Depressed iron ore price claims more jobs

The volatile price of iron ore has claimed more jobs with Cape Lambert Resources cutting 117 people.

The cuts come after a capital management review by the company in light of the falling price of iron ore.

As well as cutting jobs, the company plans to put some of its assets into care and maintenance and reduce exploration activities.

Cape Lambert says it expects to save $3.5 million a year as a result of the changes.

The company also announced it would postpone the second dividend payment to shareholders which was scheduled for February.

Executive chairman Ton Sage stressed that the postponement of the dividend payment was not a cancellation.

“We have seen a sharp drop in the iron ore price in recent months, coupled with a downturn in market conditions for the mining sector as a whole. With these factors in mind, Cape Lambert believes it is prudent capital management to find genuine cost savings across its business and postpone the second dividend payment scheduled for February 2015,” Sage said.

“Cape Lambert is confident that the iron ore price will recover in the near-to-medium term and the dividend payment can resume in due course.”

Cape Lambert owns five iron ore operations worldwide, including the Cape Lambert South Project in the Pilbara.

It said the 117 job cuts will come from non-critical areas globally including at its West Australian head office.

A horror 2014 saw the price of iron ore fall by 47 per cent, forcing many miners to cut jobs or close down their sites.

Atlas Iron and BC Iron have both cut staff in order to deal with the price slide.

CitiGroup expects the iron ore price will average $60 a tonne this 2015 and 2016.

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