BHP Billiton Iron Ore president Jimmy Wilson says the mining giant is likely to request government intervention to prevent a "devastating" proposed strike at Port Hedland which could cost miners up to $100 million a day.
BHP Billiton Iron Ore president Jimmy Wilson says the mining giant is likely to request government intervention to prevent a "devastating" proposed strike at Port Hedland which could cost miners up to $100 million a day.
Deckhands employed by tugboat operator Teekay Shipping last week voted in favour of protected strike action at Port Hedland lasting up to seven days.
A strike can be called with just three days’ notice within the 30-day protected action period.
The Maritime Union of Australia is pushing for annual leave entitlements and a salary rise of almost 10 per cent a year for the workers.
BHP says the strike could cost miners which rely on the port to export their ore, including BHP, Fortescue Metals Group and Atlas Iron, up to $100 million a day.
Teekay and the MUA have been engaged in conciliation talks through the Fair Work Commission but Mr Wilson today said the talks were at a deadlock.
He accused the maritime union of acting against the national interest and warned BHP would "use every angle that we can" to prevent strike action.
"(The MUA) are literally holding us to ransom and that is something we have to push back on," Mr Wilson told reporters.
"These demands are counter to the productivity drive that this country so desperately needs. This will create a situation where jobs will leave Australia and we will leave a legacy to our children and our grandchildren that we will not be proud of."
BHP would likely be forced to suspend mining within days of a strike being called to prevent iron ore stockpiles from building to excess, Mr Wilson said.
"Our stocks in the port are reasonably high and that backs up through the system very, very quickly," he said.
"The stock levels in this business are large but the (production) volumes are large at the same time so we choke reasonably quickly."
BHP is not directly involved in the negotiations between the maritime union and Teekay, which is contracted by BHP to provide tugboat shipping for iron ore exporters at Port Hedland.
The negotiations between the two parties have been ongoing since June 2013.
BHP is entitled to apply to have protected strike action suspended as a third-party under section 426 of the Fair Work Act if it can persaude the Fair Work Commission that the strike will cause it "significant harm".
However, its prospects of success are likely to be limited based on the commission's ruling in a 2010 dispute involving Woodside Petroleum.
Woodside successfully applied to have industrial action at its Pluto LNG project suspended under section 426 but this decision was reversed under appeal to the full bench of the commission.
The commission indicated it will only approve third-party suspension applications under circumstances where the strike will cause harm "of a more serious nature than merely suffering of a loss, inconvenience or delay".
BHP can also apply to the commission to have the matter put into arbitration, which produces a definitive outcome in the dispute.
MUA assistant WA secretary Will Tracey last week said the union's demands were reasonable given the tough conditions its workers endured.
"The MUA has been negotiating with Teekay for 12 months and while some progress has been made, there are still a number of sticking points which we are trying to work through,” he said.
“Industrial action is always a last resort and we still hope that we can come to an agreement without having to take the action which has been sanctioned by the Fair Work Commission.”
Mr Wilson said the union's annual leave requests would effectively reduce deckhands' time spent working within a year from six months to just four-and-a-half months.
He warned customers would turn to overseas suppliers if iron ore shipments were interrupted.
The iron ore spot price dropped another dollar overnight to $US97.50 per tonne.
