EDC provides up to USD 1 billion to Vale to expand Canadian operations and grow Canadian procurement from international projects

OTTAWA, Oct 4 /CNW/ - Export Development Canada (EDC) today announced it will provide up to USD 1 billion in financing to Brazil's Vale S.A. (Vale) to assist with capital expenditures related to Canadian export projects and future Canadian procurement in its international operations.

"EDC's relationship with Vale provides for significant potential benefits for Canada, both in Canadian mining and processing projects and in international opportunities for Canadian equipment suppliers and engineering firms," said Eric Siegel, President and Chief Executive Officer, EDC.

"The recent global recession has emphasized that diversification of markets will be key to growing Canada's exports in the coming years. Vale's global operations provide opportunities for Canadian companies to gain a foothold in key emerging markets like Brazil."

Of the potential USD 1 billion in funding, up to USD 250 million will be made available for capital expenditures for the Long Harbor nickel processing plant in Newfoundland and Labrador, and another USD 250 million will be available for several projects slated for development in Ontario.

The remaining USD 500 million will be available for future purchase of Canadian goods and services by Vale for its operations outside Canada, or to support Vale exports involving signed contracts with Canadian suppliers.

"Vale has demonstrated an ongoing commitment to Canadian suppliers, making senior procurement officials available to meet potential Canadian suppliers on a number of occasions through EDC matchmaking events, leading to a near doubling in Vale's Canadian procurement over the past few years," said Mr. Siegel.

EDC believes that Vale's expansion plans both domestically and internationally will create hundreds of millions in potential supply and services opportunities for Canadian companies over the next few years.

The loan facility was structured as an unsecured, non-revolving bilateral loan facility. The transaction was underwritten at market rates, consistent with EDC's commercial principles.

EDC is Canada's export credit agency, offering innovative commercial solutions to help Canadian exporters and investors expand their international business. EDC's knowledge and partnerships are used by more than 8,400 Canadian companies and their global customers in up to 200 markets worldwide each year. EDC is financially self-sustaining, a recognized leader in financial reporting and economic analysis, and has been recognized as one of Canada's Top 100 Employers for nine consecutive years.