27 Mar 2007

Xstrata makes cash bid for Canadian nickel producer

10:09 am on 27 March 2007

The Anglo-Swiss mining company Xstrata has made a cash bid worth 4 billion US dollars for the nickel producer the Canadian company, LionOre Mining International.

Xstrata is the foreign stakeholder of the Koniambo Nickel company which is planning a multi-billion dollar smelter in New Caledonia's northern province.

At an international conference on nickel in New Caledonia this week, Macquarie bank analyst Jim Lennon said that the price of nickel, having tripled in the last year, would settle down in 2010-2011 when new factories began production.

But he says Chinese demand would far exceed expectations with China now consuming about 20 percent of the world's output.