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Accumulate on dips.

SYDNEY (XFN-ASIA) - Copper prices are likely to go up overnight after BHP Billiton reportedly declared force majeure on the delivery of copper concentrate from its Escondida copper mine in northern Chile, UBS resources analyst Glynn Lawcock said.

He said the move, which follows industrial action at the world's largest copper mine, is unlikely to cause short-term supply difficulties as there remains plenty of copper concentrate in the system.

BHP Billiton is yet to issue a statement and company representatives in Australia were not available for comment.

Force majeure is a common clause in contracts which essentially frees one or both parties from liability or obligation when an extraordinary event beyond the control of the parties prevents the fulfillment of obligations under a contract.

The concentrate is piped from the 57.5 pct-owned BHP Billiton project in the Atacama desert to the Port of Antofagasta for export.

Escondida accounts for about 8 pct of the world's copper output.

Lawcock noted that the threat of an industrial action has already seen the copper price spike to around 4.00 usd a pound from 3.61 usd, even before Escondida's workforce decided to lay down their tools if their demands for higher wages and bonuses were not met.

He said resolution of the dispute is particularly important for BHP Billiton, which relies on Escondida for about 80 pct of its copper production.

Rio Tinto has a 30 pct interest in Escondida but the mine accounts for less than 50 pct of its worldwide copper production.

At 3:30 pm here, BHP Billiton (BHP.ASX) was down 0.12 aud or 0.43 pct at 27.49 while Rio Tinto was up 0.52 or 0.69 pct at 75.49