Norway: Offshore pay talks break ‘after a few seconds’

The article has been updated to include a statement by the Norwegian Oil and Gas Industry Association, the negotiator on behalf of employers.

Pay talks in Norway between offshore workers and employers scheduled for Monday, May 30, have broken down before they even started.

Negotiations over the offshore and oil service agreements primarily cover workers employed offshore. The offshore agreements apply to operator, drilling and catering companies, while the oil service agreements cover workers both offshore and on land in oil service companies.

According to Industri Energi, one of the unions representing offshore workers, the union decided to break the talks as the “employers would not follow rules of the game” and were not willing to negotiate.

According to info found on the union’s website, the union’s chairman Leif Sande broke off the talks after a few seconds. The settlement will now go to mediation, scheduled for 20th-21st June.

The news of wage talks breakdown comes less than a week after Norwegian Oil Industry Association said it successfully reached a collective pay agreement deal with land workers.

Worth noting, negotiations held a week before, on the land base agreement, broke down as the involved parties were “too far apart for an agreement to be possible.”

 Update: May 30. 6:58 pm CET

Norwegian Oil Industry Association has confirmed that today’s negotiations over new offshore pay agreements in Norway’s petroleum sector were terminated by a formal breach with two of the unions concerned, after the third had staged a walk-out.

The association says that the Norwegian Union of Industry and Energy Workers (Industry Energy) opted to leave the talks even before the two sides had presented their negotiating positions. While the Norwegian Union of Energy Workers (Safe) and the Norwegian Organisation of Managers and Executives subsequently submitted their demands in the normal way, they also decided eventually to break off negotiations, the employers’ representative said.

“Our position is that we must adapt to a lasting reduction in the level of costs while simultaneously improving our competitiveness to preserve as many jobs as possible,” says Jan Hodneland, lead negotiator for the Norwegian Oil and Gas Association.

Monday to Wednesday this week had been allocated to negotiations on the offshore agreements, which cover some 7500 employees working for oil companies, catering enterprises and drilling contractors.

The workers are employed by the following companies: Statoil ASA, A/S Norske Shell, BP Norge AS, ESS Support Services AS, Esso Norge AS, Sodexo Remote Sites Norway AS, KCA Deutag Drilling Norge AS, Talisman Energy Norge AS, Engie E&P Norge, ExxonMobil, ConocoPhillips, Wintershall, Coor Offshore AS, Eni Norge AS and Lundin Norway AS.

The oil and gas association has pointed out to last week’s updated figures from Statistics Norway which show that investment on the Norwegian continental shelf (NCS) will fall from NOK 189 billion in 2015 to NOK 166 billion this year and NOK 153 billion in 2017. The employers’ negotiator further said tht persistently low oil prices and high costs contribute to this decline in spending and activity.

“This means our member companies are experiencing demanding times,” says Hodneland. “They’re in the middle of a restructuring process with extensive downsizing. Pay settlements we reach must contribute to improving adaptability and competitiveness on the NCS.”

Offshore Energy Today Staff