Vale and Glencore are reportedly considering combining their Sudbury-area nickel operations in an effort to cut costs, according to Vale executive Mark Cutifani.
In an interview with the media outlet Reuters, Cutifani, chair of the Energy Transition Metals Board with Vale's Base Metals division, said the company would prioritize the decision this year.
"We've got some interesting thoughts on what is possible, (including) tailings (waste) and some of the old areas that could be redone and we are working through that," Cutifani is quoted as saying during the Future Minerals Forum in Riyadh.
"During the course of this year we should work out whether there's something we can do together or not. Certainly that is one of my priorities.”
The discussion is reportedly being prompted by low nickel prices and high demand by the battery-electric vehicle industry.
In Sudbury, Vale owns and operates five mines, a mill, a smelter, and a refinery, while Glencore's Sudbury Integrated Nickel Operations (SINO) owns and operates Nickel Rim South Mine and the Onaping Depth project. Properties owned by the two companies abut each other.
"It makes sense to do something where we are sharing infrastructure," Cutifani told Reuters.
Talks of some kind of partnership between the two companies go back to at least 2006 with a proposed merger of Falconbridge (now Glencore) and INCO (now Vale), which was projected to generate annual cost savings of US$550 million.
In 2018, Vale and Glencore initiated a joint feasibility study to look at accessing mineral resources from Glencore's Nickel Rim South Mine.
Under the proposal, the two companies would have used the existing shaft and infrastructure at the mine, as well as additional underground infrastructure, to potentially jointly develop and mine deposits in close proximity to each other.
“A joint approach could allow for resources to be unlocked that would likely not otherwise be productive,” said Ricus Grimbeek at the time, who was then chief operating officer for Vale’s North Atlantic Operations and Asian Refineries.
Running Jan. 9-11, the Future Minerals Forum is one of the world's largest gatherings of mining stakeholders, focused on creating resilient mineral value chains in Africa, Western and Central Asia.
