Striking Miners to Return to Work at Grasberg Gold Mine

Miners at Freeport Indonesia will end a month-long industrial action and blockades at the world's second-biggest copper mine if the firm scraps sanctions against striking workers and considers a five-fold pay hike, the union said on Thursday.

The workers' strike over pay and conditions, which started in mid-September at the remote Grasberg mine, has caused significant supply disruption for Freeport McMoRan Copper & Gold Inc and has helped support copper prices .

The union initially demanded $30 to $200 an hour for miners now earning $1.50 to $3 after finding out their counterparts around the world earned 10 times more, but they scaled back demands last week as the company boosted production without them by using contractors and other workers.

Now that the company is suffering from sabotage this week on a main pipeline to its port and from a lack of food and fuel because of worker blockages, the union is making a fresh push for a deal.

The workers now want management to remove the threat of sanctions on the strikers, pay them wages for the time they have been on strike and to consider a pay rise of $7.50 per hour, said union spokesman Juli Parorrongan.

If those three demands are agreed, we would open road blockades, end the strike and mobilise workers to return to the mine, he added.

The company has said it will not pay workers who are on strike, while the union has said Freeport had threatened strikers with layoffs if they did not return to the mine, which also has big gold reserves.

The fresh offer from the union has been conveyed to the firm through members of parliament, who are visiting in an attempt to help sort out the prolonged pay dispute. The local and central governments have previously tied to mediate without success.

Responding to the request, Freeport Indonesia spokesman Ramdani Sirait told Reuters the firm hoped it could sit down together with the union soon and talk about their offer in an official forum.

Freeport Chief Executive Officer Richard Adkerson said this week the firm wanted a fair and appropriate resolution of the strike at Grasberg. But so far talks have not resumed after mediation broke down in late September.

Freeport still managed to beat Wall Street estimates for its third-quarter profit as weak copper prices were offset by soaring gold, but it cut its sales forecasts for next year and said output was hurt by a strike due to last until mid-November.