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DARWIN, Feb 13 AAP

February 13 2013, 6:39PM

People who work in the outback centre of Nhulunbuy in Arnhem Land are joyous at news mining giant Rio Tinto Ltd will be keeping open its giant alumina refinery in Gove.

The prospect of the plant being mothballed sent a chill through Nhulunbuy, a town of about 3800 people built to service the huge refinery and associated bauxite mine.

But on Wednesday global miner Rio Tinto announced it would be keeping open the refinery.

The news was greeted by cheers from refinery staff and relief among others who work in the town.

"We are thrilled and pleased the worry is over," said Judy Carter who co-owns the Nhulunbuy newsagency.

"It has been hanging over the heads of all the miners, the contractors and all of East Arnhem Land," Ms Carter said.

She has run the newsagency for the past 26 years and said she now hoped the town would regain its former vibrancy.

"It would have been devastating if it had closed, because it would have taken away a lot of services people rely on," she said.

Ainslea Barnes, 17, who works at the local tackle shop to save money to go to university next year, said she had been worried about her job.

"It is a great relief to know I have secure full-time work this year," Ms Barnes said.

She said Nhulunbuy was a great place to live, even though it was usually pretty hot.

"It has everything you need to survive and has more of a community feel than most cities do, which is always nice," she said.

Rebecca Johnston who works at the Arnhem Club, which includes a restaurant, bar and sporting facilities, said business had already turned for the better.

"Our restaurant is pre-booked out with people celebrating," she said.

"The big bosses of Rio are all coming down and everybody is happy."