Bloomberg News

Freeport Workers Plan Full Grasberg Work as Sanctions Clear

December 30, 2011

(Updates with union comment in third paragraph.)

Dec. 30 (Bloomberg) -- Striking workers at Freeport-McMoRan Copper & Gold Inc.’s Indonesian unit will gradually return to the Grasberg mine in Papua starting next week and are expected to resume full work by Jan. 20, a union official said.

The labor union that represents PT Freeport Indonesia employees will start mobilizing miners to return to work after port unit PT Kuala Pelabuhan Indonesia agreed not to impose sanctions against about 700 contract workers, Virgo Solossa, head of organizational affairs at the union, said today.

“We’re in talks with Freeport management and mining contractors to clear sanctions for about another 500 employees,” Solossa said by telephone from Timika, the closest town to Grasberg. “We want to start fresh and resume work with a full commitment from all workers.”

The union and Freeport Indonesia’s management signed a deal to raise wages on Dec. 14, ending a three-month strike. The employees will receive a 24 percent increase in the first year of the new agreement and another 13 percent in the second year.

About 8,000 workers at Grasberg, which holds the world’s largest recoverable reserves of copper, started a strike on Sept. 15, demanding higher wages. The stoppage, which Freeport said on Oct. 26 forced it to declare force majeure on some shipments, raised concern it may widen a global metal deficit and boost prices.

Freeport expects concentrate shipments to be limited until full operations are restored, which is expected by early 2012, Ramdani Sirait, a Jakarta-based spokesman said Dec. 23.

--Editors: Greg Ahlstrand, Andrew Hobbs

To contact the reporter on this story: Yoga Rusmana in Jakarta at yrusmana@bloomberg.net

To contact the editor responsible for this story: Greg Ahlstrand at gahlstrand@bloomberg.net


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