Mediation under way – big consequences if conflict follows

Efforts have begun to mediate in collective pay talks covering 7 000 operator, drilling and catering company personnel on Norwegian offshore installations.
Photo: Norwegian Oil and Gas
The mediation has started. From left, mediator Carl Petter Martinsen, Lill-Heidi Bakkerud from Industri Energi, Hilde-Marit Rysst from Safe and Audun Ingvartsen from Lederne. At the top right is negotiator Jan Hodneland from Norwegian Oil and Gas.

Monday 28 September and Tuesday 29 September have been allocated for this process after negotiations on new settlements broke down earlier in September. The deadline for mediation expires at midnight on Tuesday.

The Norwegian Union of Industry and Energy Workers (Industry Energy), the Norwegian Union of Energy Workers (Safe) and the Norwegian Organisation of Managers and Executives (Lederne) are negotiating on behalf of the employees, while Norwegian Oil and Gas represents the employers.

Carl Petter Martinsen has been appointed as the mediator. As a result of the coronavirus epidemic, the process has been moved this year from the office of the National Mediator in Oslo to the Quality Airport Hotel at Sola.

“The oil and gas industry finds itself in a very demanding financial position because of the global epidemic,” says chief negotiator Jan Hodneland at Norwegian Oil and Gas.

“That has resulted in substantially weaker oil and gas prices compared with last year, and it is very uncertain how long this demanding period will last. The most important job we must do in the time to come is therefore to protect the competitiveness of the industry and as many jobs as possible.”

In the lead sector settlement reached earlier this year, the Confederation of Norwegian Enterprise (NHO) and the Norwegian Confederation of Trade Unions/Confederation of Vocational Unions (LO/YS) agreed an economic framework of 1.7 per cent. That sets the norm for pay formation in Norway, including for the sides in the offshore agreements.

“The very moderate settlement reached by the parties in the lead sector must  determine what framework we need to have in order to reach a collective solution through mediation,” says Hodneland.

Big consequences
If the effort to mediate fails, several fields – Johan Sverdrup, Kristin including Tyrihans and Maria, Aasta Hansteen and Kvitebjørn including Valemon – as well as the Snorre B platform risk having to shut down.

That would reduce production from the Norwegian continental shelf (NCS) by some 900 000 barrels of oil equivalent per day, or about 22 per cent of total daily output of oil, gas, condensate and natural gas liquids (NGL).

No immediate effects on production will be suffered on other fields where the unions have notified walkouts.

The unions intend to take the following workers out on strike if mediation fails.   

Industry Energy: 129 Equinor employees working on Snorre B, Kvitebjørn, Aasta Hansteen and Kristin (all operated by Equinor).

Thirty-nine personnel in ESS Support Services working on Ula (Aker BP) and Eldfisk B (ConocoPhillips).

Safe: 88 Equinor employees on Johan Sverdrup (Equinor).

Twenty-five personnel in ESS Support Services providing catering services on Ekofisk L (ConocoPhillips).

Lederne: 43 Equinor employees on Johan Sverdrup (Equinor).


Further information from:
Kolbjørn Andreassen, information manager, Norwegian Oil and Gas, mobile +47 952 82 808


Facts about the offshore settlement
About 7 000 employees are covered by the offshore agreements. They work for operator, drilling and catering companies on NCS installations. These companies include the following: Equinor ASA, ConocoPhillips Norge, Aker BP, Neptune Energy Norge, Lundin Energy Norway, Repsol Norge, Wintershall Dea Norge, Vår Energi, Okea, KCA Deutag Drilling Norge AS, ESS Support Services AS, Sodexo Remote Sites Norway AS, Coor Service Management and 4Service Offshore Hotels AS.