Colombia's Cerrejon, coal workers see progress

Saturday Feb5,2011 12:24am GMT
* No deal reached after mediation, but progress made

* Union expected to decide on Saturday on strike

* Cerrejon, workers have been in talks since early Dec
By Monica Garcia BOGOTA,

Feb 4 (Reuters) - Colombian coal workers and the nation's largest exporter, Cerrejon, failed to reach a deal on Friday but made progress in pay talks after the government scrambled to avoid a looming strike, officials said. Cerrejon produces on average 85,000 tonnes a day of high-quality thermal coal, and any prolonged stoppage at the mine would hurt output at a time when global supplies are tight due to issues in almost all major thermal producers.

Sintracarbon union President Igor Diaz said that the syndicate would present the company's proposals to workers on Saturday. "It's the workers who will decide what will happen next," he told reporters. "There were advances in some areas," he said, adding that the company had increased the salary increment to 6.5 percent for the first year from 6.3 percent previously. The union has a midnight Saturday/Sunday deadline to decidewhether to walkout, accept the deal or workers would have tovote again on a strike, according to Colombian law. "We've made great progress ... now it's in the hands of the union," Cerrejon President Leon Teicher told reporters.

Cerrejon and workers have been in talks since Dec. 9. If workers strike, it will be the first walkout in twenty years, according to the company. Colombian Vice President Angelino Garzon held an hours-longmeeting on Friday with Cerrejon executives and union leaders totry to hash out a compensation deal. "I'm optimistic that due to the willingness of the companyand the union, we're very close to a deal," Garzon said. Cerrejon -- unlike privately owned Drummond and Glencore,Colombia's other top coal producers -- has listed partners, BHPBilliton (BLT.L: Quote), Anglo American (AAL.L: Quote) and Xstrata (XTA.L: Quote),to keep happy as well as its customers. Adding to pressure to reach a deal with workers, itspartners have had lower output from mines in Australia due toflooding and would not want to lose any more production in sucha tightly balanced market set to go higher. Global coal markets have been vulnerable to supplydisruptions in many important exporting countries, such asAustralia, and that has boosted prices.(Additional reporting and writing by Jack Kimball; Editingby Gary Hill, source:Reuters)