Mining companies are hurting everywhere

IT IS easy in Australia - with 10,000 coal jobs gone from Queensland and New South Wales in two years - to think that we are the only ones doing it tough.

But the world's 40 largest mining companies are hurting everywhere, with their value falling $280 billion in 2013, losing almost a quarter of their worth.

The combined profits for these powerhouses fell by 72% to $20 billion - the lowest for a decade.

Pricewaterhouse Coopers' Mine 2014 report tells how chief executives at the world's 40 largest mining companies have faced sleepless nights, with almost half losing their ivory tower positions since 2011.

It warned that mining giants including Central Queensland players BHP Billiton, Anglo American, Rio Tinto, Vale and Sumitomo must walk the line between cutting costs while squeezing the most from their operations.

PwC Australia spokesman Jock O'Callaghan said the industry was moving quicker than ever before.

"There's no doubt the industry has moved fast to counter its sudden change in fortune: fleets were parked, jobs slashed, development projects deferred - every dollar spent requires care and consideration," he said.

"These are the sorts of traditional levers just about every mining company in the world has employed at some point in recent years but they are ultimately unsustainable and they simply won't support growth," he said.

At a time when so many workers have either changed roles or left the industry, PwC warns that "people" are a major factor in a mine's success.

Even with a strong plan for mining and all the key data, it found operations will be hindered if they do not amass the best skills or workers.

Part of that growth could be led by interest from beyond our shores.

PwC reports state-owned Coal India has up to $6.7 billion to spend on coal mines over five years.

It found, "Coal India has discussed strategic alliances with companies such as Peabody Energy and Rio Tinto to mine coal in Australia, the US, South Africa and Indonesia."

The Queensland Government through budget papers this week estimated world coal prices would increase gently between now and 2017, delivering an extra $1.5 billion to government coffers.


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