First Quantum Minerals have blamed low nickel prices for its controversial decision to place the Ravensthorpe Nickel Operation on care and maintenance, leaving around 450 employees working on site in limbo.
The mine is located within the Shire of Ravensthorpe and exports its product through Southern Ports – Esperance as well as using Southern Ports stevedoring services.
The decision will hit the community hard, however the Canadian mining giant committed to mitigating the impact.
Chief executive officer Philip Pascall labelled the decision as “disappointing”.
“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,” Mr 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 in 2011."
In a statement released on Wednesday evening the miner said it would cost about $10 million to enter care and maintenance, which should be in effect by October.
The miner also admitted the annual maintenance bill would be about $5 million.
The permitting process for the Shoemaker Levy orebody is planned to continue along with regular review of the market conditions for potential restart of operations.
If favourable conditions prevail the miner tipped the restart bill to cost about $10 million.
A spokesman for the company said there were about 450 people working on the site.
“Roughly half of these are contractors and not direct employees of FQM. The contractors may well redeploy their employees to other projects,” he said.
The news to suspend operations comes as a blow of the small communities of Ravensthorpe and Hopetoun, particularly after the devastating February floods that tore through the region.
The mine was launched by BHP Billion in 2008, before closing shortly afterwards due to the global finical crisis. First Quantum acquired the mine as a decommissioned nickel operation in February 2010 for $376 million.
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