Around 160 employees at Xstrata's Sinclair nickel operation in Western Australia are facing an uncertain future as the miner defers underground development due to current market conditions.
Development of the underground mine was due to start this month in preparation for the end of mining activities in the open pit section, which is still slated for August this year.
"Development of the underground operation will be deferred pending an improvement in market conditions and we expect to put the Sinclair operation onto a care and maintenance schedule from August," Xstrata said in a statement.
Xstrata acquired Sinclair and the larger Cosmos mine following its $3.1 billion takeover of Jubilee Mines in late 2007.
Xstrata said there will be no immediate redundancies for the 160 workers at Sinclair, however "positions will be made redundant between now and the conclusion of the open pit" operations.
The miner said affected workers will be offered positions within Xstrata Nickel Australasia and other operations.
Production from Cosmos will continue as planned with nickel in concentrate output expected at 13,000 tonnes this calendar year.
Xstrata is the latest nickel ompany to halt part of its nickel operations on the back of a sharply lower nickel price, which has fallen from around $US28,000 per tonne in March last year to around $US10,000/t.
