BHP Billiton will slash 300 jobs from its Olympic Dam mine located in South Australia in response to the sharp slump in commodity prices which tumbled to a five-and-a-half-year low.
The Olympic Dam site hosts an underground mine and an integrated metallurgical processing plant, which produces copper, uranium, gold and silver.
This mining centre currently employs around 4,300 workers, and even though BHP didn’t give a specific numbers on the jobs that will be scrapped, industry insiders suggest that the company’s cost cutting program will result in about 300 layoffs, including 90 staff positions and 210 contractor jobs.
However, according to the Sydney Morning Herald, some of the BHP staff are likely to be redeployed at other BHP Billiton operations, while the company is also likely to be creating up to 100 new roles in mid-2015 as it advances the Olympic Dam copper, gold and uranium operations.
“Over the past few months, Olympic Dam has been focused on identifying opportunities to safely reduce costs in order to build a strong, viable business. As a result, a number of positions will be made redundant. However, the impact of these redundancies will be minimised through some redeployments opportunities,” a BHP Billiton spokeswoman said on Friday.
“We are unable to determine a net figure for workforce redundancies until the redeployment process is completed later this year.”
The Olympic Dam project was opened in 1988 by WMC Resources. BHP took control of the mine when it acquired WMC in mid-2005 and subsequently announced a major expansion program, which was shelved in August 2012 due to tough economic conditions and subdued commodity prices.
According to Mining Technology, in November 2012 BHP secured a four-year extension to start the expansion, but could not guarantee that the project would go ahead.
The expansion plan envisaged a new open pit mine to increase production of copper and uranium and expand minerals processing facilities, which have made Olympic Dam the biggest mine in the world.