* Says work action started on April 1
* Says work action due to retention bonus issues
* Co, labor union and govt labor body in talks
* Sees 2010 copper, gold production hurt
April 7 Canada's Inmet Mining Corp IMN.TO
confirmed that a mine in Papua New Guinea was subject to what
it called "illegal work action" by unionised employees a week
ago which would also hurt its 2010 production view.
The work action by union employees at the Ok Tedi mine was
due to concerns on distributions under an employee retention
bonus arrangement that was not part of the industrial
agreement, Inmet said in a statement.
Inmet said that the Papua New Guinea Department of Labour
and Industrial Relations, called in to facilitate talks between
the company and the union, indicated that the strike action is
"unlawful" and that employees should return to work.
The base metals miner said that discussions between the
parties were continuing and that it was currently not possible
to say how long the work action will last.
Toronto-based Inmet's estimated that for each day the work
action continued, its 2010 copper production would be hurt by
80 tons a day, while its gold production would be hurt by 300
ounces a day.
Inmet estimates that it has already lost about 0.4 percent
of its forecast 2010 copper production and 1 percent of its
forecast 2010 gold production to date.
In January, Inmet had said its expected share of copper
production at Ok Tedi would be 39,300 tons, while gold
production would be 109,3000 ounces.
Inmet shares were down 1.3 percent at C$59.70 in morning
trade on the Toronto Stock Exchange.
(Reporting by Isheeta Sanghi in Bangalore; Editing by Savio