Here's why the Nickel Mines (ASX:NIC) share price is soaring 15% so far this week

Here's what has sent the nickel producer's stock soaring this week.

lots of nickle bullion

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

This week so far has been a big one for Nickel Mines Ltd (ASX: NIC) and its share price.

The company's stock has been gaining since it announced it had signed a memorandum of understanding with Shanghai Decent Investment Group on Monday. The agreement will see the pair creating a framework for their future collaborations.

At the time of writing, the Nickel Mines share price is $1.37, 4.18% higher than its previous close. It has also soared 15.2% so far this week.

For context, the S&P/ASX 200 Index (ASX: XJO) is currently up 0.1% today and 0.5% in the past week.

Let's take a closer look at this week's news from the nickel producer.

Nickel Mines share price soars on partnership news

The Nickel Mines share price is roaring upwards this week after it agreed to expand its partnership with Shanghai Decent over the coming years.

The understanding is multifaceted and will see Nickel Mines acquiring a 70% interest in Shanghai Decent's Oracle Nickel Project.

The project comprises 4 next-generation rotary kiln electric furnace lines, currently under construction in the Indonesia Morowali Industrial Park.

The Oracle Nickel Project company will separately undertake the construction of a 380-megawatt captive power plant. The plant will support the project's rotary kiln electric furnace lines and the Indonesia Morowali Industrial Park's overall power requirements.

Nickel Mines will pay US$371 million for the acquisition. It will also provide US$154 million of construction funding through 3 shareholder loans.

The acquisition is subject to shareholder approval.

The companies will also establish a 'future energy' collaboration framework. The framework will optimise Nickel Mines' operations' transition to renewable energy.

The collaboration could see the companies both contributing to fund a solar power plant at the Indonesia Morowali Industrial Park, or a combined-cycle gas turbine power plant.

Finally, under the agreement, the companies will look into the feasibility of jointly developing and funding future high-pressure acid leach projects.

The projects could use Nickel Mines' current and prospective resources across Indonesia to produce battery grade nickel for the electric vehicle market, further diversifying the company's operations.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Resources Shares

a sad looking engineer or miner wearing a high visibility jacket and a hard hat stands alone with his head bowed and hand to his forehead as he speaks on a mobile telephone out front of what appears to be an on site work shed.
Resources Shares

Down 14% in 2024, why is the BHP share price sliding again today?

ASX 200 investors are bidding down the BHP share price on Wednesday.

Read more »

A mining employee in a white hard hat cheers with fists pumped as the Hot Chili share price rises higher today
Resources Shares

These ASX 200 mining stocks could rise 40% to 50%

Analysts think these miners are dirt cheap at current levels.

Read more »

Image from either construction, mining or the oil industry of a friendly worker.
Resources Shares

Fortescue share price leaps 5% as electric machinery makes a milestone

Fortescue is charging ahead with its electric mining ambitions.

Read more »

rising mining asx share price represented by happy woman miner in hard hat
Resources Shares

Why the BHP share price crushed the benchmark this week

BHP shareholders enjoyed a rewarding week.

Read more »

A man wearing a hard hat and high visibility vest looks out over a vast plain where heavy mining equipment can be seen in the background.
Dividend Investing

Here is the profit forecast to 2026 for BHP shares

Let’s unearth how much profit this miner could make.

Read more »

Female miner standing next to a haul truck in a large mining operation.
Resources Shares

Is the worst of the selling now over for ASX iron ore shares?

ASX iron ore giants like BHP, Rio Tinto and Fortescue rebounded this week after falling hard in 2024.

Read more »

Three satisfied miners with their arms crossed looking at the camera proudly
Resources Shares

Why are ASX 200 mining shares smashing the benchmark on Wednesday?

Rio Tinto, BHP and Fortescue shares are all charging higher today.

Read more »

Two miners standing together.
Resources Shares

Why is the South32 share price getting battered today?

ASX 200 investors are bidding down South32 shares today.

Read more »