Ravensthorpe nickel mine in WA. [Image: First Quantum Minerals]
CANADIAN mining giant First Quantum Minerals announced plans to suspend operations at its Ravensthorpe nickel mine which struggled to remain profitable during “depressed” nickel market conditions.
From early October the mine will be placed into full care and maintenance, resulting in up to 450 job losses.
WA Mines and Petroleum minister Bill Johnston told The Australian Mining Review the State Government had tried to offer assistance to First Quantum to prevent its decision but unfortunately market conditions for nickel were not favourable enough for it to remain open.
“The State Government reached out to First Quantum and offered assistance to prevent the decision, but we were told there was nothing we could do,” Mr Johnston said.
“The McGowan Government will be putting together a task force to assist displaced workers and the local community through this difficult time.”
Mr Johnston said Ravensthorpe was the highest cost producer of nickel in WA, and he had since spoken to other nickel miners in the State, which remained confident they were able to better weather the current market conditions.
“We will continue to monitor all operations,” he said.
The news of Ravensthorpe’s imminent closure came less than two weeks after First Quantum announced a $US47 million loss for the first half of the year across its operations.
“This decision is disappointing to us, Ravensthorpe is an excellent operation with an outstanding workforce and supportive community but the continuing depressed nickel market conditions, over some years, leaves us no option,” First Quantum chairman and chief executive Philip Pascall said.
“Over the next few weeks we will work closely with our employees and key contractors to mitigate the impact and manage carefully the staged shutdown of operations.
“We will be offering assistance to employees in seeking further employment opportunities.
“We extend our sincere thanks to our entire workforce, local community, all levels of Government and our partners in the mining sector who have assisted Ravensthorpe since its restart.”
The Ravensthorpe mine, previously owned by BHP, was first commissioned in 2008 but forced to close within months of opening as a result of the Global Financial Crisis.
First Quantum purchased the mine in December 2009 for $US340 million, bringing it back to commercial production in December 2011.
First Quantum said the cost to suspend operations and enter care and maintenance was about $10 million, with additional annual maintenance of about $5 million.
Resuming operations would cost a further $10 million.