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Glencore sells Australian nickel mine to Western Areas
[LONDON] Global mining and commodity trader Glencore sold a nickel mine inherited through its Xstrata takeover to Australian nickel producer Western Areas , the nickel miner said on Friday.
The Cosmos nickel mine in Western Australia was sold for A$24.5 million, a fraction of the A$3.1 billion Xstrata spent in 2008 to acquire the Cosmos and Sinclair mines as part of its takeover of Jubilee Mines.
Xstrata suspended operations at Cosmos at the end of 2012 and Sinclair in 2013 due to prolonged weak nickel prices.
An industry source said Cosmos is expensive to mine and its economic reserves are largely exhausted given the weaker nickel price, down about 60 percent from its 2008 peak.
Earlier this month Glencore also disposed of its 23.9 per cent stake in platinum producer Lonmin, another unwanted investment inherited from Xstrata.
The Swiss-based company said on Dec 10 that it was looking to sell some assets including Cosmos.
Historical production from Cosmos is around 127,000 tonnes of nickel at an average grade of 5 per cent, Western Areas said.