Niquel Tocantins phase 1 expansion complete

Niquel Tocantins, the nickel arm of Brazilian conglomerate Votorantim, is finishing the first phase of an expansion project, officials from federal development bank BNDES told BNamericas. Output of nickel and cobalt now totals 21,000t and 1,100t, respectively, said Elizio Damiao Goncalves de Araujo, a manager from the bank's industrial area in the department of basic inputs and responsible for overseeing financing to the project. The entire expansion is to bring output of electrolytic nickel to 22,800t/y from 17,800t/y and cobalt to 1420t/y from 960t/y by 2H06. The total cost of the project is 320mn reais (US$110mn) - over two phases - of which the BNDES is financing 132mn, said Araujo. The funds include improvements of logistical infrastructure at the Niquel Tocantin's mine in Niquelandia, Minas Gerais state. Extracted and processed nickel is sent by truck to the company's smelter in San Miguel Paulista, Sao Paulo state, where the company is investing in a new line of furnaces to transform the concentrate into metallic form for sale on the London Metal Exchange. BNDES officials also said the Votorantim group has plans to expand capacity of the Serra Fortalaza nickel mine, also in Minas Gerais, but have not provided any detailed plans. The group acquired the asset for US$77mn at end-2003. The acquisition will increase the group's nickel output by 33% to around 30,000t/y and place Votorantim among the world's top 10 producers of the metal. EXPANSION ABROAD BNDES also said there are plans to internationalize nickel production with support going to help Brazilian companies invest in Cuba. "We are in discussions concerning what national firms could set up in Cuba," the bank's officers said. Besides Niquel Tocantins, other candidates include Brazilian steelmakers CSN (NYSE: SID) and Acesita.