SYDNEY, Jun. 9 -- Australia's No. 2 nickel miner, Minara Resources <MRE.AX>, will complete repairs at its Murrin Murrin mine by the weekend, with a return to normal production rates shortly afterwards, Chief Executive Peter Johnston said on Wednesday.
A pipeline failure in a key operating circuit meant production had dropped to a reduced rate, with year-to-date output tracking at the lower end of Minara's annual target of between 30,000 and 34,000 tonnes.
"We expect to complete our repairs by this weekend, and return to full production rates fairly quickly," Johnston told Reuters. "We'll return to the 30,000 to 34,000 tonnes a year range."
The incident forced Minara to rely on inventories of ore from a heap leaching operation that was capable of yielding only around 2,000 tonnes per year of nickel, according to Johnston.
Murrin Murrin, 60 percent owned by Minara and 40 percent by commodities trader Glencore Intrnational, produced 32,977 tonnes of nickel and 2,350 tonnes of cobalt in 2009.
Johnston also said substantial quantities of recycled nickel from spent stainless steel were weighing on world nickel prices <MNI3>, down almost 30 percent to around $18,600 since late April.
"Scrap makes up 40-45 percent, or around 700,000 tonnes of the world market of around 1.3 million tonnes," he said.