700 contractor positions to go at Ernest Henry mine

Around 700 contractor positions will come to an end at GlencoreXstrata's Ernest Henry operations as it shifts from a construction phase into production.

It is part of the mine's wider move from an open cut into an underground operation.

The announcement came during Ernest Henry's general manager Myles Johnston's update of the operation with the local community, according to the North West Star.

Speaking at Cloncurry, Johnston explained that the underground shaft project is slated for completion in May next year, after which around 700 contractors, the majority of which are FIFO, will finish work.

Once the kilometre deep shaft is completed it will scale back contractors for maintenance activities.

"For the most part, most of those people are fly-in, fly-out, so they have been brought in from other projects across the country, living at the Ernest Henry Village, doing their work on site and flying out," the ABC reported Johnston as saying.

"The impact on the local community I think will be minimal from that point of view.

"Wherever possible, we have used local suppliers so we'll continue to review whether some of those local supplies need further support going forward."

The mine halted magnetite production at thesite earlier this year, at the time citing market conditions.

Xstrata only began shipping magnetite in 2011, and the move to shut down production will see the company focus on producing copper concentrate, a spokesperson explained.

The future of the operation's Mount Margaret mine is still also up in the air.

"We have not made a decision yet on the future of Mount Margaret, however we are committed to supporting any affected employees following the outcome of this review,'' Johnston said.  

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