Nickel Asia sets lower capex for 2024

MANILA, Philippines — Listed mining firm Nickel Asia Corp. (NAC) will halve its capital outlays this year as it finishes the replacement work for its heavy equipment while hoping to produce up to 19 million wet metric tons (WMT) of nickel ore.

While NAC did not give an exact amount as to the company’s earmarked capital expenditures, vice president Andre Mikael Lu Dy told reporters on Wednesday that it would likely be “half, or less than half” of the 2023 figure.

Last year, NAC spent about P4.5 billion for its mining projects and for the replacement of some of its heavy equipment.

By June this year, the company is hoping to begin mining operations in Manicani, a small island in Leyte Gulf in Eastern Samar province.

READ: Nickel Asia first PH mining firm to aim for net zero

Dy said the new site would undergo a “ramp up phase” before the target full production of 3 million WMT of nickel ore could be realized.

Production targets

“We may be able to [reach] the full annual production estimates by next year at the earliest,” Dy said during NAC’s 2023 earnings briefing.

The Bulanjao mining project in Palawan province, meanwhile, was launched this month. NAC aims to produce up to 2 million WMT annually through Bulanjao.

The Zamora family’s company saw its 2023 earnings slump by 53 percent to P3.7 billion as oversupply of nickel ore in Indonesia pulled down prices.

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NAC also said weak demand from China, among other factors, pulled down the mining firm’s earnings.

Its operating mines sold a combined 16.5 million WMT of nickel ore last year, a 3-percent jump from 2022.

According to Dy, they aimed to maintain production between 16 million WMT and 19 million WMT by end-2024, saying that there “may not be a lot of growth” due to “some pressure on overall nickel prices.”