By Allison Martell and Euan Rocha
TORONTO, March 3 Vale SA's
Canadian unit has resumed work on its Copper Cliff Deep nickel
project in the Sudbury basin and expects to complete a
feasibility study by the end of the year, a company executive
said on Monday.
The project is expected to cost somewhere in the range of a
billion dollars to build and could be one of the unit's
lower-cost operations, said Kelly Strong, Vale's vice president
of Ontario and UK operations.
If it goes ahead, the revised project, now dubbed Copper
Cliff Mine, would be another boost for the Sudbury basin in
northern Ontario, where Vale recently opened Totten, its first
new mine in more than 40 years.
"It's going to look a little bit different than the original
project - it's going to be three phases," said Strong.
The project would merge and expand what are now two separate
mines. Its earlier incarnation was put on hold in the wake of
the 2008 financial crisis. In 2010, Vale Canada said it was
re-evaluating the project, though work did not proceed.
The first of the three phases could start producing within
the next two to three years, Strong told Reuters. A final
go-ahead will depend on the project securing a green light from
Vale's board in Brazil.
Mining companies from around the world are in Toronto this
week for the Prospectors and Developers Association of Canada
convention, which is the industry's largest annual gathering.
Strong, who leads Vale's operations in the Sudbury basin,
also played down expectations that the Brazilian miner would
reach a deal early this year with rival metals producer and
trader Glencore Xstrata Plc to merge their adjacent
Canadian nickel projects.
"Last year we had some conversations," he said. "We had
committed to getting back together and having conversations in
'14, but that hasn't occurred yet and there's really nothing new
to report at this time."
Strong made clear that while the talks had not yet been
held, further discussions were expected, adding there was no
specific reason for the delay.
Depending on the details of a potential deal, analysts said
a tie-up could mean substantial savings for both miners, if all
or a part of their mining, milling and even smelting operations
are brought together.
The price of nickel has begun to tick higher this year and
is currently trading at around $14,674 a tonne, up from around
$13,900 a tonne at the end of 2013, after a ban that Indonesia
imposed in January on unprocessed mineral exports.
In December, Vale's Chief Executive Officer Murilo Ferreira
announced that it was likely the company would reach a
partnership deal with Glencore about their adjacent nickel
projects in the first quarter of 2014.
Reuters had initially reported in October that the mining
giants were in talks about a potential combination of their
Sudbury basin nickel operations, as part of an effort to reduce