Natural resources company Nickel Asia Corp. (NAC) is divesting its minority stake in Coral Bay Nickel Corp. (CBNC), a nickel processing operator in Palawan, due to unfavorable market conditions.
In a stock exchange disclosure on Tuesday, NAC said it was in discussions with Japanese partner Sumitomo Metal Mining Co., Ltd. for the sale of its 15.625 percent stake in CBNC, which operates a high-pressure acid leach (HPAL) mineral processing plant in Bataraza, Palawan.
NAC vice president for treasury and investor relations and sales Andre Mikael Dy said the company had made this decision following the recent volatility in the nickel market, adding that NAC would instead focus on upstream mining and renewable energy businesses.
“Over the last three years, the financial performance of CBNC was negatively impacted by increasing operating costs and weakening LME (London Metal Exchange) price,” Dy said.
“The divestment is seen to positively impact the NAC Group in furthering its ambitious growth and diversification objectives,” he added.
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NAC will engage a third party to conduct a valuation of CBNC shares as a condition precedent for the proposed sale.
Based on CBNC’s website, minerals are refined and used as valuable components in special steel, electric materials and battery materials. “More importantly, these are used as battery material for electric vehicles, which contributes to the global goal of achieving a low-carbon future,” it added.
CBNC, which became operational in 2005, operates at a capacity of 24,000 tons of contained nickel and 2,000 tons of contained cobalt per year in the form of a mixed nickel-cobalt sulfide. Its plant is “the world’s most efficient facility using the HPAL process,” according to NAC.
NAC still owns 10 percent of Taganito HPAL Nickel Corp., HPAL operator in Surigao del Norte, together with Sumitomo (75 percent) and Mitsui & Co., Ltd. (15 percent).
The Zamora family-led mining firm operates five mines across the country and has ventured into the renewable space. INQ