(Updates with diversification plans in fifth paragraph.)
Oct. 27 (Bloomberg) -- OAO GMK Norilsk Nickel, the world’s biggest producer of the metal, said its board approved a $35 billion plan to 2025, raising the share of copper and platinum group metals in production.
Norilsk targets increases of at least 19 percent for nickel output, 49 percent for copper and 42 percent for platinum group metals, the company said today on its website.
The board passed the strategy even after dueling owners Interros Holding Co. and United Co. Rusal urged the company last month to focus on maintaining low-cost production over diversification. Norilsk said it aims to be one of the top five biggest companies by market value in that period.
Norilsk aims to boost its share of the copper market from 2.5 percent as demand outpaces new projects, Anton Berlin, head of marketing at Norilsk, said in an interview before the decision. Demand for platinum and palladium is expected to rise “in the scale of tons, if not dozens of tons” as anti- pollution devices that contain the metals are increasingly added on diesel trucks, diggers, mowers and loaders, he said.
Last year, Norilsk produced 297,329 metric tons of nickel, 388,872 tons of copper, 2.86 million ounces of palladium and 693,000 ounces of platinum, it said in a Jan. 31 filing.
Rusal Votes Against
The strategy aims to diversify the company’s products and the geography of output, Norilsk said. The company plans to start mining coal, iron ore, molybdenum, chrome and other metals, it said.
Interros and Rusal both questioned management’s proposal as risky given political unrest in developing countries and global economic concerns.
Rusal’s two directors on the Norilsk board voted against the strategy in the written form, while refusing to participate in the meeting, after Norilsk declined to provide the final documents before time, Rusal’s press-office said. Bradford Mills, an independent board member and strategy committee chairman, said Rusal wasn’t given the materials after declining to sign a confidentiality agreement,
“The most important thing is to maintain low cost production,” billionaire Interros owner Vladimir Potanin said in September. “We support such an approach,” Rusal Deputy Chief Executive Officer Maxim Sokov said.
Norilsk’s spokeswoman Alisa Fialko declined to comment on the board’s vote. Interros’s press office said it couldn’t immediately comment.
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