Cerro Matoso has escalated its operational warning, alerting investors to a potential indefinite 50% reduction in production capacity.
The Colombian miner, which produces ferronickel and coal, has now completed eight days operating at just 75% capacity following a severe cut in natural gas deliveries from its primary supplier, Canacol Energy.
The company previously reduced output by 25% in response to Canacol’s initial supply slash, but the situation has deteriorated.
The supply disruption poses a direct threat to global nickel markets, as Cerro Matoso is a significant source of ferronickel.
The company previously reduced output by 25% in response to Canacol’s initial supply slash, but the situation has deteriorated.
Management has indicated that without a resolution to the gas shortage, the mine faces a deeper, potentially open-ended curtailment of operations.
This development adds to the supply-side risks in the nickel complex.