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MARQUETTE - Development of the Kennecott Eagle Minerals Company nickel and copper mine on the Yellow Dog Plains has been "deferred until market conditions recover."

The announcement was made today in one line from a 38-page press release from Kennecott parent company Rio Tinto, which discussed the global company's 2008 financial performance.

But Kennecott Eagle Project Manager Jon Cherry said the news will not change the company's immediate plans for the mine. Officials will still work on permitting and litigation issues surrounding the project.

"There's no real change," Cherry said. "Our office is still here, our people are still here."

Though Rio Tinto reduced its net debt by $6.5 billion last year, posted underlying earnings of 38 percent above 2007 and had record 2008 production in iron ore, bauxite, U.S. coal, hard coking coal, alumina and borates, net earnings totaled $3.7 billion, half what they were the previous year, according to the release.

In December, Rio Tinto announced it would eliminate 14,000 jobs, cut capital spending from $9 billion to $4 billion for the coming year and expand the scope of assets targeted for divestment, including "significant assets" not previously up for sale.

At that time, Rio Tinto Chief Executive Tom Albanese said the measures were being taken in "response to the unprecedented rapidity and severity of the global economic downturn, which has caused sharp falls in commodity prices and a significantly weaker outlook."

Albanese said Rio Tinto remained committed to an exploration and development strategy. But Albanese also said the company's capital expenditure reductions would result in "impacts on projects across the board. Some projects will be canceled and others deferred until markets recover."

Rio Tinto said then those projects would be announced today.

In December, Cherry said despite Rio Tinto's steep cutbacks, efforts to develop the company's proposed mine on the Yellow Dog Plans were continuing, with additional exploration and development slated for the future.

"We've got a world-class ore body here. It's the highest grade ore body in the world," Cherry said. "We're taking the long-term view of nickel mining in the Upper Peninsula."

Some financial analysts speculated the $300 million Eagle Project could have made Rio Tinto's canceled projects list because of faltering nickel prices and delays in starting the mine due to legal challenges over permits, which are continuing.

Even if legal challenges were soon resolved in the company's favor, construction on the mine would take two years to complete before operations would begin.

This could mean the project deferment may not end up having much of an impact on the company's plans for the Eagle Mine. But depending on how long it takes for the markets to rebound, the deferment might also pose big problems for Kennecott.

When asked what the company would do if it was legally able to begin construction in April, Cherry said, "We'd have to wait and see how things looked then. We'll just have to see how it all fits together."

Meanwhile, the Michigan Department of Environmental Quality has scheduled meetings and public hearings next Wednesday to take public input on Kennecott's plans to reuse the Humboldt Mill.

The $80 million project would be expected to process ore from the Eagle Mine before it is shipped by rail to Canada for further processing. The facility is also eyed by Kennecott because there is room to expand processing there if additional Kennecott mining prospects in the area pan out.

Cherry said today's project deferment announcement would not affect the sessions.

Kennecott officials said about 100 construction jobs and 50 full-time jobs in operation would be created at the Humboldt Mill. The Eagle Project, situated in northern Marquette County, would mine a six-acre underground deposit expected to yield 250 million to 300 million pounds of nickel and about 200 million pounds of copper.