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World’s biggest copper mine moves closer to strike

The Sindicato 1 at Escondida mine represents more than 2,000 employees. (Image: AFP video |YouTube.)

Unionized workers at Escondida mine in northern Chile have rejected BHP’s (ASX, LON, NYSE: BHP) latest offer, which sought to avoid a strike at the world’s largest copper operation at a time of tight global supplies and high prices.

The Australian miner and Sindicato 1, which represents more than 2,000 employees, reached an agreement on Monday that included “a series of productivity measures” to benefit workers and the company.

The deal came after days of negotiations with union representatives, who had called for a strike on November 21 and 23 due to multiple “non-compliances, infractions and violations” committed by BHP.

Union members vote against the agreement, saying they were ready to walk off the job on November 28 and 30 if the company did not meet their demands.

The world’s largest miner has denied workers claims that said BHP has failed to comply with legal regulations and the current collective agreement. It says it has always operated the mine following the “highest standards of occupational safety and risk prevention.”

Missing promised bonus

The union said on Thursday its members considered proposed security measures included in the latest deal to be “insufficient” and wanted “concrete and verifiable” measures, such as joint inspections of work areas.

It also said that BHP had previously offered a bonus equivalent to about $3,100 per worker and to regularize an operating practice, which was not included in the current collective agreement.

Chile is the world’s top copper producer, and sales of the metal make up for about 60% its export earnings.

In 2017, Escondida workers staged a 44-day strike, the longest in Chilean mining history. The labour action cost the company $740 million in losses and meant a contraction of about 1.3% of Chile’s GDP.

The operation, responsible for about 5% of the world’s total copper output, is majority-owned and operated by BHP. Rio Tinto and Japanese companies such as Mitsubishi Corp also hold stakes in the mine.

Chile’s state owned mining company Codelco, the world’s biggest copper producer, warned on Thursday that global shortages of the metal may reach eight million tonnes by 2032, as soaring demand continues to offset new projects numbers.

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