January 28, 2020 / 8:42 PM / 25 days ago

Coal miner Cerrejon starts negotiations with two unions in Colombia

BOGOTA, Jan 28 (Reuters) - Cerrejon, one of Colombia’s largest coal miners, and its two unions have started negotiations ahead of the February expiration of their current contract, the parties said Tuesday. Cerrejon, which is equally owned by BHP Group, Anglo American, and Glencore, exported 26.3 million tonnes of coal in 2019 and has nearly 5,900 employees, of which 4,600 are union members.

The negotiations with unions Sintracarbon and Sintracerrejon will take place over a 20-day period ending February 15, with the option to extend the process for a further 20 days.

“The environment around the thermal coal market remains challenging in demand and price. This means Cerrejon must be increasingly competitive to ensure its sustainability in the short and medium term,” the company said in messages to Reuters. “We hope to reach agreements that are aligned with the reality of the business.”

Sintracarbon president Igor Diaz told Reuters the union, Cerrejon’s largest, is demanding an increase in pay equivalent to inflation plus 4% to cover the two-year duration of the deal. Colombia’s inflation in 2019 was 3.80%. Diaz said negotiations between Cerrejon and Sintracarbon will take place independently of those between the company and Sintracerrejon. Colombia is the fourth-largest coal exporter in the world. The fuel is the Andean country’s second top source of foreign exchange after oil.

The last strike at Cerrejon, which produces thermal coal from an open-pit mine in the extreme north of Latin America’s fourth-largest economy, took place in February 2013 and lasted 32 days.

Cerrejon, located in La Guajira province, also controls a 150-kilometer rail line and a seaport that receives ships which can carry up to 180,000 tonnes of cargo. (Reporting by Luis Jaime Acosta Writing by Oliver Griffin Editing by Chizu Nomiyama)

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