Exxon’s Norway Oil Fields Risk Shutdown by Strike Over Pensions

Three oil fields operated by Exxon Mobil (XOM) Corp. in the Norwegian North Sea could be shut by a strike if mediation with a union over pensions fails, cutting about 50,000 barrels of crude output a day.

The Safe union will order as many as 154 offshore-platform workers to walk out if the talks fail, paralyzing production at the Ringhorne, Jotun and Balder fields, the group’s leader Hilde-Marit Rysst said by phone. Though the date for a possible walkout has been set at June 16, a strike could start earlier or later, depending on the date of the mediation, which has yet to be scheduled, she said.

“We expect Exxon to take the hint,” Rysst said. “We expect this to be dealt with either before or during the mediation.”

Safe and another oil-worker union broke off talks over pensions last week, raising the risk of a strike two years after the same issue triggered the longest ever labor action by platform employees and reduced output by western Europe’s biggest oil and gas producer. The government used its power to stop the strike as a lockout by oil companies threatened to shut production entirely.

The three Exxon fields, including satellite Ringhorne East, produced about 50,000 barrels of oil a day in 2013, according to figures from the Norwegian Petroleum Directorate.

Exxon has a 100 percent stake in the Balder and Ringhorne fields, while it holds 77.4 percent in Ringhorne East, which is tied in to the Balder and Jotun installations. Exxon holds 45 percent in Jotun, where other partners include Dana Petroleum Plc with 45 percent.

Safe is targeting Exxon specifically because the company has yet to implement an early-pension plan for 31 employees that are members of the union, it said in a statement.

The pension plan isn’t an issue that should be discussed in wage talks, Exxon spokesman Knut Riple said by phone, echoing the position held by the organization representing employers, the Norwegian Oil and Gas Association. Exxon declined to say whether there was room to meet Safe’s demands, he said.

To contact the reporter on this story: Mikael Holter in Oslo at mholter2@bloomberg.net

To contact the editors responsible for this story: Will Kennedy at wkennedy3@bloomberg.net Alex Devine, Reed Landberg

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