Swiss mining giant Glencore announced on Monday plans to sell its stake and suspend operations at the Koniambo Nickel SAS (KNS) joint venture (JV) in New Caledonia as prices for the metal continue to fall.

The world’s top miner will sell its 49% stake in the JV, with the nickel mine and processing plant set to enter a “state of care and maintenance”, it said in a press statement.

It added that a process to find a potential new funding partner for the project will begin shortly and all local KNS employees will be retained for six months following Glencore’s exit to “aid in the transition”.

The company said it has been the primary funder of the nickel project, which has repeatedly failed to turn a profit for more than ten years, investing a total of $9bn since the JV’s inception.

New Caledonia remains a part of French territory. The French Government has attempted to save the nation’s ailing nickel industry as prices for the metal continue to slide amid market surpluses.

The decision to sell its stake follows months of talks with the government and key stakeholders, but even with state assistance, high operating costs and “very weak” nickel market conditions mean the project remains unprofitable, Glencore said.

It said it is “appreciative” of the French Government’s efforts to “revitalise and rescue the nickel industry in New Caledonia”, but added that “even with the proposed assistance, KNS remains an unsustainable operation” and the company “cannot justify continuing to fund losses to the detriment of its shareholders”.

In September 2023, Glencore said it would pause funding for the plant by the end of this month. At the time, it said it would explore potential solutions for relentless financial losses at KNS. Its decision to withdraw from New Caledonia altogether is an escalation of concerns that have been bubbling for months.