(Adds Codelco comment and background in paragraphs 4-6)
SANTIAGO, Aug 12 (Reuters) - Chile's state-owned Codelco , the world's biggest copper producer, said on Wednesday that striking contract workers at its Ministro Hales mine have suspended their labor action and are pursuing negotiations.
Striking contract workers at Codelco's smaller Salvador mine are expected to follow suit, Codelco said.
The strike, which started three weeks ago at Salvador and then spread to Ministro Hales on Aug. 3, has cost Codelco about 8,000 tonnes of copper production and losses of around $20 million.
Contract workers affiliated with the Confederation of Copper Workers, or CTC, are demanding the right to negotiate a benefits package similar to that offered to direct Codelco employees.
"Codelco would like to inform that it has reached a preliminary agreement with the CTC to suspend the protests and strikes at the (company's) divisions," said Jose Robles, who oversees productivity and costs at the mining company.
Codelco said it will "facilitate" the negotiations. (Reporting by Fabian Cambero; Writing by Anthony Esposito; Editing by Marguerita Choy)