Chilean union calls on BHP to change strategy in Escondida mine talks

SANTIAGO (Reuters) - The union at Chile’s Escondida copper mine, the world’s largest, said on Tuesday that BHP must alter its negotiating strategy and improve its contract offer during a final phase of talks if it hoped to avoid a strike.

FILE PHOTO: Miners watch from a lookout point at the La Escondida copper mine, the world's biggest copper mine, near Antofagasta, Chile March 31, 2008. REUTERS/Ivan Alvarado/File Photo

The two sides set the agenda for the last round of talks on Tuesday after the company on Monday requested government-led mediation just hours before unionized workers had threatened to walk off the job.

“They (BHP) still haven’t changed their strategy, they think that with a bonus they can buy out our (contract) benefits,” Carlos Allendes, a union spokesman, told Reuters on Tuesday before beginning talks in the northern coastal city of Antofagasta, near the mine.

BHP’s final contract offer two weeks ago included a signing bonus of about $18,000, plus separate bonuses intended to buy out clauses in a previous contract that allowed for housing benefits and a loan program.

The total package was valued at $27,700, including a salary increase of 1.5 percent.

But the union had asked for a signing bonus of almost double that offered by the company, and had requested a salary increase of 5 percent, leaving a wide gap between the two sides.

BHP declined to comment on the first day of the government-led talks, which are slated to continue until Aug. 13.

A strike would begin on Aug. 14 if there is no agreement, though the talks could be extended by another five days if both sides agree.

“They need to change their outlook. [For us] it’s not a question of money right now. It’s a question of long-term benefits,” Allendes said in a phone interview.

Chile’s Mining Minister Baldo Prokurica on Tuesday called the company’s decision to opt for government mediation “good news” and urged the parties to reach agreement for the “good of the country.”

Last year, a 44-day strike at the mine jolted global copper markets and slowed economic growth in the South American country, which is the world’s top copper producer.

Copper prices rose slightly on Tuesday on hopes that China would boost spending on public works projects after several days of losses amid a mounting trade dispute between the United States and its trading partners.

Escondida produced 925,000 tonnes of copper in 2017.

Additional reporting by Dave Sherwood; Editing by Paul Simao