First Quantum to close Ravensthorpe nickel mine

Canadian mining company First Quantum Minerals has chosen to cease operations at its Ravensthorpe nickel mine in Western Australia.

In January, First Quantum suspended production at the mine, indicating it would remain inactive for a minimum of two years. During this period, the company planned to process existing stockpiles until at least 2025 before contemplating a potential restart of mining operations.

Challenges in establishing a sustainable financial model for Ravensthorpe, coupled with increased operational costs and a downward projection in nickel prices over the coming years, have compelled First Quantum to take more decisive action.

"Despite our concerted efforts to sustain operations through a shift in our operating strategy, which involved halting mining activities, processing existing stockpiles, and adjusting our production approach, the site continues to incur substantial current and anticipated losses," stated First Quantum.

The company emphasized that the decision to close the mine, with the process commencing on May 1, was deemed the most strategic move, as it preserves the orebody for potential future value.

The company anticipates that approximately 330 positions will be affected when the mine ceases all operations this week. Key suppliers to the operation have been notified to allow for adequate preparation for the cessation of activities at the site, the company noted.

The nickel operation serves as the primary employer in Ravensthorpe and nearby Hopetoun.

The mine has consistently been considered a relatively high-cost operation and has faced suspensions in both 2009 and 2017. The closure in 2009 resulted in 1,800 job losses, while the shutdown in 2017 led to the loss of 450 jobs.

Last year, the mine produced approximately 30,000 tonnes of nickel in mixed hydroxide precipitate and nearly 1,000 tonnes of cobalt.

Nickel prices, traditionally utilized in steelmaking and increasingly in battery manufacturing, have remained near three-year lows, closing at $8.7 per pound on Monday.

The metal was the poorest performer among the base metal complex on both the London exchange and the Shanghai Futures Exchange in 2023, experiencing a decline of over 40% in value on both markets.