Glencore to cut production at Collinsville coal mine in Queensland

28 May 2015 (Last Updated May 28th, 2015 18:30)

Glencore has announced plans to scale-down production at its Collinsville coal mine in north Queensland, Australia, by two million tonnes citing low coal prices.

Glencore has announced plans to scale-down production at its Collinsville coal mine in north Queensland, Australia, by two million tonnes citing low coal prices.

As a result, the company is cutting 80 jobs from the existing workforce of 340 at the mine, which opened in 1919.

According to Steve Smyth from the Australian trade union the Construction, Forestry, Mining and Energy Union (CFMEU), the company's latest decision comes as a blow for the community which still did not recover from the earlier closure of the mine that took place in 2013.

"The situation at Collinsville reflects the challenges being faced by all Australian coal mines in one of the most difficult markets in the industry's recent history."

With regard to the operational changes, Glencore is set to consult with its workforce at the mine.

The company said that it will investigate alternate marketing opportunities for the mining plans and continue to operate Collinsville at reduced capacity during the remaining part of the year.

Glencore said in a statement: "The situation at Collinsville reflects the challenges being faced by all Australian coal mines in one of the most difficult markets in the industry's recent history."

In 2013, when the mining company took over Collinsville from Xstrata for $29bn, it was in loss and closed in August same year.

in January 2014, the mine re-opened as a non-union operation.

Located in the northern part of the Queensland Bowen Basin, the Collinsville mine is part of the NCA Project and produces export steaming coal and coking coal for both domestic use and export from the open cut mine.

With coal reserves amounting to 196 million tonnes (mt) of coking coal, Collinsville has a production capacity of 6mt of coal a year.