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Monday February 19, 6:22 PMSumitomo Metal to boost nickel production by 2013TOKYO, Feb 19 (Reuters) - Major Japanese metals smelter Sumitomo Metal Mining Co. said on Monday it aims to nearly double its nickel output by 2013 to catch up with global majors such as Norilsk , the world's top producer.Sumitomo Metal plans to boost output capacity of nickel, a key ingredient in stainless steel, to 100,000 tonnes a year by 2013, from the current 56,000 tonnes. Sumitomo Metal President Koichi Fukushima told a news conference the company was planning to spend about $1.2 billion to build a new 30,000-tonne nickel plant to produce the raw material outside Japan. Fukushima said the plant would be built in either Indonesia, the Philippines or New Caledonia. Construction is scheduled to begin in 2009 and operations to start in 2012. The plant will adopt a high-pressure acid leach method, which is already in use at its Coral Bay plant in the Philippines. The method enables recovery of nickel and cobalt from low-grade nickel oxide ore. Fukushima said details will be formally disclosed after the start of the new business year in April. Coral Bay Nickel Corp. started commercial production of nickel and cobalt in April 2005 at a plant that is now producing 10,000 tonnes of nickel and 700 tonnes of cobalt yearly. Last year the company said it would build a second plant at Coral Bay, doubling nickel output to 20,000 tonnes a year. Coral Bay Nickel is 54 percent owned by Sumitomo Metal Mining. Its Japanese partners Mitsui and Co. and Sojitz Holdings Corp. each have 18 percent stakes. Rio Tuba Nickel Mining Corp., with 10 percent, is the Philippine partner in the project. Tight supply conditions have been boosting nickel prices. Last week, benchmark nickel futures on the London Metal Exchange hit a new record high of $39,350 a tonne, triggered by a drop in available stocks in LME warehouses to less than half a day's global consumption. Besides Sumitomo's nickel production plan, the company plans to spend $1.2 billion by March 2010, including in the metal products business. |
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