BHP announced today that up to 3400 jobs from their Australia wide workforce to go immediately.
From smh.com:
6000 jobs axed as BHP feels the pinch
6000 jobs axed as BHP feels the pinch
Jamie Freed
January 22, 2009
BHP BILLITON broke months of silence yesterday on its plans for dealing with the plunge in metals demand by revealing it would sack nearly 6000 workers around the globe and close its disastrous Ravensthorpe nickel mine in Western Australia.
About 3400 Australian employees and contractors will lose their jobs as a result of BHP's decision to slash WA nickel and Queensland coking coal production and reduce the workforce dedicated to a proposed expansion of its Olympic Dam copper-gold-uranium mine in South Australia. The redundancies will lead to $US500 million ($765 million) in charges.
"We have had some reduction in activities and reductions in production," said BHP's chief financial officer, Alex Vanselow, after the release of the miner's December quarter production report. "These are very serious decisions … we don't take them lightly, but they are the necessary and correct decisions."
The decision to close Ravensthorpe - which was opened in May - and an associated portion of its Yabulu nickel refinery in Queensland will result in total writedowns of $US3.7 billion on the $US2.8 billion project. The impairments are higher than the project costs because they include working capital and other spending.
In addition, BHP disclosed Ravensthorpe will have lost at least $US546 million by the time it closes in June, including losses reported last year.
BHP also revealed its half-year results would take a $US1.6 billion hit due to the timing of its copper shipments, including a $US333 million hedging loss.
A UBS analyst, Glyn Lawcock, said BHP's December quarter production was in line with expectations, but sales had lagged production.
"[Coking coal] sales were down about 15 per cent on production," he said. "At the end of the day, the sales numbers are more important."
BHP said it would cut annual coking coal output by 10 to 15 per cent during the present half due to weak demand, at the cost of 1100 jobs in Queensland.
It has not changed its iron ore production or sales forecasts, but has admitted it is receiving prices below the benchmark on many shipments.
For the first time, BHP also said it would need to install water injection to help maintain production at its huge Atlantis oilfield in the Gulf of Mexico.
A Macquarie Equities analyst, Brendan Harris, said that was a concern because Atlantis was a key component of BHP's growing petroleum division.
Rio Tinto yesterday said it would slash its aluminium production by a further 6 per cent, bringing its cuts to 11 per cent of its smelting capacity. It will also cut its alumina production by 6per cent.
Those moves will force it to sack 1100 workers globally, mostly in Canada and Europe. Its Australian operations will not be affected by the cuts
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An ominous sign if ever there was one for the FIFO industry. One of the reasons I and many others decided to keep my involvement in aviation to RPT operations.
Regards,
OpsN.
