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Vale (NYSE:VALE) is shaking up its nickel game. The mining giant just kicked off a strategic review that could lead to selling off its mining and exploration assets in Thompson, Manitoba. The site isn't small potatoesit includes two underground mines, a mill, and a long stretch of exploration opportunities along the 135-km Thompson Nickel Belt, a proven deposit that's been churning out nickel since 1956. The review is expected to wrap up in the second half of 2025, signaling a potential shift in Vale's priorities as it looks to double down on copper growth in Brazil's Carajas region.
Despite producing 10,500 metric tons of finished nickel over the past year, Thompson might not fit into Vale's long-term vision anymore. In 2021, Vale announced a C$150 million investment to extend its mining activities in Canada by a decade, but now, it's weighing whether someone else should take the reins at Thompson. A potential sale could shake up the nickel market, especially at a time when demand for battery metals is heating up. The big question: Will a new player see more value in unlocking the full potential of this asset?
For investors, this move could have ripple effects beyond Vale. Nickel is a critical component in electric vehicle batteries, and with the sector ramping up, any shifts in supply dynamics are worth watching. If a well-capitalized buyer steps in, Thompson could become a key piece in North America's EV supply chain. Expect more movement as Vale inches closer to a decision.
This article first appeared on GuruFocus.