2024-07-26 09:21:20
In serious financial trouble with a debt of 13.5 billion euros, the nickel company KNS has been looking for a buyer since the departure in February of the Anglo-Swiss group Glencore, its main shareholder. In the absence of a completed offer from the buyer, 1,200 workers will be released at the end of August. Only around fifty workers will be kept on site to keep it operating at a “cold” standby level. “In this incredibly difficult time for each person, each family, we would like to emphasize that all those who have contributed to this company’s journey to date can be proud. Their work and commitment have been exemplary, especially in the progress made in recent weeks,” KNS explained in a press release.
The Koniambo Nickel SAS ferronickel plant is considered one of the projects for economic renewal between the North and South regions of the French Pacific islands. Except that this company has never been profitable and has a huge debt of almost 14 billion euros.
A call to “take responsibility”
At that time, the Minister of the Economy Bruno Le Maire called on the mining giant Glencore and the Northern region of New Caledonia, the shareholders of the company Koniambo Nickel SAS (KNS) in great difficulty, to “accept their responsibilities” to avoid its closure. . Northern Territory is a 51% shareholder and Glencore, which has only witnessed financial losses, owns 49%.
“I made proposals to Glencore. We propose 60 million euros in subsidies on the cost of energy, 45 million euros in additional resources, a loan of 100 million: 200 million euros for the company only in the north to guarantee its stability in appearance of general support, said when the government asked the session in the National Assembly. And added: “Now, it is up to the shareholders to take their responsibilities. We will not go forward and we will not contribute at a loss: Glencore and the Northern region have their responsibilities to take,” he continued, assuring that “the State has taken its own”.
Before the delegates, Bruno Le Maire was convinced “to believe in the future of the nickel sector in New Caledonia”, which represents almost a quarter of the private jobs in the island and 20% of the gross domestic product (GDP) but it has weight . through the combination of falling money, expensive energy and increased foreign competition.
For the time being, according to the company’s management, there are three groups in the running to take over the company. “The decision to make PLCME does not call into question the search process for a new partner and discussions will continue with the active participation of shareholders, financial advisors authorized in this matter and representatives of the company”, explains KNS.
The nickel crisis exacerbated tensions in the islands
Today, the nickel industry in New Caledonia, which represents 90% of the archipelago’s exports, is at a standstill, although the archipelago’s industry has a quarter of the world’s resources of the rare and precious metal. An important mineral of stainless steel and electric batteries. Caillou’s flagship company has faced a fall in the price of nickel, which will lose 45% of its value in 2023.
While Indonesia has a market share in this sector, the nickel crisis is partly based on energy costs, with a one to five share between Indonesia and New Caledonia. This nickel crisis is also partly responsible for the current tensions in the islands. If the riots started with the reform of the competition on the size of the electoral party, this crisis leading to the economic and social crisis is one of the worst causes of the situation.
In addition, the political situation is still tense between the separatists who mainly control the industry in the north of the island and Paris. The commitments requested from the regions – 66.7 million euros by Paris – are considered to be too expensive for the separatists, who point out that the region is already in debt at 153% of its budget in end of 2023. Discussions have been ongoing since then. Announcement of site closure.
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