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BHP faces strike action at Escondida mine

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BHP's Escondida mine, located in Chile's Atacama Desert, is the world's biggest copper mine.
Camera IconBHP's Escondida mine, located in Chile's Atacama Desert, is the world's biggest copper mine. Credit: AP

The union of workers at BHP's Escondida copper mine in Chile, the world's largest, has voted to reject the Anglo-Australian company's final labour contract offer, prompting BHP to request government-mediated talks in a last-ditch effort to stave off a strike.

The talks, once confirmed by authorities, will last for five to 10 days, according to Chilean labour law. If no agreement is reached, a strike would begin.

The union said in a statement late on Saturday that 99.5 per cent of those who voted had rejected the final contract offer and had approved a strike, suggesting a still wide gap between BHP and its workers despite nearly two months of talks.

Negotiations at the sprawling northern Chile copper mine have been conducted in secret, leaving metals markets on edge.

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A prolonged strike by the mine's top workers' union would further constrict global supplies of copper and send already high prices even higher.

"We hope that this strong vote will be a decisive wake-up call for BHP to begin substantive talks ... if it is to avoid an extensive conflict that could become the costliest in the country's union history," the union statement said.

BHP said in a statement following the union vote that management remained hopeful it could reach a deal with the union during the upcoming government-mediated talks.

"The interest of the company is always in reaching agreements with its workers so we remain open to dialogue and to taking advantage of all opportunities available to it," it said.

The union said in its statement that negotiations had failed to make progress on its main demands, including an improved system of professional development and performance-based compensation.

Another key sticking point is a union request that its workers share in one per cent of dividends paid to investors.

At Escondida, memories remain fresh of the historic 44-day stoppage in 2017 that jolted global copper markets and slowed Chile's economic growth.

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