Strike at Chevron Australia’s LNG Ops Ends After Regulators Recommend Terms

Chevron Australia LNG — Chevron Australia and the union alliance accepted terms for a new contract from Australia's regulators (Chevron file photo)

The strike at Chevron Australia’s LNG facilities, which account for more than five percent of global supply, was called off today after the company and unions accepted the terms “strongly recommended” by Australia’s labor regulator. Energy traders welcomed the news noting that it was the last of four major agreements and should bring greater stability to the global market.

Australia’s Fair Work Commission brokered the settlement after negotiations broke down between the two sides earlier this week. The Commission had scheduled a hearing on the strike for Friday, but in advance of the meeting proposed terms for an agreement which they said in a statement they “strongly recommended” to both sides while stopping short of officially imposing a settlement. Under Australian labor law, the Commission had the right to impose a settlement or recommend more talks.

Chevron had petitioned the Fair Work Commission after the mediated talks broke down this week. Both the Offshore Alliance, which represents the Australian Workers’ Union and Maritime Union of Australia, and Chevron said they had made progress with concessions in the recent talks. Chevron however petitioned the Fair Work Commission to resolve the dispute saying it had become an “intractable situation.” They noted talks for the Woodside facility had been ongoing for three years.

After the Fair Work Commission acted, Chevron announced yesterday that it had accepted the recommendations. Overnight the Offshore Alliance said it held a member meeting and voted to withdraw the strike which had begun on September 8. Brad Gandy, a spokesperson for the Offshore Alliance released a statement saying the approximately 500 members working at Chevron had “endorsed” the latest offer of the Fair Work Commission’s recommendations.

The union had been holding out for what it was terming an industry standard offer for raises and work rules while Chevron contended the demands were above the terms reached with Shell, INPEX, and recently Woodside. Union members at Woodside had just voted to accept the terms of their contract after also threatening in August to go on strike.

Terms of the agreement with Chevron were not announced, but the union said the proposed deal includes “substantial improvements.” They had been demanding raises, changes to the work rules, job security, and career progression.

The Offshore Alliance said it would now be working with Chevron Australia to finalize the terms of the agreement and submit it to the membership for approval. The Fair Work Commission met briefly on Friday and moved to adjourn the discussions on the Chevron strike for four weeks. The final agreement will need to be submitted to the Commission for approval.

While this is the latest of the agreements in a three-year battle between the unions and the major employers and their facilities, Reuters reports there are additional smaller, independent contracts to be resolved. They are saying the union will shift its focus to the floating production storage and offloading vessels operated by Woodside.