Global commodity trader Trafigura on Friday said it has signed a $140-million investment agreement with Korea Zinc to build an all-in-one nickel refinery in Ulsan, South Korea, and finance its initial working capital.
The refinery will be capable of processing a range of feedstocks including nickel matte and mixed hydroxide precipitate (MHP) using an integrated pyro-hydro process, the release said.
Korea Zinc is set to establish the refinery through its nickel sulfate subsidiary, Korea Energy Materials (KEMCO) and Trafigura will secure a 12.9% stake in KEMCO as part of the agreement.
The two companies also entered a long-term agreement to secure a reliable supply of feedstock for the refinery.
Under the contract, the amount of nickel to be supplied by Trafigura will range from about 20 000 to 40 000 metric tons per annum and the company will also have an off-take right in relation to the feedstock contract.