Expansion plans progressing at Papua New Guinea’s only nickel-cobalt mine

Thickener tanks at the Ramu processing plant in Basamuk, Madang Province. Credit: MCC

The operator of the Ramu nickel-cobalt mine is making progress on a planned US$1.5 billion (K6.3 billion) expansion, but regulatory approvals are expected to move slowly, according to one of the mine owners.

The current mine sits within SML 8, a 54-square-kilometre special mining lease (SML) area in PNG’s Madang Province. Ramu NiCo Management, which operates the mine on behalf of the Ramu Nickel Joint Venture (JV), is preparing to apply for a second SML to convert adjacent land into a new mining area, where it plans to double overall production.

Ramu will ramp up to 34,000 or 35,000 tonnes of nickel production by 2026, about 7 per cent above previous nameplate capacity.

However, the timing of the new SML will be “difficult to project,” according to Craig Lennon, Head of Asia-Pacific for minority owner Nickel 28.

“Frankly speaking, it’s a challenge because there are other projects in the pipeline – such as Wafi-Golpu and Frieda River – and the regulatory authorities have only got so many resources to work on such applications,” he says.

Nickel 28 currently holds an 8.56 per cent interest in the JV alongside Metallurgical Corporation of China (MCC, 85 per cent) and PNG’s Mineral Resources Development Company (MRDC, 6.44 per cent). Nickel 28 has an option to increase its interest to up to 20.55 per cent upon repayment of its construction debt to MCC.

Unprecedented

Lennon says the expansion is straightforward from a technical perspective and that it will use the same infrastructure as the existing mine. He says the regulatory complexity stems from the lack of precedent in PNG for expanding outside of an existing SML.

“I don’t think this has been done before,” he says, pointing out that expansions at Ok Tedi, Porgera and Lihir were all done within their original SML areas.

“There isn’t a clear path within the existing regulatory framework. That means a lot more engagement is needed at a time when the regulatory resources are very tied up.”

Competition drives expansion

Ramu is on track to produce 32,000 tonnes of nickel and roughly 3,000 tonnes of cobalt in 2025, according to Lennon, after a temporary shutdown of the plant in September and October last year to debottleneck parts of its operation.

The shutdown “worked fantastic,” Lennon says, adding that Ramu will ramp up to 34,000 or 35,000 tonnes of nickel production by 2026, about 7 per cent above previous nameplate capacity.

According to Lennon, the expansion plans have been driven by a need to stay competitive with other nickel projects – particularly in neighbouring Indonesia.

Exploration activities in 2024 delivered a 10 per cent increase in total reserves, an 18 per cent increase in measured and indicated resources and a 146 per cent increase in inferred resources, further bolstering these plans.

“While we’re at just over 30,000 tonnes, most of the mines that come on line over there [in Indonesia] are at 60,000 to 150,000 tonnes, so they’re going to defray their fixed costs over a lot more units,” he says.

The expansion will reduce Ramu’s cost per tonne, he says, adding it won’t entirely close the gap with Indonesian mines, “but it will assist in making sure the difference is not quite as big.”

This article was first published in Mining and Energy 2025/26, released in October. Read the full edition here