22nd May 2014 09:51
LONDON (Alliance News) - Glencore PLC Thursday said it will close its Newlands underground coal mine in Australia in late 2015 as part of its ongoing strategy to combat a collapse in coal prices.
The mining giant said it will not extend the life of the Newlands mine in Queensland's Bowen Basin, which will therefore reach the end of its life in the fourth quarter 2015 after extracting the final volumes of coal from the site.
The company said the decision will result in the end of development activities on site at the end of June 2014, leading to the loss of 50 jobs, a quarter of the mine's workforce.
Glencore did not detail the effect of the closure on the other 150 employees but said it has begun consulting with staff and representatives with respect to the proposed changes.
The news comes as the company has already reduced production, closed mines, cut staff and cancelled projects in Australia after coal prices fell significantly in recent months.
Glencore announced in March that it will suspend steel-making coal production at its Ravensworth mine in Australia from September due to the fall in coal prices and higher costs at the site.
The Newlands mine produced 2.8 million tonnes of thermal coal last year, while Ravensworth produced 2.1 million tonnes of saleable semi-soft coking coal last year.
Glencore PLC changed its name from Glencore Xstrata PLC at its annual general meeting on Tuesday. Glencore Xstrata was formed from Glencore's merger with major resources firm Xstrata PLC in May last year in a USD76 billion tie-up deal which led to the departure of Xstrata's chairman and most of its senior directors including Chief Executive Mick Davis.
Glencore shares were up 0.7% to 328.65 pence on Thursday.
By Tom McIvor; [email protected]; @TomMcIvor1
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