Workers at the Escondida copper mine in Chile started a strike on Tuesday morning after their union and operator BHP failed to reach an agreement.

The union says the negotiations with the Australian group did not provide “substantive advances” that would result in a favourable outcome for its members, Kallanish reports.

The mining giant’s final offer was a $27 million cash injection including bonuses and soft loans, according to local media. BHP had also put forward a one-off 2% increase in salaries as part of a 36-month collective contract, among others. However, workers voted against the package, which led to a strike.

Workers had been asking to distribute 1% of the dividends paid to foreign investors equally among local employees. Discussions were mediated by Chile’s Labour Inspectorate after union workers voted in favour of a strike earlier this month, when they rejected BHP’s proposals.

Escondida is the largest-producing copper mine in the world, operated by BHP as part of a joint venture with Rio Tinto and JECO Corp. Its current output is 1 million tonnes per year, which is expected to increase to 1.3m t by 2026 following expansion works. 

Last year it generated a revenue of $8.8 billion for a capital expenditure of $1.3 billion.

BHP was contacted for comment. 

The miner said last month Escondida would produce 1.18-1.30m t of copper in the 2025 financial year, up 5-16% from the previous financial year, which ended on 30 June 2024. The mine produced 1.12m t of copper in FY24, up 7% year-on-year – the highest output in four years.