IGO to record impairment against nickel assets in strategy shift
IGO has been undertaking a strategic review in an attempt to revaluate its resources.
BHP (ASX, LON, NYSE: BHP) has requested that the Chilean government mediate in talks with union leaders at its Spence copper mine to avert a strike at the operation.
The request for a five-day mediation under Chilean labour laws comes after the world’s largest miner failed to reach an agreement with the union during regular negotiations, local paper La Tercera reported.
Key issues, the union says, include the size of wage increases, bonuses and benefits, which are topics the parties remain far apart on as they enter the final phase of negotiations.
Strong copper prices this year have not only boosted companies’ profits, but also raised employee expectations. Event after a recent dip, copper has kept its place among the best-performing metals this year, with futures up 16% on the London Metal Exchange.
“We’re willing to continue talks, but we want to participate in these profits,” union leader Ronald Salcedo told the Chilean paper. He warned that a strike could begin as early as June 12.
BHP said its mediation request reflected “the company’s constant willingness to dialogue to reach a mutually beneficial agreement.”
The company added that, as the law indicates, the parties will have the next five business days to continue conversations and reach an agreement. In the meantime, operations at Spence continue as usual.
“For all Chile’s copper output problems over the last couple of years, strikes have not been a major cause, but higher copper prices always increase the risk of disagreements as workers seek more of the economic rent,” BMO’s head of Commodities Research, Colin Hamilton, wrote in a note to clients.
The events at Spence, which produced 249,000 tonnes of copper last year, are also being closely watched by traders for indications of how negotiations might proceed at BHP’s other Chilean mines, including its giant Escondida. Contract negotiations at this copper mine, the world’s largest, are due by the end of August.
The outcome at Spence could also set the tone for future labor negotiations in Chile’s vital copper industry.
Spence is part of BHP’s Pampa Norte division, which includes the Cerro Colorado mine.
