NEW YORK Brazilian miner Vale SA is planning to operate only one of the two furnaces at its Copper Cliff smelter in Sudbury, Ontario, starting in 2016 as it looks to cut costs.
"Changes in our asset footprint, such as the commissioning of our Long Harbour project in Newfoundland, together with decisions to optimize and redistribute the flow of raw materials, have made the move from a two-furnace operation to a single-furnace operation at our Copper Cliff smelter the next logical step for the business," a spokesman told AMM in an e-mail, adding that the change is not expected to affect total refined nickel output from the companys Sudbury operations.
The change follows an announcement last year that Vale was reviewing its base metals business due to volatile market conditions and operating cost challenges affecting the overall mining sector.
The idling of one furnace will significantly cut costs associated with the companys previously announced Clean AER (atmospheric emissions reduction) project at the site, which is now expected to cost only $1 billion instead of $2 billion as previously announced.
Vale announced in October it was delaying the AER project due to cash issues (amm.com, Oct. 16).
The company said it expects some "minimal" short-term adjustment to its mine production in Sudbury and expects some job losses at the smelter complex long-term as a result. "We do expect that over the next several years there will be fewer jobs in the smelter complex with a change to a single furnace, but given the lead time we will look for ways to minimize any impacts," the spokesman said.
Vales Sudbury operations produced 50,000 tonnes of nickel during the first nine months of 2012, according to the companys third-quarter production report.