Hundreds of workers on Norwegian offshore oil and gas rigs went on strike on Tuesday after rejecting a proposed wage deal, leading to the shutdown of one Shell-operated oilfield and helping to send Brent crude prices higher.
Shortly after a midnight deadline passed, a state-appointed mediator said talks between two trade unions, Safe and YS, and the Shipowners’ Association, representing the rig employers, had failed to reach a deal.
“The parties were so far apart from each other there was no point presenting a proposal that could be recommended to both sides,” mediator Carl Petter Martinsen said in a statement.
Some 670 workers will walk out from Tuesday, with an additional 901 employees joining them from midnight on Sunday if the dispute is not resolved, Safe said in letters to the Shipowners’ Association on Tuesday.
In total, up to 2,250 workers could join the action, it said.
Industri Energi, the union which represents the majority of Norwegian oil workers, concluded a wage deal earlier this year with the Shipowners’ Association.
At 0750 GMT, Brent crude was up 0.8 percent at $78.70 per barrel, following a 1.2-percent climb on Monday.
OUTPUT IMPACT
Safe said it would initially take out 106 workers from the Teekay Petrojarl production ship operating at Royal Dutch Shell’s Knarr field, which has a daily production of 23,900 barrels of mostly oil, along with some natural gas liquids and natural gas.
Equinor, formerly known as Statoil and the biggest operator of oil and gas platforms offshore Norway, said the strike was so far not disrupting production and there were no changes on projects and start-ups for now.
Norway, Western Europe’s biggest oil producer, pumped 1.97 million barrels of oil and natural gas liquids a day in 2017, according to data from BP’s Statistical Review published in June.
Natural gas production was 123 billion cubic metres last year, BP reported, making Norway the world’s seventh biggest producer and Europe’s second-largest gas supplier after Russia.
MORE WORKERS TO WALK OUT
Safe said workers on rigs that conduct exploration or production drilling for oil firms would also walk out on Tuesday.
That includes 117 workers from the Transocean Spitsbergen rig; 80 from the Songa Offshore Enabler; 71 from Odfjell Drilling’s Deepsea Stavanger; and 60 from North Atlantic Drilling’s West Elara rig, among others.
Others set to join the action include 40 Archer drilling workers on the Snorre B platform operated by Equinor; 67 from COSL working on the COSL Innovator rig; 50 from Island Offshore, a supply vessel firm; and 59 from the KCA Deutag MODU drilling contractor working on the Askeladden rig.
The employees that could walk out on Sunday work on exploration and production drilling rigs owned by Saipem, Transocean, Songa Offshore, Odfjell Drilling, Archer and COSL, among others.
Some catering workers will also be striking, Safe said.