SANTIAGO—Chilean copper giant Codelco will keep its Teniente division, home to the world's largest underground copper mine, shut until at least Friday morning due to an at times violent strike by subcontractors, a company source said Thursday.
Codelco, which produces around 1.7 million tonnes of copper a year, first closed two smaller divisions, Salvador and Andina, 16 days ago due to the latest in a series of strikes by subcontracted miners demanding more pay and improved working conditions.
"The shifts will remain suspended until we have new security measurEs in place for the transport of workers. On Friday we will reassess the situation," the source told Reuters on condition of anonymity.
However, union leaders representing full-time staff at Teniente this week called on their members to halt work indefinitely to protest the strike violence blamed on their subcontractor colleagues.
Another Codelco source said some workers were in Andina maintaining equipment to pave the way for the resumption of production, but that given the long Labor Day weekend he did not expect major changes at any of the three disrupted divisions until Monday.
"There is no change," he said. "As far as Andina goes, we are studying it. It will slowly resume production."
State-owned Codelco said on Tuesday that the two-week strike has cost it 19,000 tonnes in lost production, or around $100 million in financial losses.
The source said he saw no need for the company to ask clients to delay or cancel orders, saying the amount of production lost so far was relatively small. Codelco has publicly denied market talk it was approaching third parties to buy or borrow copper to meet delivery commitments.
"I don't seen any major supply risks," he said.
The Confederation of Copper Workers, which groups thousands of subcontractors, launched their new companywide strike over work conditions and to demand a bigger share of windfall revenue from prices up nearly sevenfold this decade.
Subcontractors have vowed to push on with their protest, which has helped keep global copper prices near record highs of about $4 per lb at a time when markets are already nervous about low inventories.
Protesters have broken bus windows with stones and caused some injuries, blocked roads, burned tires and damaged mine equipment. Subcontractors deny they are responsible, and have accused Codelco of staging incidents to make them look bad.
Codelco says it has fulfilled its end of agreements reached last year with subcontractors, including a deal to absorb some of them as full-time staff.
The government wants a quick end to the feud, the latest in a series of headaches for Chile's president, Michelle Bachelet.
Andina, about 50 miles (80 km) northeast of the Chilean capital, produced 218,000 tonnes of copper in 2007. Salvador, 685 miles (1,102 km) north of Santiago, produced 64,000 tonnes of copper last year.
Teniente, 50 miles (80 km) south of Santiago, produced 405,000 tonnes of copper last year. Codelco's Norte and Ventanas divisions have run normally throughout the strike.
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