BHP to Temporarily Halt Operations at WA Nickel Processing Plant

BHP to Temporarily Halt Operations at WA Nickel Processing Plant

In response to Wyloo’s decision to place the Cassini, Long, and Durkin nickel mines under care and maintenance, BHP has announced a temporary pause in its Kambalda processing operations in Western Australia. Wyloo, a significant supplier to BHP’s nickel concentrator in Kambalda after acquiring Mincor Resources for $760 million last year, has ceased mining in Kambalda.

As a result, BHP can no longer sustain parts of its Kambalda concentrator.

“The suspension of Wyloo’s operations makes it unviable to continue operating certain sections of the Kambalda concentrator from mid-year,” explained Jessica Farrell, BHP Nickel West asset president.

BHP plans to transition the Kambalda concentrator’s crushing, milling, and flotation circuits into care and maintenance starting in June 2024. Unfortunately, this decision is expected to lead to approximately half of the concentrator’s workforce losing their jobs by mid-2024.

The Sydney Morning Herald reported that the processing plant will continue to dry concentrate from other miners, maintaining some level of operations. Describing Nickel West as a “complex business” with underground mining, third-party supply, on-site smelting, downstream refining, and a multi-stage supply, Farrell acknowledged the challenges faced by the industry.

“We are exploring various options to remain globally competitive in a challenging operating environment,” she said.

BHP is actively assessing options to mitigate the impacts of the sharp decline in nickel prices. The company’s latest operational review highlighted ongoing evaluations and a carrying value assessment of its nickel assets in response to the evolving market conditions.

In the face of recent nickel price slumps, other Latest Mining News companies are also making significant adjustments. Chalice Mining has announced a 40% reduction in expenditure to navigate current market conditions, while First Quantum Minerals scaled back operations at its Ravensthorpe nickel mine in WA.

Despite these challenges, there is a glimmer of hope for the Australian nickel industry. Nickel has been included in Australia’s new strategic materials list, recognising its essential role in the energy transition.

Federal Resources Minister Madeleine King has expressed support for a ‘green nickel price premium,’ differentiating environmentally responsible Australian-produced nickel from less sustainable sources. This pricing structure, endorsed by industry figures like Andrew Forrest and Wyloo CEO Luca Giacovazzi, aims to distinguish between nickel produced under strong environmental, social, and governance (ESG) standards and nickel from countries with less stringent regulations, such as Indonesia.

While the nickel industry in Australia undergoes significant changes, the inclusion of nickel on the strategic materials list and support for environmentally conscious practices may contribute to a more positive future for the sector. Stay informed with the latest updates on Latest Mining News for news on product announcements, industry developments, commodities, and more.

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