Finland inks $266 million deal to revitalize Europe's largest nickel mine
A large but troubled nickel mine in Finland may be back on the road to profitability thanks to a recent deal that saw commodities trader Trafigura take a 15.5 percent stake.
The Terrafame mine in northern Finland has been operated by the state since 2014, after its former operator Talvivaara Sotkamo went bankrupt following years of losses and production problems. Talvivaara also had to deal with a major environmental and public relations disaster in 2012 when the mine leaked wastewater, spilling toxic levels of nickel, cadmium, uranium, aluminium and zinc into nearby lakes and rivers.
The Finnish government planned to close what was once the European Union's biggest nickel mine, but changed its mind in November. Instead, the government provided 100 million euros to Terrafame, citing rising nickel and zinc prices and state-controlled Terrafame Ltd's efforts to put the business back on track, according to a story in Digital Journal.
Now the mine has been given an even bigger vote of confidence, with Trafigura – which describes itself as one of the world’s leading commodity trading and logistics houses – paying 250 million euros (US$266 million) for a 15.5% stake to help complete a planned ramp-up in production. Last year the mine produced 22,575 tonnes of zinc and 9,554 tonnes of nickel.
The cash will be issued through Trafigura's Galena fund; the company will also finance a new loan as part of the deal.
Trafigura also agreed to purchase all of the mine's nickel-cobalt sulphide precipitates and 80% of its zinc sulphide precipitates during the next seven years.
Ore at the mine is processed through a bioheapleaching process said to be cleaner and more energy-efficient. It uses natural bacteria to leach sulphide minerals.