Over 500 workers at a coal mine in Mozambique owned by a subsidiary of an Indian company have been on strike for a week, the company said in a statement on Tuesday, hurting coal production at a time of peak coal prices.
The striking workers, who make up around 10% of the 5 300-strong workforce at the Moatize mine in central province of Tete, are demanding compensation from Vulcan following its purchase of the mine from Brazilian miner Vale, Vulcan said.
Vale SA said in December it had agreed to sell the mine in a $270-million deal that included a connected railway corridor to Vulcan Minerals, a subsidiary of India's $18-billion Jindal Group.
"There was no destruction or vandalism of company or private equipment. However, the strike did not follow the legal procedures, because the striking workers did not deliver a prior notice," Vulcan said in a statement.
The statement did not say what steps the company was taking to resolve the issue and by when it foresees an end to the strike, but said it would respond to workers claims by May 20.
"Vulcan reinforces its objective of guaranteeing the continuity of the coal operation in the country," it said, but added that it was not yet possible to estimate the extent of financial loss due to the strike.
The $18-billion Jindal Group also operates Chirodzi coal mine in the Tete province of Mozambique.