Mexican miners walk out but Cananea stays open

MEXICO CITY, July 5 (Reuters) Mexican miners today walked off the job in a one-day strike in a protest over safety conditions and a long-running power struggle in the union but the country's biggest copper mine stayed open.

Senior union official Carlos Pavon told Reuters most of the union chapters had stopped working, affecting mines owned by silver producer Penoles and copper giant Grupo Mexico.

But the union, which is split by a leadership tussle, did not stop operations at Grupo Mexico's key Cananea copper mine.

Grupo Mexico spokesman Juan Rebolledo said work had slowed or stopped at two zinc and silver mines in Guerrero and Zacatecas states but that the rest of the company's operations were normal.

Grupo Mexico's mines in Mexico produced 180,000 tonnes of copper content last year. Of that, 111,000 tonnes came out of the ground at Cananea.

Grupo Mexico's stock rose 0.33 per cent to 70.40 pesos as copper futures charged to a two-month peak.

PENOLES REFINERY OPEN Work halted at Penoles' silver mine in Fresnillo, although operations continued at the company's Metmex silver and gold refinery, spokesman Luis Rey Delgado told Reuters.

''They stopped operations in the Fresnillo mine, although they're making sure emergency personnel are on duty,'' Rey Delgado said.

Shares of Penoles were down 1.93 per cent at 128.05 pesos in Mexico City.

The union also plans a formal strike beginning on July 16 at three Grupo Mexico facilities, including its Cananea mine.

Pavon said the miners at Cananea as well as Grupo Mexico's San Martin zinc mine and its silver mine will strike unless the company improves safety conditions and agrees to negotiate new labor contracts under its reinstated leader.

Mexico's mine union has been gripped by a long-running leadership struggle between two factions.

One union boss, Napoleon Gomez, left the country last year after being accused of corruption by the government and dissident union members.

Gomez was recently reinstated as union leader but has not yet returned to Mexico. His supporters refuse to recognize labor contracts negotiated last year by Gomez's rival for the leadership.

All of Grupo Mexico's mining operations in Latin America belong to its Southern Copper subsidiary.

REUTERS SY BST2326