IGO flags write-downs after shuttering nickel project
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The news: Lithium and nickel miner IGO has placed its Cosmos nickel project on care and maintenance, and posted a slide in December quarter earnings amid lower prices.
The numbers: The miner flagged impairments in the range of $160 million to $190 million against its nickel assets after announcing it will mothball the under-construction Cosmos nickel mine in WA in response to the slide in prices. Its group sales dropped 28% in the December quarter to $178.7 million following an 18% fall in nickel prices. Underlying earnings were 58% lower for the quarter.
The context: The slide in lithium prices also hurt IGO’s earnings, with its TLEA joint venture with China’s Tianqi Lithium electing not to pay a dividend for the quarter, as it looks to finalise the 2024 budget at a time of falling commodity prices. The decision on the Cosmos project comes just days after IGO said it would cut production at the Greenbushes lithium mine in WA citing a weak global lithium market. The company had posted a record annual profit in FY23, despite a $968 million impairment on two mines it had acquired through the Western Areas deal.
