Codelco’s chief executive Nelson Pizarro is following through with his promise of cutting costs “to the bone” as the Chile-owned miner announced it has cut almost 3,900 jobs, including contractors, in response to low prices and weak demand.
Until now, the world’s top copper producer had only disclosed the layoff of about 400 employees, mostly staff members in top positions.
The fresh and massive cuts bring the number of layoffs to over 4,000, making of Codelco the mining company that has let go the highest amount of workers in Chile since metal prices began their decline over a year ago.
According to Pizarro, the “painful, but necessary” move has not affected production, local newspaper El Mercurio reports (in Spanish). “What’s more, the company’s output has grown 5.5% during the last year, and costs have dropped by about 11%,” he told the paper.
Last week, the country’s Finance Ministry announced it would give the miner $600 million in funds to help fund a five-year spending plan.
The capital injection, which will come from government bond sales, was announced after Pizarro presented an updated investment plan that reduced to $21 billion or $22 billion an original proposal of $25 billion, which aims to avoid a slump in output as existing deposits run out of profitable ore.
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