The Western Australian government has unveiled a A$15-million interest-free loan initiative aimed at supporting the state’s embattled nickel sector, as improving prices and sentiment offer hope for a recovery.

The funding package, announced last week, is designed to assist operating nickel producers, facilitate the restart of idled mines and support the ramp-up of new projects across Western Australia.

The Western Australian nickel industry has experienced challenging global market conditions in the past few years, which have prompted mine and processing plant suspensions, and significantly impacted jobs.

However, prices and the market outlook for the commodity have improved in recent months.

Under the scheme, eligible miners will have access to loans that are repayment-free until either July 1, 2028, or until nickel prices exceed $22 000/t for two consecutive quarters.

Repayments will then be made on an interest-free basis in quarterly installments over a two-year period.

Details regarding eligibility criteria, loan limits and the application process are still being finalised and will be developed by relevant government departments in consultation with industry stakeholders.

Mines and Petroleum Minister David Michael said the initiative would provide targeted support to help the sector recover.

“Besides the jobs and export sales it provides, WA's nickel industry is also an essential component of the state's vision of becoming a global hub for the downstream processing of battery metals.

“Our nickel miners are competing internationally with mining jurisdictions that have significantly lower environmental, social, and governance standards.

“It’s important that they are supported to weather the storm of current market conditions and get back to what they do best, so they can be part of ongoing and future efforts to decarbonise the globe.

“The no-interest loan initiative represents sensible, responsible and targeted support to help WA's nickel industry get back on its feet.”