Teck cuts 1,400 jobs, 2009 coal production
By Cameron French
TORONTO (Reuters) - Teck Cominco Ltd will cut about 1,400 jobs, or 13 percent of its staff, as part of a plan to lower costs and keep competitive following a sharp drop in commodity prices, the mining company said on Thursday.
Teck, which has been cutting costs to pay down nearly $10 billion in debt taken on to acquire Fording Canadian Coal Trust, expects to save about C$85 million ($71 million) annually with the job cuts.
It also said it plans to reduce 2009 coal output by around 13 percent to 20 million metric tons due to declining global demand from steel-making and other industries.
About 1,000 employee and 400 contractor positions will be eliminated by the end of 2009, largely in the first quarter, said Teck. It expects to take a $35 million charge for severance and related costs in the first quarter.
"Given continued economic uncertainty, a significant reduction in our workforce is needed to further reduce costs and position Teck for both short and long-term competitiveness," Chief Executive Don Lindsay said in a statement.
Teck's shares were down 3.9 percent at C$7.30 on the Toronto Stock Exchange following the news.
The company, which is also a top copper and zinc producer and has holdings in the Alberta oil sands, took over Fording to get full control of the Elk Valley Coal Partnership, one of the world's top producers of metallurgical coal. Continued...