* Debt would be cut by up to 99 pct in 8-year plan
* Government minister hints at more bailout help
* Shares fall 24 percent (Adds share reaction, government comment, background)
By Jussi Rosendahl
HELSINKI, Sept 30 (Reuters) - Finnish nickel miner Talvivaara lacks the long-term financing it needs to avoid bankruptcy, it said on Tuesday after an administrator proposed an eight-year restructuring plan that includes slashing its debts by up to 99 percent.
Talvivaara listed to great fanfare in London in 2007 when nickel peaked at around $51,000 per tonne.
But nickel prices have more than halved, and hurt by repeated production disruptions and environmental damage, the company last year suspended its mining operations and started a court-led debt restructuring process to avoid bankruptcy.
The administrator on Tuesday proposed Talvivaara's unsecured debts of around 1.4 billion euros ($1.8 billion), including group internal debt, be cut by 97-99 percent. The plan could involve a share issue, which the administrator warned could dilute the company's shares.
It shares fell as much as 24 percent on Tuesday.
The company lamented on Tuesday that implementing the plan would need funds and creditor support, which is does not have.
"In order to ramp-up the Talvivaara group's mining operations to full scale, a significant amount of new financing for the operative activities is required immediately," it said in a statement.
The government has invested 150 million euros in the company, and economy minister Jan Vapaavuori hinted on Tuesday that it could give more, but that a bailout would need the participation of a private investor or industrial partner.
"The state does not rule out a possibility to participate in a market-based financing of the company," Vapaavuori said in a statement.
Talvivaara has not said how much it needs, but analyst Jukka Oksaharju at brokerage Nordnet estimated a long-term solution would require several hundred million euros. "Without long-term funding, it is just hospice for this company," Oksaharju said.
Talvivaara is a major employer in the rural Kainuu region with staff of about 500. Oksaharju suggested political pressure could prompt the government to put more funds on the table ahead of a general election next spring.
Its shares, mainly owned by about 80,000 Finnish retail investors, were down 24 percent at 4.5 euro cents on Tuesday. They peaked at about 2 euros in 2011. The company delisted its London shares earlier this year.
"They (Talvivaara) were given extra time so they could avoid an acute bankruptcy. But it is very negative news that they still haven't found any financing," Oksaharju said.
Founder and Chief Executive Pekka Pera believed its Sotkamo nickel mine would become Europe's biggest by pioneering a metals extraction process called bioheapleaching, which uses bacteria to leach metals from ore.
But repeated production problems were compounded in 2012 when the mine leaked large amounts of waste water, pushing up uranium and metal levels in nearby lakes and rivers.
Last week, prosecutors instigated charges against four Talvivaara executives, including Pera, over the environmental damage and requested the company to pay a 850,000 euro corporate fine.
1 US dollar = 0.7941 euro Editing by Jason Neely and Susan Thomas