Nickel mining in Western Australia

Nickel mining in Western Australia has been an industry that has had many fluctuations of fortune in its history. Large fluctuations in the world nickel price[1] have seen mines close and reopen on several occasions.

In 2004/05, the value of nickel production ($2.3 billion) exceeded that of gold ($2.2 billion).[2]

In the 2011 calendar year, nickel contributed $3.9 billion or four per cent to the value of the State's resources.[3] Nickel production in the same year was 188,000 tonnes.

Australia (predominantly Western Australia) holds one-third of the world's known reserves of nickel-producing laterites and sulfide deposits.[4] As of 2011, Australia was the world's fifth largest nickel producer. The only other significant Australian nickel production outside Western Australia is a refinery at Yabulu, Queensland which processes ore from New Caledonia, Indonesia, and the Philippines.

Early mines

Nickel mines were developed in the late 1960s in Kambalda,[5] Laverton and the Kimberley region of Western Australia.

The price of nickel peaked at about £7,000 per pound in late 1969, driven by demand from the Vietnam War and the major Canadian producer, Inco (now Vale Limited), being embroiled in industrial action, creating a supply shortage. In November 1969, a prospector working for Poseidon NL made a promising nickel discovery at Mount Windara near Laverton. The discovery created a spectacular investment bubble when its shares moved from $0.50 to $280 in February 1970.[6]

During the early 1970s, an exploration boom fueled by speculators followed, with new companies searching for new deposits. Western Mining Corporation (WMC) purchased Poseidon and developed the find into a major mining and processing operation which continued until 1989.[7] WMC had initially identified a total resource of 8.5 million tonnes of ore @ 2.02% Ni for 172,000 tonnes of nickel metal.[8] The first shipment of nickel concentrate was made in 1974, but by this time the nickel price had fallen significantly. By 1990 the company had mined 5 million tonnes of ore at an average grade of 1.59% Ni and had produced 80,000 tonnes of the metal. Operations at Windara re-commenced several times during the 1990s. Several of the Kambalda mines have since been sold and the remainder are known the Windarra Nickel Project which, as of 2012 is under care and maintenance.

WMC was taken over by BHP Billiton and the company was delisted in 2005.

In 1971 the movie Nickel Queen was able to reflect upon the Poseidon bubble.[9]

Nickel West

Nickel West is a division of BHP Billiton. In Western Australia, BHP Billiton's nickel operations are combined under the Nickel West Operation[10] which includes Mount Keith Nickel Mine, Leinster Nickel Mine, Kambalda Nickel Concentrator, Kalgoorlie Nickel Smelter and Kwinana Nickel Refinery.

Production figures published by the company at the end of 2008 are for the whole Nickel West Operations and not broken down to individual mines. In the calendar year 2008 Nickel West produced 85,800 tonnes of nickel. At the time, Nickel West also included the Ravensthorpe Nickel Mine.[11]

In 2012 there were press reports suggesting the operations may be divested.[12][13]

Current mining operations
Quarterly expenditure ($millions) on exploration for nickel and cobalt in Western Australia since 1988

As of 2012, nickel prices had moved to as low as $7.30 per pound.[12]

Nickel is not strip mined

Several of the state's nickel mines are operated by junior producers:[14]

  • Mincor — several ex-WMC mines all near Kambalda[15]
  • Western Areas NL — two of the highest grade underground nickel mines in the world, Flying Fox and Spotted Quoll mines, near Forrestania[16]
  • Panoramic Resources — Savannah (East Kimberley),[17] Lanfranchi,[18] Gidgee and Copernicus mines
  • Independence Group — Long Nickel mine (ex-WMC) near Kambalda

Other operations include:

Notes
  1. "Nickel Monthly Price - US Dollars per Metric Ton". Index Mundi. Retrieved 31 October 2012.
  2. "An update on the economy of Western Australia's Goldfields-Esperance Region" (PDF). Department of Local Government and Regional Development and the Goldfields-Esperance Development Commission. July 2006.
  3. "Western Australian resources industry delivers a record $107 billion in sales in 2011". Department of Mines and Petroleum. Retrieved 26 October 2012.
  4. "Nickel" (PDF). U.S. Geological Survey, Mineral Commodity Summaries. January 2012.
  5. Western Mining Corporation (1967), Kambalda nickel project : opening ceremony by the Honourable David Brand, M.L.A., Premier of Western Australia, Friday 15th September 1967, The Corporation, retrieved 26 October 2012
  6. "The 10 Most Ridiculous Price Bubbles In History". Business Insider. 11 October 2010.
  7. "Windarra Nickel Project" (PDF). Poseidon Nickel. June 2011. Archived from the original (PDF) on 9 April 2013.
  8. "Mount Windara". Poseidon Nickel. Retrieved 26 October 2012.
  9. Verevis, Constantine (2001), After the nickel boom, British Australian Studies Association, retrieved 26 October 2012
  10. "Nickel West Media Tour". BHP Billiton. 19 September 2007.
  11. "BHP Billiton Quarterly Production Report – December 2008" (PDF). 21 January 2009. p. 11. Retrieved 11 December 2009.
  12. "BHP may offload Nickel West: analyst". ABC News. 26 October 2012.
  13. Nick Evans (28 August 2012). "BHP takes razor to WA nickel". The West Australian.
  14. Paul Garvey (20 October 2011). "Nickel's Wild Ride Leaves Investors Reeling" (PDF). Business News.
  15. "Kambalda Nickel Operations / Current Mining Operations & Nickel Projects". Mincor. Retrieved 26 October 2012.
  16. Western Areas NL Australian Shares. Retrieved on 2014-10-08.
  17. "Panoramic Resources". Archived from the original on 8 July 2012. Retrieved 26 October 2012.
  18. "Lanfranchi". Archived from the original on 19 June 2012. Retrieved 26 October 2012.
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