Vale plans to more than double production by 2015, prompting its board of directors to approve a US$24 billion capex budget for 2011, dedicated to sustaining existing operations, R&D, and project execution.

Next year's capex budget is a 125.1% increase over the US$10.66 billion invested in the last 12-month period ended on September 30, 2010.

Vale plans to bring 18 large projects on line between 2010 and 2012 at an estimated total price tag of US$26 billion. Approved projects include Carajás Additional 30 Mtpy, Conceiçao Itabritos, Vargem Grand Ibabiritos, Oman, Tubarão VIII, CLN 150, Salobo, Salobo II, Konkola North, Long Harbour, Totten, Moatize, Biofuels, Estreito and Karebbe.

Five projects are expected to be completed next year including nickel/copper project Totten, an old mine in Sudbury; copper project Salobo; coal project Moatiz; and power generation projects Estreito and Karebbe.

"While iron ore and nickel will remain as our largest operations, our investments will entail a significant expansion of fertilizers, copper and coal, thus fostering the consolidation of a diversified portfolio of world-class assets, composed of bulk materials, base metals and fertilizers," Vale said in a news release Thursday.

While planned iron ore production is 311 million metric tons for 2011, Vale has targeted 522 million metric tons of production by 2015. Nickel production will be increased from the 295,000 tonnes planned for 2011 to 381,000 tonnes by 2015.

Copper production will be increased from 332,000 tonnes anticipated next year to 691,000 tonnes in 2015. Coal production will rise substantially from 11.6 million tonnes in 2011 to 42 million tonnes in 2015.

Potash production will be more than quadrupled from 800,000 tonnes in 2011 to 3.4 million tonnes in 2015. Phosphate rock production will be nearly double from 6.4 million tonnes in 2011 to 12.7 million tonnes in 2015.

Vale plans to spend $15.3 billion or 63.8% of its capex budget in Brazil, along with $1.96 billion budgeted for Canada, $1.4 billion for Argentina, $1.13 billion for Guinea, $1.12 billion for Mozambique, $663 million for China, $436 million for Australia, $338 million for Indonesia, $306 million for Oman, $166 million for Malaysia, $163 million for Peru, $102 million for Columbia, $98 million for Liberia, and $93 million for Zambia among other countries.

Budgeted R&D expenditures in 2011 are US$681 million to finance global exploration, $236 million for natural gas exploration, $805 million for conceptual, pre-feasibility and feasibility studies, and $264 million to be invested in new processes, technological innovation and adaption. Mineral exploration programs are being implemented in 22 countries.


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