--Halt in shipments affects sales to one customer and business with a group of suppliers
--Force majeure declared after incident at acid plant
--No employees were affected and no environmental damage occurred, Vale says
(Updates with data on Vale's nickel output at VNC and worldwide, beginning in paragraph 5.)
RIO DE JANEIRO -(Dow Jones)- Brazilian mining company Vale SA (VALE, VALE5.BR) said it declared force majeure, effective Thursday, on some nickel sales from its Vale New Caledonia nickel operation.
The halt in shipments will affect sales to one customer and business with a group of suppliers who have been informed of the problem, Vale said in a statement.
The force majeure was declared after an incident at VNC's acid plant, which affected no employees and didn't cause any environmental damage, Vale said.
The extent of damage to the plant is still being assessed, the company said.
Vale's VNC plant, formerly known as Goro, is still ramping up to full production, which should be achieved in 2013 after a series of technical problems.
The company said in its most recent production report in late April that during the first quarter it had conducted successful tests at VNC with an integrated refinery operation and produced 1,100 metric tons of nickel oxide--proving that the product could be produced at the site in a sustainable manner.
"An important by-product was the knowledge provided by this experience, which will be very useful to further improve the production process," Vale said in the report.
Vale's total nickel output worldwide for the quarter was 56,000 tons. The company is the world's second-biggest nickel producer.
Vale expects to produce a total of 22,000 tons of nickel in the form of oxide or nickel hydroxide cake at VNC in 2012, the company said in its first-quarter earnings report.
-By Diana Kinch, Dow Jones Newswires, 55 21 7564 4495 diana.kinch@dowjones.com
(END) Dow Jones Newswires
May 10, 2012 18:52 ET (22:52 GMT)
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