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DJ Zambia Munali Nickel Mine Cuts 271 Jobs-Union
Dec 08, 2008 (Dow Jones Commodities News via Comtex) --

DOW JONES NEWSWIRES

Zambia's sole nickel mine, Munali Nickel Mine has laid off 271 workers citing dropping global metal prices, a union official told Dow Jones Newswires Monday.


Sikufela Mundia, president of National Union of Miners and Allied Workers said that management has laid off the workers as a cost-cutting measure in a wake of dropping nickel prices on the world market.

"The Munali Nickel mine management has decided to lay off workers due to reducing nickel prices," he said, adding that the unions would continue to fight against the lay offs.

In the past few weeks, hundreds of miners have lost their jobs in Zambia as companies continue to feel the pinch of dropping metal prices. Company officials could not be reached for an immediate comment.

According to Mundia, the union signed a memorandum of understanding with Albidon Ltd (ALB.AU), owners of the mine last year but most of the workers are not yet unionized.

Munali started commercial nickel production in the middle of this year and is Zambia's sole nickel producer, according to company data. Initial annual production is projected at 8,600 metric tons of nickel. The mine has a 10-year life span.

Last year, Albidon said that it also plans to produce 1,400 tons of copper, 400 tons of cobalt and 15,000 ounces of platinum group metals per year at the mine.

Since 2002, Zambia's mining sector has been on its way to recovery after years of unimpressive performance amid low metal prices in the 1990s. However, analysts have warned that the current turmoil in commodity markets could reverse the gains made in the sector.

-By Nicholas Bariyo, contributing to Dow Jones Newswires; +256-75-2624615; [email protected]

(END) Dow Jones Newswires