A large-scale Western Australian iron ore mine will cease operating by the end of the year in a move that will see about 1000 jobs cut from one of Australia’s largest mining ventures.
ASX-listed resources giant Mineral Resources Limited issued the announcement on the market on Wednesday, stating its Esperance Yilgarn Hub was “not financially viable” beyond the 2024 calendar year.
The decision was triggered by the “limited remaining mine life” across the hub’s five mines, and said it would be too costly, and take too long to “develop new resources to ensure continuity of supply”.
Mineral Resources said the closure would “regrettably” also impact contractors, supplies, and other businesses in the supply chain.
Softening the blow, the company will work to redeploy the affected employees across the company, with about 800 vacant jobs across the business, including roles at the business’ flagship $3bn Onslow Iron project in the West Pilbara.
Workers have also been offered in-house mental health counsellors, and HR support.
Mineral Resources’ billionaire managing director Chris Ellison said the “prudent but difficult decision was not taken lightly”.
“By the end of this year, we will have operated Koolyanobbing for six and a half years, exported almost 45m tonnes via the Port of Esperance and spent $4.2bn running our Yilgarn operation, exceeding our commitments,” he said.
“I want to thank everyone whose hard work and dedication over the past 13 years made this challenging operation a great success.
The company share price dropped 78 cents, 1.27 per cent, to $60.57 at the time of the ASX’s closing, following it’s May peak of $79.24.