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New Caledonia leaders agree terms for sale of Vale nickel mine

Mar 4, 2021 8:05AM EST

Political parties in New Caledonia on Thursday agreed new terms for the sale of Vale's nickel business, including a proposed majority stakeholding for local interests, seeking to resolve unrest over the planned sale.

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Adds Trafigura reaction, environment commitments

PARIS, March 4 (Reuters) - Political parties in New Caledonia on Thursday agreed new terms for the sale of Vale's VALE3.SA nickel business, including a proposed majority stakeholding for local interests, seeking to resolve unrest over the planned sale.

Brazilian miner Vale's VALE3.SA decision last year to sell its nickel mine and processing plant in the French Pacific territory to a consortium including Swiss commodity trader Trafigura TRAFGF.UL sparked fierce opposition from pro-independence groups.

Violent protests led Vale to shut down the site in December.

Under Thursday's agreement, pro-independence and loyalist leaders proposed that a 51% stake in the Vale operations be held by New Caledonia's provincial authorities and other local interests. Trafigura would have a 19% stake, less than the 25% planned in the initial sale deal with Vale.

The text released by the New Caledonian parties also mentioned a "technical and industrial partnership" with Tesla TSLA.O, under which the electric car company would source raw materials for batteries.

The parties also called for reinforced environmental standards and set a target for the mining complex to be carbon neutral by 2040.

Trafigura said it welcomed the political agreement.

"We're looking forward to operations resuming and for final completion of the transaction as soon as possible," a Trafigura spokesperson said.

Vale and Tesla did not immediately respond to requests for comment.

New Caledonia is the world's fourth-largest nickel producer behind Indonesia, the Philippines and Russia.

Demand for nickel, mainly used in making stainless steel, is expected to grow rapidly owing to increased demand for batteries for electric vehicle.

(Reporting by Gus Trompiz and Eric Onstad Editing by David Goodman )

https://www.nasdaq.com/articles/new-caledonia-leaders-agree-terms-for-sale-of-vale-nickel-mine-2021-03-04