The court found in March that the mine's waste emissions had affected neighbouring communities, with some members diagnosed with heart and lung problems including cancer, and some had high levels of nickel in their blood and urine, Reuters reported.

The court ordered South32 pay damages and reapply for its mine licence.

The company said today it had been notified of the decision on Monday and was in the process of appealing it.

"At this stage it is not possible to fully assess any potential financial or operational impacts, as the decision orders various compensatory and remedial activities which are not yet quantifiable," South32 said.

"Our work is continuing to understand the impact of the decision and we will advise of any material developments."

The three-year-old BHP spin-off said it was committed to contributing positively to communities where it operated.

Cerro Matoso's nickel production increased 23% to 21,800 tonnes in the second half of 2017 and generated US$244 million in revenue.

It is expected to produce 41,600 tonnes in FY18.

South32 shares were down 2.4% in midday trade to A$3.395, valuing the company at $17.91 billion.