Ambatovy Ni to Commercialize by March 2012, Sumitomo Corp.

Sumitomo Corporation expects the firm gets first equity nickel production in fiscal 2011 started April through joint venture in Madagascar. The joint venture with Canadian and South Korean companies is completing Ambatovy project for US$ 4.5 billion while the original plan was to start operation in late 2010. The nickel project realizes full capacity operation to make annual 60,000 tonnes of nickel in 2013 to serve growing demand in the world.

The refinery construction work will complete as early as in July. The project plans to increase the operation rate to 90% level in late 2012. The project is to make world 60,000 tonnes of nickel, which represents estimated around 4% share in the world supply in 2011, while the project will make 5,600 tonnes of cobalt, which represents world 9% share. Sumitomo Corp. will sell 50% of the production volume to buyers in Japan and Asian countries.

The project is to mine nickel ore at open cut mine and to transport the ore slurry through around 220 kilometers of pipeline for refinery. Sumitomo Corp. joined the project in 2005 to get 27.5% share in the project.

Nickel demand increases as battery materials for mobile devices and automobile along with traditional stainless and special steel applications. The supply is concentrated into 5 countries including Canada, Russia and Australia, which represent around two third of world supply, while world mineral majors control majority of the resources.

Ambatovy project with world class production volume would contribute to the stable supply. Sumitomo Corp. tries to realize the project with the largest exposure for the company for better profit base.