BHP, Union reach agreement to suspend strike at world's largest copper mine in Chile

The workers' union at Chile's Escondida copper mine, which produces the largest amount of copper in the world, announced that a consensus has been reached with Anglo-Australian giant BHP to avoid a strike. The union, comprising of over 2,000 members, claimed that it had received almost unanimous support for a new collective agreement proposed by the management, quashing a strike notice which was filed last month on July 31. The Union also said it has completed all the necessary formalities regarding the new collective contract, which includes all the achievements made in the collective bargaining process. It further added that the negotiated conditions will be in force for the next 36 months. 

BHP holds 58% stake and manages mining operation 

According to a report by local media, the agreement included a bonus for each union member of $23,000, as well as nearly $4,000 for extra days, worked, in addition to other provisions. After their demands for a one-time bonus to acknowledge their work during the Coronavirus outbreak were not met, workers at the Escondida mine had announced their intention to strike. It is to be noted here that Escondida workers had staged a 44-day strike in 2017, the longest ever in the Chilean mining industry, resulting in a whopping loss of $740 million to BHP and also incurred a 1.3 per cent fall in the country's GDP. BHP manages the mining operation and holds a roughly 58 per cent stake while other investors include Rio Tinto PLC and Japan’s Mitsubishi Corp. The mining operation is already facing challenges from the COVID-19 pandemic. 

Chilean copper mines hit by COVID-19 pandemic 

BHP has been running its Chilean copper mines, including Escondida, with a limited workforce because of measures to prevent the spread of COVID-19. As per reports, copper prices also reached a new high earlier this year on expectations of a continued global economic recovery and a mushrooming energy transition that needs lots of copper for electric vehicles and renewable power. It is pertinent to mention here that with an annual production of 5.6 million tons of copper, or 28% of global output, Chile is the world’s greatest copper producer. It exports the majority of it to China which is the world's largest consumer of copper. Also, mining accounts for 10-15% of Chile’s GDP and half of the country’s annual exports.

Image Credits: Losandescopper/Twitter