Chile No. 4 copper mine not hit by worker protest

Chile's No. 4 copper mine, Codelco's El Teniente, produced normally on Wednesday despite a walk out by contract workers demanding more benefits from the world's top producer, the company said.

Protesters threatened to block roads and halt production at the mine, rekindling memories of a violent 2008 contractors strike that forced Codelco to shut down El Teniente and two other divisions before giving in to wage demands.

Codelco said most contractors don't work directly in production operations and the walkout was not affecting output at the 404 000-tonnes-a-year mine, the world's largest underground operation.

The state giant said any labor issues have to be resolved between contractors and their employers.

Hundreds of temporary workers marched through the nearby city of Rancagua with banners that read strike and Chilean flags, according to staff workers not linked to the protest and images by local media.

"Our people will not quit this fight," Luis Nunez, a protest leader, told Reuters. "We could take over the entrance to the tunnels and the roads leading to the Caletones smelter."

The federation of Codelco workers, an umbrella group of Codelco's unions, warned that any violence against staff workers will force them to halt operations at the mine.

Nunez said around 8 000 contractors had joined the peaceful walkout. Codelco did not confirm the figure, but staff union sources estimate between 2 000 and 5 000 contractors participated in Wednesday's protest.

El Teniente employs around 11 000 contractors, most of whom support non-production operations like reinforcing tunnel walls, repairing machinery and distributing food. The mine's 4 000 staff workers are directly linked to output operations.

A staff union official, who asked not to be named because he was not allowed to speak publicly, said a prolonged strike could ultimately hit operations.

"You need contractors to support operations. If they gather enough people and it drags on for some time, then it could hit production," the senior union source said.

The protest comes only a month after Codelco reached a collective agreement with staff workers and paid them about $32 000 in bonuses and soft loans.

The demonstration draws comparison to the 2008 strike in which contract workers blocked roads, burned buses and clashed with police. The protest curbed output and lifted world copper prices.

Cristian Cuevas, a leader of the workers' strike in 2008, said his nationwide mining contractors union had no intentions of joining the protest. He said he supports protesters' demands at El Teniente, but warned their leadership is fractured.

Cuevas said it was unlikely the protest would spread to other Codelco divisions.

Temporary workers earn less than their staff colleagues, a disparity that has prompted a wave of protests and walkouts at state-run Codelco and private mines in the world's top producer of the metal used to build cars and power lines.

A year ago, a protest by subcontractors forced the world's No. 3 mine, Chile's Collahuasi, to briefly halt operations.

Codelco, which for years has struggled to lift output, plans to spend billions of dollars in a project to sustain output at the century-old El Teniente mine.