otter juan

Below from The West. A few days old, but may be of interest to some. Of note "Otter-Juan is the oldest and most productive nickel mine in the Kambalda region, producing almost 300,000 tonnes of nickel metal since mining began in 1970".


Contractors clean up with sale to Mincor
15th May 2007, 8:30 WST

Six years after they bought the Otter-Juan nickel mine near Kambalda from WMC, a quartet of Kalgoorlie mining contractors are set to share almost $70 million after selling the operation to Mincor Resources.

Mincor, which already operates four former WMC mines at Kambalda, said yesterday it would pay $68.5 million for Goldfields Mine Management Pty Ltd to secure the Otter-Juan operation and mothballed McMahon and Durkin mines.

Mincor will also pay an ongoing royalty of 3 per cent on all nickel produced from the assets, which it expects to generate up to $135 million in pre-tax cash flow over the next two years.

GMM is the private company owned by Kalgoorlie contractors David Williams, Ross Graham, Peter Bowman and Michael Foulds, which acquired the projects from WMC in early 2001.

The price was not disclosed at the time, but the deal was struck at a time when nickel prices were in the doldrums around $US6000 a tonne. Buoyed by strong demand from China and tight supplies, nickel was yesterday trading above $US53,000/t.

Though it was briefly suspended when WMC first announced it would sell its Kambalda operations in 1998, Otter-Juan is the oldest and most productive nickel mine in the Kambalda region, producing almost 300,000 tonnes of nickel metal since mining began in 1970.

Mincor said the mine was expected to keep producing about 3600t of nickel a year for at least the next three years. At current costs of just $6.70 per pound of nickel, it should generate bonanza profits at current prices around $27.50/lb.

Mincor chief executive David Moore said the deal was a “very significant transaction” for the company.

Mr Moore said Mincor would also benefit from the addition of GMM’s “highly skilled and experienced workforce”.

Mincor shares surged 23¢ to $4.09.

JOHN PHACEAS