Mincor, BHP nickel venture slow to start

Fallout from WA’s strained labour market has delayed the start of an offtake agreement between BHP Nickel West and Mincor Resources, setting back first production by three months.

Mincor today announced it had notified BHP of its intent to deliver first ore in an arrangement struck between the parties, under which Mincor is set to supply and process nickel ore to its partner from Kambalda operations in its namesake district in WA.

However, a “step-change” in Mincor’s development programme - driven a lack of skilled labour in the state - has forced Mincor to push back first production from the March quarter to June after struggling to get operations up and running.

Mincor managing director David Southam said the planned restart had not been immune to WA’s labour shortages.

“Our original development schedule, which was created in a pre-COVID environment, envisaged a ramp-up of activity and skilled blue collar labour supply mid-September and into early October,” Mr Southam said in a statement.

“This ramp-up has not eventuated to the extent planned, prompting us to take the proactive step of updating our development plans with first nickel concentrate now scheduled for the June 2022 quarter.”

Mr Southam said his company had been working with mining services company Pit N Portal to retain current staff and increase recruitment.

“The Company remains extremely well-funded to deliver the project following our recent capital raising, and we are confident that our strong partnership approach with Pit N Portal will ultimately set the Company up for success as we move towards first revenue in the June 2022 quarter.”

In triggering the agreement, BHP will begin a works programme at its Kambalda nickel concentrator to get the facility up and running to process ore supplied by Mincor.

Concurrently, Mincor said exploration at its Hartley and Golden Mile prospects was progressing well and was in the processing of sourcing additional drill rigs for its campaign.

Mincor shares are down 0.36 per cent to trade at $1.37.