Posted on 17 Feb 2009
The
Berong Nickel, in which London-listed Toledo Mining Corp has a 56.1% stake, said it has more than enough stock to ship to client BHP Billiton.
Berong has an agreement to supply up to 500,000 tonnes of nickel laterite ore to BHP annually until 2013.
BHP only agreed to buy 400,000 tonnes of nickel laterite ore for 2009 and negotiations to raise the annual volume to 1 million tonnes were unsuccessful, Berong shareholder Atlas Consolidated Mining and Development Corp told
"With more than enough stock to meet the initial shipments to BHP Billiton, all production activity at Berong has ceased for the time being," Atlas said, adding more than 600 employees and contractors were laid off and fewer than 50 staff were still employed in the mine site.
Atlas said half of the 400,000 tonnes intended for BHP can be supplied from stockpiles, "which means full-scale mining operations can be deferred until the second half of 2009."
The first shipment to BHP is scheduled for April, followed by monthly shipments, it added. Apart from BHP, the Berong project, potentially the world's fourth-largest nickel laterite resource, was shipping ore with an average grade of around 1.5% to producers in
Nickel, a key ingredient in making stainless steel, was trading at US$10,250 a tonne by 0944 GMT on the London Metal Exchange, less than a fifth of its all-time high of US$51,800 reached in May 2007.
The
European Nickel holds an 18.7% interest in the Berong deposit on
