MEXICO CITY (AFX) - Mexican mining giant Grupo Mexico announced Thursday that it will be forced to close one of the country's largest copper mines if workers continue striking.
Grupo Mexico issued a news release stating the company would 'be forced to close the mine and concentrator' at La Caridad copper complex in northern Sonora state if strikes continue at La Caridad mine and the nearby Cananea mine.
Workers at Cananea, Mexico's biggest copper mine, walked off the job June 2, saying the company had refused to give half of the workers the day off to celebrate the 100th anniversary of a historic 1906 strike at the mine when it was owned by a U.S. company.
The strike at the Cananea mine added to the supply problems already caused when workers at La Caridad, the country's second largest copper mine, went on strike March 24, demanding government support in their ongoing dispute with the mining union's leadership.
Mining workers across Mexico have demanded government recognition of Napoleon Gomez Urrutia as the leader of the miners union, but the government has instead maintained that dissident Elias Morales is the new leader of the union, despite a number of union meetings in which Urrutia was ratified.
Gomez Urrutia is accused of misappropriating $55 million in funds paid into a trust by Grupo Mexico in relation to the 1990 privatization of La Caridad and Cananea, and a judge in Sonora last week issued a warrant for his arrest on fraud charges. He was in Canada last week.
The growing dispute has already escalated into strikes at a number of key mining and steel operations.
Grupo Mexico has said that Mexican copper production in 2006 could drop as a result of the prolonged strike at La Caridad, after the company earlier in the year forecast production to rise.
La Caridad produces about 150,000 metric tons of copper concentrate a year and 250,000 tons of different refined copper products. Cananea produces about 140,000 tons of copper concentrate and 50,000 tons of refined copper.
Branding the ongoing strikes as 'illegal activities,' Grupo Mexico said that not only the Caridad mining complex, but also the Cananea mine would be closed if a lasting solution wasn't reached promptly.
Maja Wallengren works for Dow Jones Newswires in Mexico City.
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