GLOBAL Ferronickel Holdings Inc., which claims to be the country’s third-largest producer of nickel, on Friday said that it may increase its production in two to three years and may reach 10 million metric tons (MMT) as the company expand its mine sites to Palawan and Zambales.
Dante Bravo, Global Ferronickel’s executive vice president said the figure was higher than last year’s estimated production of 6.3 MMT.
As of September, the company’s net income reached $100 billion, and at steady production, it would have about $130 million (about P5.72 billion) by the end of the year.
“Our target [production] this year is about 6 [million metric tons] to 7 million metric tons. We hope to increase our net income for this year as a result,” Bravo said in a briefing with reporters.
Bravo said its production may increase to 10 million in two to three years, when its additional mines in Palawan and Zamboanga come into stream, which will add to its current mine site in Surigao del Norte.
The company is selling a primary and secondary offer of up to 6.16 billion common shares, including an overallotment option of up to 924.72 million shares. It placed an indicative price of P4.38 apiece.
The company’s stock price has been falling during the past few days. It closed on Friday at P3.04 apiece.
UBS AG Hong Kong branch and its local affiliate is the sole bookrunner for the said deal.
The company has an authorized capital stock of P12.55 billion.
Global Ferronickel claims to be the third-largest nickel producer in the Philippines by volume and one of the largest global suppliers of nickel ore accounting for 11 percent of the country’s exports last year.
It operates two open pit deposit sites known as Caga 2 and Caga 4 within its mine in Cagdianao, Claver, Surigao del Norte.
“We have further identified five additional deposits site at Cagdianao that have not been exploited,” it said.
It entered a memorandum of agreement (MOA) to buy Southeast Palawan, which owns the mining license at the foothills of Mantalingahan Mountain Range in Brooke’s Point in south-central Palawan.
It also entered a MOA to purchase a company which holds two operating agreements with Zambales Diversified Metals Corp. and Zambales Chromite Mining Co. for the life of XXX
In September last year Southeast Asia Cement Holding Inc. (Seacem) a shell company owned by the same investors of 8990 Holdings Inc., issued 99 percent of the company to the major stockholders of Platinum Group, which include Huatai Investment Holding Pty. Ltd., Sohoton Synergy Inc., Ultimate Horizon Capital Inc. and Blue Eagle Elite Ventures Inc.
The transaction allowed the backdoor entry of the Platinum Group, the former name of Global Ferronickel, using Seacem.
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Perhaps the next leader of our country should also look into the state of mining industry. Considering that if the government is the owner of the minerals, which is entitled to the share of X percentage of the income derived from the mining of nickels for example, then if these mining companies (NAC included, plus others) will increase their production when the price of nickel is very low – then perhaps it is not a good idea. The nickels are being depleted at a fast pace at a very low cost. There is currently an over-production of nickels in world market.
The gov’t should look not only on the share that it gets from mining. It should also look at efficient and proper conservation of its mining resources. Over production translates to too much supply and only lowers the price, while depleting the resources.
Government (Philippines) should have a say on the production, with consideration to conservation of its resources. Just like Saudi with its oil, if they want to control the price of oil.
Government should also have directors or representatives in the board (at least 40%).
Just my thoughts. Mr Binay, or Mar Roxas or Grace Poe should look into this.