Chevron, one of the leading energy companies, is facing the possibility of industrial action at its Western Australian LNG terminals due to disputes over pay and working conditions. The Offshore Alliance, which includes the Australian Workers’ Union and Maritime Union of Australia, has initiated three separate ballots to authorize industrial action.
The first two ballots have opened for downstream workers at Chevron’s Wheatstone LNG and Gorgon LNG terminals, which are responsible for the production of 8.9 million and 15.6 million tonnes per year, respectively. The third ballot, scheduled for 21 August, will involve staff at the offshore Wheatstone platform.
The Offshore Alliance is urging its members to vote in favor of industrial action, citing disagreements with Chevron on various issues such as job security, rosters, transfers to other worksites, overcycle work, training standards, travel arrangements, and pay rates.
In response to the situation, Chevron has emphasized its commitment to engaging with employees and their representatives in search of mutually beneficial outcomes. The company spokesperson stated that Chevron aims to address the concerns of both employees and the organization.
The Wheatstone platform, situated in Western Australia’s Pilbara region, provides the feedstock for the Wheatstone LNG facility, located 1,140 km north of the state capital, Perth. This platform is hailed as the largest offshore gas-processing platform ever installed in Australia.
The results of the ballots for the Wheatstone LNG and Gorgon LNG projects are set to be announced on 24 August. If industrial action occurs, it would follow Australia’s Fair Work Commission regulations, which require a written notice period of seven working days.
The recent negotiations between the Offshore Alliance and Woodside Energy, an Australian independent company, ended with limited progress regarding a new enterprise agreement for offshore platform workers. Additional meetings are scheduled for 23 August.
RBC Capital Markets has estimated that a full shutdown of Chevron’s Gorgon and Wheatstone projects, as well as the Woodside-operated North West Shelf LNG project, could impact around 11% of global gas exports. This potential disruption has contributed to volatile gas prices in Europe, with the Dutch TTF benchmark day-ahead natural gas contract experiencing steady increases since news of the dispute emerged, reaching €37/MWh on 9 August.
The outcome of the ballots and the subsequent negotiations will shape the future of Chevron’s operations in Western Australia. As the energy industry watches closely, it remains crucial for both parties to find common ground to ensure a fair and mutually beneficial resolution to the ongoing disputes.
