Why are Nickel Mines (ASX:NIC) shares in limelight today?

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Why are Nickel Mines (ASX:NIC) shares in limelight today?

ASX NIC, Nickel Mines MOU, ASX NIC share price
Image source: © A2dstudiodesign | Megapixl.com

Highlights

  • Australian nickel producer Nickel Mines signed an MOU with Indonesia’s SESNA.
  • The Company plans to develop a 200MWP solar capacity within Indonesia Morowali Industrial Park.
  • Nickel Mines will be the long-term offtake partner for SESNA.

The shares of ASX listed global nickel producer Nickel Mines Limited (ASX:NIC) have been grabbing the spotlight today after the Company announced a new MOU.

Nickel Mines shared on Wednesday that it has signed a memorandum of understanding (MoU) with PT Sumber Energi Surya Nusantara (SESNA) to implement a 200MWp solar project in Indonesia.

Meanwhile, NIC shares were spotted trading 0.31% higher at AU$1.62 at 12.57 pm AEDT.

The Company plans to execute the capacity within the Indonesia Morowali Industrial Park (MIP), subject to specific economic parameters. NIC expects to implement the project in stages once SESNA gives a final commitment over the project proposal within three months of signing the MOU.

Related read - Australian govt announces upto $40M funding for ultra-low-cost solar

Key Highlights - 

  • As per the MOU, Nickel Mines will be the long-term off-take partner for SESNA. However, NIC will not pay for any capital funding.
  • Also, the indicative tariff for electricity will remain commercial-in-confidence, competitive with other similar scale solar projects, and are likely to remain constant throughout the project.
  • SESNA will act as the project initiator and is responsible for construction, financing, commissioning, and operating a 200MWp solar farm project.
  • This will significantly accelerate the renewable energy supply to the Company’s Hengjaya and Ranger nickel processing operations within the region.
  • The 200MWp solar project adds to NIC’s ongoing 396kWp plus 250kWh battery storage project with SESNA at Hengjaya Mine.
  • NIC aims to reduce diesel consumption by nearly 31 million litres over the 25-year project life, scheduled to be commissioned in Q1 FY2022.

Related read - Five solar stocks worth watching in 2022

About SESNA 

Indonesia-based SESNA is a leading solar development firm that owns and operates a portfolio of microgrid & solar feed-in tariff projects while providing a range of engineering & related solutions.

Bottomline 

The latest MOU is likely to help NIC reduce its greenhouse gas emission targets and marks a significant milestone in NIC’s future energy collaboration with SESNA.

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