Zambia President Reopens Munali Nickel Mine Friday

Mar 26, 2010 (Dow Jones Commodities News via Comtex) -- DOW JONES NEWSWIRES

Zambian President Rupiah Banda will Friday officially reopen the country's sole nickel producer, Munali Nickel Mine, more than a year after it was closed due to low global nickel prices, according to the president's office.

Dickson Jere, Zambia's presidential press secretary, said China's Jinchuan Group, which acquired a 70% stake in the mine last year, had invested at least $37 million to reopen the mine. The mine is expected to employ 350 workers when it resumes operations, he added.

Jinchuan is the world's fourth-largest nickel producer.

Munali Nickel Mine has been under care and maintenance since February last year after its former owners, Australia-based Albidon Ltd. (ALB.AU), halted operations, citing low nickel prices as a result of the global economic downturn.

The economic downturn also affected some other Zambian mines, including Luanshya Copper Mines, which also halted operations. At least 10,000 miners were laid off last year as companies scaled down operations. Luanshya has also since resumed output following its takeover by Chinese-owned NFC Africa Mining, a unit of China Nonferrous Metal Mining (Group) Co.

Munali General Manager Xin Xining announced in December last year that annual nickel ore output at the mine would hit 1.2 million metric tons by 2012. Munali projects 2010 output at 750,000 tons of nickel ore and 2011 production at 1 million tons. Company officials couldn't be immediately reached for comment.