LionOre International, the giant metals and precious stones miner, opened the year in style with the commencement of its trail-blazing refinery project and new finds at Selkirk in Botswana as it pushes to increase its shareholders? value.
The multi-listed miner embarked on the first ever refinery project in the world, Activox, which will enhance the extraction of nickel to help the world to cope with the ever increasing demand.
LionOre President and Chief Executive Officer, Colin Steyn, who is bullish on the nickel prices, has praised the P 4 billion new technology project at a time when the demand is outpacing the supply.
?The supply side on the other hand never caught up with the demand and Activox will go a long way in increasing the world?s nickel production, with Botswana playing a very integral role,? he said.
Steyn has attributed the increasing demand on the steel hungry China which is caught up on the industrialization process.
Speaking in an interview with The Sunday Standard, Steyn said the nickel prices are not expected to fall to the historical lows since the ?Chinese economy was growing by up to 12 percent per annum.? Through the mass urbanization of the Chinese, the nickel prices have increased.
China, which is also gearing to be a world super-power, has been instrumental in nickel prices spike as it consumes over 20 percent of the world?s nickel and around 40 percent of world?s iron ore.
In an exclusive interview with The Sunday Standard, Steyn said, ?The stainless steel industry has proven very successful in recent years, growing by an average of five-to- 10 percent in the last few years and 15 percent last year.
?This has proven to be a great benefit to the nickel industry.? he said, adding that China had contributed to the push.
Activox uses a chemical solution to extract metals from finely ground ore at low temperature and moderate pressure of below 120 degrees Celsius.
The process removes the smelting stage of the present day LionOre production, enabling the company to a vertically integrated producer that produces high quality nickel on site at cost effective prices.
Further, the process is more environmentally friendly, as compared to the smelter, since it ensures that the residual sulphur is not emitted as a gas?sulphur dioxide ? and remains a solid that can be controlled environmentally.
When complete in 2009, the refinery will make it possible to produce 22,000 metric tons (24,250 tons) of nickel a year from the company?s Tati Nickel mine.
The refinery will be built at the Tati Mine and will be 15 percent owned by the Botswana government.
LionOre acquired the Activox technology from an Australian based group of scientists who decided to shift their interest to Gold mining. The development of the technology was done with Western Minerals Technology ? a subsidiary of LionOre.
The total cost of $620m or P 4 billion, includes a 12 million tonnes per annum (tpa) dense media separator for $114m, a 25,000 tpa $482m Activox refinery and $24m for power infrastructure.
The dense media separator will be commissioned by mid-2008 and the Activox Refinery by the third quarter of 2009. Full production is forecast for third quarter 2009.
Activox enhances the recovery of metals at a fraction of a cost and is expected to increase the life-span of the mine.
?The world is presently grappling to increase supply in the face of increased demand. All ore bodies in the world are presently being mined and none have been discovered such that Activox is key to meeting the demand,? Steyn said.
?The price of nickel will never drop to the very low levels as before because all the juicy ore bodies are being mined or have been mined,? he added.
The multi-listed company said it will not sell Activox technology but rather leverage the technology to buy into the existing mines that do not have it.