The future of nickel factory in French Island territory, New Caledonia, looks bleak after mining giant, Vale failed to strike a deal with New Century Resources. Vale has warned of shutting the site by the end of October unless a credible buyer emerges.

 

Vale said it could no longer afford to invest in a loss-making factory. Last week, Vale announced that the Goro nickel and cobalt mine in New Caledonia would be placed under care and maintenance mode as New Century declined to sign an acquisition deal. New Century believes Goro nickel mine has strong potential, but it has never reached its full annual capacity of 57,000mt of nickel a year. In 2019, it produced 23,000mt.

 

New Caledonia hosts a quarter of the world’s known nickel supply. If the factory shuts, 1,300 employees could lose their jobs and over 100 subcontractors will also be out of work and the archipelago economy would be in trouble depriving local authorities of millions of euros as tax revenue. On the other hand, China is looking to bolster its influence in New Caledonia, which can be a worrisome development for Australia and New Zealand and the other Asia Pacific nations. 

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