Goro Nickel to postpone production

Goro Nickel to postpone production

NOUMEA, Canada: New Caledonia's metallurgical company Goro Nickel will begin production by end 2005 rather than by late next year, due to a cost reappraisal, according to Scott Hand, chief executive of Canadian group Inco.

Construction work on a unit of Goro Nickel, which is expected to produce 54,000 tons of nickel and 5,400 tons of cobalt a year, was halted for six months from November as the cost of operation rose sharply from 1.4 billion euro (US$1.5 billion) to 2 billion euro.

Hand said all aspects of the project were under review and that the start of production would be delayed until end 2005.

He said "mistakes" had been made in the unit which had got off too quick but added that Inco was committed to the project which could yield 2,500 jobs.

Stoppage of work on the project has met with dismay among business circles in the French Pacific territory, which has a six percent share of the world nickel market. -- AFP