Goro Nickel Project, New Caledonia

The Goro Nickel plant is located on the South Pacific island of New Caledonia and is one of the largest mining projects under construction anywhere in the world.

Goro is considered among the world's best-known undeveloped laterite ore bodies, with 55 million tonnes of estimated measured and indicated mineral reserves.

The expected annual capacity of the Goro Nickel project is 60,000t of nickel and 4,300 to 5,000t of cobalt, which represents around 20% of global production.

Goro was acquired by Brazillian iron ore and nickel giant CVRD after the success last year of its friendly $19bn takeover bid for Inco.

Vale Inco holds a 69% interest in the Goro project. Through a jointly owned company called Sumic Nickel Netherlands, Japan's Sumitomo Metal Mining Co. Ltd. and Mitsui Co. Ltd. own 21%.

The remaining 10% is held by the three provinces of New Caledonia.

Production at Goro was scheduled for late in 2008. However, construction of a key offshore tailings pipe stalled in the face of fierce community opposition, led by New Caledonia's native Kanak people.

The estimated total cost of development was recently revised up to $4.3bn, from $3.2bn, in part to satisfy environmental concerns. As of late February 2008, the company said that construction was around 70% complete. Exploration of the site was first carried out in 1969.

The project was re-scheduled in January 2010, with production expected to start by April. It was, however, delayed yet again after a problem occurred with an autoclave used in high-pressure acid leaching. The project has been extended three times within a year due to poor demand for nickel, environmental opposition and mounting costs. The project is nearly $2bn over budget and two years behind schedule. No timelines for commissioning have been set and full production is not expected before 2013.

Geology and reserves

The deposit on the Goro Plateau in New Caledonia is a classic deposit in its composition. It comprises iron oxides on the surface (laterites) and magnesium silicates beneath (saprolite). The nickel and cobalt contained therein result from chemical concentrations within this residual formation.

Of the world's laterite deposits, this has one of the highest nickel contents. Proven and likely reserves in the initial mining area of the Goro Plateau total 120 million tonnes, with an average nickel content of 1.48% and a cobalt content of 0.11%.

As well as reserves, around the initial mining area there are indicated and measured resources estimated at 55 million tonnes, giving a nickel content of 1.49% and a cobalt content of 0.12% as of 2009.

Mining

The mine on the Goro plateau will be opencast, dug to a depth of 50 to 60m. It is expected that some 4 million tonnes of dry ore will be removed each year, with 12 million tonnes of earth shifted.

Initially, the superficial layers which have no commercial use will be cleared away from the plateau area. The laterite and saprolite ore will then be extracted from a series of terraces using hydraulic excavators and bulldozers. Haulage will be undertaken by a fleet of dumper trucks.

The deposit is a single, continuous but thick layer, therefore several faces will be opened laterally and vertically so that the entire profile can be extracted from the surface lateritic layer and the saprolite which is further down.

The mine has been given a life of 29 years, during which time mining pits will be filled and replanted at the end of each mining cycle.

Ore processing

Inco boasts that its mining processes involve state-of-the art, fourth-generation hydrometallurgical techniques, designed to make it possible to profitably process laterites with low nickel content at low cost, whilst reducing the impact on the environment.

The mined ore is screened and ground and then mixed with water to create a combined pulp of limonite and saprolite. Rigorous control of chemical quality and particle size is undertaken. The pulp is then conveyed via a pipe which extends for 8km to the autoclave at the processing plant. When it is in full production, the plant will process approximately 536t of pulp per hour.

Production and costs

At full capacity, Goro will produce 60,000t annually of nickel in the form of nickel oxide, which will contain from 70 to 80% nickel. Between 4,600 and 5,500t of cobalt will be produced each year.

Details about exact production costs are scant. However, Inco has repeatedly stated in official documents that the mine is on track to being one of the world's more efficient operations.

The future

Due to ongoing delays, longer term targets may need to be revised to soon. Initially it was expected that the mine would reach full production by 2013. No changes have yet been made to this date.

Vale Inco is planning a second phase for Goro for the next decade, so there is a huge financial commitment riding on project completion and in reaching an accord with project opponents.