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Last Updated: Friday, 18 August 2006, 06:31 GMT 07:31 UK
Chilean copper mine suspends work
Copper mine workers protesting over pay
Escondida says the picketing has created a health and security risk
Managers at the world's largest privately-owned copper mine, Chile's Escondida, have suspended operations as a strike enters its 12th day.

Escondida said it had shut down work because striking staff had blocked access roads to the mine for two days, causing a health and security risk.

The firm, which is majority owned by global giant BHP Billiton, also said it had broken off talks with the union.

Union staff at the mine are striking in a dispute over pay.

While their picketing is continuing, earlier this week the workers appeared to soften their stand, cutting their pay rise demand from 13% to 10%.

Managers are continuing to only offer 3%.

Prices rise

Escondida, which had claimed that it was producing more than half its usual output during the strike, said it had no choice but to temporarily halt production.

"The company wants to maintain its operational continuity and renew operations as soon as possible, as soon as the police can insure the full safety of people who work in the company," it said in a statement.

The Escondida mine produces 8% of the world's copper, and the strike has caused already high copper prices to rise still further.

In early Friday trading, copper prices were up 2.5% on Thursday's close.

Copper prices have hit record highs this year - due to strong global demand led by China - and this is the main reason why workers at the mine say they deserve a substantial pay rise.

In addition to BHP Billiton's 57.5% stake in Escondida, its global mining rival Rio Tinto holds 30%.

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