UPDATE 1-Philippines H1 nickel ore output rises 3% despite mine shutdowns

* Sixteen of 31 nickel mines reported zero output
* Suspension order on 3 mines lifted - govt official
* Two other suspended mines may soon resume operations
* Fitch sees modest Philippine ore output in 2019-2028

(Adds updates on mine suspensions, comments)
By Enrico Dela Cruz
MANILA, Sept 10 (Reuters) - Nickel ore output in the
Philippines, one of the world's top two producers of the
material for stainless steel and batteries, rose 3% in the first
half, government data showed.
Output was capped as half of the country's mines were closed
for maintenance or environmental reasons.
The Philippines sells most of its nickel ore to top buyer
China. It produced 11.31 million dry metric tonnes of the
material between January and June, compared with 11.01 million
tonnes in the same period last year, the Mines and Geosciences
Bureau (MGB) said on Tuesday.
The Philippines and Indonesia are the top two producers
globally.
Sixteen of the Philippines' 31 nickel mines were shut in the
first half for either maintenance or suspension of operations
for environmental and other offences, the MGB said in its
quarterly industry report.
The Department of Environment and Natural Resources (DENR)
last year issued a resolution suspending the operations of
several mines, including some nickel producers, following audits
to assess their compliance with environmental
regulations. The DENR lifted the suspension order on three mines over the
past nine months, while the MGB has recommended the same action
for two others, Environment Undersecretary Analiza Teh said in a
speech at a Philippine mining conference on Tuesday.
Five other mines suspended have yet to comply fully with the
requirements for lifting the suspension, she said.
"We expect output in the number one global producer, the
Philippines, to begin to rise in 2019 as some of the currently
suspended mines become operational," Fitch Solutions Macro
Research said in a note.
Last year the Philippines' nickel ore output dropped 4% to
25.9 million dry metric tonnes, putting it behind Indonesia. It
retook the top spot in the first half of this year.
Fitch expects nickel ore output in the Philippines "to
remain modest over the coming years due to a stringent
regulatory environment and high levels of policy uncertainty,
which will constrain project development".
It forecasts average annual growth of 2.5% in Philippine
output over 2019 to 2028.
Philippine nickel miners are likely to boost ore production
next year, but may still not be able to fill up a supply gap to
be created when Indonesia halts its ore exports, industry
executives have said. Indonesia has decided to stop nickel ore exports from Jan.
1, 2020, two years earlier than initially flagged as it speeds
up efforts to process more of its resources at home.