UPDATE: Brazil's Belo Monte Dam Workers Strike For Pay Raise

Workers at Brazil's controversial Belo Monte dam went on strike Monday to demand higher pay and benefits, the union representing the workers said.

Sintrapav, or the Union of Heavy Construction Industry Workers, said that all construction employees stopped work as of Monday, while support employees such as health and food services workers are working with limited staff. The strikers have yet to meet with representatives of Norte Energia, the group responsible for operating the dam, or Consorcio Construtor Belo Monte, the group building the dam, according to Sintrapav's office in Altamira, where Belo Monte is being built.

Norte Energia deferred questions to CCBM. CCBM said in a statement that the current employment contract is in effect until October 2012, and that the company will go through the courts to try to end the strike.

Andrade Gutierrez, Camargo Correa and Odebrecht, three of Brazil's biggest construction companies, are all part of CCBM.

Belo Monte, with a capacity of 11,200 megawatts, is set to be the world's third-largest hydroelectric plant when it begins operations in 2015. The dam, one of many planned for Brazil's Amazon basin, has been criticized by environmentalists and indigenous-rights groups who fear the dam will increase often violent struggles over access to land in the contentious region.

Norte Energia is composed of government-controlled utility Centrais Eletricas Brasileiras, or Eletrobras (EBR, ELET6.BR); the pension funds of state-run oil company Petroleo Brasileiro (PBR, PETR3.BR, PETR4.BR) and government lender Caixa Economica; as well as utilities Neoenergia (GNAN3B.SM) and Cemig (CIG, CMIG4.BR) and mining company Vale (VALE, VALE3.BR, VALE5.FR, VALE5.BR). Eletrobras is the biggest shareholder, with a 49.98% stake.

The striking workers are seeking improved pay as well as more time to visit family members at home.

The strike at Belo Monte follows work stoppages at other major hydroelectric dams in the Amazon basin. Workers at the Santo Antonio and Jirau dams, being built on the Madeira river close to the Bolivian border, returned to work at the start of this month after the most recent strike led to wage increases.

The government alleged that middlemen between construction companies and workers were making promises to workers that weren't kept by construction companies. As a result, the government pushed for more universal contract terms at future dams to avoid such problems at other work sites.

-By Paulo Winterstein, Dow Jones Newswires; 55-11-3544-7073; [e-mail]