The nickel industry in New Caledonia is facing a dire situation as weeks of unrest have brought mining and processing operations to a standstill, pushing the sector closer to catastrophe. The French Pacific territory is a major player in the global nickel market, ranking third in production behind Indonesia and the Philippines.
The disruption in the industry comes at a critical time, as nickel is a key component in electric vehicle batteries and essential for the transition towards cleaner energy. The unrest, sparked by a constitutional reform project, has led to riots, deaths, and injuries, causing significant damage to mining sites and affecting fuel supplies.
Major players in the industry, such as Societe Le Nickel (SLN) and Prony Resources, have been forced to halt operations, with reserves dwindling and financial struggles mounting. The Koniambo Nickel (KNS) site has been idle since February, and Glencore is looking to sell its stake in the operation. With New Caledonia holding a significant portion of the world’s nickel reserves, the impact of the industry’s crisis extends beyond financial losses.
Industry representatives warn of catastrophic consequences for the mining sector and the territory as a whole if the situation does not improve soon. Talks to stabilize the industry with government assistance have stalled, raising concerns about a widening competitive gap with other nickel-producing countries like Indonesia and the Philippines.
As the nickel industry in New Caledonia teeters on the brink of collapse, the future remains uncertain, with the potential for further economic turmoil and job losses in an already fragile market.
