RUSSIA'S Norilsk Nickel will suspend the two remaining mines in its Australian nickel operations because low prices have made the operations unsustainable.

Norilsk will suspend the Black Swan and Lake Johnston mines immediately, cutting staff by about 330 from March 1 to leave a small number of employees to carry out care and maintenance at the sites.

Last year, the two mines produced about 25,000 tonnes of nickel concentrate.

Norilsk owns a number of mines in Western Australia, producing almost 30,000 tonnes annually.

Norilsk bought US-based OM Group's nickel business for $US408 million in 2007 as well as taking over Australia's third-largest nickel miner, LionOre Mining International, for $US6.36 billion when nickel was bringing record prices.

In November, the world's biggest nickel miner shut its Cawse and Waterloo operations because of the metal price slump.

Australian nickel miner Western Areas said yesterday it had restructured its ore offtake deal with Norilsk, relying instead on its own concentrator, which is in the start-up phase. Nickel is mainly used to make stainless steel, and global steel prices fell by about 40 per cent during the course of last year.

After hitting record highs of more than $US50,000 a tonne in mid-2007, nickel plunged to a five-year low of $US8850 a tonne in October, forcing many operations to shut down.

Earlier this year, BHP Billiton announced it would shut its 50,000 tonne Ravensthorpe nickel laterite operation.

It took an impairment charge of $US3.36 billion from the project, which it commissioned last year.