December 17, 2010 / 2:29 PM / in 7 years

UPDATE 1-Sherritt ups Ambatovy project capex to $4.8 bln

* Says plant to produce metal by summer of 2011

* Says will fund its share of capex directly

Dec 17 (Reuters) - Diversified miner Sherritt International Corp S.TO said it raised the capital costs budget for its Ambatovy Project by 5 percent to $4.76 billion to step up production. The company’s 40 percent-owned Ambatovy nickel mine project in Madagascar is a joint venture with Japan’s Sumitomo Corp 8053.T, Korea Resources[KOREC.UL] and SNC-Lavalin Group Inc SNC.TO.

Toronto-based Sherritt said the budget includes a contingency of $50 million and it intends to fund its 40 percent share of the capital cost increase directly.

The company, which primarily owns assets in Cuba and Madagascar, said it expects the plant to produce metal by the summer of 2011.

Sherritt shares closed at C$8.30 on Thursday on the Toronto Stock Exchange. (Reporting by Arnika Thakur in Bangalore; Editing by S. John Tilak)

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