BHP Billiton has cancelled a $ 360 million mining services contract with Downer EDI at a Queensland coal mine, putting more than 400 jobs at risk.
Downer said it was informed late yesterday that its contract at the Goonyella Riverside mine in central Queensland, where it employs 427 people, would be terminated by the BHP Billiton Mitsubishi Alliance in September.
The contract was scheduled to end in June 2016.
The termination will reduce Downer’s work-in-hand by $ 160 million in the 2014-15 financial year and by $ 200 million in 2015-16, the company said.
Downer will be entitled to compensation for early termination under the terms of the contract.
Major coal miners have been cutting costs and shutting some mines in response to falling prices, caused mainly by global oversupply.