Yesterday, Fortescue Metals Group (FMG) revealed that there is a drug problem at its worksites. The news comes after an alleged seizure of $25,000 cash and methamphetamine in a company owned workers’ village a few weeks ago. it was reported that a 31 year old man working for a subcontractor (Bam Clough) was charged by police with drug offences.
Fortescue executive Richard Kinnane told community business leaders that the rapidly increasing drug use in the community had infiltrated the company’s workforce. He outlined the drug problem affecting the port headland region presently and that what they are seeing on their worksites he can only assume is the same in the community.
Having workers that are using drugs creates a high level of risks for other workers as well as the company itself. FMG has stated they have a zero tolerance towards drug use and have recently put in place new measures aimed to help any employee that may be battling a drug problem through their ‘Speak Up’ program. Through the program, those who admit to having a drug problem are given the chance to avoid termination of their employment.
Fortescue Metals Group is the fourth largest iron ore producer in the world, based in the Pilbara region of Western Australia. The company’s share price has been questionable of late as the iron ore price heads towards $100USD per tonne. Economists and hedge fund managers alike have been short selling their interests in the company as the iron ore price slides as this makes it a lot harder for the company to pay back around $6 billion of debt. Based on historical data, FMG Stocks are traditional tied to the iron ore price. back in 2010 when iron ore prices dropped 26% FMG’s stocks took a similar dip by 31%. A repeat of history could very well see the end Fortescue.