January 13, 2009

Uruguayan iron ore port project on hold

The sluggish world economy has claimed a major iron ore port project in Uruguay for the time being, government officials said Tuesday.

Rio Tinto, a major Anglo-Australian mining concern, said it will hold off on the $320 million project for at least one year, the Latin American Herald Tribune reported.

Transportation and Public Works Ministry officials said the project would be completed once the global economy recovers.

It means the people of La Agraciada in Soriano province will not enjoy the 1,000 construction jobs and 180 permanent jobs any time soon, the report said.

Rio Tinto had proposed transporting iron ore from Brazil down the Parana and Uruguay rivers to the Uruguayan port. From there it would be shipped to Europe and China.

The Herald Tribune reported Uruguayan Transportation and Public Works Ministry officials said the government was notified by Rio Tinto of the decision Monday.

The port project is part of a $2.15 billion investment plan Rio Tinto has put on hold, the Herald Tribune said. Last month, the company said it would cut 14,000 jobs while concentrating on paying down $10 billion of its $38.9 billion debt this year.