New Caledonian local consortium makes offer for moth-balled Koniambo nickel plant
Koniambo nickel operation. Photo: Image courtesy of Glencore
A local consortium in New Caledonia is reported to have made an eleventh-hour offer to take over and restart activity for the now moth-balled Koniambo (KNS) nickel plant.
The plant's furnaces were placed in "cold" mode at the end of August, six months after major shareholder Anglo-Swiss Glencore announced it wanted to withdraw and sell the 49 percent shares it has in the project.
This caused close to 1200 job losses and another 600 among sub-contractors.
Although KNS claimed at least two foreign investors were still interested at this stage, none of these have so far materialised.
But a "Okelani Group One" (OGO), made up of three local partners, said their offer could revive the project with a different business model.
They have made an offer to KNS's majority shareholder SMSP (Société Minière du Sud Pacifique, New Caledonia's Northern province financial arm).
OGO President Florent Tavernier told public broadcaster NC la 1ère much depended on what Glencore intended to do with a debt of some US$13.7 billion KNS had accumulated over the past ten years.
Another OGO partner, Gilles Hernandez, explained: "We would be targeting a niche market of very high quality nickel used in aeronautics and edge-cutting technologies, especially in Europe, where nickel is now classified as 'strategic metal'."
Although KNS was designed to produce 60,000 tonnes of nickel per year, that target was never reached.
OGO said it would only aim for 15,000 tonnes per year and could only re-employ 400 of the 1,200 laid-off staff.
Takeover in sight for Southern New Caledonia plant
In the south of New Caledonia, another mining plant, Prony Resources, is also in dire straits and stopped operations a few months ago.
It has been trying to find a possible company to take over the shares held by Swiss trader Trafigura (19 percent).
But Southern Province President Sonia Backès told NC la 1ère last week that one "seriously interested" buyer had now been found.
"They have successfully passed the several stages of the takeover process and we really hope they can complete it," she said, without indicating where the potential buyer was from.
If the deal eventuated, the new entity would take over the shares held by Swiss trader Trafigura (19 percent) and another block of shares held by the Southern Province, with a total of 74 percent participation.
Prony Resources intends to remain open to new offers until February 2025, which leaves only five months to complete any takeover and transfer of shares process.
Prony Resources, in full operation mode, employs some 1,300 staff. Another 1,700 are also employed indirectly through sub-contractors.
It has paused its production only to retain up to 300 staff, in safety and maintenance mode, partly due to New Caledonia's current unrest and insurrectional situation.
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