Posted on 02 May 2024
Vale has received regulatory approval to sell a 10% stake in Vale Base Metals Limited (VBM) to Saudi Arabia’s Manara Minerals for $2.5 billion.
VBM is one of the world’s largest producers of nickel, copper, cobalt and platinum group metals. It is headquartered in Toronto, Canada and has operations in the UK, Brazil, Japan and Indonesia. Manara Minerals is a joint venture between Saudi state-owned miner Ma’aden and the kingdom’s Public Investment Fund.
Over the next decade, VBM is expected to invest in new projects across Brazil, Canada and Indonesia, boosting copper production from 350,000 tonnes/year to 900,000 t/y. Its nickel production is planned to increase from 175,000 t/y to 300,000 t/y.
Vale and Manara first signed their strategic partnership in July 2023, whereby Manara agreed to invest in VBM at an implied enterprise value of $26 billion.
At the time, Vale also agreed to sell a 3% stake in VBM to US-based investment firm Engine No. 1, Kallanish reports. However, the pair have agreed not to move forward with the previously agreed terms and conditions “but remain open to future partnerships,” Vale says.
Over the past two years, the Brazilian miner has worked to turn its energy transition metals business into a globally recognised critical mineral supplier. Its strategy included the creation of VBM to drive operational efficiency, supported by a new governance structure and a dedicated board of directors chaired by Mark Cutifani.
VBM intends to become North America’s largest integrated nickel producer and among the largest copper businesses globally.
Separately, Vale also announced an agreement with equipment manufacturer Caterpillar to test battery electric large trucks and energy transfer systems to decarbonise its operations. The BEV with capacity of 240 tonnes will be tested in Minas Gerais, Brazil.
The cooperation comes as part of Vale’s efforts to cut its Scope 1 and 2 emissions – direct and generated by energy use, respectively – by 33% by 2030 and achieving net zero by 2050.
Diesel emissions from mine operations account for 15% of Vale’s Scope 1 CO2 equivalent emissions and are mostly generated by haul tracks.
Source:Kallanish
