HUMBOLDT - With a recent move to scale back its mine production and processing schedule, Rio Tinto reduced its overall contractor employment by 20 percent.
In February, Rio Tinto officials said the company would shift first production of nickel and copper at the company's Eagle Mine and processing at the Humboldt Mill to the second half of 2014.
Officials said an aggressive construction season had been planned for this year and production was initially slated for early to mid-2014, but the decision was made to "moderate" the pace of construction in response to "economic headwinds" and volatility in commodities markets.
With scheduled work scaled back at the Eagle Mine in Michigamme Township, Rio Tinto recently laid off 11 employees, three of whom were reassigned to other company projects. The mining company continues to expect production at the mine to begin in late 2014. (Rio Tinto photo)
With news of the slowdown - which Rio Tinto said was affecting operations across the mining industry - the company was planning to finish any current construction work, but new construction would be rescheduled.
"We continue to review our construction schedule with the aim to commence production in late 2014," Rio Tinto spokesman Dan Blondeau said. "Unfortunately, due to the moderated construction pace at Eagle 11 people were laid off. Of those affected employees, three were reassigned to other Rio Tinto projects. Overall contractor employment was reduced by 20 percent."
Rio Tinto officials said construction work at the Eagle Mine in Michigamme Township is about 80 percent completed, with the overall project - including the Humboldt Mill - about half finished.
Even with the decreased construction efforts, Rio Tinto will continue to spend about $10 million each month on the mine and mill projects, Blondeau said.
Meanwhile, Rio Tinto has been using aerial surveys and drilling to better delineate the Eagle ore body and to look for more nickel and copper near Covington in Baraga County and in the Sidnaw area of southern Houghton County.
Last month, the Marquette County Road Commission voted unanimously to approve an agreement with Rio Tinto for upgrading three existing county roads leading from the company's Eagle Mine to Marquette. Marquette County roads 550, 510 and the Triple A will be improved to an all-season standard.
The two-year agreement covers work to be done from the railroad tracks along Marquette County Road 550 -situated just north of the Dead River and the city limits - to within three-quarters of a mile of the mine, located west of Big Bay.
Improvements are slated to begin this spring over roughly 34 miles of roadway, costing an estimated $44.4 million. Rio Tinto will provide about $6 million to spend up to June 30 of this year and the company will then release more funds as they become available under the agreement.
The project is set to be completed by Nov. 30, 2014.
John Pepin can be reached at 906-228-2500, ext. 206.