New Caledonia and EU sign nickel cooperation deal

A new agreement was signed on October 20 between the European Commission and the government of New Caledonia. The deal aims to strengthen cooperation in the nickel industry, focusing on improving mining competitiveness and ensuring a stable supply of critical metals for Europe. The agreement was signed by Stéphane Séjourné, the European Commission's executive vice-president, and representatives from New Caledonia's government at Station N in Nouméa.

EU seeks to boost local raw material production

The European Union has set a goal to extract at least 10 percent of its strategic raw materials within member states by 2030, with 40 percent of that material processed in the EU. This goal highlights the Union's growing concern over its reliance on a few countries for essential resources. Séjourné emphasized this during a speech at the Congress on October 19.

New Caledonia's nickel sector faces challenges

New Caledonia's metallurgical industry has been struggling, with its nickel sector facing a severe crisis. The Step pumped storage power station project in Tontouta, which could cost around 50 billion francs, is under consideration. Local industry representatives hope the new agreement will help recover capital, while three key plants—KNS, SLN, and PRNC—are seeking investors.

Roadmap and European collaboration planned

The agreement requires the development of a strategic partnership roadmap within six months. The European Union plans to work closely with all member states, industry partners, and the European Investment Bank on this collaboration. Ambroise Fayolle, vice-president of the European Investment Bank, is expected to visit New Caledonia in early December, and the financing for the Step project will be addressed.

EU explores tools to support nickel prices

The European Commission is considering new measures to stabilize nickel prices, including long-term purchase contracts, price difference compensation, and a price floor. These tools aim to diversify supply sources and provide more binding commercial instruments to support the industry.

New Caledonia's nickel exports to Europe decline

According to the Institute of Statistics and Economic Studies (Isee), only 11,000 tons of Caledonian ferronickel reached Europe last year, compared to 137,500 tons in Asia. Europe has been relying less on New Caledonia's nickel since 2008, though it still uses it indirectly through intermediate products refined in Asia. Fatima Lachaize, interim president of the South plant, noted that much of New Caledonia's nickel ends up in European cars.

Political tensions over the agreement

Independentist groups Kanaky NC and UNI boycotted the session where Séjourné spoke on October 19, leaving empty seats. Some elected officials criticized the lack of prior debate and the timing of the agreement, which they felt was close to the presidential election. Deputy Emmanuel Tjibaou argued that cooperation with Europe should not come at the expense of local jobs or decision-making power.

Sovereignty concerns raised by independentists

Christian Tein from FLNKS warned that New Caledonia's nickel should be used to promote local development, not create new dependencies. The Kanaky NC group called for a strategy developed independently on the Caillou. Séjourné expressed surprise at the concerns raised by these groups.

Future steps and possible export routes

The agreement is only the first step, according to the signatories. Alcide Ponga emphasized the need for a "program of reindustrialization" in Europe. Other options are being explored, including exporting ore to Japan or South Korea to ensure regular nickel supplies to Europe. A value chain that includes processing stages is also being considered.