A strike by employees at two big liquefied natural gas (LNG) plants owned by US energy giant Chevron and located in Australia is scheduled to begin on September 7.
This comes after several weeks of discussions with unions about wages and working conditions.
Chevron assured the BBC that it will “continue to take steps to maintain safe and reliable operations in the event of disruption at our facilities”.
European wholesale petrol prices recently increased due to strike fears.
More than 5% of the LNG produced worldwide is produced at the Wheatstone and Gorgon complexes, which employ a combined 500 people in Western Australia.
Although we don’t think that strikes are necessary to reach a deal, we do acknowledge that employees have the right to take protected strikes, Chevron said in a statement on Tuesday.
The corporation said further that it would “continue to work through the bargaining process as we seek outcomes that are in the interests of both employees and the company.”
The Offshore Alliance, a collaboration between two unions that represent energy workers, including those employed by Chevron, stated that it had been attempting to come to terms with the business on “several key” concerns, such as salary, job security, rosters, and training standards.
Workers have “consistently been disappointed with the company’s approach to negotiations with the union and Chevron’s refusal to accept that an industry standard agreement should apply to the work they perform for the company,” the statement continued.
“labour may be suspended for brief periods of time, and certain types of labour, such as helicopter unloadings, may be prohibited. Energy analyst Saul Kavonic claimed that these efforts produce inefficiencies and might cause minor production disruptions.
According to Mr Kavonic, the strike will only have a minor effect on petrol prices around the world. He did, however, issue a warning that if the industrial action was intensified, energy prices may skyrocket.
In the extremely rare scenario of a protracted, widespread supply disruption, he continued, “prices could return to crisis levels witnessed last year [after Russia’s invasion of Ukraine].”
On account of worries about a supply outage at Chevron and another Australian LNG plant operated by Woodside Energy, wholesale petrol prices in Europe have increased during the past week.
Woodside announced on Thursday that it had achieved a preliminary understanding with the unions that represent the workers at its North West Shelf production.
Around 10% of the LNG supply in the world is produced by the Woodside and Chevron plants collectively.Following the outbreak of the Ukraine War in 2022, Russia drastically reduced its natural gas exports to Europe.
As a result, prices rose globally, forcing nations to look for other energy supplies like LNG. Australia is one of the largest LNG exporters in the world, and its exports have contributed to a reduction in energy prices worldwide.
LNG is methane, or methane blended with ethane, that has been purified of contaminants and cooled to about -160C. As a result, the gas is converted to a liquid that can be transported in pressurized tankers.
LNG is converted back into gas at its final destination where it is used for power, heating and cooking much like any other natural gas.