Vale concludes the sale of its New Caledonia assets to Prony Resources consortium

 
Vale Usine du Sud.jpeg

Brazilian miner Vale has concluded the sale of its stake in Vale New Caledonia (VNC), which operates the Goro nickel mine and a processing plant, to the Prony Resources New Caledonia consortium, which includes local players and Swiss commodity trader Trafigura, the company informed on Wednesday March 31. 

Vale said in a filing that $1.1 billion will be invested in the assets, with $555 million coming from its subsidiary Vale Canada Ltd., and that Vale will have a supply contract to off-take part of the nickel produced.

France, which controls the Pacific territory of New Caledonia, will offer nearly 500 million euros ($587 million) in support through loans, guarantees and tax breaks, the French economy ministry said.

The consortium, called Prony Resources New Caledonia, would invest $100 million, of which $50 million from Trafigura, the ministry added.

This sale will ensure the sustainability of the company, central to the Caledonian economy with its more than 1,200 employees (which should increase to 1900 by 2022) and nearly 1,300 subcontracted jobs.

The restart of nickel production is expected in mid-April after operations at the site resumed this week, the consortium said in a separate statement.

Tesla Inc. will support the operation through a “technical and industrial partnership” with the consortium, decisive in order to improve and develop its industrial process.

Prony Resources New Caledonia will notably develop the production of nickel for the electric vehicle battery market and will lead the "Lucy" environmental project which consists in putting in place a dry storage of industrial waste, replacing the current storage of residues in a dam. 

Under the consortium, New Caledonia's provincial authorities and other local interests will have a 51% stake, Trafigura 19% and a joint venture between Prony Resources management and international investment firm Agio Global will indirectly hold the remaining 30%.

New Caledonia is the world's fourth-largest nickel producer. 

 
Carlota Porta