Colombian coal miner Cerrejón, owned by Glencore, has reached a pay deal with unions, averting a strike at the largest open-pit thermal coal mine in Latin America.

The collective-bargaining process kicked off late last year, when the Sintracarbón union submitted a list of demands to Cerrejón, although formal negotiations began last month.

The new labor agreement is valid for four years from Jan. 1, 2024. Salaries will rise 11.28% in 2024 and will increase in the following three years at a rate of one percentage point above CPI.

The deal also includes an agreement to include worker participation in the mine-closure plan when Cerrejón's mining license expires in 2034.

A strike in 2020 forced Cerrejón to shut down for 91 days, the longest in Colombian coal mining history. During the strike, between 6.2-6.5 mt of thermal coal production was lost. As a consequence, Cerrejón's exports in 2020 fell to 12.5-13.0 mt, from 26.8 mt in 2019.

Cerrejón produced 22.0 mt of thermal coal in 2023, up 12% from 19.7 mt in 2022.

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02-28-24 0928ET