Vale trying to lower project costs, sees Goro in Q2
miningweekly.com
By: Reuters
23rd March 2009
TORONTO - Brazil's Vale continues to look for cost savings at its key projects and expects two nickel mines under construction will produce metal in the next few months, a company spokesman said on Monday.
The company hopes to lower the cost of the Goro nickel project in the French Region of the South Pacific island of New Caledonia, which is due to start production in the second quarter, and the Onca Puma project in Brazil, due to begin output in the third quarter.
"As previously announced, investment costs are under review because we are currently renegotiating with suppliers. These negotiations have not been concluded yet," said Cory McPhee, a spokesman for Vale Inco, the Brazilian company's Toronto-headquartered nickel division.
Vale acquired nickel miner Inco in 2006.
Goro was previously budgeted at $3,2 billion, while Onca Puma had been expected to cost $2,3 billion.
Vale has also said that the expected start dates could change depending on market conditions.
In a release in October, the company said: "In light of the risks posed by a challenging global economic environment, Vale retains the optionality to manage the development of its project pipeline according to the evolution of market conditions."
Goro is expected to produce 60,000 tonnes of nickel a year when it reaches full capacity. Onca Puma, whose second line is expected to begin output in January, is seen producing 52 000 tonnes a year.
Vale is also developing the Vermelho nickel project in Brazil, which was originally expected to begin production in 2012, but is now under review.
The company has cut back production and laid off workers in the last few months due to plunging metals prices. |
