400 workers are currently taking part in the first strike in 30 years on North Sea oil rigs. Brian Parkin reports
Since the downward oil price shock of November 2014, oil and gas companies worldwide have been struggling to stay in business by any means possible. For some, this has meant abandoning marginal fields or selling-on their assets and licences as way of limiting risk and losses.
But for the UK offshore industry, with the highest exploration, development and extraction costs of any mature reserves in the world, the answer has been threefold: i) to effectively scrap planned investment, ii) to accelerate field closures and capacity equipment disposals, and iii) to engage in a wholesale ‘rationalisation’ of operating costs – particularly in terms of jobs, wages and conditions of contract.
North Sea turmoil
Since the summer of 2015, the UK offshore industry has seen a massive programme of job shedding: from 450,000 (total offshore plus overall supply chain) in 2014-15, down to 375,000 currently, and set to fall below 300,000 by Jan 2017. Also the number of productive fields is set to be cut by half from the present 300 to less than 150 by 2020 – within just 4 years.
In the meantime, wages have been cut by 22%, which, when allowances are taken into account, amounts to a pay cut of over 30%, in order for the operators to cut overheads while ensuring that with further generous tax breaks, the fall in profits is minimised. Aberdeen based Wood Group have now arranged for their employees engaged on Royal Dutch Shell platforms to not only work under such pay reductions, but also to work imposed a gruelling ‘three on three’ shift and duty system of three weeks offshore based on seven 19 hour shifts per week followed by three weeks onshore ‘leave’. A newly imposed disciplinary code has also meant that workers cautioned for any infringements face the prospect of re-engagement back on what is essentially a minimum wage.
Wood Group employees who are members of the RMT and Unite unions have now enacted the 91% majority vote for industrial action and have commenced the first of a rolling programme of 24 hour strikes on board eight Shell production platforms in the Brent Alpha, Bravo, Charlie, Gannet, Nelson and Shearwater fields. This initial strike involves over 400 workers. Elsewhere an overtime ban is in place.
This fight is essential if the offshore operating companies are to be held to account not only on wages and conditions, but also in the vital area of operational safety, which under the current imposed shift regime, could be greatly imperilled. It is also essential to spread the strike action as well as build onshore solidarity throughout the massive supply chain and beyond.
Such resistance is now necessary if the offshore operators are not to be licenced to play Russian roulette, not only with workers terms, conditions and safety, but also with the very future of the UK offshore oil and gas resource itself. Only through the victory of the present strike can the operators be brought to heel, vital jobs protected and an enormous hydrocarbon asset be brought into the responsible management through public ownership.
Messages of support to: www.uniteoffshore2015.org