Vale to Sit down with Striking Sudbury Union

TORONTO, Feb. 26 -- Vale (VALE5.SA: Quote) will hold "exploratory" talks with union leaders representing striking workers at the company's Sudbury, Ontario, nickel operations, the first signs of movement in a strike that began last July.

The two sides will meet this weekend with a mediator "to explore potential ways forward in the collective bargaining impasse between the parties", said the United Steelworkers (USW), which represents the 3,100 striking workers in Sudbury and at a smaller operation in Port Colborne, Ontario.

The strike began in mid-July, and relations since then have been frosty, particularly since Vale began partial mining operations last year using contract workers and employees from outside the striking bargaining unit.

Vale has since partially restarted the smelter and said earlier this month it was eyeing an eventual full restart of the Sudbury operations.

Key areas of friction include pension issues and a worker bonus tied to the price of nickel.

Pressure from government officials for a resolution has been strong, and some have pointed to the relative ease with which cross-town rival Xstrata (XTA.L: Quote) recently inked a new three-year deal with its union without a strike.

Vale acquired the Sudbury assets, which include mines, mills and the smelter, in 2006 when it bought Canada's Inco.

Workers at Vale's Voisey's Bay nickel mine in the eastern province of Newfoundland and Labrador have also been on strike, since August last year, but are represented by a different USW bargaining unit.