Coal news and updates

BHP Billiton and Mitsubishi <8058.T) will cut about 700 jobs at coal mines they operate jointly in Australia, with the two companies citing over-staffing in tough market conditions threatening the viability of the business.

 

The move follows a review of the operations, in Australia's Queensland state, owned 50-50 through the BHP Billiton-Mitsubishi Alliance (BMA) that found employee numbers were higher than required to operate safely and efficiently, the partners said in a statement on Tuesday.

 

"BMA will reduce its workforce by approximately 700 roles, and consultations will occur with employees, contractors and the representatives in the coming weeks," the statement said.

 

"The coal industry continues to face challenging market conditions and had to act to ensure the long-term viability of the business," it said.

 

The job reductions represent about seven percent of BMA's total workforce of roughly 10,000.

 

The mines, which yield predominately coking-grade coals used in steelmaking, have been under pressure to lower operating costs in response to sharply lower coal prices in export markets, currently running at around $110 a tonne.

 

Almost all the coal mined by BMA is exported, as Australia has only a small domestic steel industry.

 

BHP Chief Executive Andrew Mackenzie has grouped the company's coal unit as one of "four pillars of growth", along with iron ore, copper and petroleum products, perplexing some analysts who see the sector heading into long-term decline.

 

 

Source: Reuters