Battery minerals specialist IGO will close its Cosmos nickel mine in Western Australia’s Goldfields region at the cost of about 400 jobs as cheap production from Indonesia wreaks havoc with Australian producers. IGO chief executive Ivan Vella said the ability of Indonesian nickel miners to cost-effectively build new mines and processing plants and bring them to full capacity had caught the market by surprise.
Vella, presenting his first results since joining IGO from Rio Tinto in December, said the recent nickel price plunge meant it would not be prudent to bring the new mine into full production.
A recent review of Cosmos determined the mine life would be less than planned while expected operating and capital costs had increased. IGO’s Nova and Forrestania nickel mines will stay open. “It’s a very difficult situation where we’ve invested so much money into the asset,” Vella said on Wednesday.
IGO obtained the Cosmos project when it took over ASX-listed Western Areas for $1.3 billion in 2022. The market was kind to the enlarged firm for a while, but since mid-2023 its share price has more than halved. Vella said IGO would publish an independent review into the acquisition in February.