Guy Quenneville
Northern News Services
Published Friday, December 19, 2008

SOMBA K'E/YELLOWKNIFE - Rio Tinto is cutting back considerably on the number of contract workers originally slated for underground mine construction work at the Diavik Diamond Mine next year.

On Wednesday the company advised its underground contractor, Kitikmeot Cementation Mining & Development (KCMD), that it will require "significantly" fewer workers to complete construction of Diavik's underground infrastructure, said Doug Ashbury, acting spokesperson for the Diavik mine.

Despite repeated attempts Thursday, KCMD could not be reached for comment.

The news comes a week after Rio Tinto announced it is pushing back the beginning of Diavik's underground production from the first quarter of 2009 to the third quarter of 2009 as part of its worldwide effort to lessen financial risk during the global economic crisis.

"We have more time to get the underground mine ready. As a result of that, we will need less workers to do that," Ashbury said.

Asked how many workers will be affected by the cuts, Ashbury said, "It is a significant number, but I don't know the number."

But the vast majority of underground construction workers under contract are southern, he said.

The original underground mine plan called for construction to run throughout the Christmas season. But this week Rio Tinto decided to put the underground mine into care and maintenance from now until early January, with only a handful of people on site, said Ashbury.

Construction will then resume in January with reduced manpower. Construction of the underground mine infrastructure is now expected to be complete in time for the third quarter, he added.

"That timeline remains solid," he said.

Jon Jaque, president of the Yellowknife Chamber of Commerce, hopes that any Northern workers laid off by KCMD will be rehired by the Diavik mine.

He views a recent memorandum of understanding - signed by the Yellowknife area's three diamond mines and aimed at maximizing Northern hiring at the mines - as a positive sign.

"They're talking about this MOU," said Jaque. "The mines are coming together to work on labour issues. It's interesting that this is all coming to pass as this is happening."

While Ashbury did not go so far as to say that any Northerners laid off by KCMD would be rehired by the Diavik mine, he said, "We do have a commitment to hire Northern workers."