12/05/2009 - 15:31

BHP to shed 240 workers at Leinster mine

12/05/2009 - 15:31

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Around 240 employees and contractors at BHP Billiton's Leinster nickel operations will be affected by the company's decision to halt activities at the Rocky's Reward open pit mine.

BHP to shed 240 workers at Leinster mine

Around 240 employees and contractors at BHP Billiton's Leinster nickel operations will be affected by the company's decision to halt activities at the Rocky's Reward open pit mine.

In a statement to WA Business News today, BHP said the decision to place the mine on care and maintenance was in response to the deteriorating nickel price.

About 20 employees and 220 contractors will be affected, and BHP said it will seek to maximise internal re-deployment opportunities for employees.

The Leinster nickel operation also includes an underground mine and a processing plant, which are not affected by the suspension of activities at Rocky's Reward.

BHP said the suspension of mining activities at the open pit was in line with its business operation, adding that "all operations are under regular review and we will adjust production is an operation is cash negative and set to remain so or customers are not taking the produsts".

"Rocky's Reward Open Pit mine is a higher cost operation because of its lower ore grade and high strip ratio. With the deterioration of the nickel price this is a discipline and necessary action to preserve long term value," BHP said.

The company added that it will work closely with suppliers, customers and the local community to minimise the effects of its decision.

The closure of Rocky's Reward follows BHP's decision to mothball its Ravensthorpe nickel miner earlier this year, with around 1,800 workers made redundant.

The miner has previously said it plans to cut its global workforce by 6,000.

WA opposition state development spokesman Mark McGowan said the job losses were bad news for the state and the local community.

He said the state government should intervene to stop further job losses.

"The Barnett government acts like it is absolutely helpless to do anything about these job losses that are occurring around WA day in, day out," he said.

"They should actually take some steps to intervene and be proactive in assisting to keep individual companies operating.

More broadly, the government should "engage with our major trading partner China to put out the state infrastructure strategy and make sure that they start implementing it, and to make some decisions in the environment portfolio to benefit business around WA".

He added: "BHP has taken this step. I'm not critical of them, I'm critical of a state government that doesn't do anything about it.

"It doesn't actually engage with the company to try and keep the operation open, and doesn't take some of those macro steps."

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