Rio Tinto to Slow Damond Mine Expansion

Rio Tinto Ltd. said Wednesday it would cut production and jobs at a diamond mine in Outback Australia because of the global economic downturn.

Underground expansion work at the Argyle diamond mine in the north of Western Australia state would be "slowed to only critical development activities," the company said in a statement.

"Given global market conditions, we will also reduce diamond production by taking an extended maintenance shutdown of the diamond processing facilities for up to three months, commencing in March," Argyle Diamonds chief operating officer Kevin McLeish said in the statement.

Workers and contractors would be laid off, though the company did not give numbers.

London-based Rio Tinto group has said it would cut 14,000 jobs worldwide, around 12.5 percent of its work force, and reduce capital investment as part of new measures to reduce its debt of around $US40 billion.

Rio Tinto shares, which are traded on the Sydney and London bourses, rose slightly in Australia Wednesday to close at 40.61 Australian dollars.