Chinese group to develop two laterite mines in the Philippines

China’s Jinchuan Group Ltd has signed agreements to invest in two laterite mines in the Philippines. Jinchuan, China’s top nickel producer and third-gest copper producer, will join Zamora Group and Macroasia Group to develop two laterite mines in Palawan Island in the Philippines. A statement on the Chinese firm’s website did not provide the details, including the size of the mines.

Laterite is the ore for the production of nickel-pig-iron (NPI) and ferro-nickel in China. Both NPI and ferro-nickel are used for the production of stainless steel. China is the world’s top producer of NPI, a low grade ferro-nickel with high iron content, and relies on imported laterite ores for NPI production. Official data showed that China’s nickel ore and concentrate imports surged 72 per cent on the year to 21.21 million tonnes in the first seven months of 2011. The Philippines was China’s second-largest supplier of the materials after Indonesia during the period. The bulk of the imports are typically laterite ores used to make NPI.

Jinchuan may also invest in the Nonoc nickel mine in the southern Philippines, the company said in February.  That would revive the production of Nonoc, which was closed in 1982 due to high energy costs and has capacity to produce 40,000 tonnes of nickel a year. In China, Jinchuan operates the country’s gest nickel mine in the northwestern province of Gansu. But it needs more nickel ores as it expands metal production.

Jinchuan is building annual capacity of 600,000 tonnes of copper, 100,000 tonnes of ferro-nickel and 20,000-30,000 tonnes of nickel in the southeast Chinese region of Guangxi. In 2011, Jinchuan plans to increase production to 130,000-140,000 tonnes of nickel and 500,000 tonnes of copper, compared to about 130,000 tonnes of nickel and less than 400,000 tonnes of copper in 2010.