BHP Billiton cements Western Areas relationship with new nickel agreement

A day after outlining a significant agreement with a Chinese steelmaker, nickel miner Western Areas today confirmed a new off-take contract with BHP Billiton’s Nickel West business.

The agreement, which adds to an existing arrangement between the two parties, will commence on February 1 2017 for either a three-year period or until the quantity of nickel has been supplied.

According to Western Areas, up to 10,000 tonnes of nickel contained in concentrate will be delivered to Nickel West each year, with a 30,000-tonne overall limit.

The company’s existing off-take agreement with Nickel West is due to finish on January 31 2017

Western Areas managing director Dan Lougher said the agreement was an excellent outcome, which results in customer, geographic and market diversity following yesterday’s off-take announcement with China’s Tsingshan Group.

“Western Areas has a strong fundamental belief in the long-term sustainability of nickel production in Western Australia and the execution of this three-year contract demonstrates our vision of a positive future,” Lougher said in statement.

“Nickel West is a quality partner and the relationship developed over the prior seven years is stronger than ever. Both parties will benefit from this new contract, due to the high reliability, quality and consistency of supply from our Forrestania operations.”

The agreement with Nickel West completes Western Areas’ off-take tender process, the company added.