Nickel Industries Limited (ASX:NIC): ENC Commissioning and Hengjaya Ore Sales

Aditi Sarkar

12 November 2026 06:01 PM AEDT

Nickel Industries Limited (ASX:NIC): ENC Commissioning and Hengjaya Ore Sales

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Highlights

ENC began producing mixed hydroxide precipitate and nickel cathode in 2026.
Hengjaya ore sales rose 56% in the September quarter.
Group adjusted operating EBITDA was USD 125.9 million.
ENC received an industrial Business licence announcement on 29 October 2026.

Nickel Industries Limited (ASX:NIC) owns interests in nickel ore mining, nickel pig iron smelting and high-pressure acid leach processing projects in Indonesia. Its operations serve stainless steel and battery-material Supply chains. The September 2026 quarter brought initial output from Excelsior Nickel Cobalt, or ENC, while water shortages affected the pace of commissioning and several established operations.

ENC Introduces Additional Nickel Products

Nickel Industries Limited (ASX:NIC) holds a 46% interest in the ENC high-pressure acid leach project. ENC produced its first mixed hydroxide precipitate in July 2026, nickel cathode in August and cobalt cathode in September. Quarterly output included 4,840 tonnes of nickel and 494 tonnes of cobalt contained in mixed hydroxide precipitate, alongside 818 tonnes of nickel cathode. These figures describe production, not commercial sales. The September report stated that ENC had not yet recorded sales. Its production rate had approached roughly half of nameplate capacity before water shortages constrained commissioning. A subsequent 29 October announcement confirmed receipt of an industrial business licence, updating the earlier regulatory position.

Hengjaya Mine Provides Quarterly Earnings Support

Ore sales from the Hengjaya mine reached approximately 4.49 million wet metric tonnes in the September quarter, an increase of 56% from June. Nickel Industries Limited (ASX:NIC) reported mine adjusted EBITDA of USD 76.9 million, up 68%, and an operating cost of USD 18.5 per wet metric tonne, compared with USD 21.9 previously. The mine supplied laterite ore into Indonesian processing activities. A request to increase the permitted annual ore sales Quota remains subject to the relevant Indonesian authority. The sales increase does not itself indicate that a higher quota has been approved.

Smelting Results and Group Performance

The group reported September-quarter adjusted EBITDA from operations of USD 125.9 million. In contrast to mining, rotary kiln electric furnace operations experienced Margin pressure. Smelter nickel production was approximately 27,800 tonnes, while cash production costs increased and realised selling prices eased. Segment adjusted EBITDA was approximately USD 40.7 million, down around one-third from the June quarter. Nickel Industries Limited (ASX:NIC) also reported that water shortages reduced October operating rates at these facilities. Differences across the Mining and smelting segments illustrate why higher ore sales need not translate into higher earnings in every business line.

Financing, Water Supply and Outlook

At 30 September 2026, Nickel Industries Limited (ASX:NIC) held approximately USD 145.9 million in cash, down from USD 260.1 million at June’s end. After quarter-end, ENC established USD 245 million in non-recourse project financing. The company also has Investment commitments associated with further Indonesian processing and resource interests. Severe dry conditions constrained water availability during the period, and the timing of normal rainfall remains outside management’s control. Progress towards higher ENC production and commercial sales depends on water supply, commissioning performance, project execution and the nickel market. Planned output should not be confused with sales already completed.

Key Insights

Nickel Industries Limited (ASX:NIC) recorded higher Hengjaya ore sales while ENC began producing multiple nickel and cobalt products. The later licence update addressed one outstanding regulatory step, but weather-related constraints, early-stage commissioning and Capital commitments continue to affect the delivery timetable and financial profile.

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