Pacific Nickel busy building out a wharf in Solomons ahead of mid-2023 cargoes to Glencore; China

Thu 17 Nov 22, 3:34pm (AEST)
An unknown mining operation with a constructed export wharf alongside it is photographed from above in an unknown location
Source: iStock

Key Points

  • Pacific Nickel Mines currently has a construction team of 50 workers building an export wharf only 500m away from the Kolosori mine
  • Mine DFS pending; local contractors are currently working out mining costs in a jurisdiction with desirable currency exchange rate benefits
  • International mining giant Glencore to finance project with a US$22m facility

Pacific Nickel Mines (ASX:PNM) is on track to meet its target of shipping from the Solomon Islands nickel laterite cargoes to China in mid-2023 with a 50-man construction camp currently being established at company acreage to facilitate the build of a direct shipping ore (DSO) wharf. 

The sizeable workforce will also construct a haul road (only 500m long) between Pacific’s Solomon Islands-based Kolosori nickel mine itself, and the DSO port in question. 

All in all, Pacific expects works to be complete by July 2023, given it targets export commencement “from mid-2023.” 

Glencore to fund US$22m; recently visited site

The implication to keep in mind, too, is that cashflow will follow. Project financers Glencore (set for early offtake of the nickel ore) have visited the project in recent weeks as part of an underlying due diligence process which will trigger the mining giant’s payment of US$22m to Pacific. 

Pacific reports Glencore sent five of its people to get boots on the ground at Kolosori; in the style of a trade delegation, the company inspected the mineface at Kolosori; overall mine plan layout, and current progress on the wharf. 

Glencore also met with Indigenous (Solomon Islands) stakeholders. Ahead of their funding facility for Kolosori, Pacific is also engaging local mining contractor HBS PNG Pty Ltd (Australian-owned) to provide a schedule of mining costs ahead of Pacific’s upcoming Definitive Feasibility Study (DFS). 

Full export capacity to be met in 2023: Management 

“We are pleased that the construction activities have commenced with a particular focus on the DSO load out wharf, perhaps the project’s most important component. Once this is in place the operation will be unlocked,” Pacific Nickel chief Geoff Hiller said. 

“This should allow the project to ramp up to full production, of around 1.3 million wet metric tonnes per annum of direct shipping nickel ore, during 2023.”

For clarity, Pacific will not be shipping 1.3 million tonnes of nickel itself, but rather, ore containing laterite-type nickel into the Chinese market. 

“We are working closely with the landowners and local contractors and appreciate their support in the delivery of this project,” Hiller added. 

Market Index News recently spoke to Pacific chief Geoff Hiller for our definitive guide on nickel, where further updates on company progress were given.

A look at Pacific Nickel's recent performance on the bourse
A look at Pacific Nickel's recent performance on the bourse

Note: a previous version of this article incorrectly stated the Kolosori mine was based in PNG.

Written By

Jonathon Davidson

Finance Writer

Jonathon is a journalism graduate and avid market watcher with exposure to governance, NGO and mining environments. He was most recently hired as an oil and gas specialist for a trade publication.

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