Indonesia's state-owned miner PT Aneka Tambang Tbk forecast on Thursday its nickel output would jump 42 percent next year after restarting its third ferronickel smelter and on expectations of demand picking up.
Antam expects to produce 17,000 tonnes in 2010, up from 12,000 tonnes this year, Alwin Syah Loebis said.
"FeNi 3 has resumed operations. We also see that nickel demand is increasing. So we are production can be higher," Loebis said.
FeNi 3, its third ferronickel smelter, is expected to resume full operations in November after months of maintenance, he said.
The price of nickel MNI3, used in stainless steel, stood at $18,400 a tonne at 0702 GMT on Thursday, after gaining 57 percent so far this year. But the price is still about 64 percent below a record high of $51,800 a tonne hit in May 2007.
Antam also confirmed it was in talks with PT International Nickel Indonesia (INCO.JK) on the possibility of resuming its nickel supply agreement.
"Inco has exploration near our facility while we are also looking for nickel supplies nearby. We expect to conclude discussions in the near future," Loebis said without elaborating.
The agreement to supply nickel from PT Inco's Pomalaa mine in Sulawesi ended in August 2008.
Under the agreement, which started in February 2003, PT Inco which is 60.8 percent owned by Brazil's Vale Inco supplied about 1 million tonnes of nickel ore annually to Antam's ferronickel smelters.
If an agreement is reached, Antam may use the nickel to feed its ferronickel plant FeNi3 in Pomalaa.
Antam currently sources nickel ore from its mines in Halmahera, North Maluku, for the smelters.
Antam, which is 65 percent-owned by the Indonesian government, is involved in the exploration and production of nickel ore, bauxite and iron sands, smelting of ferro-nickel, and exploration, production and refining of gold and silver.
Source: Reuters
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