 TORONTO (miningweekly.com) - After weathering the worst of the financial crisis and with its large Ambatovy nickel project in Madagascar heading towards commissioning, Canada's Sherritt International is ready to start thinking seriously about what comes next, CEO Ian Delaney said on Wednesday.
"Our balance sheet is in good shape, it looks like our business is in pretty good shape, so it is absolutely our intention to embark on more corporate ventures this year," he promised.
After reporting what Delaney called a "profitable, delightfully boring" fourth quarter, there are a number of opportunities that the firm has been looking at in the last six months or so, he told analysts and investors on a conference call.
"The last couple of years we have been building Ambatovy, we have had an internal management focus, and of course the markets have been in turmoil.
"But our sense is that we are on the other side of that now and it's time to put our company back on a real growth footing, and so we intend to be very aggressive in the coming year," Delaney said.
While the company does not plan any moves into "weird" businesses that it knows nothing about, there is a wide range of opportunities that compare with its current activities mining nickel, cobalt and coal, and in various energy-related operations.
CONFIDENT ON AMBATOVY
With progress continuing to be made at the Ambatovy project, Sherritt is now "very comfortable" with the timing and cost forecasts it has supplied to the market, Delaney said.
"In fact, we are starting to cast our minds forward beyond the mechanical completion date and begin to think of how quickly that can get ramped up and turned into metal and turned into profit."
Sherritt owns 40% of the Ambatovy project, Sumitomo and a consortium led by Korea Resources each have a 27,5% stake in the mine, and the project's engineering contractor, SNC-Lavalin, also has a 5% interest.
Work on the project slowed dramatically in late 2008, after metals prices dropped, and the operation faced further uncertainty when the capital cost estimate was revised upwards in February 2009 to $4,52-billion, from a previous figure of $3,4-billion.
However, Sherritt was able to come to a financing agreement with the other partners, which agreed in June to provide loans to fund the Canadian firm's share of the remaining capital spending.
The Ambatovy mine is expected to produce 60 000 t/y of nickel and 5 600 t/y of cobalt.
The project is scheduled for mechanical completion by year-end 2010 and the most recent capital cost estimate was $4,52-billion.
Shares in Sherritt, which posted a C$48,3-million fourth quarter profit, rose 2,67% on Wednesday, to C$6,91 apiece by 16:10 in Toronto.
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