Colombia coal miner Cerrejon, union fail to reach contract agreement

BOGOTA, March 6 (Reuters) - Cerrejon, one of Colombia’s biggest coal producers, and its largest workers union on Friday concluded contract negotiations without reaching an agreement, the parties said.

Union members will now vote on whether to strike or to go to arbitration with the company.

“There was no agreement. We will call a vote between a strike and an arbitration,” Igor Diaz, president of Sintracarbon, told Reuters in a message. “Right now we are closer to a strike than we are to a solution.”

“Negotiations remain ongoing,” Cerrejon said in a message, which is owned equally by BHP Group, Anglo American and Glencore.

The company exported 26.3 million tonnes of coal in 2019 and has 5,896 employees, of which 4,600 are union members.

The union is demanding a pay rise of 7.8%, as well as additional health, education and accommodation benefits. The mining company, which offered a rise of 3.8% to match inflation in 2019, is also in talks with smaller union Sintracerrejon.

The initial negotiation period between the miner and Sintracarbon ended on Feb. 15 but both groups agreed to a further 20 days of negotiations, which expired on Friday.

The last strike at Cerrejon was in Feb. 2013 and lasted 32 days.

Last year, coal prices fell to an average of $51.40 per tonne, down from $82.50 per tonne in the previous year, according to the Energy Ministry.

Colombia is the fifth-largest coal exporter in the world. The fuel is the Andean country’s second top source of foreign exchange after oil.

Cerrejon, located in La Guajira province, also controls a 150-kilometer (90-mile) rail line and a seaport that receives ships which can carry up to 180,000 tonnes of cargo.

Reporting by Luis Jaime Acosts Writing by Oliver Griffin Editing by Nick Zieminski