The French government has agreed to dig in its coffers and throw more lifebuoys at New Caledonia’s beleaguered nickel industry. But the aid is tied to a stringent reform “pact”.
The latest financial assistance came early this week with an agreement between France and mining giant Eramet, whereby a sum of €320 million (which is the amount of previous loans granted by the French government) will be converted to “neutralise” an existing debt in Eramet’s New Caledonia subsidiary Société Le Nickel (SLN) so as the huge figure can be transferred from the liabilities section to “quasi-equities”.
The main objective was to off-load SLN’s consolidated accounts and make it easier for Eramet’s SLN to appear more attractive to potential future companies willing to takeover. Eramet stressed in a release this week that it would not grant any more financing to SLN “in order to preserve the group’s balance sheet”.
SLN has accumulated a debt of €493m at the end of 2023. The French State holds 27.13 percent in Eramet’s stock. The France-Eramet agreement is also part of a more general approach from Paris to try and save New Caledonia’s nickel industry’s major players: SLN, as well as two other nickel mining plants (Koniambo -KNS-, North of New Caledonia’s main island and Prony Resources, South).
For the rest of this article: https://www.rnz.co.nz/international/pacific-news/511111/french-government-throws-more-lifebuoys-at-new-caledonia-s-beleaguered-nickel-industry