Ukrainian billionaire Gennadiy Bogolyubov's Consolidated Minerals has become the latest Pilbara operator to slash its workforce, with the manganese and chromite miner chopping jobs at both of its WA mines.
Sources say ConsMin took the drastic action to cut costs in recent weeks, with the company shedding about one third of the workforce at its Woodie Woodie manganese operation. It is understood about 80 workers have been laid off since the beginning of the month.
More than 20 jobs have been cut from ConsMin's Coobina chromite mine, near Newman, and a small number of contract workers at both operations have also been shed.
ConsMin produced about 400,000 tonnes of manganese ore from Woodie Woodie in the June quarter.
The company said its cash costs had fallen since it moved to an owner-miner model earlier this year after sacking the mining contractor. However, ConsMin reports cash costs on a consolidated basis and does not separate its Australian and Ghanean operating costs.
Across its operations in manganese, cash costs averaged $US3 per dry metric tonne unit while the price received for the manganese averaged $US4.35/dmtu.
That price may have fallen in recent months, with other manganese producers reporting falls in September and October as Chinese steelmakers reduced production.
ConsMin reported a $US491 million paper loss last year after booking a $US495 million impairment to the value of its Australian assets. Underlying before tax profits from operations for 2011 were $US126 million.
It is understood ConsMin expects to be able to maintain production levels despite the cuts at Woodie Woodie.
A new mine plan implemented earlier in the year allowed it to drastically drop the waste ore being mined, and it is understood ConsMin believes further production improvements can be found by targeting higher grade areas at the mine.
Coobina produced 110,800t of chromite ore in the June quarter but was operating on thin cash margins for the period. According to ConsMin's last quarterly report, the average cash cost at Coobina was $US222/t, with an average sale price of $US231/t.ConsMin only returned Coobina to production in late 2010, after the mine was mothballed at the height of the global financial crisis amid a sharp drop in commodity prices.
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