Mining company South32 is pouring $125-million into repair and remediation work at its Groote Eylandt manganese operation (Gemco) in Northern Territory, following the devastation caused by Cyclone Megan earlier this year.

South32 CEO Graham Kerr, reflecting on his visit to the site after the cyclone struck in March, described the extensive damage left in the wake of the storm. “The impact was immense,” Kerr said on Thursday, highlighting the scale of the challenge.

The cyclone inflicted significant damage on critical infrastructure, including the wharf and a vital bridge. South32, which holds a 60% stake in the operation in partnership with Anglo American (40%), has earmarked the additional $125-million for repairs and infrastructure restoration during the 2025 financial year.

Wharf operations are scheduled to recommence in the third quarter of the 2025 financial year, contingent on maintaining construction productivity during the wet season. Sales volumes are expected to progressively increase from the fourth quarter of 2025, aligning with the completion of critical infrastructure repairs.

Production at Gemco was heavily impacted, with Australian manganese saleable output down by 34% to 2.32-million tonnes in the 2024 financial year owing to the temporary suspension of operations in March.

Looking ahead, production is forecast to reach one-million wet metric tonnes in the 2025 financial year and rebound to 3.20-million tonnes in 2026 as the recovery plan progresses. However, the disruption has led to a 23% increase in operating unit costs, rising to $2.32 per dry metric tonne unit in 2024. South32 said operating costs for the 2025 financial year were subject to the pace of recovery and production volumes in the second half of the year.

The financial toll of the cyclone has been substantial. Underlying earnings before interest and taxes (Ebit) plunged by 77% to $61-million in 2024, with an additional $93-million incurred in idle capacity and remediation costs, which were excluded from the reported underlying Ebit as an earnings adjustment

The company noted that its insurers had confirmed that the damages incurred were covered under its property damage and business interruption insurance policies. “We are continuing to work with our insurers to assess the timing and value of recoveries under these policies,” the miner stated.