SRN signs HOA with Shandong Xinhai for RKEF nickel smelter

SRN signs HOA with Shandong Xinhai for RKEF nickel smelter

SGX-Catalist listed Silkroad Nickel Ltd. (“Silkroad Nickel” or the “Company”, and together with its subsidiaries, the “Group”) is pleased to announce that further to the non-binding memorandum of understanding entered into with Shandong Xinhai (Singapore) Pte Ltd, a subsidiary of Shandong Xinhai Technology Co Ltd1 (“Shandong Xinhai”, and together with the Company, collectively known as the “Parties”) as announced by the Company on 15 August 2019, the Parties had, on 16 April 2020, signed a non-binding heads of agreement (“HOA”), pursuant to which the Parties will build and operate a Rotary Kiln Electric Furnace (“RKEF”) nickel smelter in Sambalagi Village, Sulawesi, Indonesia for the production of up to 350,000 metric tonnes of ferronickel per annum (“RKEF Project”).

Concurrently, PT Aneka Tambang Tbk2 (“Antam”) had also signed a heads of agreement with Shandong Xinhai’s consortium to partner in the RKEF Project. It is expected that, on commissioning of the RKEF, Antam will acquire up to 49% in the RKEF Project with at least 51% of the RKEF Project being held jointly by the consortium of Shandong Xinhai (i.e. Shandong Xinhai and Silkroad Nickel). The estimated cost of the RKEF Project (excluding the cost of any supporting coal fired power plant) currently stands at approximately US$400 million and the RKEF nickel smelter is expected to be built and commissioned for operations by the second quarter of 2022.

For the full SGX announcement, please click here.

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