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The agreement, requiring an upfront cash payment of $250,000, also included an asset swap between the two companies. Centaurus will transfer the Salobo West copper-gold project, also in the Carajás mineral province, to Vale.
The two companies also entered a future offtake agreement giving Vale the right to purchase 100% of production from the Jaguar sulfide project.
The Jaguar nickel sulfide deposit, a high-nickel content and at-surface nickel deposit, contains 315,000 tonnes of nickel in metal, Centaurus said.
The acquisition of the Jaguar project will give Centaurus further exposure to a metal with “exceptional supply-demand fundamentals and a robust outlook”, the company said, pointing to nickel’s use in the stainless steel industry and growing consumption by the lithium-ion battery sector.
The three-month nickel price on the London Metal Exchange has been in an upswing since early July and hit a one-year high of $15,025-15,030 per tonne on Tuesday August 6, largely due to a promising outlook for the metal from investors amid a series of supply disruption concerns.
“We believe the acquisition of the Jaguar nickel project will provide the same opportunity for Centaurus as there simply aren’t many nickel sulfide projects globally of this quality that provide the opportunity to fast-track a nickel sulfide development ready to meet the growing market shortfall,” Centaurus managing director Darren Gordon said in a statement.
Vale produced 45,000 tonnes of nickel in metal in the second quarter in April-June this year, registering a 32% decline year on year and reflecting maintenance halts in Canada and Indonesia as well as a suspension at its Onça Puma plant in Brazil.