KPC?s production activities halted due to massive labor strike

Production activities of East Kalimantan-based coalmining giant PT Kaltim Prima Coal (KPC) were halted Friday (today) as thousands of its workers went on strike, the company?s spokesperson told Petromindo.Com.

The peaceful labor strike, starting from 1 AM Friday, was continuing, KPC spokesperson Nunik Maharani Maulana said in a telephone interview at noon on the same day.

?Production activities have been halted,? she said.

Nunik did not say how many workers were involved in the massive strike, but earlier reports said that around 2,700 workers would take part in it. The strike had initially been planned for Thursday (yesterday).

Nunik said the labor strike took place when the KPC management was actually in negotiations with workers? leaders.

She said the KPC management viewed the workers? demand as not up to normal standard.

She said the workers were demanding that Rio Tinto and BP Plc., KPC's current shareholders to pay compensation to workers after the companies planned to sell their entire shares in KPC to JSX-listed Bumi Resources.

The KPC management had actually agreed in principle to pay compensation, but said talks will be resumed on September 2, Nunik said.

BP and Rio Tinto decided to sell its entire stakes in KPC after negotiation to divest 51 percent of KPC?s shares to local companies stalled for years.

KPC runs a huge coalmining in Sangatta, East Kalimantan with production target of 18 million tons this year. (godang)