U.S. Oil Workers' Union Expands Biggest Plant Strike Since 1980

Representatives from the United Steel Workers Union (USW) hold a rally at the entrance to the Marathon refinery in Catlettsburg, Kentucky, on Feb. 7, 2015.

Representatives from the United Steel Workers Union (USW) hold a rally at the entrance to the Marathon refinery in Catlettsburg, Kentucky, on Feb. 7, 2015.

Photographer: The Independent/Kevin Goldy/AP Photo

The United Steelworkers, which represents 30,000 U.S. oil workers, called on four more plants to join the biggest strike since 1980 as talks dragged on with Royal Dutch Shell Plc, negotiating a labor contract for oil companies.

The USW, with members at more than 200 refineries, fuel terminals, pipelines and chemical plants across the U.S., asked workers late Friday at Motiva Enterprises LLC’s Port Arthur refinery in Texas, the nation’s largest, to join a nationwide walkout on Saturday, and issued notices for three other plants to go on strike in 24 hours.

This brings the work stoppage -- which began on Feb. 1 at nine sites from California to Texas and expanded to two BP Plc refineries in the Midwest a week later -- to 12 refineries and 3 other facilities. The union has rejected seven contract offers from Shell, which is representing companies including Exxon Mobil Corp. and Chevron Corp.

An agreement would end a strike at U.S. plants that account for almost 20 percent of the country’s refining capacity. It’s the first national walkout of U.S. oil workers since 1980, when a work stoppage lasted three months. The USW represents workers at plants that together account for 64 percent of U.S. fuel output.

“The industry’s refusal to meaningfully address safety issues through good faith bargaining gave us no other option but to expand our work stoppage,” said USW International President Leo W. Gerard in a statement late Friday. There are no talks scheduled for Saturday, according to the USW.

‘Wrong Tone’

Ray Fisher, a spokesman for The Hague, Netherlands-based Shell, said Saturday in an e-mail that Shell was “extremely disappointed” that the USW issued additional strike notices. It sets the “wrong tone” for both parties to move forward, he said.

The USW has been asking for tougher measures to prevent fatigue and to keep union workers rather than contract employees on the job, statements posted on the group’s website show. The union said on Thursday that Shell’s seventh offer failed to address safety concerns “in any sort of meaningful or enforceable way.”

As the oil workers strike expanded, West Coast dockworkers and their employers ended their nine-month standoff with a five-year contract deal, averting a shutdown of 29 ports that could have cost the U.S. economy $2 billion a day.

Striking Plants

The USW previously called strikes at: Tesoro Corp.’s plants in Martinez and Carson, California, and Anacortes, Washington; Marathon Petroleum Corp.’s Catlettsburg complex in Kentucky and Galveston Bay site in Texas; Shell’s Deer Park complex; LyondellBasell Industries NV’s Houston facility; and BP Plc’s Whiting and Toledo refineries in the Midwest.

In addition to Port Arthur, Motiva’s refineries in Convent and Norco, Louisiana, and Shell’s chemical facility in Norco received 24-hour notices. Motiva is a joint venture between Shell and Saudi Arabian Oil Co.

The Port Arthur plant was running at about 50 percent of capacity, with units including a hydrocracker, a coker, a hydotreater and a fluid catalytic cracker shut for repairs, according to Troy Barbay, the USW workmen’s committee chairman and Hoot Landry, the USW staff representative at the site. The facility’s largest crude unit was running at reduced rates, Barbay said.

More than 5,200 workers have walked out, USW statements show. United Steelworkers members operate refinery units, perform maintenance and work in labs at the plants.

Contract Negotiations

The USW and Shell began negotiations on Jan. 21 amid the biggest collapse in oil prices since 2008, driven largely by surging output from U.S. shale formations that cut oil prices by 49 percent in the second half of 2014.

Refiners in the Standard & Poor’s 500 have tripled in value since the beginning of 2012, when the steelworkers last negotiated an agreement. Marathon and Tesoro went on that year to take their place among the 10 best performers in the S&P 500 Index.

The national agreement, which addresses wages, benefits and health and safety, serves as the pattern that companies use to negotiate local contracts. Individual USW units may still decide to strike if the terms they’re offered locally don’t mirror those in the national agreement.

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