Nickel Asia to cover shipments after NPA attack

Nickel Asia Corp., the Philippines' largest nickel producer, will divert output from two mines to cover ore shipments from its Taganito mine that was damaged in an attack by New People’s Army (NPA) rebels, a company official said on Tuesday. The company also plans to hire equipment from other firms to replace machinery destroyed in the attack, as well as ship stockpiled ore from the Taganito nickel mine. Emmanuel Samson, company chief financial officer, said Taganito was due to ship about 500,000 tons of nickel ore in the fourth quarter. "We're a multi-mine operator, so some of these shipments that were scheduled for this month and next month out of Taganito can be diverted," Samson said in a TV interview. "We have two other mines that can cover for the shipments that were affected out of Taganito," he said. "We can also rely on third-party contractors to cover the damaged equipment." The Philippines is the third largest mine producer of nickel in 2010, according to the International Nickel Study Group. "We continue to assess the damage," Gerard Brimo, Nickel Asia president, told Reuters, declining to add more details. Shares of Nickel Asia fell sharply Tuesday on the Philippine Stock Exchange after it suspended operations indefinitely following the attack on Monday by hundreds of Maoist rebels at its Taganito mine and a nearby nickel processing facility under construction. NIckel prices It fell nearly 13 percent in early deals before trimming its losses to close 2.6 percent down as the broader market fell nearly 1 percent. It hit a record low of P15.04 per share during the session. Nickel prices jumped more than 5 percent on Monday to a session high of $18,695 a ton, which traders said was due to short-covering and after Norilsk, the world's top producer of nickel and palladium, said world nickel producers could cut output by as much as 30,000 tons in the fourth quarter. On Tuesday, benchmark nickel shed 0.8 percent after earlier suffering deep losses on heightened concerns over Greece's debt. Taganito is the biggest of the four mines of Nickel Asia, partly owned by Japan's Sumitomo Metal Mining Co. Ltd . In June, the company said its sales volumes were likely to increase about 20 percent this year, with about 60 percent of output going to China. Its first half sales volume was up 24 percent from a year earlier. It was looking to sell a total of about 10 million tons of ore this year, topping last year's record of 8.3 million tons. Taganito produced a total 2.75 million tons of saprolite and limonite ore last year, accounting for about a third of Nickel Asia's overall output in 2010. Taganito has total ore reserves of 21.1 million tons saprolite and 124.2 million tons limonite as of end-2010. — Reuters