Avebury mine to close
Less than two years after recommencing operations, the Avebury nickel mine is being transitioned back into care and maintenance.
Avebury, wholly owned by Mallee Resources, is located approximately 8km west of the town of Zeehan, within a known mining district on Tasmania’s west coast.
Mallee’s receivers and managers were appointed in September 2023 and have been operating Avebury while searching for a long-term buyer.
KordaMentha Restructing, an advisory and investment firm, cited the weakening nickel price and the increase in Indonesian nickel supply as the reason behind the mine’s closure.
Avebury mine receiver Scott Langdon said the oversupply of low-quality Indonesian nickel made the higher priced, good quality Australian nickel uncompetitive.
“As a number of Australian miners have recently experienced, without a structural change in the market to properly value low-carbon, battery-grade nickel, local mine operations will continue to be disadvantaged compared to their competitors,” he said.
“It is disappointing that despite interest from global participants, current market conditions have presented challenges to finding the right path for a sale at this point in time. These external factors left us with no other choice than transitioning to a care and maintenance program for Avebury.
“We thank the Avebury workforce for their hard work and support throughout the receivership.”
The care and maintenance plan will be communicated to Avebury employees and stakeholders over the next few days.
Avebury’s closure is just the latest nickel mine to close in Australia.
IGO is currently transitioning its Cosmos nickel project into care and maintenance, while Wyloo is doing the same with its Cassini, Long and Durkin mines, which led to BHP pausing part of its Kambalda processing operations in Western Australia.
The nickel downturn has also had an effect on other nickel miners and exploration companies operating in Australia, notably Chalice Mining, First Quantum Minerals and Panoramic Resources.
Federal Resources Minister Madeleine King and WA Mines Minister David Michael met with nickel and lithium producers in late January to discuss challenges facing the industry.
Following the discussions, King, Michael and the WA Government will accelerate discussions within Government on incentivising investment through the taxation system. Discussions will also be progressed with State and Territory Governments on common user infrastructure to include strategic materials like nickel in the Strategic Infrastructure Hubs Scoping Study.
King has also repeatedly recommended a ‘green price premium’, which would differentiate between the Australian-produced nickel that follows strong environmental, social and governance (ESG) standards and the low-quality nickel produced in Indonesia at an increasing rate.
She has called for tax incentives and the removal of downstream barriers to shore up foreign interest in home-grown commodities.
Source: https://www.australianmining.com.au/avebury-mine-to-close/
