Ban Phuc Nickel mine suspended due to loss of US$129 million

AMR, a global independent exploration and mining company, holds a 90% stake in the Ban Phuc Nickel mine. The remaining is held by Son La Mechanical Engineering Joint Stock Company.

Ban Phuc nickel mine (BPNM) was expected to be put into operation by the middle of 2009. Until May 2013, the operation at mine was started. However, the construction and development of the mine have been suspended for maintenance until market conditions were improved. 

BPNM contains over 200,000 tons of nickel and 18,000 tons of copper inside the compact sulfur and disseminated deposit.

After the mine was put into operation, the total volume of Ni-Cu sulfides was processed to be pure Nickel 9.5. As of November 2016, 42 shipments of pure nickel were exported. The total amount of export tax paid into the state budget was VND929 billion (equivalent to US$41 million).

However, the exploitation and processing of compact sulfur at BPNM are temporarily suspended until September 30, 2018.

Stephen Phillips Ennor, General Director of Ban Phuc Nickel Co. Ltd., explained that prices of nickel and copper are low in the world market. Therefore, the revenues cannot offset the operating costs at the present.

In addition, charges and taxes on the nickel mining, processing and export are considered at high rate, leading to the high costs of operation of the mine. Specifically, the company has to spend 32 per cent of its revenue on paying taxes and charges (20 per cent of export tax, 10 per cent of natural resource tax and 2% mining right). Besides, there are other payables such as land rental fee, contractor tax and corporate income tax. As of August 2017, the accumulated loss was US$129 million.