Colombian coal production falls 8 pct in 3rd qtr vs year ago

BOGOTA Thu Nov 15, 2012 12:20pm EST

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BOGOTA Nov 15 (Reuters) - Colombian coal production fell 8 percent in the third quarter to 21 million tonnes versus the same period last year as labor disputes cut output in the world's fourth-largest coal exporter, according to data from the mining regulator.

Strikes at a key coal railway serving some of the country's top producers and at a large mine have had a negative impact on output in Latin America's top exporter of the material.

Drummond, the country's second-biggest exporter, saw production increase a paltry 1.7 percent in the quarter to around 6 million tonnes versus a year before. Output fell 8.5 percent versus the second quarter this year.

Glencore-owned mines saw output drop 21 percent due to a 3-month-long strike at La Jagua coal mine. La Jagua's is the highest-quality coal produced in Colombia and the mine's production plunged 92 percent in the third quarter.

Compared with the second quarter of 2012, total output from the mines f ell nearly 19 percent.

The walkout to demand higher wages and better working conditions started on July 19 and became one of the longest labor strikes in the sector's recent history, ending in late October.

Drummond and Glencore's Prodeco unit are shareholders in the Fenoco railway whose workers went on strike for more than a month in July-August.

In the July-to-September period, coal production at Colombia's largest exporter, Cerrejon, fell about 2 percent to 8.7 million tonnes versus the same period in 2011, regulator data showed. It decreased around 7 percent versus the second quarter.

The Andean nation's thermal coal sector is dominated by major producers such as Glencore, Drummond and Cerrejon, which is jointly owned by BHP Billiton Plc, Anglo American Plc and Xstrata Plc.

Labor strife has forced the government to lower its production goal to 93 million tonnes for 2012 from a previous target of 97 million tonnes. Colombia produced 85.8 million tonnes last year.

Colombia's mining industry has also faced increased attacks by Revolutionary Armed Forces of Colombia (FARC) rebels this year despite Bogota sending thousands of additional troops to protect the sector.

The government and FARC guerrillas have started a peace process aimed at finding a negotiated end to the 5-decade-old conflict. At the start of talks, rebels called for foreign oil and mining interests to leave the country.

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