NEW YORK Royal Nickel Corp. has signed a memorandum of understanding with Chinese stainless steel producer Tsingshan Holding Group Co. to help secure supply for a new plant processing sulfide nickel concentrate, with the possibility of an offtake agreement to follow.
The Toronto-based company said that it has worked with Tsingshan for more than a year on the use of sulfide nickel concentrate in the production of stainless steel, with Tsingshan planning "to make the necessary investment in plant and equipment once concentrate feed is secured."
The memorandum will see Royal Nickel help Tsingshan secure concentrate supply internally and externally as Tsingshan constructs this plant, with the two companies set to consider an offtake proposal following the completion of a feasibility study for Royal Nickels Dumont nickel project in Quebec. The completion of this study is currently expected by mid-2013.
The new plant is likely to be co-located with another Tsingshan plant in China, Royal Nickel senior vice president of business development Mark Selby told AMM.
"We see great potential for the Dumont project to become a premier large-scale and low-cost nickel mine and a great source of feed for our operations for many decades to come," Tsingshan chairman Xiang Guang Da said in a statement.