OSLO (Reuters) – The union that is leading the industrial strike told Reuters that Norwegian marine workers began a strike on Tuesday that will cut oil and gas production.
The strike, in which workers are demanding higher wages to offset rising inflation, comes amid soaring oil and gas prices, with natural gas supplies to Europe particularly tight after Russian exports curtailed.
“The strike has begun,” Ledern union leader Audun Ingvartsen said in an interview.
Register now to get free unlimited access to Reuters.com
operator equalizer (EQNR.OL)The company said on Tuesday it had begun closing three fields in the North Sea as a result of the strike. Read more
The Norwegian Ministry of Labor reiterated that it is following the conflict “closely”. It can intervene to stop the strike if there are exceptional circumstances.
Equinor reiterated on Tuesday that oil and gas production will be reduced by 89,000 barrels of oil equivalent per day (boepd), of which gas production will be up to 27,500 barrels per day.
On Wednesday, the strike will deepen the cut in the country’s gas production to a total of 292,000 barrels of oil equivalent per day, or 13% of production, NOG said Sunday, in line with Equinor’s estimate. Read more
Equinor said oil production from Wednesday will be cut by 130,000 barrels per day, in line with the lobby’s previous estimates.
This corresponds to about 6.5% of Norway’s production, according to Reuters calculations.
Another planned escalation by Saturday could shut down nearly a quarter of Norway’s gas production, as well as about 15% of its oil production, according to Reuters calculations.
“The consequences of this escalation are not yet clear,” Equinor said.
It is ultimately the decision of the operator – Equinor – to shut down the output.
Three-step escalation
The industrial strike began at midnight local time (2200 GMT) in three fields – Gudrun, Oseberg South and Oseberg East – and will expand to three more fields – Kristin, Heidrun and Aasta Hansteen – from midnight Wednesday.
A seventh field, Tyrihans, will also have to close on Wednesday because its production is being processed from Kristin.
By July 9, Slipner, Gulfax A and Gulfax C will likely cease production because Leedn members are deemed critical to operations, with potentially ripple effects on other fields pumping their products through those fields.
If they do, it could cut production of crude oil and other oil liquids by another 160,000 barrels of oil per day and natural gas production by nearly 230,000 barrels per day, according to Reuters calculations.
Ledern union members voted Thursday to reject a proposed wage agreement negotiated by companies and union leaders. Read more
Other Norwegian oil and gas workers’ unions have accepted the wage deal and will not go on strike.
Register now to get free unlimited access to Reuters.com
Additional reporting by Victoria Kelesty, editing by Kim Coogle and Jason Neely
Our criteria: Thomson Reuters Trust Principles.
“Infuriatingly humble analyst. Bacon maven. Proud food specialist. Certified reader. Avid writer. Zombie advocate. Incurable problem solver.”