Business
Nickel 28 Letter From the Chairman
TORONTO / Dec 28, 2022 / Business Wire / Nickel 28 Capital Corp. (“Nickel 28” or the “Company”) (TSXV: NKL) (FSE: 3JC0) provides the following update to shareho
About this update from Nickel 28 Capital Corp
[{"type":"text","content":"TORONTO / Dec 28, 2022 / Business Wire / Nickel 28 Capital Corp. (“Nickel 28” or the “Company”) (TSXV: NKL) (FSE: 3JC0) provides the following update to shareholders from its Executive Chairman, Mr. Anthony Milewski. As we close out 2022, I want to take a moment to provide an update to our shareholders and partners. As one of the few nickel producers listed on the Toronto Stock Exchange or TSX Venture Exchange, Nickel 28 is a unique vehicle providing shareholders with leverage to the price of nickel and cobalt through our interest in the producing Ramu Nickel mine as well as royalties on quality Canadian-based nickel sulphide deposits – Dumont and Turnagain. 2022 proved to be a unique year for the nickel markets with a short squeeze on the London Metals Exchange (LME) contract that defied anything the contract had ever experienced. We believe that the short squeeze, and the manner in which the LME reacted to the situation has likely changed the way nickel is priced for years to come. Producers, consumers, and financial players alike have reconsidered what the appropriate, if any, current reference price actually is. Moreover, the longer than anticipated affects of COVID-19 on Chinese and other economies and increased nickel supply from Indonesia meant that for much of 2022 nickel inventories were actually increasing. Management believes that these headwinds are temporary and that 2023 will see a “re-opening” trade as China comes out of COVID. 2022 also saw a fairly dramatic increase in production costs at Ramu Nickel. By way of example, spot sulfur costs went from approximately under $100 per tonne in 2020 to over $600/tonne in the middle of 2022. These costs have come down in recent months but remain materially inflated relative to last year. However, Ramu Nickel consistently ranks as either number one or two in terms of cost when ranked amongst the global HPAL operations as published by Wood Mackenzie, which is a testament to our partners and the continued performance of Ramu Nickel to achieve or surpass nameplate capacity. We do not have a view on cost inflation for 2023 but note that ultimately these costs should be reflected in the future price of nickel. In 2022, we expect Ramu Nickel to produce approximately 34,000 tonnes of contained nickel and 3,000 tonnes of contained cobalt, ranking it as one of the top producers of M...