Offshore strikes in Norway and the UK have made summer season 2018 a season of discontent for the trade. What are the manufacturing impacts of strikes similar to these in mature hydrocarbon areas, and the way can the trade scale back the probabilities of additional disruption from strike motion?
In some ways, summer season 2018 appears like a season of promise for the North Sea oil and fuel trade. Rewinding to the start of summer season 2016, the worth of Brent crude was simply starting to rally from its nadir a couple of months earlier, with costs hovering round $40 a barrel and the market nonetheless prompting heavy belt-tightening from the trade.
This summer season, prospects are trying distinctly rosier for the North Sea. The oil value is fluctuating at a way more worthwhile $70-$75, whereas operators are benefiting from the effectivity financial savings they achieved in the course of the downturn and a wholesome stream of funding – albeit usually small and surgical moderately than big-ticket spending – is flowing into the area. Production on the UK Continental Shelf (UKCS) has additionally stabilised at round one million barrels a day, a halt within the current decline.
“Oil manufacturing is pretty sturdy for the UK and has been for the final couple of years,” says S&P Global Platts analyst and senior editor Nick Coleman. “The message from the most important oil firms has been comparatively constructive; it’s a hit story of bringing down prices, bringing in expertise and halting the decline.”
While the prognosis is trying usually constructive for the North Sea as an oil and fuel area, labour relations in key fields seem to have taken a nosedive. After a number of years with little to no strike motion, even by way of a downturn that has seen tens of hundreds of jobs misplaced within the sector, this summer season has been a busy one for labour disputes.
Oil strikes in Norway and the UK
In the Norwegian North Sea, a strike in opposition to the Norwegian Shipowners’ Association organised by the Safe union in July ran for 10 days, finally bringing in 1,600 employees, who have been primarily defending pension ensures that have been underneath menace, but in addition arguing for floating rig employees to be paid the identical as platform employees. The strike concerned employees on rigs operated by the likes of Saipem and Transocean, and brought on the shutdown of manufacturing at Shell’s Knarr discipline, which produces just below 24,000 barrels of oil a day.
“The operators are world, they’re pondering worldwide,” says Safe union chief Hilde-Marit Rysst, one of many predominant organisers of the strike. “If they’ll lower their prices, they do it. We’re saying that they’ve to know what they’re slicing, not simply say that they need it to be cheaper. I suppose you will notice it in a number of areas – just like the UK, the Gulf of Mexico and all around the world. But we in Norway have union and we’re ready to take that form of combat.”
Just as Safe’s strike got here to an finish on 20 July, a spherical of strikes kicked off on the UKCS. At three of Total’s platforms on the Elgin-Franklin fields – Alwyn, Elgin and Dunbar – members of the Unite union have voted for a collection of 12 and 24-hour strikes over pay and an unpopular three-weeks-on/three-weeks-off work rota for offshore employees, with strike motion scheduled sporadically all through August, September and October.
At Equinor’s (previously Statoil) Mariner undertaking, positioned 93 miles east of the Shetland Islands, GMB union members have additionally threatened to strike over pay in opposition to oilfield providers firm Aker Solutions, which is a serious contractor on the undertaking, earlier than manufacturing on the discipline even begins. The strike was averted in mid-August after members accepted a brand new pay supply from Aker, besides it’s clear that offshore employees are asserting themselves, particularly after a interval of commercial decline in the course of the downturn.
“The oil value is greater, income for these firms are greater, and clearly the commerce unions really feel that they tightened their belts in the course of the downturn, as everyone did,” says Coleman. “Many folks misplaced their…