Rio Tinto’s Rossing Mine May Add to Job Cuts

By Felix Njini

May 22 (Bloomberg) —- Rossing Uranium Ltd., a unit of Rio Tinto Group in Namibia, will probably add to last year’s job cuts as the company tackles reduced demand and lower ore grades.

“It is very likely that we will cut jobs,” Managing Director Werner Duvenhage said in an interview. “How many people we will lay off, we don’t know yet.”

Rossing fired 276 workers last year as demand for the metal used in nuclear power stations weakened around the world after Japan’s Fukushima atomic meltdown in 2011. The mining company is reviewing operations, also hurt by worsening ore grades. Output fell to about 2,400 metric tons last year from 4,200 in 2009.

“We will have to come up with a plan that would see us through this difficult period,” Duvenhage said. “We simply do not know what will be the outcome of this review exercise.”

Rossing Uranium may consider exploiting the Z20 deposit, south of its main pit, after the company review and when the outlook for prices is improving at prices above $60 a pound.

The deposit is a “significant asset with fairly good grades, slightly better than current grades,” Duvenhage said.

Uranium fell to $29 a pound on May 2, the lowest since June 2005 and extending the year’s drop to 16 percent, according to TradeTech, a Denver, Colorado-based consultant to the nuclear industry.

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