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Mincor and BHP will work together to better manage off-specification product after BHP refused to amend off-take agreement specifications.

Mincor supplies BHP with ore from its northern and southern operations and delivers a blended product to BHP’s Kambalda nickel concentrator in Kambalda East, Western Australia.

The two companies have been in discussions over methods to manage off-specification product, however Mincor has also been seeking discussions about potential amendments to the off-take terms.

According to Mincor, this would provide the company with ongoing flexibility with respect to product specification requirements and will also provide certainty as to Mincor’s ability to continue to deliver 100 per cent of mined ore to BHP.

However, BHP has not agreed to amend the off-take agreement specifications.

“Given the lack of certainty regarding future acceptance of any off-specification product and the incomplete status of potential solutions, Mincor has decided to withdraw its guidance,” Mincor said in a statement.

The production guidance was set at 8,000 to 10,000 tonnes of nickel in concentrate, announced as part of Mincor’s presentation to the Euroz Hartleys Institutional Conference in March.

Mincor said it would continue to deliver on-specification ore to BHP as the companies work together to improve orebody knowledge.

The end goal is to enable optimisation of the forward mine plan to consistently deliver on-specification product.

Mincor will also stockpile any ore that is off-specification and will blend it with other Mincor ore sources at a subsequent date.