Sumitomo announces withdrawal from the Solomon islands nickel exploration project
Japan Sumitomo Metal Mining Company Limited (Sumitomo Metal Mining Co. Ltd., referred to as: Sumitomo) said today that the nickel price plummeted, and Solomon Islands (Solomon Islands) legal disputes caused by mining rights, the company decided to withdraw from the exploration project in the island's nickel ore prospecting.
Sumitomo in 2005 began the exploration work in Solomon islands, has been with Australia's Axiom Mining company for as long as six years of legal tug of war, the struggle in the end of this year finally ended, the two companies have got in Isabel Province, nickel ore mining rights.
"According to our comprehensive review of the business environment, the final decision on the legal process, and other factors, we concluded that it was difficult for us to implement the project," Sumitomo said in a statement."
A company spokesman said: "we will withdraw all pending mining lease application, and will be completed before the end of December this year."
Sumitomo declined to disclose its exploration costs and litigation costs, but said the withdrawal would have a slight impact on its earnings for the fiscal year ended March 2018.
The spokesman said, "in the course of litigation, nickel prices plummeted.". But even if the market recovers, the project will still be difficult to implement because of the limitations of the Solomon islands' social and legal system."
Sumitomo plans to increase its nickel production target from 100 thousand tons to 150 thousand tons by 2021. The company said it would continue to seek new nickel assets through projects in countries such as Philippines and indonesia.