Conic Releases Ramu Q2 2020 Performance
August 17 2020 - 1:13PM
Business Wire
Conic Metals Corp. (“Conic” or the “Company”)
(TSXV: NKL) is pleased to provide operating results for the
quarter ending June 30, 2020 of the Company’s largest asset, being
the Ramu Nickel-Cobalt (“Ramu”) integrated operation in
Papua New Guinea. Conic currently holds an 8.56% joint-venture
interest in the Ramu operation. Ramu is operated by the
Metallurgical Corporation of China which, along with its partners,
owns an 85.0% interest in Ramu.
“Despite the impact of the COVID pandemic on the global economy,
Ramu continued to demonstrate solid operating performance, and
sales in the quarter and half year results are consistent with 2019
performance” stated Justin Cochrane, President and CEO. “Nickel
production for the half year are 1% lower in comparison to the same
period in 2019 and we expect Ramu to meet guidance of 32,000-33,000
in 2020. We are pleasantly surprised considering other operations
had to shut down in the quarter and Ramu continues to operate at
full capacity” added Mr. Cochrane, who also noted “sales numbers in
the quarter at 7,555 tonnes of nickel contained combined with
industry leading cash costs of $2.18 per pound continue to support
our belief that Ramu is the best performing HPAL operation in the
world. Ramu is able to generate significant free cash flow due to
vigilance in keeping costs low.” Actual cash costs for six months
ending June 30, 2020 were $2.11 per pound of nickel produced, net
of byproduct credits.
According to Wood Mackenzie, the lowest quartile of C1 Cash Cost
of nickel production is forecast to be $3.26 per pound in 2020. C1
Cash Cost differs from actual production cost as it includes
transportation and refining costs to produce Class I or Class II
nickel. Ramu produces nickel in the form of mixed hydroxide product
(“MHP”) which contains approximately 40% nickel and 3.5%
cobalt. MHP is a desired raw material for the manufacture of
lithium ion battery cathode materials such as NCA and NMC, which
are being extensively adopted in the electric vehicles.
Ramu’s production and Actual Cash Cost are presented in the
table below.
2019
2020
Q1
Q2
Half Year
Q1
Q2
Half Year
Ore Processed (dry kt)
800
959
1,759
920
814
1,734
MHP Produced (dry tonne)
19,653
22,490
42,143
21,177
18,975
40,152
Contained Nickel (tonne)
7,663
8,767
16,430
8,635
7,603
16,238
Contained Cobalt (tonne)
704
793
1,497
720
655
1,375
Nickel Capacity Utilization (% of
design1)
94%
108%
101%
106%
93%
100%
MHP Shipped (dry tonne)
17,219
24,607
41,826
15,121
19,024
34,145
Contained Nickel (tonne)
6,588
9,457
16,045
6,108
7,555
13,663
Contained Cobalt (tonne)
609
861
1,470
522
644
1,166
Cash Cost Actual2
$2.44
$2.41
$2.42
$2.05
$2.18
$2.11
Note (1) – Ramu design capacity of 32,600 tonne per year of
contained nickel Note (2) – Actual Cash Cost net of byproduct
credits
A. Conic has included certain performance
measures in this press release that do not have any standardized
meaning prescribed by international financial reporting standards
(“IFRS”) including (i) C1 Cash Cost and (ii) Cash Cost
Actual. C1 Cash Cost is a metric published independently by Wood
Mackenzie. The C1 Cash Cost presented is annualized cash cost to
produce one pound of finished nickel product based on Wood
Mackenzie’s analysis of global refined nickel operations. The
presentation of these non-IFRS measures is intended to provide
additional information and should not be considered in isolation or
as a substitute for measures of performance prepared in accordance
with IFRS. Other companies may calculate these non-IFRS measures
differently. Note these figures have not been audited and are
subject to change.
Update on Timing of Reporting of Q2 2020 Financial
Results
In response to the ongoing global COVID-19 pandemic, the
Canadian Securities Administrators have announced additional
temporary blanket relief allowing market participants an additional
45 days in which to complete certain regulatory filings required to
be made between June 1, 2020 and August 31, 2020 (including
financial statements and management’s discussion and analysis).
Accordingly, the Company intends to rely on this blanket relief for
the filing of the Company’s quarterly financial statements for the
period ended June 30, 2020 (and related management’s discussion and
analysis thereon) (collectively, the “Q2 2020 Disclosure
Documents”) as a result of delays caused by the COVID-19
pandemic. The Company, under this temporary relief, is making every
effort to issue and file the Q2 2020 Disclosure Documents at the
earliest opportunity and currently expects to file them no later
than October 13, 2020.
The Company confirms that there have been no material business
developments since filing its Interim Financial Statements (related
management’s discussion and analysis thereon) filed on July 14,
2020, which are available on SEDAR at www.sedar.com. Until such time as the Q2 2020
Disclosure Documents are filed, the Company’s management and other
insiders will observe a trading blackout consistent with the
principles contained in section 9 of National Policy 11-207 –
Failure to File Cease Orders and Revocations in Multiple
Jurisdictions.
About Conic
Conic Metals Corp. is a base metals company offering direct
exposure to nickel and cobalt, both being critical elements of
electric vehicles and energy storage systems. Conic holds an 8.56%
joint-venture interest in the producing, long-life and world-class
Ramu Nickel-Cobalt Operation located in Papua New Guinea which
provides Conic with significant attributable nickel and cobalt
production. In addition, Conic manages a portfolio of 11 nickel and
cobalt royalties on development and exploration projects in Canada
and Australia. Conic will continue to invest in a battery
metals-focused portfolio of streams, royalties and direct interests
in mineral properties containing battery metals.
Cautionary Note Regarding Forward-Looking Statements
This news release contains certain information which constitutes
‘forward-looking statements’ and ‘forward-looking information’
within the meaning of applicable Canadian securities laws. Any
statements that are contained in this news release that are not
statements of historical fact may be deemed to be forward-looking
statements. Forward-looking statements are often identified by
terms such as “may”, “should”, “anticipate”, “expect”, “potential”,
“believe”, “intend” or the negative of these terms and similar
expressions. Forward-looking statements in this news release
include, but are not limited to: statements with respect to the
operational and financial results; statements with respect to the
prospects of nickel and cobalt in the global electrification of
vehicles; statements related to the impact of COVID-19 on the
Company; statements with respect to the timing of the filing of the
Q2 2020 Disclosure Documents; and statements with respect to the
business and assets of Conic and its strategy going forward.
Readers are cautioned not to place undue reliance on
forward-looking statements. Forward-looking statements involve
known and unknown risks and uncertainties, most of which are beyond
the Company’s control. Should one or more of the risks or
uncertainties underlying these forward-looking statements
materialize, or should assumptions underlying the forward-looking
statements prove incorrect, actual results, performance or
achievements could vary materially from those expressed or implied
by the forward-looking statements.
The forward-looking statements contained herein are made as of
the date of this release and, other than as required by applicable
securities laws, the Company does not assume any obligation to
update or revise them to reflect new events or circumstances. The
forward-looking statements contained in this release are expressly
qualified by this cautionary statement.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. No securities regulatory authority has
either approved or disapproved of the contents of this news
release.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200817005565/en/
Investors: Justin Cochrane Tel:
647.846.7765 Email: info@conicmetals.com
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