Pit wall instability has led to a collapse at the Koolan Island hematite mine, with seawater flooding the main pit.
High tides around the pit on Tuesday night managed to breach a damaged section of the wall, which has been under repairs since October.
According to mine owner Mount Gibson Iron, no personnel were at risk and all activity in the pit was suspended, along with all non-essential activities on the island.
An ASX announcement from the company yesterday said it was not yet possible to determine the extent of the “likely impacts” on the Koolan Island operation.
“At this stage, Mount Gibson is unable to provide a more detailed update on the anticipated impact of the failure, including on the company’s sales guidance for the 2015 financial year,” the company said.
Mount Gibson said the current trading halt would remain in place until Friday 28 November, however if they cannot provide more detailed information at that time they will apply to enter into voluntary suspension.
The last share price for Mount Gibson was 41 cents.
The company has previously said the repair work would cost up to $10 million and take three months to complete.
In September Mount Gibson CEO Jim Beyer told a New York investment conference he was confident the price of iron ore (at the time, $US81 per tonne) would rebound in respond to seasonal pressures, however global prices have slumped even further this week, down to $68 per tonne.