The payment covers the pair’s pro rata share of capital and other expenditures incurred at Goro since Inco originally gave the go-ahead in July 2001. The project was subsequently suspended at the end of 2002, owing to soaring costs, but was revived in October 2004 following a review to establish a reliable and acceptable cost estimate.
The two Japanese metal producers acquired their stake through a jointly owned company called Sumic Nickel Netherlands and must also fund their share of capital to complete the project. Sumic Nickel also has the right to participate and authorize certain future expansions. Sumitomo owns 52.4% of Sumic Nickel, with Mitsui owning the remainder.
Also under the deal, Sumic Nickel is obliged to buy its share of nickel and cobalt production from Goro, with Inco purchasing the balance. Goro is designed to produce 60,000 tonnes nickel and 4,300-5,000 tonnes cobalt annually. During its first year, the operation is expected to reach 75% of capacity, with 90% capacity attained after two years. Initial production is slated for September 2007.
At last count, reserves at Goro stood at 57 million tonnes grading 1.52% nickel and 0.12% cobalt.
Inco retains a 69% stake in Goro, with Sumic Nickel holding 21%, and the three provinces of New Caledonia owning the remainder.
Be the first to comment on "Inco gets Japanese partners"