Investment

Huayou Cobalt invests in Huashan wet process project

Seetao 2022-06-21 11:24
  • The additional capital raised of 12.2 billion yuan will be used for the construction of the Huashan wet process project
  • 1.5 billion yuan will be used to build a battery-grade lithium salt project with an annual output of 50,000 tons of Guangxi Huayou Lithium Industry Company
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In order to lay out the nickel and lithium industries, Huayou Cobalt has made a large and fixed increase in fundraising. On the evening of June 19, 2022, Huayou Cobalt announced that it plans to raise no more than 17.7 billion yuan. Among them, 12.2 billion yuan will be used to build a nickel-cobalt hydroxide wet process project with an annual output of 120,000 tons of nickel metal by Indonesia Huashan Nickel-Cobalt Company, accounting for 70% of the total raised funds; 1.5 billion yuan will be used to build Guangxi Huayou Lithium Industry Company Battery-grade lithium salt project with an annual output of 50,000 tons; others are used to supplement working capital.

Indonesia Huashan Nickel-Cobalt Company is a joint venture company, Huatuo International, a wholly-owned subsidiary of Huayou Cobalt, holds 68% and Glaucous holds 32%.

In May 2021, the Huashan wet process project was launched and will be built in the Weidabe Industrial Park in Indonesia. The industrial park is located on Halmahera Island in the Maluku Archipelago in Indonesia, and belongs to North Maluku County, Maluku Province.

The construction period of Huashan wet process project is three years. According to Huayou Cobalt's announcement on June 19, 2022, the project is still in the design stage, and the later construction, equipment installation and commissioning needs to be further implemented. After the project is completed, it will be able to process about 10.4 million tons/year of dry ore of laterite nickel ore.

The two investors have reached an agreement on the underwriting of the project's products. Among them, Huatuo International underwriting ratio of 68%, Glaucous underwriting 32%.

Ni Wenyi, a researcher at Sinolink Securities, pointed out that considering the previous experience of Huayou Cobalt's Huayue project, the actual production cycle of the Huashan project may be shorter than the planned value.

Up to now, Huayou Cobalt has invested and constructed four nickel-cobalt smelting projects in Indonesia: Huayue, Huake, Huafei and Huashan.

Huayou Cobalt started to deploy nickel and cobalt resources in Indonesia in 2018, and launched the first project, Huayue's nickel-cobalt hydroxide hydro-smelting project with an annual output of 60,000 tons of nickel metal. At the end of 2021, the project will be put into trial production, and will achieve full-load production in March 2022, and will be fully transferred to the production and operation period.

In May 2020, Huayou Cobalt started the Huake project with an annual output of 45,000 tons of nickel metal with a high amount of matte nickel. As of the end of March this year, some production lines of the electric furnace sub-item have started trial production, and the whole process is expected to be completed in the second half of this year.

In May 2021, Huayou Cobalt started the Huafei Company's nickel-cobalt hydroxide hydro-smelting project with an annual output of 120,000 tons of nickel metal.

In March 2022, Huayou Cobalt reached a strategic cooperation intention with Volkswagen and Tsingshan Holding Group, planning to build a nickel-cobalt hydroxide hydro-smelting project with an annual output of 120,000 tons of nickel metal; in April, a cooperation framework agreement was signed with Vale , plans to build capacity in Indonesia to produce nickel-cobalt hydroxide products with an annual output of no more than 120,000 tons of nickel metal.

The total production capacity of the above projects is 465,000 tons of nickel metal. Orient Securities said that according to the medium and long-term demand of Huayou Cobalt, it is still expected to increase the smelting capacity by 250,000 tons.

In addition to the nickel industry, Huayou Cobalt will further deploy lithium ore and lithium salt processing projects.

According to the announcement on June 19, 2022, Huayou Cobalt intends to jointly build a prospective lithium mine Arcadia lithium mine development project with TIMGO through its wholly-owned subsidiary Huayou International Mining. Huayou International Mining holds 90% and TIMGO holds 10%.

The lithium mine is located in the Mashonaland district east of Zimbabwe, about 38 kilometers from the capital Harare. After completion, the raw ore processing scale will reach 15,000 tons/day, which is equivalent to an annual production capacity of about 50,000 tons of lithium carbonate equivalent resources. The project construction period is one year. The preliminary estimated investment of this project is about 275 million US dollars.

In addition, Huayou Cobalt will invest in the construction of a battery-grade lithium salt project with an annual output of 50,000 tons through its wholly-owned subsidiary Huayou Lithium. After the project is completed, the processing scale of spodumene concentrate will reach 38.9 tons/year. The total investment of the project is about 2.58 billion yuan, and it is planned to use 1.5 billion yuan of this fixed increase.

After the three newly announced investment projects are fully completed, Huayou Cobalt will add an annual production capacity of 120,000 tons (nickel metal) nickel-cobalt hydroxide, 50,000 tons of lithium carbonate equivalent resource capacity, and 50,000 tons of lithium carbonate equivalent resources. Battery-grade lithium salt production capacity. Keywords: One Belt One Road, One Belt One Road News, One Belt One Road Project

As of the close on June 17, London Nickel closed at $25,600/ton, down 13% in two weeks. As of the close of noon on June 20, Shanghai nickel closed at about 197,000 yuan / ton, down 10% in two weeks.

As of the close of noon on June 20, Huayou Cobalt rose 1.52% to close at 92.88 yuan, with a market value of 147.5 billion yuan. Editor /Zhao

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