Nickel royalty relief talks continue

Premier Roger Cook will continue talks with federal government around nickel royalty relief today, after the revelation that BHP was considering placing its Nickel West assets on care and maintenance.

News this morning that BHP was writing-down the value of its Nickel West and West Musgrave assets by $5.4 billion cast a further cloud over the future of the state’s nickel industry.

A spate of project closures, suspensions and curtailments struck the nickel sector in January after the price of the metal halved in 12 months as a result of a flood of Indonesian supply.

Any move to place Nickel West on care and maintenance, as was mooted by BHP in announcing the impairment, would have a huge impact on the 3,300 people employed there.

Resources Minister Madeleine King held crisis talks with nickel producers late last month and has continued to speak regularly with her state counterparts around potential relief for the sector.

That includes the potential for royalty relief: a move that would bring down the cost to mine nickel in the state.

Mr Cook said the conversation continued with industry groups and federal counterparts, calling on all levels of government to assist in the nickel saga.

“We need to make sure any assistance we provide is about supporting an industry, rather than just a price cycle,” he said.

“But we understand that the industry is being disrupted by the significant increase in nickel supplies on the global market.

“If there’s market distortions which we need to respond to, to protect our industries, we’ll obviously be on hand to see what we can do.”

Mr Cook said his government would continue to work with Indonesia around its impact on the Indonesian nickel market, but conceded he hadn’t spoken directly with his Indonesian counterparts on the matter.

An alarming report commissioned and released by the Chamber of Minerals and Energy of Western Australia last week found that up to 10,000 jobs and $2 billion worth of economic activity were at risk if the nickel industry failed.

“As we outlined at the industry roundtables, temporary and targeted royalty relief is an immediate action the WA government should be considering," CME WA chief executive Rebecca Tomkinson said on the report’s release.

“Industry is shouting out the solutions, but we need governments to action them.”

Mr Cook said he had also spoken with the CME this morning.