Chinese group JinPei has signed a pact with a firm in nickel-rich New Caledonia to mine and process the ore after the world's top producer Indonesia imposed a ban on exports of the metal.

The agreement with Mai Kouaoua Mines (MKM) was signed in September and aims to produce 10,000 tonnes of nickel annually from 2018 and 30,000 tonnes every year in a later phase.

JinPei is investing one billion euros ($1.25 billion) in the project and will take a 49-percent stake in MKM, which owns several mines in the South Pacific French territory.

They then plan to ship it to Vanuatu, a tax haven nearby, for smelting. MKM will have 51 percent equity in the Vanuatu plant and the rest will be held by the Chinese.

New Caledonia, off northeastern Australia, has a quarter of the world's deposits of nickel, a key ingredient for manufacturing stainless steel.

"China has become the biggest producer and consumer of nickel," said MKM boss Didier Grosgurin. "New Caledonia has to open up."

New Caledonia currently exports around 4.5 million tonnes of nickel, mainly to Japan, South Korea and Australia.

The Indonesian ban removed a third of global nickel mine supply, driving nickel prices this year.

South Pacific countries are vying to play a bigger role in supplying nickel, which is required to make stainless steel.