Chevron Australia Labour Dispute: The Offshore Alliance has called for a two-week strike at Chevron-owned Gorgon and Wheatstone LNG plants in Australia to begin on September 14. A long-running dispute over salary and working conditions has advanced with this news. Australia is the world’s largest LNG exporter, thus this Tuesday announcement further destabilizes the natural gas market.
This frightening comment comes during a moment of high stress and mediation by Australia’s Fair Work Commission. These negotiations, which began earlier in the week and will continue daily, are supposed to lead up to small work delays that the union plans to start on Thursday and has outlined.
Offshore Alliance has stated its views on social media. The strike is a strong hint that their bargaining talks are trapped and will take a long time to resolve. This was after the Offshore Alliance said the walkout was a strong hint that pay talks had stalled. Long-term worker unrest might hinder LNG shipments, forcing Asian and European purchasers to compete for the scarce cargo. Without supply-chain logistics, the market is even harder.
ING’s financial research suggests that the union’s harder stance may have stalled the arbitration procedure. As Norway’s Troll gas field is being repaired, gas flows have slowed, complicating matters. Because of this, global supply is constrained, raising prices.
Gas prices in the Netherlands and UK started the week differently. More storage space kept prices low in the short term. But market experts are growing increasingly concerned about Australia’s LNG supply interruption. These analysts foresee a global supply chain disruption.
Wheatstone and Gorgon can supply 50% of Western Australia’s gas due to their strong infrastructure. The Offshore Alliance claimed several staff had kindly offered to run Wheatstone’s domestic gas plant throughout the walkout. The Offshore Alliance may have done this to make peace or as a plot. This act of goodwill was noticeably absent for the facility’s LNG trains, which are crucial to exporting.
The union has generated similar workplace issues before. The Offshore Alliance has previously called for a less drastic seven-day strike against the Gorgon and Wheatstone projects before this latest rise. The world’s LNG capacity will increase by 5% with these massive projects. If no solution is found, the employees have planned 11-hour work stoppages from August 28 to September 14 if no solution is found.
In a second statement, the Offshore Alliance increased their rhetoric, suggesting work delays will stretch until September. They believed this extended timescale would force Chevron to give up, despite billion-dollar financial losses.
Energy expert Saul Kavonic said it now seemed nearly probable that strikes with less impact will happen. Even though labor conflicts might delay the supply chain and generate bottlenecks, Kavonic is confident that current labor dispute settlement methods will prevent a severe supply chain meltdown.
Gorgon, Australia’s second-largest LNG plant after Wheatstone’s 8.9 million tonnes, exports 15.6 million tonnes annually. This should be known. The stakes are global, not just national. This makes the outcome of this struggle crucial for the Australian energy industry and a complex global market.