Close to 80 per cent of workers at Glencore’s Collinsville coal mine will be cut next year as it rolls down mining.
The decision to drastically reduce the workforce and phase down overburden removal – producing coal only from in-pit inventory and stockpiles – comes on the back of low coal prices and heavy financial losses for the operation.
Thermal coal prices have nearly halved since Glencore took control of the operation in 2013, falling 43 per cent from US$95 per tonne down to US$54 as of October this year.
In an effort to stem the losses, Glencore has announced it will carry out the reduction of work, which will result in the losses of approximately 180 positions from the 230-strong workforce on site.
These job cuts will begin in March next year.
“It is a particularly difficult decision given the significant effort and the improvements made at Collinsville by Glencore and the entire workforce over the last two years in attempting to turn around the mine's financial position,” a Glencore spokesperson told Australian Mining.
“The situation at Collinsville reflects the challenges being faced by all Australian coal mines in one of the most difficult markets in the industry's recent history.
“We will continue with our environmental management programs on the site in relation to spontaneous combustion management, rehabilitation of legacy areas and management of mine water.”
The miner will put support services in place for those affected by the decision, and will carry out redeployment where possible, it stated.
In the meantime Glencore will repeat its Christmas shutdown again this year, halting production for three weeks over the holiday period.
Last year it shut down some operations from November through to January in an effort to cut global supply, and reduce its own Australian output by five million tonnes.