The Brazilian mining company Vale is to invest $US500 million in its nickel operation in New Caledonia.
The decision comes amid expectations that nickel prices will recover as demand for the metal increases to build batteries for electric vehicles.
Vale’s CEO chief executive officer Fabio Schvartsman told Reuters that earlier the company was considering a partnership to maintain the Goro plant which had been running at a loss.
Last year, Vale was reportedly also considering mothballing the plant while holding discussions with possible Chinese investors.
It had ruled out investing more money, fuelling fears of massive job losses in New Caledonia’s southern province.
Vale’s new investment is to fund the so-called Lucy project which is a system to store residue from its nickel production.