Core Lithium has suspended mining at its Finniss project near Darwin in light of "weak market conditions", with up to half of the 300 jobs at the site to be lost.

Key points:

· Core Lithium will continue to process ore stockpiles at its Finniss mine until mid-2024

· Up to 50 per cent of the operation's workers are expected to impacted by the suspension

· Core chief executive Gareth Manderson says the decision has "no bearing" on the site's performance

In late December, the company announced a review of its operations near Darwin and suspended early works on its proposed second mine BP33, following an 80 per cent drop in the price of spodumene concentrate (high-purity lithium ore) in 2023.

The product is a vital component in lithium-ion batteries, including those found in electric vehicles.

On Friday morning, Core Lithium released an ASX statement saying it had now temporarily suspended mining operations at its Grants open pit at Finniss, though it would continue to process its stockpiles of lithium.

The company said it had about 280,000 tonnes of ore stockpiled, which would allow its processing plant to continue operating until mid-2024 without any further mining.

The Core statement said the open pit would be maintained "to allow an orderly ramp up when market conditions improve".

Core chief executive Gareth Manderson told the ABC's Country Hour that just over 300 people currently worked onsite, including Core Lithium employees and contractors. 

"You can probably expect that 40 to 50 per cent of the team will be impacted with this," he said. 

"We’re just working through that detail with our contracting partners at the moment."

Mr Manderson said the job losses were "not something I take lightly at all". 

"In terms of getting the operation up and running and running well..they've done a very good job in that space," he said. 

"This decision has no bearing whatsoever on the performance onsite."

Mr Manderson said the pause in operations would be done in a way that would allow them to recommence quickly when market conditions improved, but said it was difficult to predict the price of spodumene concentrate. 

"No one predicted an 80 plus per cent reduction in 12 months," Mr Manderson said. 

 

Former deputy chief minister and mining minister Nicole Manison opened the Finniss project in 2022. (ABC News: Jesse Thompson)

NT Chief Minister Eva Lawler in December said "a glut of lithium" had led to plummeting prices for the product, but she expected that would "absolutely change in the next few years".

Mr Manderson in August also said Core Lithium had been the target of short-sellers this year, but that he was focused on "running the best business and build the best business possible".

The Finniss mine was opened in early October 2022 with what was expected to be a 12-year life span.

At the time of its opening, Core had already entered into an arrangement to supply electric vehicle manufacturer Tesla. 

However, the company later announced the deal would not be going ahead, but said it remained "well-positioned" to take advantage of strong global demand for lithium. 

Government confident Core will resume operations

The NT's new mining minister, Mark Monaghan, today said he was confident the Finniss mine would continue to operate and would resume digging later in the year, citing the prospect of the lithium price rebounding.

 

Lithium is highly prized by battery manufacturers for its light weight.(ABC News: Rachel Pupazzoni)

"At the end of the day, I would be very surprised moving forward whether the lithium demand comes off globally," he said.

"I've got no doubt that the world will continue to move towards a renewable future, and they need our lithium for that."

He went on to say that if Core's position weakened to a point where it was no longer able to operate, other mine operators would be welcomed.

"One thing I'm very supportive of is new mining operators in the territory, and I'll back them every time to to realise their their ambitions in the territory," he said.

He also suggested other mine sites may be able to take on workers made redundant.

"These miners and these technical staff and these scientists that are all involved in this industry of mining are in high demand," he said.

Opposition leader Lia Finocchiaro stopped short of blaming the government for the Core's suspension at Finniss, but criticised its ability to attract investment to the territory more broadly.

"What it shows is mining continues to be a significant platform for our economy — but we can't just rest on one new mine, we have to be aggressively pursuing investment," she said.

She also said infrastructure projects in the NT were suffering from too many regulatory approvals.

"We've got a private sector project suffering the consequences of commodity price changes," she said.

"What the government could be doing is making sure that projects, when they're starting out in the territory, have as [few] upfront costs and regulatory timeframes as possible."