The owners of the mothballed Ravensthorpe nickel mine in Western Australia's south-east say they will move to re-open the site if surging demand for the metal continues.

In its latest quarterly results posted overnight, First Quantum Minerals said it was planning to restart the nickel and cobalt operation by early next year.

The Canadian mining giant memorably bought the asset off BHP Billiton in 2010 for $US340 million ($493 million), a fraction of the $US3 billion it cost to build and commission the facility.

Mining analyst Carey Smith says he is confident the mine will re-open because of strong global demand. ( ABC News: Erin Parke )

Around 450 employees and contractors lost their jobs when it was closed for a second time by the new owners in 2017 amid a global downturn for the commodity.

Years before, 1,800 people lost their jobs when BHP closed the mine in 2009.

In the report, First Quantum confirmed it has spent $14 million dollars on the facility so far this year, had recently completed drilling of its Shoemaker Levy orebody deposit, and had almost finished upgrades to its processing facilities.

Alto Capital Research Analyst Carey Smith said he was confident the mine was on track to reopen for a third time.

"They've announced that they're still progressing with their plans to reopen in the first quarter of next year, which is a really good sign for the nickel price going forward and also for a lot of employment down south," he said.

The analyst said since First Quantum first teased a re-open of Western Australia's largest nickel mine in March, prices for the metal have surged by 12 per cent.

The mine was originally opened by BHP Billiton in late 2008 but the global financial crisis prompted its closure and sale just months later. ( ABC News, file photo )

"When you consider the Australian dollar … which is trading around 70 cents, that puts the Australian nickel price at about $9 a pound. You [can] make money at that price," he said.

"The amount [it costs] to restart it and also then to re-shut it down — if you're not confident — is quite substantial. So I would suspect [the mine will be] back up and running for a few years at least."

Renewables spur demand

Fuelling the high prices is a shrinking supply of the commodity.

Unlike its tech metal cousin lithium, the analyst said global stockpiles of nickel have plummeted from around half a million tonnes to below 150,000 tonnes earlier this month.

Nickel is a key component in the production of lithium ion batteries. ( Commons: Kristoferb )

While around two thirds of global supplies are used in the production of stainless steel, Mr Smith pointed towards its role in producing batteries to store renewable energy and power electric cars as the long-term driver of the market.

"Historically … [lithium-ion batteries have] been about 8 per cent of the total market. But with these electric vehicles growing at 20 to 30 per cent a year, that's just becoming a much larger component," he said.

"As that continues to grow there is going to be more and more demand for nickel."

The analyst said despite a track record of a volatile market, he would be surprised to see the mine close for a fourth time unless the price dropped again for at least 6 months.

"Because of the amount of costs to [restart] the mine and to also put it back onto care and maintenance, they would want to be fairly certain that the nickel price was going to stay lower for longer," Mr Smith said.

"First Quantum can, on-site, make changes much, much easier than a large resource company [like BHP] can.

"So their operational performance is much more efficient."