Page 16 - pd248 April17 mag-web

NEWS

Escondida operations to restart

The strike at Chile’s Escon- “Having collective talks in
dida, the world’s largest 18 months ... would require

copper mine, is ending after us to revise our plan, our op-

workers decided to invoke a erating model, our structure

rarely used legal provision in order to allow us to make

that allows them to extend our mining business viable,”

their old contract, the union he said.

said. BHP declined to comment

Talks between the two further on the union’s deci-

sides initially failed, and Es- sion.

condida, which is operated by Throughout the dispute, the

BHP Billiton Ltd, said it would union has said it would not

attempt to restart production. budge on three key points;

The workers said they would giving new workers the same

present their decision to the benefits as existing workers,

Government and return to maintaining current benefits

work. and keeping shift patterns

A swift restart of Escon- Copper prices have soared in light of strike action at Escondida, from becoming more taxing.

dida, which produced about the world’s largest copper mine Both sides see the uniform

5% of the world’s copper last benefits issue as particularly

year, may bring some relief to the Chil- The company is legally obligated to com- important. The new labour law that takes

ean economy after a strike that lasted 43 ply. effect this month requires a company to

days. Returning to their former contract offer the minimum benefits in a previous

But there was little immediate effect on means workers will enjoy existing ben- contract as the negotiating floor.

copper prices, with industry experts say- efits and working conditions and hold the Industry veteran and analyst Juan

ing the two sides will still have to tackle next talks under an upcoming labour law Carlos Guajardo said he thought the out-

major issues in 18 months, when talks that strengthens their hand. But they will come of the dispute was “very bad”.

must resume. also lose out on a bonus typically paid “It just prolonged it for a year and half

The stoppage by the union’s 2,500 when the contract is signed and on any without resolving any major points,” he

workers began on February 9 after initial pay raise. said. “This could affect other negotia-

talks with the company to set new wage “The money is important,” a truck tions.”

and benefit contracts failed. Negotiations worker who requested anonymity said Escondida is majority-controlled by

take place when the former contract ex- outside the union meeting, “but the ben- BHP Billiton, with minority participation

pires, typically every 3-4 years. efits that we have fought for over years by Rio Tinto Ltd and Japanese compa-

The legal provision, Article 369, al- are good for us.” nies, including Mitsubishi Corp. It pro-

lows workers to revert to their previous The use of Article 369 would be “com- duced slightly more than 1mt of copper

contract for 18 months, after which both plex” for Escondida, mine president Mar- in 2016.

sides must try to reach a new agreement. celo Castillo said. – Felipe Iturrieta, Reuters

Reko Diq decision favours
Barrick-Antofagasta

Atribunal of the World Bank’s Inter- impressed by the denial of the Reko Diq with Australia, where Tethyan is incorpo-
national Centre for Settlement of In- project in the Balochistan province of Pa- rated.
vestment Disputes has ruled in favour of kistan, considering it is one of the world’s
Tethyan Copper Company Pty Ltd which largest undeveloped copper and gold de- In late March, the tribunal began con-
filed a case against the Islamic Republic posits, with a potential mine life of more sidering submissions from both parties to
of Pakistan because of an unlawful denial than 50 years. determine the damages Pakistan must
of a mining lease. pay Tethyan. A ruling on the final amount
The project was expected to require of damages is expected in 2018.
Tethyan Copper Company Pty Ltd, a JV an initial capital investment of more than
between Canadian mining heavyweight $US3 billion. Following the ruling, market sentiment
Barrick Gold Corp and Antofagasta plc, towards Barrick rose, with its share price
had its mining lease for the Reko Diq pro- The ICSID tribunal rejected Pakistan’s advancing 1.2% to $C25.76, despite an
ject shutdown in 2011. final defence against liability, and con- otherwise turbulent period for Wall Street
firmed that Pakistan had violated provi- and the TSX.
It is no surprise that the JV was not sions within its bilateral investment treaty

PAGE 16 APRIL 2017 AUSTRALIA’S PAYDIRT