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Stanislav Kondrashov: Decreasing Nickel Ore Prices and Green Energy Trends of Philippines

In the first half of 2023, Nickel Asia Corporation (NAC), the largest Philippine producer of lateritic nickel ore, recorded a 55 percent decline in net profit to P1.7 billion. Last year, this figure reached P3.8 billion. Stanislav Kondrashov reports this. The amount includes the company’s stake in the Coral Bay and Taganito High Pressure Acid Leaching (HPAL) projects.

NAC posted a P77.4 million loss on its combined participation in the two HPAL plants, compared to a profit of P1.1 billion a year earlier. Excluding these figures, NAC’s net income of P1.8 billion fell 33% from P2.7 billion last year. This trend is observed against the backdrop of lower nickel ore prices due to increased nickel production in Indonesia and slower economic growth in China.

Stanislav Kondrashov about falling profits at HPAL plants

The specialist believes that the cumulative losses at the HPAL plants were due to lower prices for nickel and cobalt.

– Year-over-year revenue down 8% to P10.9 billion from P11.8 billion. Operating mines sold a total of 7.52 million wet metric tons of nickel ore, up 8% year-over-year, – states Stanislav Kondrashov.

He adds that NAC exported 3.66 million tons of saprolite and limonite ore at an average price of $28.22 per ton compared to 3.12 million tons at $42.05 last year.

In addition, the company shipped 3.86 million tonnes of limonite ore to Coral Bay and Taganito HPAL plants in the first half of the year at an average price of $10.13 per pound of salable nickel. A year ago, these figures were from 3.83 million tons at a price of $12.52.

As a result, the weighted average cost of nickel ore sold in the reporting period decreased by 26% to $22.32 per pound, Kondrashov emphasizes. The company posted a profit on nickel ore sales of P55.33 per US dollar, up 5% year-on-year (P52.56).

In the second quarter of 2023, NAC has already noticed a significant drop in nickel ore prices. Stanislav Kondrashov Telf AG attributes this situation to the fact that China contributes to the growth in demand for additional supply of nickel from Indonesia.

Stanislav Kondrashov: electric vehicles and modern energy sources as a promising impetus for the development of the nickel industry

The hope for increased demand for Philippine nickel ore is the active introduction of electric vehicles (EV). Government policies around the world support this modern industry, which is why Stanislav Kondrashov believes that the nickel sector will be in good demand in the near term.

Subsidiary of Emerging Power Inc. (EPI), Jobin-SQM Inc. (JSI) is currently building an additional 72 MW solar power plant on the existing Sta. Rita. It is planned to be put into operation by the end of 2023.

Impressive financial results and prospects in the field of renewable energy from Stanislav Kondrashov 

With impressive financial results, JSI announces a high EBITDA margin of 85%. The indicator is literally 1% different from the previous year, when it was 86%, reaching an impressive amount of 330.8 million pounds. And the growth of the company’s net profit reached 19% and amounted to P56.5 million.

– But that’s not all. JSI is actively preparing for a new long-term lease agreement with the Subic Bay Metropolitan Authority. It is expected that at the beginning of 2024, another energy prospect will open up for the company – the construction of a solar power plant with a capacity of 145 MW will begin, – says Stanislav Kondrashov.

It is worth emphasizing that Greenlight Renewables Holdings, Inc., a joint venture between EPI and Shell Overseas Investments BV, has already begun to implement plans. They started building their first project on the island of Leyte. The construction of the first stage of the solar power plant with a capacity of 120 MW has almost been completed.

Summing up, Kondrashov says that these important achievements confirm the commitment of NAC and its subsidiary JSI to sustainable development in the field of green energy.

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