Forum Topics GNG GNG BHP -shuttering Nickel West

Pinned straw:

Added 6 months ago

The weekend Aussie pretty well laid out BHP’s intentions - Anglo American off & Nickel west likely shuttered until prices improve and the lower quality Indonesian nickel flooding the market is ‘right sided’.

I'm yet to fully understand the West Musgrave situation, but given its material size to GNG going forward, the position requires clarification. It’s reasonable value atm, but I wonder whether this issue is hanging heavy on SP.

Bear77
Added 6 months ago

Because West Musgrave is both nickel and copper and the build is due to continue until around this time next year, followed by the commissioning and ramp up, I think BHP will honour their contracts and continue with the build, particularly as copper is rising again. I did have concerns about West Musgrave being deferred or paused or whatever, but the time for that appears to have passed now, and there hasn't been any changes at West Musgrave that I know of, so I now think that work will continue. The Nickel West nickel production however was losing money at the lower nickel prices we have seen of late so it makes sense to pause production on uneconomic production. I have heard however that some maintenance work that was due next year is now being brought forward or they are considering bringing it forward to get it done while the plant is idle, in readiness for a rapid start-up when nickel prices rise again.

I agree that the market may be getting jittery about West Musgrave in terms of it being such a large percentage of GNG's current order book, and that seems entirely reasonable to me, however my gut feel is that the work will continue and GNG will get paid.

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