“They Lose A Few $Billion”: Chevron Workers Plan Multi-Week Strike At Major Australian LNG Plants

On Monday, Chevron resorted to mediation talks with the union representing its workers at the Gorgon and Wheatstone liquefied natural gas projects in Australia in the latest attempt to avert a strike. In a significant escalation over pay and working conditions, the union announced Tuesday it was planning a two-week strike starting September 14. 

“The Offshore Alliance is escalating protected industrial action to demonstrate that our bargaining negotiations are far from ‘intractable,'” Offshore Alliance wrote in a Facebook post. 

The union continued, “Offshore Alliance members are yet to exercise their lawful workplace rights to take Protected Industrial Action and our bargaining claims will look more and more reasonable as Chevron’s Gorgon and Wheatstone LNG exports dry up.” 

“The Offshore Alliance Log Of Claims will ultimately be claims which Chevron will agree to, but not before they lose a few $Billion – judging by the form guide,” it said. 

The strike is expected to begin at the end of next week and come after the union initiated other industrial actions. 

“The new Protected Industrial Action Notice will escalate workbans and the OA will have rolling 24 x 1 hour stoppages,each day for 14 days from Thursday September 14,” Offshore Alliance said. 

Strikes at Gorgon and Wheatstone could disrupt LNG exports and jolt global natural gas markets if the walkouts are prolonged. Wood Mackenzie, a commodities research firm, estimates that Chevron operations account for about 7% of global LNG supply. 

Dutch bank ING Group wrote in a note to clients that the latest move by the union is an ominous sign mediation talks were not “progressing well.” 

“This is likely to provide some support to gas prices today and comes at a time when there is ongoing maintenance work at the Norwegian gas field, Troll, which has seen flows from Norway falling,” ING said. 

Energy analyst Saul Kavonic said potential strikes appear inevitable: “It will create inefficiencies, and the risk of supply impacts grows with time but the mediation process should resolve the issues before the strikes escalate to the point of a material supply disruption.” 

On Tuesday morning, Chevron’s Colin Parfitt, vice president of midstream, spoke with Bloomberg Television about how the producer aims “to find a solution that is a win-win-win for Chevron, our employees and the gas market.” 

“We understand it has to be good for employees, good for us and that will be good in the energy markets,” Parfitt said on the sidelines of the Gastech conference in Singapore. 

In another interview with Bloomberg on the sidelines of Gastech, Woodside Energy Group Ltd.’s CEO Meg O’Neill said she was sharing experiences on bargaining with unions with Chevron. Last month, Woodside made a breakthrough deal with unions to avoid strikes that would’ve shuttered its North West Shelf plant. 

Disruptions in Australia could make US LNG cargoes destined for Europe more appealing to Asia. All eyes are on potential Chevron strikes in Australia next week.