Mt Gibson Iron will close its Koolan Island iron ore mine off Western Australia’s Kimberley coast due to safety concerns after a rockfall at the site’s main pit last week.
The company says the closure will lead to approximately 250 redundancies and the loss of 200 contractor roles.
Mount Gibson Iron has closed it Koolan Island operation in the Kimberley.
In a statement to the ASX, the company said it had determined that “remediating the rockfall-affected area and resuming mining is not viable given the safety risks of future instability and the time and investment required to mitigate such risks especially in the context of the operation’s limited remaining mine life”.
Production from Koolan Island was already scheduled to wrap up around September next year, before the rockfall on October 16. The company says no personnel were injured in the incident.
Mining will remain suspended and processing operations will continue, using ore stockpiles to meet near-term scheduled shipments. There will also be the potential for additional sales from lower-grade stocks previously retained for blending purposes.
The company said it would also accelerate progressive rehabilitation activities. A total of 75 staff are expected to be retained for rehabilitation and ongoing processing.
Mt Gibson chief executive Peter Kerr said the safety of employees was the company’s priority.
“It is extremely disappointing for the company and its people that we must prematurely ramp down operations at Koolan Island, however the physical safety of our personnel is our prime consideration,” he said.
“We will now be working closely with our site team, the Dambimangari Traditional Owners and other relevant stakeholders to responsibly manage the transition and preserve a strong legacy for the region.”
Koolan Island is located in the Buccaneer Archipelago, about 140 kilometres north of Derby. The operation was acquired through the takeover of Aztec Resources in 2007.
According to the company’s website, the mine boasts Australia’s highest-grade hematite ore reserves, which average more than 65 per cent iron.
Mount Gibson completed recommissioning of the former BHP mine and commenced shipments in April 2007. Mining was interrupted in late 2014 when the main pit flooded but continued in satellite pits until early 2016.
Production and sales of high-grade hematite recommenced in April 2019 following a two year seawall reconstruction and mine refurbishment program.
As of July 2024, Mount Gibson had exported more than 38Mt of ore from Koolan Island.
The company said the rockfall would not impact its previously announced acquisition of a 50 per cent interest in the Central Tanami Gold Project, near Alice Springs in the Northern Territory, which is scheduled for completion by the end of March next year.
“The Company intends to retain a number of Koolan Island personnel whose skills and experience can be utilised to advance the Central Tanami Gold Project towards a development decision and into production,” the statement read.
“Various items of plant and equipment from Koolan Island are also proposed to be retained for future use at the Central Tanami Gold Project.”
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