Rio axes 78 Argyle workers

RIO Tinto has cut 78 workers from its Argyle diamond operation in Western Australia less than a month after confirming it will hold on to its struggling diamonds division.
Rio axes 78 Argyle workers Rio axes 78 Argyle workers Rio axes 78 Argyle workers Rio axes 78 Argyle workers Rio axes 78 Argyle workers

"Like others in the mining industry, we are looking to reduce costs in the business," a Rio spokesman said.

"Seventy-eight contractors from one of our underground contracting companies have been advised that their services on the Argyle underground project are no longer required. These contractors are part of a temporary construction workforce providing administrative, advisory and mining services roles to the project.

"This decision is a continuation of our approach to focus on costs, drive for improved efficiencies and transition to a fully underground mining operation."

A spokesman for Macmahon Holdings confirmed to that the contractor had been touched by the cuts, but was unable to specify the number of employees affected.

Macmahon said it was undergoing adjustments to its operational contracts at the mine.

With 70% of the workforce living locally, Argyle is one of the largest contributors to the East Kimberley economy. Indigenous Australians account for one in four members of the local workforce.

The news comes just weeks after Rio stated its diamond division was "well positioned to capitalise on the positive market outlook".

Reassertion that it would maintain its diamonds business followed a March 2012 review that was expected to list the division as one of the most likely divestments.

Last April, Rio announced it had officially moved Argyle's open pit operations underground in an effort to extend its life until at least 2020.

The average annual production over the life of the underground mine is expected to be 20 million carats per year.

Argyle has produced some 800 million carats of rough diamonds over the past 25 years, including a small supply of the world's rare pink diamonds.

Rio owns 100% of Argyle, 60% of the Diavik mine in Canada and 78% of Murowa in Zimbabwe, as well as 100% of the advanced Bunder project in India.

The diamond business has its marketing headquarters in Antwerp, with representative offices in Mumbai, Hong Kong and New York. Rio has a cutting and polishing factory in Perth for the rare pink diamonds.

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