UPDATE 3-Chile Collahuasi mine back to normal, strike drags

Tue May 18, 2010 4:56pm EDT

 * Mine says back to normal output
 * Prolonged strike could delay expansion projects-union
 (Recasts, Updates with Collahuasi confirmation that mine back
to normal)
 SANTIAGO, May 18 (Reuters) - Chile's giant Collahuasi
copper mine has returned to normal operations despite a
subcontractor work stoppage that entered its 12th day, the
company said on Tuesday.
 Collahuasi spokeswoman Bernardita Fernandez confirmed the
mine resumed normal operations, but added she did not know when
the operator planned to lift the force majeure on copper
shipments.
 Union president Manuel Munoz said the mine, one of the
world's largest, returned to normal output levels Monday
afternoon using full-time staff and contractors not
participating in the stoppage.
 Collahuasi, which produces 3.3 percent of the world's mined
copper, resumed limited operations on Wednesday last week, a
day after subcontractors lifted a blockade to the mine after
police stormed the site.
 The mine, which is jointly owned by Anglo American (AAL.L)
and Xstrata XTA.L, produced 535,000 tonnes of copper in
2009.
 A prolonged strike, Munoz said could delay expansion
projects at the mine. Some in the industry fear labor troubles
might spread to other mines in the world's top copper
producer.
 "Most of the subcontractors work in expansion projects,"
Munoz said. "It is very likely that the expansion objectives
would be delayed."
 Fernandez said the current ramp-up included work at
expansion projects and added the mine's operator had moved to
improve living conditions for workers.
 Chile in February approved a $750 million project that
allows Collahuasi to increase mineral processing capacity by 20
percent. [ID:nN01215337]
 Subcontractor strike leaders, who said they represent
around 4,000 workers, vowed to continue the 12-day stoppage
after walking away from talks with the company late Monday.
 "Subcontractors at other mines are in a state of alert,
watching how things develop here," said Ricardo Arellano, one
of the subcontractor leaders. "We will not let this stand."
 He said subcontractors were analyzing taking further action
to get the company to accept their demands to improve working
conditions and raise their pay.
 There have been no reports of subcontractor strife at other
mines across Chile.
 In 2007 and 2008, subcontractor protests that occasionally
 turned violent cut output at the world's top producer Codelco,
forcing the state giant to pay higher wages and improve working
conditions.
 (Reporting by Alonso Soto; Editing by Sofina Mirza-Reid)


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