WHILE thousands of West Australians will be affected by the suspension of operations at BHP’s Nickel West operation, Mines and Petroleum Minister David Michael believes the State’s critical minerals industry will thrive in the longer term.

Minister Michael said WA was able to supply responsibly sourced, quality metal products that are essential to the world’s energy transition.

“Critical minerals are an important part of WA’s economic diversification story and the Government will continue to work towards positioning our State as a major global leader in downstream processing.”

The Minister’s comments come in the face of a chorus of concern from communities that have been reliant on the nickel industry and many experts, some of whom believe the suspension at Nickel West could mark the end of the nickel industry in Australia.

Both BHP and the State Government have announced measures to support affected workers and communities following what Premier Roger Cook described as a “disappointing decision” to suspend operations at Nickel West.

BHP’s announcement of the suspension blamed global oversupply for the decision to temporarily suspend operations.

A report released by the company said it will continue to invest around $450 million a year to enable a re-start if the market outlook improves.

“This will support continued investment in resource exploration and understanding, maintaining the integrity and maintainability of mining operations, smelting and refinery facilities,” the report said.   

BHP has committed $20 million to support the local communities affected by the decision and will honour contracts for supply of reagents in Kalgoorlie from its operation.

BHP has promised to redeploy frontline workers, the State Government will help workers who need support in finding alternative employment, including upskilling or reskilling.

It has also committed to funding for the Government’s proposed Critical Minerals Advanced Processing Facility, building on a $100 million Government investment included in the 2024-25 State Budget.

BHP will go ahead with its Electricity Smelting Furnace in Kwinana working with NeoSmelt partners Rio Tinto and Bluescope to develop the country’s first ironmaking  Electric Smelting Furnace (ESF) pilot plant.

It is working with the WA Government to evaluate land and services for the ESF pilot plant in Kwinana, including a site adjacent to the Nickel West refinery, a project which the Government media release said puts WA at the forefront of the global green steel industry.

BHP’s refinery resources and expertise will be available for critical minerals research, in partnership with Curtin University, to support the Government’s Battery and Critical Minerals Strategy.

It will also provide $5 million to support apprenticeships in the building and construction industry through the Government’s Group Training Organisation wage subsidy program.

BHP has committed to reviewing the suspension by February 2027, but many think it unlikely conditions will change sufficiently for a resumption by then.

Premier Cook said the Government was investing billions of dollars to set up the economy for the long term, and he welcomed BHP’s commitments to support that work, through investing in the Critical Minerals Advanced Processing Facility and kickstarting work on a green steel industry in Kwinana.

“These are important projects that will help to push WA to the forefront of the global green steel and critical minerals processing industries.”