Two competing companies, Inco (N-T) and Noranda (NRD.LV-T) have reached a mutually beneficial agreement to have Noranda refine all of Inco’s Ontario copper production at Noranda’s Canadian copper refinery in Montreal East, Quebec.
The deal covers a 10-year period beginning Jan. 1 of next year. Inco estimates it will supply the refinery with 230-270 million lbs of copper anode per year.
Inco will sell the anodes to Noranda and later receive back the nickel and platinum-group metals, which have been recovered (subject to a processing fee). Noranda will pay Inco for the gold and silver, which it recovers.
The price Noranda pays for the anodes will be based upon gold, silver and copper recovery, as well as the market price, minus certain treatment costs and charges.
Noranda’s facility currently refines about 300,000 tonnes of copper anodes, primarily from the Horne and Altonorte smelters. In addition it processes copper and precious metals from other clients.
Noranda plans to spend about $18 million over the next year to expand the throughput at its Montreal refinery to 370,000 tonnes per year. In addition changes will be made to improve nickel and platinum-group metal extraction from the copper. The expansion is due to be completed by the end of the first quarter of 2006.
Inco plans to close its dated Sudbury, Ontario copper refinery and expects the closure to result in a pre-tax charge of US$30-$35 million.
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