UPDATE 6-Chile Collahuasi mine resumes limited operations

Wed May 12, 2010 8:13pm EDT

 * Mine resumes limited operations, seeks talks
 * Collahuasi declared force majeure
 * Mine eyes normal operational levels in coming days
 * Subcontractors to forge on with protest from nearby city
 (Updates with mine seeks resumption of talks)
 By Antonio de la Jara and Fabian Cambero
 SANTIAGO, May 12 (Reuters) - Chile's giant Collahuasi
copper mine said on Wednesday it had resumed limited operations
a day after protesting subcontractors lifted a blockade, and
hoped to return to normal levels in coming days.
 The mine said earlier on Wednesday it had declared force
majeure, a contract clause that enables it to default on
delivery obligations, because of the protest.
 Subcontractors left the mine on Tuesday night to avoid
clashes with police. The Collahuasi mine produces 3.3 percent
of the world's mined copper.
 "Collahuasi started to operate in a restricted way during
the afternoon ... and expects to return to normal operational
levels in coming days," Collahuasi spokeswoman Bernardita
Fernandez said in a statement.
 She said the company had asked local authorities in the far
northern region of Tarapaca to arrange talks with subcontractor
representatives for Monday, May 17.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
 ANALYSIS-Chile copper may take hit on protest [ID:nN11103356]
 TIMELINE of Chile's major mining strikes      [ID:nN1199411]
 FACTBOX of Chile copper labor contracts       [ID:nLDE60A1JH]
 FACTBOX on Chile's giant Collahuasi mine      [ID:nN1198815]
 Map: Chile top copper mines link.reuters.com/zad85j
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 Collahuasi, which produced 535,000 tonnes of copper last
year, was forced to halt operations on Saturday, a day after
hundreds of subcontractors blocked access to the mine with
burning tires and rocks to demand better working conditions and
pay.
 Subcontractors vowed to push on with their protest, but
from the northern city of Iquique.
 SHIPMENTS CONTINUE
 Port officials at the mine's exporting port of Puerto
Patache said that shipments had not been affected by the
protest, and that a ship was waiting to be loaded with copper
from the mine.
 "What has happened at Collahuasi has not affected
(shipments) because the cargo was already ready for loading,"
an official at the port of Puerto Patache told Reuters, asking
not to be named in line with policy.
 He said a ship was waiting to be loaded with the latest
export cargo.
 "There is copper," he added. However no details on
Collahuasi's stock levels were immediately available.
 Subcontractor union leader and spokesman Alejandro Allende
said the subcontract workers had moved their protest, now in
its sixth day, to the city of Iquique where they would hold
internal talks to define their action plan.
 "None of our (subcontractor) workers will go up to
Collahuasi," he said, adding he did not think Collahuasi would
be able to normalize operations within 24 hours because
subcontractors fulfilled key roles throughout the production
process.
 Global miners Anglo American (AAL.L) and Xstrata XTA.L
each own a 44 percent stake in Collahuasi. A Japanese
consortium led by Mitsui & Co (8031.T) is a minority
stakeholder.
 Mining companies face a growing risk of more protests if
they fail to raise benefits and improve conditions for
thousands of part-time workers who are needed for operations in
a country that extracts a third of the world's mined copper.
 In 2007 and 2008, sometimes violent subcontractor protests
cut output at the world's top producer Codelco, forcing the
state giant to pay higher wages and improve working
conditions.
 (With reporting by Simon Gardner; editing by Carol Bishopric)


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