Union Members Authorize September Strike at Chevron Australia’s LNG Ops

Chevron Australia LNG
Chevron's Australian LNG operation accounts for a fifth of global supply (Wheatstone file photo)

Published Aug 28, 2023 3:32 PM by The Maritime Executive

The Offshore Alliance which represents workers at Chevron’s Australian LNG production and distribution facilities scheduled an unspecified industrial action for September 7 after receiving nearly unanimous support for a strike from the 500 union members working at the company’s three plants. With Chevron Australia accounting for more than five percent of global LNG production, the news of the strike sent the European market for liquified natural gas up more than 10 percent according to Reuters. 

Voting for a potential strike at Chevron’s facilities began last week with the union reporting in a filing to Australia’s Fair Work Commission that 99 percent of the 450 members at Chevron’s Gorgon LNG facility and Wheatstone downstream processing plant voted at the end of last week in favor of a job action. Today, polling was completed for the Wheatstone offshore platform where all 37 union members also voted to support a job action.

Under Australian labor law, the union needs to give notice and the action could be for a set number of hours, a ban on certain functions, or a full strike. Reuters is quoting unnamed sources saying that the union plans to stop work for three hours on September 7 and then escalate the number of hours if there is not sufficient progress on the negotiations.

Chevron confirmed that it had received the notice without announcing the details of the planned action. A company spokesperson said they don’t believe a job action is necessary for an agreement to be reached. In similar negotiations, Woodside and the union had set last Wednesday as a deadline in their talks and after a marathon negotiating session reported an in-principle agreement. Chevron combined with Woodside represents a tenth of global LNG production.

“Our members are locked and loaded and ready for Protected Industrial Action,” the Offshore Alliance wrote on its social media account. “A settlement is increasingly likely to come after we ‘jam up’ Chevron’s LNG exports.” The Offshore Alliance was formed as a combination of the Maritime Union of Australia and the Australian Workers’ Union to represent the employees at the major LNG producers. 

Chevron’s Gorgon facility has an annual capacity of 15.6 million metric tons. In June the company reported it had production of first gas from the Gorgon Stage Two development off the northwest coast of Western Australia which included the addition of 11 wells and accompanying offshore production pipelines and subsea structures to maintain feed gas supply for the gas processing facilities on Barrow Island. The facility is a major LNG supplier to Asia Pacific as well as Australia’s domestic supply of LNG.

Just last week, a five percent increase in capacity was announced at the domestic gas facility at the Chevron-operated Wheatstone Project near Onslow. The company completed technical enhancements and plant modifications to increase production rates. The facility handles nearly nine million metric tons of LNG annually.

The Offshore Alliance highlighted that it had reached a new agreement with three of the operators and is now concentrating on Chevron saying that “no members will be left behind in our eventual settlement of our bargaining claims,” which center on wages and working conditions. INPEX reached terms on a new agreement early in 2022, but Shell only came to terms with the union after a 76-day job action that ended last September. Woodside has said it was confident that the in-principle agreement reached last week could be finalized and the union agreed not to proceed with a job action while the agreement was completed, submitted to the membership for a vote, and sent to the Fair Work Commission for approval.