Mining Commences in New Caledonia at World's Largest Nickel Deposit

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Researched by Industrial Info Resources (Sugar Land, Texas)--Last month, Vale Inco Limited (Toronto, Ontario), a subsidiary of Vale S.A. (NYSE:VALE) (Rio de Janeiro, Brazil), began mining the world's largest nickel deposits.

When it was being built, the Goro Nickel project was one of the world's largest under construction. With an estimated total investment value of $4.3 billion, a project of this size would have a positive impact on any major economy. The impact in New Caledonia has been, to say the least, substantial.

New Caledonia is a tiny island nation in the south Pacific, not far from the east coast of Australia. It is slightly smaller than New Jersey and has a population of slightly less than 250,000.

Historically, New Caledonia has relied on financial assistance from France for about 15% of the country's total GDP. Consequently, hopes are high for the Goro project, both in terms of badly needed revenue as well as stable employment for the population. The three provinces of New Caledonia own 10% of the project.

The expected annual capacity of Goro is 60,000 tons of nickel and up to 5,000 tons of cobalt. This represents about 20% of global production. The mine has been given a life of 29 years, during which time the mining pits will be filled in and replanted at the end of each mining cycle. However, Vale Inco is already considering the possibility of a second phase for Goro for the next decade.

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