Column: Electric dreams turn into a nightmare for battery metals
A sector that was once racing to build new supply has been closing mines and deferring projects as low prices bite into the cost curve.
Vale (NYSE: VALE) will postpone the sale of its Goro nickel and cobalt operations in New Caledonia, at the request of local authorities, the company said on Friday.
VCN has proven a financial burden for Vale since it began operations two years behind schedule in 2010.
“There is nothing established, but the doors are open. It is a good thing for our country, ”said Brazilian deputy Philippe Gomes, who is part of a commission to look for other possible buyers.
The commission asked for the postponement of the signing of the sale agreement foreseen between Vale and an international consortium led by Trafigura.
Vale New Caledonia said it agreed to “postpone its decision” for a few days to “move forward” in the possibility of a sale with the participation of New Caledonia shareholders.
Melbourne-based zinc producer New Century first announced its intention to acquire a 95% stake of Vale Nouvelle Calédonie (VNC), the operator of the troubled Goro nickel-cobalt mine, in May. A final decision on the transaction was expected in July but was deferred to September.
New Century said in a separate statement that its business analysis had concluded there was “strong potential” for sustainable long-term operations at Goro. Negotiations with various stakeholders, however, did not lead to a worthwhile venture, it said.
Vale cut in April its 2020 nickel production guidance to 200,000 – 210-000 tonnes per year from 240,000 tpy to account for the anticipated loss of VNC’s 60,000-tpy output.
Shortly after, the miner revealed it had received non-binding offers for VNC, which includes the Goro mine, a processing plant and the port of Prony. The complex is located on New Caledonia, a French territory which is a top nickel producing region globally.
