- New Century Resources (NCZ) and Vale Canada have entered a 60-day agreement for the potential acquisition in Vale Nouvelle-Calédonie (VNC)
- If the acquisition goes ahead, New Century will acquire 95 per cent of the issued shares in VNC and, by extent, its Goro Nickel and Cobalt Mine in New Caledonia
- The Goro Mine is a fully integrated and operational world class mine that includes a processing plant and port facility for exports
- New Century will complete due diligence, while VNC conducts a simplification plan for Goro to expand production and lower costs
- Company shares are down 8 per cent and trading for 23 cents each
New Century Resources (NCZ) and Vale Canada have entered an exclusive 60-day agreement to complete due diligence and negotiate a potential acquisition.
The acquisition will consist of 95 per cent of the issued shares in Vale Nouvelle-Calédonie S.A.S (VNC). VNC owns and operates the Goro Nickel and Cobalt Mine in New Caledonia.
The Goro Mine is undergoing a VNC-instituted Simplification Plan to expand production of its mixed hydroxide product (MHP) and lowering the cost base.
“New Century is pleased to secure this exclusivity agreement in relation to the potential acquisition of the Goro Nickel & Cobalt Mine,” New Century Managing Director Patrick Walta said.
Plant and infrastructure
Goro comprises a fully integrated, operational, world-class processing facility and logistics infrastructure from mine to port.
This includes a mining fleet and maintenance facilities, a hydrometallurgical plant, tailings storage facility, onsite 100-megawatt power station, bulk port and cargo wharfs, 3000-person camp, 350-person ferry, and a rehabilitation facility.
The four key areas of the Simplification Plan includes limonite-only processing, exporting saprolite ore, decommissioning the refinery and only producing MHP, and implementing dry stack tailings at the mine.
“The current initiatives instituted by VNC to simplify the flowsheet provide the strong potential to transform Goro into a sustainable long-life operation and a major global supplier of Nickel and non-DRC sourced Cobalt,” Patrick added.
Processing only limonite ore not only contains less impurities, but it allows for consistent operation of the processing plant.
Exporting saprolite ore
Saprolite ore, which will no longer be processed at the plant, can be exported to provide an easy, low-cost revenue source.
In 2019, New Caledonia exported seven million tonnes of saprolite. This accounts for roughly 12 per cent of the global saprolite production.
New Caledonia ore is usually priced at 25 per cent of London Metal Exchange (LME) for 1.8 per cent nickel in ore and 26 per cent of LME for two per cent nickel in ore.
The company will present a government-supported draft bill to the local Congress next month, which will give a legal basis to export up to two million tonnes per year of saprolite ore from Goro.
Decommissioning the refinery and shifting to 100 per cent production of MHP
MHP is considered a key product when manufacturing batteries for the electric vehicle industry.
The shift to 100 per cent MHP production will significantly reduce operational complexity and, by extent, lowers the cost base for the mine.
Dry stack tailings
Implementing dry stack tailings will provide a best-in-class and long-term tailings management solution for the operation.
The overall benefits include the elimination of risks related to dam technology and storage of wet sludge, improved water management and a smaller environmental footprint, reduced investment compared to other wet dam construction, and optimal technology which is recognised and used worldwide.
Company shares are down 8 per cent and trading for 23 cents each at 11:23 am AEST.