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Talks break down on offshore agreements

Today’s negotiations over new offshore pay agreements in Norway’s petroleum sector were terminated by a formal breach with two of the unions concerned, after the third had staged a walk-out.

The Norwegian Union of Industry and Energy Workers (Industry Energy) opted to leave the talks even before the two sides had presented their negotiating positions. While the Norwegian Union of Energy Workers (Safe) and the Norwegian Organisation of Managers and Executives subsequently submitted their demands in the normal way, they also decided eventually to break off negotiations.

“Our position is that we must adapt to a lasting reduction in the level of costs while simultaneously improving our competitiveness to preserve as many jobs as possible,” says Jan Hodneland, lead negotiator for the Norwegian Oil and Gas Association.

Monday to Wednesday this week had been allocated to negotiations on the offshore agreements, which cover some 7 500 employees working for oil companies, catering enterprises and drilling contractors.

Industry Energy, Safe and the Norwegian Organisation of Managers and Executives are negotiating on behalf of the employees, while Norwegian Oil and Gas represents the employers.

Challenging times
Updated figures from Statistics Norway last week show that investment on the Norwegian continental shelf (NCS) will fall from NOK 189 billion in 2015 to NOK 166 billion this year and NOK 153 billion in 2017. Persistently low oil prices and high costs contribute to this decline in spending and activity.

“This means our member companies are experiencing demanding times,” says Hodneland. “They’re in the middle of a restructuring process with extensive downsizing. Pay settlements we reach must contribute to improving adaptability and competitiveness on the NCS.”

The offshore agreements are the third of four sets of collective pay deals being negotiated by Norwegian Oil and Gas this year and the second to go to mediation. Talks on the land base agreements broke down two weeks ago, while agreement was reached with employees on land last week.

Jan Hodneland, lead negotiator, Norwegian Oil and Gas, mobile +47 913 41 301
Kolbjørn Andreassen, communication manager, Norwegian Oil and Gas, mobile +47 952 82 808

The offshore agreements in brief
These cover about 7 500 employees in the following companies: Statoil ASA, A/S Norske Shell, BP Norge AS, ESS Support Services AS, Esso Norge AS, Sodexo Remote Sites Norway AS, KCA Deutag Drilling Norge AS, Talisman Energy Norge AS, Engie E&P Norge, ExxonMobil, ConocoPhillips, Wintershall, Coor Offshore AS, Eni Norge AS and Lundin Norway AS.