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Colombian Coal Union Says Work Has Resumed at Drummond

Increase font size  Decrease font size Date:2013-09-26   Views:555
BOGOTA, Colombia--Drummond Ltd., one of the largest coal producers in Colombia, partially restarted operations Saturday night after the government stepped in to resolve a strike that has stifled the country's coal exports.

Edgar Munoz, a spokesman for the Sintramineregetica union that has led the labor stoppage, said that employees began to return to their jobs for the first time since the strike started in late July.

"There is a partial restart of the operations now and by Tuesday all workers should have reported back to their posts," Mr. Munoz said Sunday.

Drummond, which is based in Alabama, said in a press release Saturday night that the company's workers should return to work that same day after Colombia's Labor Ministry ordered an arbitration tribunal to resolve the dispute between Drummond and the union, which has centered on salary demands.

The strike at Drummond, which exported about 26 million metric tons of coal last year, is the latest setback for the coal industry in Colombia, which ranks as one of the world's top coal exporters, as a result of crippling labor strikes at some of the country's key producers.

Coal output fell 13% in the first half of 2013 from the same period a year earlier to 40.5 million metric tons, according to government data.

A month-long labor strike that ended in March at Cerrejon, which is equally owned by mining companies Glencore Xstrata PLC (GLEN.LN), Anglo American PLC (AAUKY, AAL.LN) and BHP Billiton Ltd. (BHP, BHP.AU), was one significant factor behind the drop in production in the first six months of the year.

The strikes at Cerrejon and Drummond are bringing into doubt the coal sector's capacity to meet the government's production target of 94 million metric tons of coal for 2013.

The lower output could drag down Colombia's economic activity, which relies heavily on its exports of oil and coal. The Colombian economy slowed sharply in the first quarter and the central bank estimates that Colombia's gross domestic product will post an expansion of between 3% and 5% in 2013.
 
 
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