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Exclusive: Chile putting mine workers' health over copper production, minister says

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07/07/2020 | 04:08pm EDT
FILE PHOTO: Chile's Minister of Mining Baldo Prokurica walks on Pedernales Salt Flat in the Atacama Desert

By Fabian Cambero and Aislinn Laing

Chile's mines minister said on Tuesday there were "no silver bullets" to help the industry weather the coronavirus pandemic, but insisted the world's biggest copper producer was prioritizing workers' health to avoid the spread of infections that could further harm operations.

Baldo Prokurica told Reuters that Chile's copper industry had kept the contagion rate to just 2% with a strict testing regime and by keeping half of its more than 200,000-strong workforce at home.

"A company that does not take care of its workers will not be able to work, if workers get sick," he said in a video interview. "If we were prioritising production, companies would have 100% of workers on the job."

Neighboring Peru, the No. 2 copper producer, opted to shut down all industry for 100 days but still had the world's fifth-highest case rate, he said, while Uruguay had maintained all productive work and reported just 29 deaths from COVID-19.

Leading copper miners in Chile, including state-owned Codelco, BHP Group Ltd and Anglo American Plc have maintained and even increased production until now. But as coronavirus cases have recently spiked with at least 10 confirmed deaths, the miners have altered shift patterns, suspended upgrades and smelter operations in a bid to stop the spread.

Some unions and local leaders have called for mines in the worst-hit areas to shut down altogether. Prokurica said nothing could be ruled out.

"There's no silver bullet with these things," he said. "No one in the world can say what is going to happen. Venturing an opinion on that puts you in a position where frankly there is a very high possibility you end up being wrong."

Chile's copper commission, Cochilco, has predicted a 200,000 to 240,000-tonne drop in 2020 production. Prokurica said that projection held only if cases start to decline.

"Everything will depend on how the pandemic evolves," he said. "If cases increase, that will generate a more serious outlook."

He said Tuesday's copper price of $2.77 per pound - from an annual low of $2.09 on March 23 - was a more accurate reflection of the market's supply-demand dynamics after many months of distortion driven by the U.S.-China trade war and collapse in the price of petrol.

"We've had one thing after another and also that means that the markets are moving towards stabilization," he said. "We feel positive and believe that that price should remain as such because one way or another you're not going to see more copper being produced."

Last month, Prokurica underlined the importance of finding "balance" between keeping mining - a major earner for the country's battered economy - on its feet and safeguarding the health of workers.

Addressing recent accusations by Chile's Federation of Copper Workers (FTC) that the government had prioritized copper output over health, Prokurica said it was not in the interest of mining companies to risk the health of their very specialized workers.

"President Sebastian Piñera, I as a minister and also the companies and workers know that the first priority is the life and health of workers," he said. "Nothing is more important than health."

(Reporting by Fabian Cambero and Aislinn Laing in Santiago; Writing by Aislinn Laing; Editing by Matthew Lewis)

Stocks mentioned in the article
ChangeLast1st jan.
ANGLO AMERICAN PLC -2.40% 1915.8 Delayed Quote.-9.70%
BHP GROUP 0.00% 39.91 End-of-day quote.2.54%
GOLD 1.02% 1942.33 Delayed Quote.25.83%
SILVER 3.94% 26.6728 Delayed Quote.39.69%
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