Strike Action Hits U.K. Oil Production

---

Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--U.K. oil workers have carried out a second 24-hour strike at three platforms operated by Total E&P U.K. (Aberdeen, Scotland) in the North Sea.

The platforms--Alwyn, Elgin, and Dunbar--produce about 50,000 oil barrels per day (BBL/d) to the Forties and Brent Blend crude streams and will be subject to alternating 12- and 24-hour strikes over wages and working hours. The strikes are backed by Unite, the U.K.'s largest workers union, which told media that "all rigs are shut down with no production." Further strikes on the platforms are scheduled for August 13 and 20, for 12 and 24 hours, respectively. The U.K. strikes follow a series of damaging strikes in Norway that disrupted production at a number of major oil fields in recent months. Immediate oil supply disruption has been offset by stored crude.

Unite regional officer John Boland said: "We can confirm that the strike action on Alwyn, Dunbar and Elgin platforms has gone ahead as planned. Production has been stopped, and the wells have been shut."

Total is not the oil firm facing U.K. strike action. Unite members working for Aker Solutions on the Statoil Mariner Oil Platform have also voted for strike action. The Mariner field with an expected production capacity of 50,000 BBL/d is due to start production in the second half of this year. About 200 workers rejected a final pay, terms and conditions offer made by Aker management, and prospective industrial action is likely to take place between early August to early October. An overtime ban will also be in place during this period. Aker has recently made another offer to workers, and another vote is expected.

"There has been significant movement by Aker management over the last week to address a number of the key concerns our membership had," said Unite's Boland. "These latest negotiations have been conducted in a constructive way."

BMI Research (London) has warned that the increasing incidence of labour strike action in the U.K. and Norwegian offshore infrastructure "raises the risk to the timely completion of project timelines as well as the longer-term investment attractiveness of the region".

It added, "Over the past weeks, three fields in the U.K. North Sea, Alwyn, Dunbar and Elgin temporarily halted operations, whilst in Norway, the Knarr field was also shut briefly over wage and pension disputes. Further strike action is planned over the summer and into the autumn. Previously, the two years of significant industry downturn hit the offshore labour market hard, as companies rapidly cut costs and jobs in the face of tanking oil prices. With oil prices now recovering, workers are beginning to push for a reflective increase in wages as well as a re-scheduling of unpopular offshore working times. If compromise cannot be met between labour unions and companies, there is a risk that escalating strike action will begin to affect new project developments. Furthermore, there is a risk that companies looking to pursue further investments in the U.K. offshore will be dissuaded or delay investment decisions whilst faced with an increasingly disruptive workforce."

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Our European headquarters are located in Galway, Ireland. Follow IIR Europe on: Facebook - Twitter - LinkedIn For more information on our European coverage send inquiries to info@industrialinfo.eu or visit us online at Industrial Info Europe.