The owner of the Ravensthorpe nickel operation on Western Australia's south coast says it will suspend mining and cut 30 per cent of its 420-strong workforce.
Key points:
- The Ravensthorpe nickel mine, 150km west of Esperance, is cutting jobs and suspending mining due to weaker metal prices
- The mine owner, Canada's First Quantum Minerals, expects to restart mining when prices recover
- Ravensthorpe has a chequered past and was closed in 2009 and 2017 but restarted operations in 2020
Canada's First Quantum Minerals has today announced the changes in response to weaker metal prices — the second casualty in as many weeks for WA's once-booming nickel industry.
Nickel is a key ingredient in stainless steel and lithium-ion batteries, but prices have fallen more than 40 per cent in the past year.
In a statement, First Quantum Minerals said it will continue to produce nickel from ore stockpiles, and the suspension of mining will ensure Ravensthorpe remains viable in the long-term.
The stockpiles are anticipated to take the next 18 months to two years to process before mining resumes at the Hale Bopp and Halleys ore bodies at Ravensthorpe.
It is expected that 125 workers will lose their jobs.
Ravensthorpe was last placed on care and maintenance in 2017, but restarted mining again in 2020.
Today's announcement follows the closure of the Savannah nickel mine in the Kimberley, which was announced last week and saw its 140-strong workforce made redundant.
Ravensthorpe nickel operation general manager Scott Whitehead said reducing the mine's operating activities for a sustained period was the "best decision for the company, workforce and local region".
"Transitioning to a new operating model will allow us to continue to produce and export our nickel product, which is a critical mineral and has a lower carbon footprint than other suppliers," Mr Whitehead said in a statement.
"The operational changes will ensure Ravensthorpe remains viable longer term and we will retain most of our residential and FIFO workforce, thereby supporting the communities of Hopetoun and Ravensthorpe and providing income for the region and Western Australia.
"It's important we position ourselves to respond in a timely manner to future improvements in the nickel price by being able to reactivate our mining activities at the preferred time."
Bought for $US340m
In 2021, First Quantum sold a 30 per cent interest in the Ravensthorpe mine for US$240 million to South Korea's POSCO, one of the world's largest steel producers.
Toronto-based First Quantum retained a 70 per cent stake in Ravensthorpe and continued to be the operator.
The Canadian company had bought the asset off BHP in 2010 for $US340 million, a fraction of the $US3 billion it cost to build and commission the facility.
About 450 employees and contractors lost their jobs when it was closed for a second time in 2017 amid a global downturn for the commodity.
Years before, 1,800 people lost their jobs when BHP closed the mine in 2009.