Mine jobs on hold as FMG shares the pain

Fortescue Metals Group has temporarily cut up to 60 positions from its Cloudbreak mine in the Pilbara, though it is understood no workers have lost their jobs.

It is understood the workforce changes will see about half of the affected staff voluntarily move to part-time job sharing arrangements for the next six months, with the remainder redeployed to other Fortescue operations.

It is believed Fortescue has deferred clearing waste rock over some of the ore body for six months, pushing the stripping costs into next financial year.

The Cloudbreak changes came after Fortescue shed up to 30 workers from its Christmas Creek operations late month as it reduced its mining fleet.

A Fortescue spokesman said yesterday the changes at the two Chichester operations were related to shifts in the mine plans, not a reaction to the persistently low iron ore price.

"Our employee numbers naturally vary from time to time due to normal fluctuations in the mining cycle, as we develop different parts of the ore body and make efficiency improvements," he said.

It is understood the mine plan re-jig is the result of an internal cost review, delivered in November, that promised total savings of $US650 million ($765 million) this financial year.

The savings were to come from re-engineering de-watering infrastructure, lower construction costs at its new berth at Port Hedland, exploration cuts, the cancellation of a $US105 million plant to upgrade detrital ore produced at its Solomon operations and the "reduction and deferral of operational capital expenditure".

Fortescue shares shed 7¢, or 2.5 per cent, to $2.67 yesterday after Australia's third-biggest iron ore producer released a 300 million tonne upgrade to its resource inventory around the Chichester mining hub.

While extra tonnes were added near both mines, the figures released yesterday show the new resources have lower iron grades and higher impurity levels than existing mining reserves at either operation.

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