Post Courier | April 04, 2017
THE Ramu nickel-cobalt project in Madang is facing a huge deficit balance accounting to more than K100 million despite achieving 100 per cent design capacity beginning this year.
The deficits are due to the declining commodity prices and serious April 2016 fatality at Basamuk refinery forcing the project to shut down indefinitely at the time incurring huge production losses.
Vice President of Ramu NiCo, Zhao Deqian announced this during the monthly KBK elders’ project update meeting in KBK on Saturday. Mr Zhao was accompanied by Executive Deputy General Manager KBK Mine Li Bentao and Deputy General Manager Commercial KBK Mine Liu Tianhua.
“We have achieved milestone production reaching 109 percent design capacity but at the time when nickel price is at US$13,000/ton low and production loss during Basamuk April 2016 incident costing hundreds of millions of Kina deficit.
“We are still recovering from production loss but capable to sustain ourselves given the current production stability,” Mr Zhao said.
He said the project operation cost can sustain itself from little money made including salary for employees and the deliverance of Project MOA commitments.
“We are now emphasising on safety issues and taking strict control on safety standards on site so we do not repeat the same Basamuk April 2016 incident. We cannot afford another production loss,” Mr Zhao said.
He said the company has identified some priority areas to cut down costs including the reduction of Chinese employees and increase of national employees through localisation programs.
“Our aim now is to make profit, deliver benefits to landowners and ensure high safety standards,” he said.
The Vice President acknowledges the landowners for their support and asked for their continuous support for the Project until it clears off the deficit balance.