China Hanking to acquire 70% stake in nickel producer Northeastern Lion
China Hanking Holdings has signed an agreement to acquire a 70% interest in Northeastern Lion in a deal valued at RMB311.8m ($50m).
The acquisition supports China Hanking's long-term strategy to diversify mining resources and expand into international markets.
Northeastern Lion owns laterite nickel mines in Indonesia through three project companies; Konutara Sejati, Konutara Prima and Karyatama Konawe Utara.
Together, the three project companies represent laterite nickel resources covering 7,869ha.
The company's North Konawe Regency properties in South-East Sulawesi, Indonesia, comprise an inferred nickel resources of 1.04 million tonnes andmeasured and indicated resources of 3.75 million tonnes.
Through Konutara Sejati, which currently produces laterite nickel, Northeastern Lion expects to expand its mining capacity.
By 2016, the project companies plan to have smelters with 40,000 tonnes annual capacity in Indonesia.
China Hanking CEO, Pan Guocheng, remarked that this acquisition will further diversify the company's mining resources.
"A temporary pier has been established to provide logistics facilities, satisfying the Group's requirement of low-cost operations and promoting the long-term development of the company," Guocheng said.
Guocheng said that Northeastern Lion has begun mining and selling laterite nickel.
"Our outstanding alchemical technique for laterite nickel mining and metallurgy can also be applied in Indonesia.
"We believe that upon completion of the acquisition, the integration of resources as well as processing and refinery techniques will bring great synergies to the current operations of the Group, further improving its overall operating performance," added Guocheng.
Image: China Hanking has diversified its mining portfolio with nickel resources. Photo: Saperaud.