Xstrata idles Australia nickel mine as reserves dry up, prices weaken
SYDNEY May 3 (Reuters) - Xstrata will close down its Sinclair nickel mine in Western Australia this month due to dwindling reserves and weak global prices for the metal used to make stainless steel.
Xstrata -- recently acquired by trading group Glencore -- had closed down its Cosmos nickel mine in September, citing persistent weakness in metal prices that have plunged about 50 percent from its 2011 peak above $29,000 per tonne.
Operations at the Sinclair mine, acquired as part of Xstrata's $3.1 billion takeover of Jubilee Mines five years ago, will cease on May 15, an Xstrata spokesman said on Friday.
The ores stockpiled at the mine will continue to be processed into the third quarter of 2013, he added. The mine produced 7,472 tonnes of nickel in concentrate in 2012.
The Sinclair mine is nearing the end of its forecast operating life at a time of weak nickel prices, the spokesman said. "The two coincided more than anything."
Since the shutdown of the Cosmos mine, also part of the Jubilee acquisition, nickel prices have dropped a further 18 percent.
Xstrata this week was acquired by Glencore International , which owns the Murrin Murrin nickel mine and processing plant, also in Western Australia.