JOHANNESBURG (miningweekly.com) – Nickel miner and refiner Sherritt International Corporation has cautioned the market of an expected $2.4-billion impairment of the Ambatovy joint venture (JV) assets, in Madagascar, citing lower forecast nickel prices.
The expected impairment figure was based on an expected nickel price of $8.50/lb.
Sherritt expected to record an impairment expense of some C$1.6-billion for the year ended December 31, 2015.
The total impairment comprised C$1.3-billion – being Sherritt's 40% share of Ambatovy's impairment – and C$300-million from the incremental carrying value of Sherritt's investment in an associate, primarily related to mineral rights acquired from Dynatec in 2007.
The company said the impairment loss was a noncash item with no adverse impact on cash flow.
The Ambatovy mine is a JV between Sherritt, Sumitomo and Korea Resources.