Vale Base Metals, a subsidiary of Vale (NYSE: VALE), has commissioned a second furnace at its Onça Puma ferronickel complex in southeastern Pará, Brazil, increasing the asset’s nominal production capacity by 60%.
The start-up of Furnace 2 adds 15,000 tonnes of nickel production capacity, lifting Onça Puma’s nameplate output to 40,000 tonnes per year. The company said the investment will allow higher production at lower costs, consolidating Onça Puma as Brazil’s largest ferronickel operation.
CEO Shaun Usmar told Reuters that the expansion places Vale Base Metals in a “very strong position” once the market recovers, despite current low nickel prices driven by oversupply from Indonesia. He added that the operation should generate “reasonable cash flow” under the new configuration.
Vale Base Metals reaffirmed its guidance of 160,000–175,000 tonnes of nickel production in 2025. By 2030, it expects output of 210,000–250,000 tonnes, supported by Onça Puma’s Furnace 2 and the ramp-up of underground mining at Voisey’s Bay in Canada.
Construction of Furnace 2 took three years and cost about $480 million, below the originally budgeted $555 million.
Vale Base Metals is 90% owned by Vale S.A. and 10% by Manara Minerals Investment Company.
Vale shares rose 0.3% on Tuesday morning in New York, giving the company a market capitalization of $46.7 billion.
