Fortescue Metals has halved its spending plans in response to weak iron ore prices.
The company has reduced its capital expenditure forecast for the 2014/15 year from $US1.3 billion to $US650 million, but maintained its production target of between 155 million and 160 million tonnes of iron ore.
“In the current environment it is prudent to defer investing additional capital that increases supply into the market,” chief executive Nev Power said.
“We will maximise output from our world class mining and infrastructure assets and remain focused on factors within our control to ensure the efficiency of operations and cash discipline to continue the program of early, voluntary debt repayment.”
Iron ore prices have almost halved in 2014, and are currently around five year lows.
Both Rio Tinto and BHP Billiton have also cut their costs and expenditure, while increasing iron ore production.
Fortescue’s expenditure cuts will be achieved through reduced exploration, more efficient construction of a berth at Anderson Point at Port Hedland, and deferral of other works.
As market conditions improve, deferred projects would be restarted with minimal impact on expenditure, Mr Power said.