Closure of WA Nickel Mine
Panoramic Resources has announced the suspension of operations at its Savannah nickel project in Western Australia. The decision, made by administrators from FTI Consulting, comes in the wake of a decline in nickel prices. This closure will result in the loss of approximately 140 jobs at the mine.
Most of the Panoramic staff, numbering around 140, stationed at the Savannah project will face immediate redundancy. Perenti, a mining services company, also has 160 employees on site, with possibilities of redeployment being explored.
FTI Consulting’s senior managing partner, Daniel Woodhouse, expressed that maintaining operations at the Savannah nickel project was initially intended. However, financial and operational difficulties, exacerbated by falling nickel prices, have led to the decision to suspend operations. The administrators will continue to explore options for selling or recapitalizing Panoramic’s business.
Background of Panoramic’s Voluntary Administration
Panoramic entered voluntary administration on December 14 following a strategic review triggered by the fall in nickel prices. Unfortunately, this review failed to secure a sale or recapitalization that offered financial certainty.
The downturn in nickel prices, which saw a significant 45% plunge on the London Metal Exchange in 2023, was the largest decline since 2008. The drop in prices is attributed to increased production in Indonesia and projections of global nickel production surpassing demand in 2024.
Despite the suspension of the Savannah project, efforts to sell or recapitalize the Panoramic business will persist. The administrators, along with Treadstone Resource Partners, aim to realize the full value of the mine’s resources and potential.
The fall in nickel prices has also affected other nickel producers, including IGO, which anticipates further impairment against its Cosmos project in Western Australia.