Mitsui & Co Ltd: Change in Ownership Interest in Vale New Caledonia Nickel Cobalt Project

  Mitsui & Co Ltd: Change in Ownership Interest in Vale New Caledonia Nickel
  Cobalt Project

UK Regulatory Announcement

LONDON

This announcement is for our U.S. $5,000,000,000 Euro Medium Term Note
Programme .

Mitsui & Co., Ltd. ("Mitsui") (Head Office: Tokyo, Japan, President and CEO:
Masami Iijima) and Sumitomo Metal Mining Co., Ltd. (“SMM”) (Head Office:
Tokyo, Japan, President and CEO: Nobumasa Kemori) decided not to undertake
additional investment in the Vale New Caledonia (“VNC”) Nickel Cobalt Project
in New Caledonia (“VNC Project”) at this time to cover repair work outlays
arisen primarily from equipment troubles. The VNC Project is being carried out
jointly by Mitsui, SMM, and a major Canadian nickel producer, Vale Canada
Limited (“Vale Canada”) (Head Office: Toronto, Canada). As a result of this
decision, Mitsui and SMM’s collective ownership interest in Vale
Nouvelle-Calédonie S.A.S. (“VNC S.A.S.”) (Head Office: Paris, France), the VNC
Project operating company, will be diluted from 21% to 14.5%.

The equipment trouble took place during the project’s test operation phase,
and it put the launch of full-scale production at VNC Project behind schedule.
The necessary repair work has now been completed and production is scheduled
to get under way in earnest by year’s end. The repair and improvement costs
stemming from the equipment problems were quite substantial, however, and
Mitsui and SMM had discussion with Vale Canada how to allocate unplanned
repair and improvement costs. Those discussions led to an agreement with Vale
Canada under which Mitsui and SMM will not bear the project costs in excess of
US$4.6 billion. The agreement includes an option to recover Mitsui and SMM’s
collective ownership interest in VNC S.A.S. to 21%, subject to future
condition of operation at VNC Project.

Earlier, Mitsui and SMM jointly set up a company, Sumic Nickel Netherlands
b.v. (Sumic) (Head Office: Amsterdam), to carry out their investments in VNC
Project. As a result of their newly reached agreement with Vale Canada,
Sumic’s ownership interest in VNC S.A.S. will be diluted to 14.5%. At that
level, VNC S.A.S. will no longer qualify as an equity-method affiliated
company of SMM. And Mitsui will reclassify VNC S.A.S., which it consolidates
through Sumic by equity method, from associated company to other investment.

Mitsui and SMM’ s reduced ownership interest will also result in their booking
of profits/losses in or after the third quarter of the current fiscal year
ending March 2012. What impact these profits/losses will have on both
companies’ consolidated earnings is currently under review.

The VNC Project is one of the world’s largest nickel development projects
employing high-pressure acid leaching (HPAL) technology, and the volume of
nickel resources to be developed under the project is also expected to be
among the world’s largest. Notwithstanding the impending reductions in their
ownership interest Mitsui and SMM both intend to continue going forward with
their participation in the project itself.

Profile of Vale Nouvelle-Calédonie S.A.S. (as of September 30, 2012)

1. Country of registration: France (based in Paris)

2. President: Ricardo Carvalho

3. Scope of business: Production of nickel oxides

4. Shareholders: Vale Canada Limited (74%), Sumic Nickel Netherlands b.v.*
(21%), Société de Participation Minière du Sud Calédonien (SPMSC)** (5%)

*Sumic acquired 21% ownership interest of VNC S.A.S. on April 8, 2005

** A venture jointly established by New Caledonia’s South Province (50%),
North Province (25%) and Loyalty Islands Province (25%)

Profile of Sumic Nickel Netherlands b.v. (as of September 30, 2012)

1. Country of registration: The Netherlands (based in Amsterdam)

2. President: Naoyuki Tsuchida

3. Scope of business: Investment into nickel/cobalt development projects and
product sales

4. Shareholders: Sumitomo Metal Mining Co., Ltd. (52.38%), Mitsui & Co., Ltd.
(47.62%)

For diagrams omitted, please see our home page.
(http://www.mitsui.com/jp/en/release/2012/1199223_3607.html)

Address inquiries concerning this Press Release to:

Mitsui & Co., Ltd.
IR Division
TEL: 03-3285-7910
FAX: 03-3285-9821

Noriko Okamoto, Corporate Communications Division
TEL: 03-3285-6645
FAX: 03-3285-9819

Sumitomo Metal Mining Co., Ltd.
Masashi Takahashi, Public Relations & Investor Relations Department
TEL: 03-3436-7705
FAX: 03-3434-2215

Contact:

Mitsui & Co Ltd
 
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