SANDNES, Norway– A mediation process has started today between employers’ representation Norwegian Oil and Gas Association and the Norwegian Union of Energy Workers (Safe) over a well service pay agreement. The deadline expires at midnight.
If no agreement has been reached, the association said a stoppage could occur. This “possible conflict would mean a halt to or delays with various services, such as cementing of wells, exploration drilling and well completion. However, it would have no immediate consequences for production on the Norwegian continental shelf,” the Norwegian Oil and Gas Association said in a statement.
Jan Hodneland, lead negotiator for Norwegian Oil and Gas, said: “Many of the supplies companies are experiencing very demanding times because of the reduction in activity. Their earnings have declined substantially as a result of both new and renegotiated contracts.
“This means that a growth in costs would add to their burden. It would worsen the position not only for the companies but also for their employees, who have seen many of their colleagues being made redundant.”
These talks come on the heels of a recently averted strike regarding offshore pay when, on July 2, an agreement between Safe, Norwegian Union of Industry and Energy Workers (Industry Energy), and the Norwegian Organisation of Managers and Executives was reached 3.5 hours after deadline. Chief among those results, according to the Energy Industry and others, was promotions and raises of about NOK 15,000 ($1,777.10) total. Shift and night work supplement was also increased.
However, today, Norwegian Oil and Gas said that the position of the suppliers is not comparable to that of the operator companies, which have been through major restructuring over the past few years, including extensive cost cuts and downsizing.
“A prudent pay settlement would make a significant contribution to improving the competitive terms for Norway’s supplies companies,” Hodneland said. “It will help to preserve the largest number of jobs, which needs the contribution of both sides.”
Safe has notified a stoppage by all 663 of its members in the following companies: Baker Hughes AS (79), Halliburton AS (35), Oceaneering AS (17), Schlumberger Norge AS (228), Subsea 7 AS (78), Vetco Gray Scandinavia AS (184), and Weatherford Norge AS (42).
Norwegian Oil and Gas negotiated with the Norwegian Union of Industry and Industry Energy over the oil service agreement on Tues., July 5. These talks are temporarily put on pause.