Chile Collahuasi Copper Mine Prepares Contingency In Case Of Strike

Chilean copper mine Dona Ines de Collahuasi has an contigency plan in place should its workers go on strike on Friday, a company spokeswoman said Wednesday.

Management and the sole union at the mine are currently in the middle of a five-day government-mediated negotiation period scheduled to end on Thursday.

Earlier this week, the company sweetened its wage and benefits offer, which includes end-of-conflict and other bonuses totaling 13.5 million Chilean pesos ($27,600) per worker. The union represents 1,551 Collahuasi workers, or 90% of those eligible for union membership.

"We've set up an operational continuity plan which focuses on maintain operations and ensuring the safety of both employess and contract workers," the spokeswoman said.

A union leader close to the negotiations told Dow Jones that workers would likely opt to go on strike later this week in the hopes of obtaining even better benefits.

The leader, however, noted that the strike would likely be short-lived as the current conservative administration of President Sebastian Pinera has taken a tougher stance on street protests and violence.

"Things have changed since the previous government. I don't think this strike will last very long," he said on condition of anonimity.

The mine, one of the biggest in Chile, is owned by diversified mining companies Xstrata PLC (XTA.LN) and Anglo American PLC (AAUKY, AAL.LN), each with a 44% stake. A consortium led by Mitsui & Co. (MITSY, 8031.TO) holds the remaining 12%.

The mine produces about 500,000 metric tons of copper a year, or about 10% of Chile's annual output. Chile 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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