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Woodside and Australian Unions Reach In-Principle Agreement on LNG Contract

Woodside LNG platform Australia
North Rankin Complex, North West Shelf Project, Western Australia (Woodside)

Published Aug 24, 2023 6:22 PM by The Maritime Executive

Woodside Energy and its labor unions announced that they have reached an in-principle agreement for an enterprise labor agreement for the company’s liquified natural gas operations in Australia. Energy market analysts welcomed the news noting that the threatened strike against Woodside and Chevron was putting as much as 10 percent of the world’s LNG supply at risk. Negotiations are still ongoing with Chevron.

Representatives for the Australian Workers’ Union called the agreement a “huge win” for members. The contract if completed would the be first enterprise-wide agreement in decades covering both on-shore employees and the over 150 workers at Woodside’s offshore LNG platform Goodwyn Alpha, North Rankin Complex, and Angel Platform. It also marks the union’s successful negotiations with three of the four large producers in Australia. 

The Offshore Alliance, which is made up of the Australian Workers’ Union and the Maritime Union of Australia, called the agreement a “positive step” saying that Woodside had made a strong offer without the unions having to proceed with their threatened industrial action. The alliance reported that the in-principle agreement came as a 15-hour meeting and at the deadline set by the union to start a countdown toward a strike. The unions had authorization to begin a strike which was expected to start as early as September 2.

“Despite the lengthy road to this point, we are relieved that Woodside has now taken a more pragmatic approach and decided to offer our members an enterprise agreement with industry-standard terms and conditions,” said AWU WA Secretary Brad Grandy. Woodside in its statement said that the agreement covered all claims related to remuneration and other terms and conditions of employment.

Union members were scheduled to meet today to review the terms of the in-principle agreement and determine next steps. Woodside said it would be working with the union to finalize the agreement which would require a union vote and approval by Australia’s Fair Work Commission. They noted that the unions had agreed not to file for an industrial action while the process is underway while the union said members would also consider withdrawing their notices.

Just four days ago, the Electrical Trades Union which was negotiating alongside the alliance said it was “gearing up to take on the giants,” referring to Woodside and Chevron. “ETU members refuse to settle for anything less than they rightfully deserve,” the union warned.

Last year, the unions held out for 76 days in a strike against Shell before reaching a new agreement. Workers at INPEX secured a deal with the union earlier in 2022.

Chevron remains the last of the majors to reach terms with the union. The Offshore Alliance members began voting to authorize a possible strike. Union members at both Chevron’s downstream services and Gorgon platform were due to return their ballots today while workers at Chevron’s Wheatstone platform were due to submit their votes on Monday, August 28. 

Industry analysts are hopeful that the initial agreement with Woodside would clear the way for a similar resolution with Chevron. Traders in LNG remained cautious but the announcement from Woodside and the unions took some pressure off the market which was bracing for a potential strike.