Exxon’s Norway Output Threatened as Union Readies Pension Strike

A Norwegian oil-workers union said it’s ready to go on strike over pensions in a move that threatens to cut oil production from Exxon Mobil Corp.’s platforms in the North Sea by more than 60,000 barrels a day.

A court in Oslo today ruled that a strike notice by the Safe union that would affect three Exxon platforms is legal, clearing the way for a walkout, according to the group’s leader, Hilde-Marit Rysst. While the union is yet to decide on a public mediator’s proposal that seeks to bridge differences with employers, it will do so by the June 27 midday deadline, she said by phone today.

“Everything is set” for a strike, Rysst said. The mediator’s proposal, endorsed by the Norwegian Oil and Gas Association, which represents employers in wage negotiations, “is not good enough,” she said.

A strike would set Safe apart from two other unions that reached wage agreements in talks that covered 7,615 offshore oil-platform workers. In 2012, workers from all three unions walked out in their longest action, disrupting oil and gas production until the government intervened to stop companies imposing a full lockout that would have halted output from western Europe’s largest producer.

The conflict centers on pension terms for 31 Safe-affiliated workers at Exxon, the world’s largest oil company by market value. While the Norwegian Oil and Gas Association argued that the issue isn’t relevant for industry-wide wage talks, the Oslo court ruled Safe’s strike notice is legal.

Union Threat

The Norwegian Oil and Gas Association could meet with Safe again this week after last week’s state-backed mediation, though there are no talks planned yet, the oil-industry lobby group’s spokeswoman Eli Ane Nedreskaar said by phone. Exxon declined to comment on talks with the union as it’s represented by the Norwegian Oil and Gas Association, spokesman Knut Riple said.

Safe has threatened to take out 154 of its members from Exxon’s Balder, Ringhorne and Jotun platforms, shutting down production that reached 61,000 barrels of oil in April, according to figures from the Norwegian Petroleum Directorate. A strike would also halt production at Det Norske Oljeselskap ASA’s Jette field, which goes through Jotun and amounted to 2,000 barrels of crude a day in April.

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 Alastair Reed, Indranil Ghosh

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