Nickel miner Western Areas has announced a pair of three year, 10,000 tonne per annum offtake deals in just two days.
Western Areas, which operates its two flagship mines at Forrestania, WA, announced the first offtake deal on November 28. Under the three-year deal, Western Areas will deliver 10,000 tonnes per annum of nickel in concentrate to Chinese stainless steel producer Tsingshan, via half height containers.
The other agreement, announced on November 29, will see Western Areas deliver up to 10,000 tonnes per annum of nickel in concentrate to BHP Billiton Nickel West, via bulk logistics delivery to Kambalda. The BHP deal has a 30,000 tonne aggregate limit over its full term.
Western Areas managing director Dan Lougher said the first deal, with Tsingshan, was many years in the making.
“Over three years ago, Western Areas recognised Tsingshan as an innovator in the production of stainless steel and since then we have developed a close working relationship through the sharing of technical knowledge and many site visits,” Lougher said.
“Tsingshan is clearly leading the charge in China to produce a greater proportion of the higher quality 300 series stainless steel product, which contains up to four times the amount of nickel than then 200 series stainless.”
As for the BHP deal, Lougher described it as an “excellent outcome”.
“Western Areas has a strong fundamental belief in the long term sustainability of nickel production in Western Australia and the execution of this three year contract demonstrates our vision of a positive future,” he said.
“Nickel West is a quality partner and the relationship developed over the prior seven years is stronger than ever. Both parties will benefit from this new contract, due to the high reliability, quality and consistency of supply from our Forrestania operations.”