4 Jul 2017

Vale New Caledonia faces review, possible mothballing

3:33 pm on 4 July 2017

The operation of the loss-making Vale New Caledonia nickel company is to be reviewed in light of the persistently low nickel price.

Vale's nickel plant in New Caledonia

Vale's nickel plant in New Caledonia Photo: AFP

This was announced by Fabio Schvartsman who is the new CEO of the Brazilian mining conglomerate Vale that owns the plant at Goro in New Caledonia's south.

The plant's production costs are too high for it to be profitable and the outlook is poor.

Last November, Vale said a $US200 million loan from the French state had reduced the risk of it shutting its multi-billion dollar plant.

The funding offer was announced by the French prime minister Manuel Valls to help shore up the territory's economy which is reliant on nickel production.

One report said Vale New Caledonia used $US1.3 billion in the past three years and has to be shut down.

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