TAQA's Cormorant Alpha asset in the UK North Sea; Source: TAQA

Wave of unrest across UK’s offshore energy sector grows with more workers to cast votes on strike action

UK’s Unite the union has revealed that offshore workers employed by Petrofac on one of Ithaca Energy’s platforms and those working for Wood Group UK Limited on TAQA’s platforms are being balloted for strike action. This brings the total number of workers being balloted across dozens of offshore installations on the United Kingdom Continental Shelf (UKCS) to over 1,300.

TAQA's Cormorant Alpha asset in the UK North Sea; Source: TAQA

Unite the union disclosed on Tuesday, 14 February 2023, that offshore workers employed by the Wood Group UK Limited on TAQA’s platforms and Petrofac on the Ithaca Energy-operated FPF1 platform would be balloted for industrial action for four weeks with both ballots opening on 17 February and closing on 17 March. The union explained that any strike action would occur in early April, following a successful ballot.

John Boland, Unite industrial officer, remarked: “At the heart of both these disputes is a failure to provide a decent and safe working environment whether that relates to salary cuts, working rotas or enforcing draconian clawback days. Our members are rightly angry at the corporate arrogance shown by offshore operators and contractors, and they are prepared to take them head on.”

According to the union, the latest Petrofac Facilities Management Limited dispute involves around 50 workers on the FPF1 platform and it is centred on working rotas. While the company made a profit of £12.5 million (around $15 million) in 2020 in its last lodged full accounts, offshore workers can be asked to work at any time for no additional payment.

In addition, the operator, Ithaca Energy, has a clawback policy of 14 days which is significantly above the industry norm of 7 days, says the union, while adding that 14 days financially is approximately equivalent to £6,000 (about $7,205) lost income per person. As a result, the ballot includes electrical, production and mechanical technicians in addition to deck crew, scaffolders and crane operators. 

On the other hand, Unite is also balloting around 80 members working for the Wood Group UK Ltd on TAQA’s platforms – Cormorant Alpha, North Cormorant and Tern Alpha – demanding the reinstatement of a 10 per cent cut to salaries made in 2015 worth around £7,000 (approximately $8,406) a year, and an enhanced redundancy and retention scheme. This ballot includes electrical, production and mechanical technicians along with pipefitters, platers, riggers and deck crew.

Based on Unite the union’s statement, the latest offshore disputes are part of a growing wave of industrial unrest hitting the United Kingdom Continental Shelf, as over 1,300 Unite members are now involved in a series of disputes. This includes Petrofac Facilities Management Ltd on BP’s platformsOdfjell Technology LtdStork and Bilfinger.

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Sharon Graham, Unite general secretary, commented: “Corporate greed in the oil and gas industry is at its peak in our lifetime. BP and Shell recently announced combined record profits totalling £55 billion. Offshore workers including our members at Petrofac and the Wood Group however are not seeing any of these record profits flowing into their pay packets. There is now a growing wave of industrial unrest hitting the offshore sector and Unite will support our members every step of the way in the fight for better jobs, pay and conditions.”

Furthermore, Unite was among those who blasted the UK government’s inaction on taxing oil firms last week, as BP posted the biggest profits in its history, after Shell reports earnings of £32 billion (more than $38.4 billion), bringing the combined total profits of the top two energy companies in Britain to a record £55 billion (over $66 billion). 

As the release of BP and Shell’s profits gave rise to calls for higher windfall taxes on energy producers’ global profits from opposition politicians and union leaders, Offshore Energies UK (OEUK) warned that these calls for new windfall taxes on global profits were misleading, as such a levy risked breaching global tax agreements and so could never be implemented.

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For global oil and gas producers, UK operations will typically be just a fraction of their overall portfolio – probably less than 10 per cent for the UK majors. While the relevant UK taxes – Corporation Tax, Supplementary Charge and the EPL – apply to energy producers’ profits made on oil and gas extracted in UK waters, they will not apply to profit earned by subsidiaries of UK companies operating overseas.