Newmont Mining Corp‘s (NEM) output at its Batu Hijau copper and gold mine in Indonesia was unaffected after about 400 workers went on strike in a dispute over shifts.
Management and union representatives are in talks to resolve the dispute. The mine has more than 7,000 employees and contractors.
Batu Hijau, the nation’s second-biggest copper mine, aims to produce around 275 million pounds of copper and 275,000 ounces of gold in 2011.
The Newmont strike comes at a time of heightened tensions within the Indonesian mining industry, as workers push for a greater share of profits.
Striking workers at Freeport-McMoRan Copper & Gold Inc. (FCX), which is Indonesia’s giant Grasberg copper and gold mine, are currently involved in the country’s longest-running mining dispute.
Miners at Grasberg, the world’s second biggest copper mine, have been on strike since mid-September, driving Freeport McMoRan Copper & Gold Inc. to declare a force majeure on concentrate shipments last month.
Recently, Newmont reported adjusted net income of $635 million or $1.29 per share in the third quarter of 2011, up from last year’s $533 million or $1.08 per share. The result exceeded the Zacks Consensus Estimate of $1.24 per share.
Total revenue was $2.7 billion, up 6% year over year.
Newmont reported attributable gold and copper production of 1.3 million ounces and 58 million pounds, respectively, in the quarter at costs applicable to sales (CAS) of $622 per ounce, and $1.10 per pound on a co-product basis.
The company faces stiff competition from Posco (PKX) and Arcelor Mittal (MT).
Newmont has a short-term (1 to 3 months) Zacks #3 Rank (Hold) and a long-term Neutral recommendation.
