Cleveland-Cliffs Inc. plans to shut down its Koolyanobbing iron ore mine in Western Australia by the end of June, The West Australian wrote March 20.
In January 2017, the company secured approval from the Environmental Protection Authority for the Koolyanobbing expansion. However, earlier this year, the U.S.-based miner hinted that it would close the operation by the end of 2018 due to profit decline resulting from increasing discounts from Chinese buyers for its lower-grade iron ore.
Cleveland-Cliffs informed its port and rail contractors regarding its plan to shut down the mine, a move that could affect hundreds of jobs.
Southern Ports, the operator of the Esperance port, told its employees that the company issued a notification of the closure date. Iron ore from Koolyanobbing made up 75% of Esperance's export tonnes in fiscal 2017.
"As soon as we can, we will communicate directly with you to advise how this change will impact you, and the broader workforce," Southern Ports CEO Nicolas Fertin said. About 130 Southern Ports workers are based in Esperance.
Rail haulage contractor Aurizon, which has a 90-member team on the haulage route along with rolling stock and assets in Kalgoorlie and Esperance, said it will start consultation with workers in the coming weeks.
"We will be working through operational issues as part of the ramp-down to June, including redeployment opportunities for our employees and for rolling stock," said a spokesperson for Aurizon.
Arc Infrastructure, which owns and maintains the Leonora-Esperance railway line on which Cleveland-Cliffs was a major customer, also expects redundancies, the report added.
The shipments from the 11-million-tonne-per-annum iron ore project will cease by the end of June.