The Western Australian Government is allocating $15 million for interest-free loans to help the state’s nickel miners in operation, as well as support the potential restart of idled mines and ramp up of new projects.
The initiative aims to provide further confidence for the nickel industry as sentiment and prices for the steel-making commodity and battery metal improve.
Loans will be repayment free until either 1 July 2028 or until nickel prices exceed US$22,000 ($31,635) per tonne for two consecutive quarters. Interest-free repayments will be in quarterly installments over a two-year period.
At the time of writing, nickel futures traded at US$17,200 a tonne, falling from March highs near US$17,770.
Trading Economics reports that the battery metal’s price reflects ongoing structural tightness in the market and cautious investor sentiment. Supply remains constrained as Indonesia advances its proposed export tax on nickel, while disruptions to shipping through the Straits of Hormuz add logistical pressure on key raw materials.
The Western Australian Government says the state’s nickel industry has experienced challenging global market conditions in the past few years, which has prompted mine and processing plant suspension and significantly impacted jobs.
Western Mines Group (ASX:WMG) recently entered into memorandum of understanding (MoU) with Magnium Australia for collaboration on the potential supply of magnesite from the Mulga Tank Project in Western Australia.
Both parties will work together to define and delineate the magnesite resources, alongside other magnesium oxide feedstocks, from the Mulga Tank Project.
Managing Director Caedmon Marriott says Magnium has some “very exciting technology” that is focused on being commercialised for magnesium metal production.
“A key input into their process is magnesite and other high magnesium oxide feedstocks… At Mulga Tank we have ‘high magnesium oxide’ in abundance,” Marriott says.
the Mulga Tank Project, covering 425km2, has an initial 5.3-million-tonne contained nickel resource. The project contains the entire Mulga Tank Ultramafic Complex, which is a major ultramafic dunite intrusion analogous to complexes hosting the Mt Keith and Perseverance nickel deposits.
Mines and Petroleum David Michael says besides the jobs and export sales it provides, Western Australia’s nickel industry is an essential component of the state’s vision of becoming a global hub for the downstream processing of battery metals.
“Our nickel miners are competing internationally with mining jurisdictions that have significantly lower environment, social and governance standards,” Michael says.
“The no-interest loan initiative represents sensible, responsible and targeted support to help Western Australia’s nickel industry get back on its feet.”
According to Geoscience Australia, Western Australia has the largest nickel resource in the nation, accounting for 96% of its total resources, contained within nickel sulphide and lateritic nickel deposits.
Queensland is the second largest with 4.5%, followed by Tasmania with 0.2%.
Write to Aaliyah Rogan at Mining.com.au
Images: Unsplash
