‘Short, smart’ support for ailing nickel industry

Any assistance to Australia’s ­embattled nickel mining industry will only be short-term, Anthony Albanese has promised, as the government continues to weigh up ways to rescue the sector.

Anthony Albanese visits BHP’s Nickel West Kwinana Nickel Refinery in October 2022. Picture: AFP

Any assistance to Australia’s ­embattled nickel mining industry will only be short-term, Anthony Albanese has promised, as the government continues to weigh up ways to rescue the sector.

The fate of WA’s remaining nickel mines is front and centre during the Prime Minister’s visit to Perth this week, following revelations that mining giant BHP is considering closing its Nickel West business due to low prices and rising costs. Nickel West ­employs more than 3000 people and processes nickel material from smaller miners, who will have few viable alternatives if the BHP business goes.

Mr Albanese said his government was working through the details of an assistance package.

“I won’t comment on the specifics because they’ll be part of discussions, but what we’re looking for is a smart, targeted and time-limited support for the nickel ­industry,” he said.

“We know this is a short-term issue that’s arisen because Indonesia has gone and increased its share of the global nickel market by more than 10 times and that’s had an impact on the market, which the government and industry needs to respond to.”

The WA government on the weekend announced that it would provide a 50 per cent ­royalty rebate to the state’s nickel miners over the next 18 months. The rebate will apply only while nickel prices are below $US20,000 a tonne, and will be repayable over 24 months.

The potential closure of ­Nickel West has put Australia’s broader battery manufacturing strategy in doubt. Nickel is one of the key ingredients in batteries used in electric vehicles and large-scale power storage systems. The effective end of Australia’s nickel industry would severely dent hopes of growing a domestic battery industry.

While Mr Albanese would not be drawn on the specifics under consideration, reports have suggested the government may be looking at production tax credits.

Federal Resources Minister Madeleine King has already added nickel to the commonwealth’s critical minerals list, opening up the sector to potential financial support.

The Prime Minister said nickel was a resource that would be so important in the 21st century. “What we don’t need is a response that lasts a day or two. We do need a response though that gets through these issues,” he said.

WA Premier Roger Cook said taxpayers in the state would ­expect the government to try to protect jobs. “We need to look at all opportunities that we can to make sure that we continue to grow that industry,” he said.