SYDNEY, July 16 (Reuters) - MMG Ltd 1208.HK is in fresh talks with potential buyers for its Avebury nickel mine in Australia after an earlier sale collapsed, a company executive said on Thursday.
MMG put the mine in the Australian island state of Tasmania on the block after acquiring it in a takeover of Oz Minerals in 2009.
MMG is the Hong Kong-listed arm of state-owned China Minmetals Corp and is charged with expanding its overseas reach in mining.
Privately-held Averbury Nickel Mines hoped to reopen the mine for the first time since 2009 but it missed a June 30 deadline to finalise the A$40 million ($29.42 million) purchase.
"As a result of the option lapsing because the company was unable to complete the transaction, we have had a number of expressions of interest shown and we are obviously pursuing those," MMG chief financial officer David Lamont said in a conference call.
Lamont said MMG was seeking to unload the mine as it was too small for the company's portfolio. He did not name any of the parties holding discussions.
The mine was idled six years ago as the cost of producing a pound of nickel exceeded the going price at the London Metal Exchange. This week, the LME three-month nickel price CMNI3 traded for around $11,500 a tonne, or $5.21 a pound, roughly the same price as in 2009.
Nickel miners have had hopes dashed that a ban in Indonesia on exports of nickel ores would lead to a rise in demand in China for the steel-making alloy from other parts of the world.
But Filipino suppliers appear to have taken up the Indonesian shortfall, according to analysts.
Morgan Stanley advised clients this month that ore for China's nickel pig iron producers was readily available, with exports from the Philippines proving greater than expected.
Australia's Poseidon Nickel POS.AX on Thursday said it was postponing the restart of a mine in Western Australia until prices improved. ID:nWNBS0113B
The Avebury mine is capable of producing 7,000 tonnes of nickel in concentrate annually, regarded as small by industry standards. It holds a supply agreement with Chinese nickel refining company Jinchuan Group 2362.HK for all it can ship.
MMG has turned its attention to bigger operations. Last year it completed a 5.85 billion acquisition of the Las Bambas copper project in Peru from Glencore International GLEN.L in partnership with China's Guoxin International Investment Corp Ltd and CITIC Metal Co Ltd.
Construction of Las Bambas was 95 percent complete, according to the company. ($1 = 1.3596 Australian dollars)