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Brazil's Vale Expects Commercial Nickel Output At VNC In 2011
Mar 1,2011 10:31CST
industry news

RIO DE JANEIRO, Mar. 1 -- Brazilian miner Vale SA (VALE, VALE5.BR), the world's second-biggest nickel producer, said Friday it expects this year to start commercial nickel metal production at its Vale New Caledonia nickel plant, which was formerly named Goro.

A trial production period at the $4.4 billion project in the South Pacific has been completed and the works is selling a preliminary nickel product to Australian buyers, Tito Martins, Vale's base metals operations director, said on a conference call.

"We've commissioned the entire plant at Goro. We're optimistic about outcomes from the plant, the technology has been proved," Martins said. "We hope to produce nickel metal this year."

VNC is a nickel laterite project with a production capacity of 60,000 metric tons of nickel and 4,600 tons of cobalt. It uses high-pressure acid-leaching, or HPAL, technology, which requires rigorous environmental controls.

VNC was originally expected to start up in mid-2009 but was delayed on a market slump for stainless steel, for which nickel is one of the main raw materials. The stainless-steel market has now recovered after the crisis, notching up 23.4% growth in 2010, Vale said Friday.

An acid spill at the VNC site in April 2009 also delayed the start-up schedule, Vale's nickel unit said at the time.

Vale produced 179,000 tons of nickel in 2010, down 4.2% from 2009 levels due to strike action at some mines in Canada. Output is set to grow in 2011 due to output from VNC and after the recent start-up of operations at Vale's 58,000 tons a year capacity Onca Puma nickel mine in Brazil.



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