Global Ferronickel Holdings Inc. said Monday it expects nickel ore production to increase 20 percent this year with the start of its Palawan mine’s commercial operations.
The Palawan mine will have an annual production capacity of 1.5 million wet metric tons. The project will complement GFNI’s Surigao mine which has an annual capacity of 7.5 million WMT.
GFNI said its acquisition of a 20-percent interest in Chinese firm Guangdong Century Tsingshan Nickel Industry Co. Ltd. was also expected to boost the company’s operations in 2023.
“The start of commercial operations at the Palawan mine along with the acquisition of 20-percent interest of GCTN, both in the fourth quarter, should enable us to carry out production all year-round and generate improved financial growth as we scale and integrate the business. We believe this positions us to achieve more consistent profitability throughout the year,” GFNI president Dante Bravo said in a statement to the stock exchange.
“It will also allow us to benefit from higher nickel prices and China’s ongoing reopening, which is expected to prompt a rebound in stainless steel production and in the new energy vehicle supply chain,” he said.
The company earlier said the Palawan mine would address the seasonality constraint of the Surigao mine.
The Cagdianao mine in Surigao operates only from April to October, while the Palawan mine would operate from November to July.
GFNI said it was on track with its medium-term strategy, which includes the construction of a steel processing plant in Mariveles, Bataan and its commercial production, and the development of a nearby port.
The nickel miner reported a net income of P2.2 billion in 2022, up 9 percent year-on-year as lower revenues was offset by higher foreign exchange rate.
Revenues in 2022 declined 13 percent to P6.7 billion amid adverse weather. Total shipped volume fell 24 percent to 3.735 million WMT, resulting from weather events such as more rain days that affected the production of nickel ore.
Overall product mix was 76-percent low-grade ore and 24-percent medium-grade ore with an average realized price of $31.68 per WMT.