Norwegian oil fields in shutdown threat as strike over pay looms

A possible strike over pay could see Norway lose roughly 440 000 barrels of oil equivalent a day in production. The Norwegian Oil and Gas Association and the Norwegian Organisation of Managers and Executives (Lederne) began mediation at 10.00 Monday over pay and conditions.

The Gjøa platform in the North Sea. Image by Martin Lindland/Equinor

The mediation follows a recent decision by Lederne to break off negotiations with the with Norwegian Oil and Gas, employer’s association for oil and supplier companies, over the offshore agreement on pay and conditions.

“Lederne thereby rejected an offer within the framework for the lead sectors set by the Confederation of Norwegian Enterprise (NHO), the Confederation of Vocational Unions (YS) and the Norwegian Confederation of Trade Unions (LO) earlier this year,” the Norwegian Oil and Gas Association said,

Jan Hodneland, lead negotiator for Norwegian Oil and Gas: “It’s crucial that we avoid excessive pay growth in the time to come. Increased costs will make jobs more uncertain instead of secure and long-term. So it’s important that this and future settlements are brought in within a responsible framework.”

Lederne has about 1 000 members of the 7 500 unionized workers covered by the offshore agreements. According to the Norwegian Oil and Gas Association, Lederne has issued an official notice that 198 personnel will down tools on the following installations:

Gjøa (Neptune Energy): 75 members

Ekofisk 2/4 K and 2/4 B (ConocoPhillips): 28 members

Kristin (Equinor): 24 members

Draugen (Okea): 23 members

Ivar Aasen (Aker BP): 17 members

Oseberg East (Equinor): 16 members

Gudrun (Equinor): 15 members.

According to the Norwegian Oil and Gas Association, a possible conflict would mean that Gjøa, Kristin, Draugen, Ivar Aasen, Oseberg East, and Gudrun would have to shut down.

As a consequence, the output would also cease from associated fields such as Tyrihans, Maria and Vega. This would mean a daily production loss of roughly 440 000 barrels of oil equivalent.

“Production from a number of Norwegian fields would be affected by a possible conflict, which is serious,” notes Hodneland. ”We, therefore, hope agreement can be reached with Lederne through mediation.”

Production from fields in the Ekofisk area has been shut down from Monday, June 3, in connection with planned maintenance, and will therefore not be affected by a possible conflict in the short term, the oil and gas body said. A possible strike may not be initiated until 24.00 on 3 June 2019 at the earliest, it added.

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