Dow Jones reported that Xstrata Plc plans to double nickel mine output by 2016. Falcondo, in the Dominican Republic, is on track to ramp up to 50% capacity, roughly 14,000 tonnes a year, of nickel in ferronickel by 2011, and the Koniambo, New Caledonia, nickel project is 65% complete and on track for a 2012 start date and capacity of 60,000 tonnes.
The miner has three additional nickel projects in feasibility; Kabanga, Tanzania, planned to start in 2014 with capacity of 40,000 to 45,000 tons; Fraser Morgan, to start in 2012 with capacity of 6,000 tonnes and a return to 100% capacity at Falcondo by 2016.
Mr Ian Pearce head of Xstrata's nickel division said that there are four additional projects in feasibility and scoping stage. Pearce noted nickel pig iron is now a permanent component of elastic nickel supply.
Xstrata said in the short and medium term the availability of nickel supply means prices will be driven cash costs. In 2009, Xstrata produced 88,577 tonnes of refined nickel production.
The company also said that a post tax non cash impairment charge of USD 440 million will be reflected in its results for the year ending December 31st 2010, following a review of the Araguaia, Brazil nickel project.
It added that the impairment is primarily due to the company giving more priority to other growth projects in its nickel pipeline, including Koniambo, Kabanga, and the 50% capacity restart of Falcondo.
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