Two thirds of the world’s primary nickel ore is used in stainless steel production. It’s also becoming a key component in the production of electric vehicles, due to its use in heavy duty batteries.
Investing News stated that in 2021 Russia was the third largest producer of nickel. Of course, analysts had their concerns regarding the nickel market due to the sanctions on Russia, and trading of nickel was even halted on the London Metal Exchange in March 2022.
It is imperative then, that other reserves for this metal be found.
The largest foreign investment in Madagascar
A joint venture between Sumitomo Corporation and KOMIR, Ambatovy is a major industrial operation, mining and refining nickel and cobalt in Madagascar.
Sumitomo, headquartered in Japan, is a leading Fortune 500 trading and investment business. Meanwhile, KOMIR (formerly known as KORES) is a fully integrated mining rehabilitation organisation.
Together, the businesses produce high-quality nickel and cobalt from the Ambatovy mine, with a focus on sustainability.
Thus far, the project has seen investment of (US) $8 billion, making it the largest-ever foreign investment in the country – and one of the biggest in sub-Saharan Africa.
With an early production capacity of 60,000 tons of nickel and 5,600 tons of cobalt, it ranks among the largest lateritic nickel mining companies in the world.
Ambatovy strives to be a leader in operational efficiency, health and safety, environmental management, and social engagement – all whilst contributing to the long-term prosperity of Madagascar.
Achieving Top 5 Status
The mine site of Ambatovy is located 80km east of Madagascar’s capital, Antananarivo. The ore body of the mine consists of two large, weathered lateritic nickel deposits – the Ambatovy deposit and the Analamay depost.
Combined, the two deposits constitute one of the world’s largest lateritic nickel reserves, spanning around 1600 ha.
Despite a history dating back to the 1960’s, Ambatovy started its operations in 2012, accomplishing its first commercial production in January 2014.
Operations at the mine have been designed to produce around 60,000 tonnes of refined nickel and 5,600 tonnes of refined cobalt annually.
In 2021, however, the partnership exceeded its yearly projection, making them one of the top five producers of nickel and cobalt in the industry.
“We owe our 2021 achievements to a strong and fully committed team,” said newly appointed CEO, Gus Gomes, “They succeeded in achieving a major turnaround, in very difficult and challenging conditions, including the Covid-19 pandemic, which had led to stopping production between March 2020 and March 2021”.
In addition to its outputs, Ambatovy can proudly say its briquettes contain 99.9% pure metal.
On top of its nickel and cobalt supply, the project also produces 120,000 tonnes of ammonium, created as a by-product of the refining process.
Contributing to community, country and economy
Central to Ambatovy’s mission is supporting Madagascar’s input into the United Nations’ Sustainable Development Goals.
Ambatovy sees its support for Madagascar’s achievement of the SDG’s in three pillars:
Business Approach;
Community and Environmental Approach;
And Supporting Local Growth.
By processing its raw ore in-country, Ambatovy contributes to Madagascar’s economic development. By doing so, it increases Madagascar’s foreign earnings through export of nickel and cobalt.
Ambatovy has also made significant investment into local, social infrastructure. This includes creating roads and rehabilitating schools and medical centres.
In addition, it has focussed on creating environmental programmes to educate the local community on the importance of Madagascar’s rich biodiversity, and its role in the country’s future.
At the heart of Ambatovy’s procurement practices is its “buy locally, hire locally” policy, reflecting the organisation’s commitment to support the growth of the Malagasy industry and small business.
“We are proud of our diverse and international workforce, with over 90% Malagasy employees, and 65% of leadership roles held by Malagasy professionals,” said Mr Gomes.
From providing training and capacity building, to assisting in the development of local suppliers, Ambatovy appreciates the importance of its role in driving the local economy forward in its development.
Ensuring a future for the next generation
Ambatovy considers its sustainability programme to be second to none, worldwide
Its continual efforts include having a strong safety culture and demonstrating responsible environmental stewardship, both elements of which Ambatovy strives to meet the highest standards.
In June 2022 the organisation celebrated Sustainability Month. The theme it followed this year was “Ensuring a future for the next generation”, something Ambatovy considers part of its culture.
As part of the awareness campaign, Ambatovy gave colleagues and their families an opportunity to learn more about the business’s environmental activities, including its unique breeding program for the golden mantella.
An exhibition was held at the mine site and plant site, where visitors were able to learn about Ambatovy’s activities in the fields of biodiversity, livelihoods, community engagement, reforestation and environmental monitoring.
“Our biodiversity commitment includes protecting large conservation areas,” said Mr Gomes, “We have an orchidarium and orchid parks with over 283 orchid species, including 28 new species we discovered and some that are critically endangered. The orchids are protected and transferred to our rehabilitation areas. We also protect a large number of fauna, including unique Lemurs which only exist in Madagascar”.
Ambatovy continues to make specific investments in education and social infrastructure. Its aim is to ensure that its presence in Madagascar is providing the maximum benefit to its host communities now and for future generations.
A new era
In November 2021, Ambatovy appointed Gus Gomes to head up the business, which stands at 10,000 employees and contractors.
Mr Gomes has more than 35 years experience in the mining industry, with appointments spanning the globe.
Having completed a degree in Engineering and Geology and an MBA in Finance, Mr Gomes first embarked on his mining career for Broken Hill Proprietary. He went on to work as Director of Operations and Technical Services for the second largest metals and mining organisation Rio Tinto.
Prior to working for Ambatovy, Mr Gomes took on senior managerial roles at MPX Energia and MMG, as well as ArcelorMittal and Vale.
On his appointment, Mr Gomes said, “We are committed to continuing our activities in a sustainable, responsible and effective manner, following good governance, in order to generate tangible benefits for the country. I assure you that Ambatovy will continue to live up to its commitments”.