First Quantum Minerals has announced the closure of its Ravensthorpe nickel operation in Western Australia, with the shutdown process commencing on 1 May.

This decision comes after production at the mine was halted in January, with initial plans to idle the mine for at least two years and process existing stockpiles into 2025, and then later consider resuming mining.

The company cited difficulties in establishing a sustainable financial model, increased operational costs and a lower nickel price forecast as reasons for the closure.

In a statement, the company said: “Despite our best efforts to maintain operations by transitioning to a new operating strategy that involved ceasing mining activities, processing stockpiles and altering its approach to production, the site is incurring significant current and projected losses.”

First Quantum further added: “It is strategically more important to leave the Shoemaker-Levy orebody in-situ and preserve its future value for the company, the region and Australia, rather than process and sell nickel product at a loss.”

Approximately 330 positions will be affected by the mine’s closure.

First Quantum has informed major suppliers to facilitate their preparation for the cessation of activities at the site.

The Ravensthorpe nickel operation has been a significant employer in the region across the local communities of Ravensthorpe and Hopetoun.

Historically, the mine has faced challenges, with previous suspensions in 2009 and 2017 that led to significant job losses.

Last year, Ravensthorpe produced roughly 30,000 tonnes (t) of nickel in mixed hydroxide precipitate and nearly 1,000t of cobalt.  However, nickel’s performance has been disappointing on major exchanges, with a decline of more than 40% in value in 2023.