Nyrstar to invest $365 mln in Australian smelter

BRUSSELS Dec 3 (Reuters) - Belgium's Nyrstar said it had reached an initial agreement with the Australian government for an investment of about A$350 million ($365 million) to transform its lead smelter at Port Pirie in south Australia.

Of the sum invested, A$150 million would be financed by third parties with a guarantee from the Australian government.

Another A$100 million would be raised by forward selling some of the metals that would be produced by the new facility, with the final A$100 million to be financed by Nyrstar itself, the group said on Monday.

In 2011 Port Pirie produced 195,000 tonnes of lead and 30,000 tonnes of zinc, along with some copper, silver and gold.

Nyrstar said the investment would update some of the ageing equipment at the plant and allow it to process a wider range of raw materials, increasing the plant's profitability.

The financial framework with the Australian government will be finalised by late 2013, with commissioning planned for early 2016, the group said.

($1 = 0.9585 Australian dollars) (Reporting by Robert-Jan Bartunek; Editing by Mark Potter)