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The new labor contract has been accepted by the No1 Workers Union and ratified by its members and just needs to be signed, the miner said on Thursday.
Members of the union, which represents workers at the world’s largest copper mine, voted to go on strike on July 31, after rejecting the then-latest offer from Escondida. That vote led to further talks mediated by the Chilean government.
The original deadline was Thursday, but the two sides were close to a deal earlier in the week.
“Union No.1 and the company requested to extend the mediation for one more day, until August 13 to proceed with the signing of the new collective contract that was ratified by the members of the Union,” BHP said on Thursday.
BHP owns 57.50% of Escondida shares and is its operator, while Rio Tinto holds 30% and a Japanese consortium possesses the remaining 10%. The mine produced 1.19 million tonnes of copper in 2020, largely stable from the previous year, according to data from the Chilean copper commission, Cochilco.
Escondida, however, is just one of several Chilean copper mines facing the threat of industrial action and while it has avoided a walkout, on August 10 a strike began at Minera Lumina’s Caserones mine and on August 12 workers at Codelco’s Andina also downed tools.
Chilean copper output has been recently recovering, despite a lower contribution from Escondida, and the increase in supplies was providing tailwinds to treatment and refining charges (TC/RCs) from Asian smelters.
Fastmarkets’ copper concentrates TC index, cif Asia Pacific was calculated at $54.60 per tonne on Friday, up by 5.41% from $51.80 per tonne the week before, and reached its highest since $54.90 per tonne on April 24, 2020.
Ana de Liz in London contributed to this report.