The company said it considered the suspension "unfounded" and was seeking to have the order reversed.

Vale said it was estimating the impact of a shutdown at the mine, which accounted for almost 9% of the company's nickel production last year, excluding Vale New Caledonia.

Onca Puma had produced 16,000t of nickel in 2020, of Vale's ex-VNC total of 183,700t, after an improved fourth quarter due to extensive furnace maintenance work.

Vale said it was in contact with the Secretaria de Estado de Meio Ambiente e Sustentabilidade (SEMAS) to understand the technical and legal grounds for the determination.

The department cited an unfulfilled obligation to provide services for communities surrounding the mine, including setting up a fibre optics network and a health unit, in a statement to Reuters.

Onca Puma was shuttered in 2017-2019 due to its alleged impact on indigenous communities and Vale had been ordered to pay millions in damages in 2018.

Vale had signed a transitional agreement with the Xikrin do Catete and Kayapo indigenous peoples last year, suspending various lawsuits for a year "to create a favourable and harmonious environment for building reconciliation in a joint and participatory manner that may eventually close the lawsuits", the company said in its 2020 annual report.

Vale's New York-listed stock lost 2.18% yesterday and the company is capitalised about US$71 billion.