Canadian miner Sherritt takes majority stake in Indonesian nickel project

Sherritt International, a Canadian diversified natural resource company, yesterday said that it will take a majority stake in the Sulawesi nickel project in Indonesia.

Toronto-based Sherritt has executed an earn-in and shareholders agreement with a subsidiary of Anglo Australian miner Rio Tinto, where Sherritt will acquire a controlling 57.5 per cent equity interest in the holding company that owns the Sulawesi Project while the remaining 42.5 per cent will be continued to be held by Rio Tinto.

Under Indonesia's mining laws, local Indonesian groups are expected to acquire a 20-per cent interest in the project and Sherritt and Rio Tinto together will then indirectly own and control an 80 per cent interest in the Sulawesi Project, with Sherritt holding a controlling 46 per cent interest and Rio Tinto 34 per cent.

Sherritt said that as consideration for its interest, it has committed to fund $110 million towards feasibility study from which a development decision will be made.

The Sulawesi Project is located in the Southeast and Central Sulawesi provinces on the Republic of Indonesia and is currently ranked as one of the largest known undeveloped in the world. 

Based on exploration completed to date, the Sulawesi Project includes a large, high grade resource. Identification of further mineralisation will be achieved through additional of Sulawesi in the exploration and completion of feasibility studies.