Chile Collahuasi Resumes Limited Operations After Strike Shutdown

Operations at Chilean copper mine Dona Ines de Collahuasi restarted Wednesday, albeit at a limited rate, following a five-day contract workers strike that halted the mine, a company spokeswoman said.

Mining operations will ramp up to normal levels over the next few days, she added. The strike ended without the contract workers receiving any new benefits.

Operations were stopped over the weekend after striking contract workers barricaded the road leading into the mining compound, leaving 4,000 workers stranded inside with dwindling water and food supplies.

The contract workers began the strike Friday by the blocking access to the Collahuasi mining complex located around 4,500 meters above sea level in the Andes mountains in northern Chile.

The contract workers, employed by over a dozen mining services providers, sought improved working conditions and production bonuses of around $2,000 a person.

Tuesday night, police broke up the strike, considered illegal as workers weren't in the process of negotiating new contracts, allowing stranded workers to go home.

The disgruntled contract workers took their protests to the port city of Iquique amid claims that the government gave police the order to break up the strike.

Labor leader Cristian Cuevas, who rallied contract workers at state copper miner Corporacion Nacional del Cobre a few years ago, told La Segunda evening daily that he was concerned this was a signal of how the new conservative government of Sebastian Pinera was going to deal with labor movements.

"If this is how [the government] will deal with workers and how it will resolve conflicts, then our call is for more mobilizations," Cuevas is quoted as saying.

Collahuasi is owned by diversified mining companies Xstrata PLC (XTA.LN), Anglo American PLC (AAL.LN, AAUKY) and a consortium led by Mitsui & Co. (MITSY, 8031.TO).

The mine, one of the largest in the world, produces about 500,000 metric tons of copper a year, or about 10% of Chile's annual output. The South American nation is the world's leading copper producer, accounting for about 35% of global output.

-By Carolina Pica, Dow Jones Newswires; 56-2-715-8919; carolina.pica@dowjones.com

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