project in northern Vietnam by 17% while ongoing operational efficiencies have contributed to a further reduction in operating costs.
During the June quarter average monthly mined production was 37,073 tonnes, which was about the targeted rate of 31,686 tonnes.
With the production ramp-up now completed, there were 2033 tonnes of nickel contained metal in concentrate produced, up from 1746 tonnes in the corresponding period of 2014, and 972 tonnes of copper contained metal in concentrate, up from the 2014 amount of 852 tonnes. There were 66 tonnes of cobalt produced. Mill recoveries were above target at 87%, compared to 84% a year earlier.
AMR had net sale revenues of $20.5 million in the June quarter with an average realized nickel price of US$5.71 per pound. This was down from the $21.1 million of the corresponding period of 2014 due to lower nickel prices. C1 unit operating cash costs in the period were US$4.55 per pound, lower than the US$4.92 of a year earlier.
Cash generated in operating activities amounted to $5.9 million, down from $8.3 million 12 months earlier. This allowed for $1.7 million of capital investment.
AMR recorded a gross loss of $1.2 million for the quarter and a net loss of $3.3 million compared to gross profit of $5.8 million and net income of $3.9 million in the June quarter of 2014. As at June 30, 2015, AMR had total cash and cash equivalents of $7.5 million and total current assets of $32.2 million.
The company’s CEO Evan Spencer said, “AMR’s focus on operational excellence has again proved key to our ongoing success in this period of lower nickel prices. In Q2 2015, we have been able to increase our mine production rate significantly. This increase, together with savings from improved procurement and tendering processes, contributed to a further reduction of the operating cost.”
AMR is one of the few new sources of nickel sulphide supply globally. The company commenced commercial production from its Ban Phuc project in mid-2013.
The project currently produces more than 6900 tonnes of nickel and 3500 tonnes of copper annually contained in concentrate, plus a cobalt by-product.
In addition to in and near-mine expansion projects, Ban Phuc provides a cash-generative operating platform from which AMR can continue to focus on developing a new nickel camp within its 150sqkm of concessions located throughout the highly-prolific Song Da rift zone, where the company has a number of advanced-stage nickel exploration targets.
During the September quarter, AMR paid down US$14.7 million in debt, including fully repaying the outstanding term loan facility.