IQUIQUE, Chile, Dec 1 (Reuters) - Tensions flared between Chile's Collahuasi mine and protesting workers on Wednesday,
but wage talks continued in a sign a deal could still be brokered to end a 27-day strike at the world No.3 copper deposit.
A source familiar with talks said negotiations had moved ahead since early afternoon, when union president Manuel Munoz said there had been no progress in ending the longest-ever strike at a major private copper mine in the world's top producer, Chile.
Police used water cannons to disperse several hundred demonstrators who tried to block streets and burn debris in a morning protest in the northern city of Iquique to demand local authorities force strike defectors back onto the picket line.
The mine operator said acts of violence by some unionized workers could "seriously harm" talks.
Still, industry experts and analysts say renewed talks show both sides want to secure a deal to defuse the stoppage, which began on Nov.5, as soon as this week.
At least 220 full-time workers broke from the strike at Collahuasi, which extracts 3.3 percent of global mined copper, or 535,000 tonnes a year. It has hired hundreds of temporary workers and around 100 new, permanent employees.
Collahuasi has managed to operate with limited production losses despite the strike, thanks to a contingency plan. The operator said on Wednesday its output was at normal levels, a day after saying operations were normalizing satisfactorily. It did not quantify what "normal" meant.
The two sides in recent days have appeared keen on a deal to end the strike, which is now longer than a nearly four-week 2006 stoppage at Escondida, the world's top copper mine.
Continuing to operate on a contingency plan, however, could risk damage to machinery handled by part-timers and harm the long-term relationship with the union, industry experts say.
The mine, owned by Xstrata (XTA.L) and Anglo American (AAL.L), had by last week probably suffered minimal losses of about 6,000 tonnes, or about 1 percent of annual output, traders say.
Union leaders have shown signs of fatigue as restless workers who are going unpaid press for resolution.
The mine failed to bypass the union after most strikers snubbed a $29,000 bonus offer that would have ended the deadlock.
Management had needed to convince 50 percent of strikers to accept the bonus by Friday, but as of last week management had won over less than 15 percent of the 1,551 unionized workers.
Copper prices CMCU3 have shown little sensitivity to the strike or resumed talks, partly because the operator has kept supplies flowing and as other factors such as the euro zone debt crisis have taken precedence.