Zimbabwe's Minister of Mines Winston Chitando speaks at a conference in Harare, Zimbabwe, on Feb. 28, 2018.Philimon Bulawayo/Reuters
Zimbabwe’s only operating nickel mine was on Thursday placed under administration, according to a government notice, seven months after halting production due to equipment failure and low prices.
Zimbabwe’s government owns 70 per cent of Bindura Nickel Corporation’s Trojan Nickel Mine which employs about 1,100 people according to Bindura’s latest annual report.
The reconstruction order was published on Thursday in the Government Gazette which also announced the appointment of an administrator.
Trojan is Zimbabwe’s only primary nickel producer, though the country’s platinum miners also produce the metal which is mainly used in steelmaking.
Nickel prices have fallen from record levels above $100,000 in 2022 when they were driven by expectations of reduced supplies from major producer Russia following its invasion of Ukraine, to around $19,000 per ton in the currently oversupplied market. Prices are currently 25 per cent down on their levels a year ago.
Low prices have forced top global producer BHP Group to review its nickel business, warning that 30 per cent of Australian mine capacity had gone offline and another 30 per cent was in trouble due to the squeeze on margins.
Trojan mine’s nickel concentrate output plunged to 1,314 metric tons in its last financial year, which ended in March 2024, down from 3,180 metric tons the year before.
This was after the mine suspended operations last September following the damage suffered by its ore hoisting equipment during a seismic event. The mine has capacity to produce 5,500 metric tons of nickel concentrate annually.
On April 29, the company said while it had managed to install new ore hoisting gear, it would delay restarting mining operations due to low prices and high costs of inputs such as electricity.
“BNC needs to mobilize the requisite capital for retooling, with particular emphasis on increasing the availability of underground mining mobile equipment and the processing plant,” it said on Thursday.
Trojan mine started production in 1964 under the Anglo American group which sold the asset in 2003.