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Third of eligible Kennecott workers consider buyouts drawing little interest

More layoffs loom at mine following April landslide

SALT LAKE CITY — About a third of 270 eligible workers are willing to take an early retirement offer from Kennecott Utah Copper Corp. following a landslide that damaged an ore pit west of Salt Lake City, union officials said Friday.

Interest could pick up today, the deadline that Kennecott gave workers in their 50s and older to make a decision. They can accept a $20,000 early retirement bonus and take a pension and health insurance benefits, or stay put and risk a layoff.

Kennecott said Friday it wasn't certain how many would take the buyout offer or what that means for ensuing layoffs. It abolished 100 salaried positions May 23 and said it needs to reduce the unionized work force — all to match lower ore production resulting from the April 10 landslide.

"We will have a stronger understanding of the number of roles impacted next week," Kennecott spokesman Kyle Bennett said Friday.

About 80 of 270 hourly employees have expressed interest in taking the retirement offer, according to officials from the United Steelworkers and Operating Engineers Local 3.

More are likely to come forward by the deadline, said Wayne Holland of the United Steelworkers, which represents more than 1,000 of Kennecott's 2,100 workers.

"The plan is to get back up to 50 percent of normal production by Jan. 1," Holland said. "That would send a message to London that these guys are back in business."

Kennecott is a subsidiary of London-based Rio Tinto PLC.

It's expected to take months, if not years, for the major U.S. copper mine to fully recover from a slide that loosened enough material to nearly fill the Panama Canal — rock and dirt without ore value that nearly filled the bottom of the pit. At first, it appeared the company would have to haul away the debris pile, but with little ore value under the pile, that option looks like a wasted effort, Holland said.

Instead, Kennecott could leave much of the debris pile in place and work around it.

The bottom of the nearly mile-deep pit "was as low as they were going anyway," said Brandon Dew, business agent for Operating Engineers Local 3, which represents shovel and other heavy-equipment operators. "There are certain areas where they don't desire to dig further."

Kennecott's best prospect is an ongoing expansion. It is broadening the pit, but company officials have said it will take another five years of digging to reach new ore deposits. The work is taking place on a side of the pit opposite the slide.

To keep a smelter and refinery operating, Kennecott is shopping for concentrated ore it could import from neighboring states by rail, union officials said.

Kennecott has invested heavily in new refining technology. It has resumed limited ore digging around debris piles as high as 300 feet at the bottom of the pit.