Sydney — Chevron faces the prospect of work stoppages or even an all-out strike at Australia’s second largest liquefied natural gas (LNG) plant at Gorgon and at its Wheatstone operations after voting opened on Friday for a union ballot.
Australia is one of the largest exporters of LNG to the world along with Qatar and the United States, and concerns about a strike have spurred volatility in European gas prices over fears the move would fuel competition between Asian and European buyers for cargoes. China and Japan are the top lifters of Australian LNG, followed by South Korea and Taiwan.
Australia’s labour regulator last week cleared the way for unions to conduct a “protected action ballot” that gives employees the chance to secretly vote, fuelling worries any potential strike could slow the country’s LNG exports.
Based on industrial rules, the ballot for workers at Gorgon and the Wheatstone downstream facility must close by Aug. 24 at the latest. A separate ballot for the Wheatstone offshore platform workers must close by Aug. 28 at the latest.
The Offshore Alliance, which combines the Maritime Union of Australia and Australian Workers’ Union, did not immediately respond to a request for comment on the ballot’s closing date.
If successful, the union can decide whether to go ahead with action that must take place within 30 days and could range from a mix of short work stoppages and bans on certain tasks to an all-out strike. Employers are given notice beforehand.
“It’s game on in pushing back against Chevron’s sub-standard employment standards,” said the Offshore Alliance, which urged workers to vote for all of the demands on the ballot.
The unions are seeking higher wages and improved working conditions.
Chevron was continuing negotiations with employees, a company spokesperson said. After the decision by the labour regulator last week, Chevron said it was taking steps to ensure reliable operations could be maintained if any disruption occurred.
Woodside Energy Group, which operates Australia’s biggest LNG plant at North West Shelf, and Chevron have been holding talks with unions to avert threatened strikes at their facilities that together supply about 10% of the global LNG market.
North West Shelf has an export capacity of 16.9 million metric tons a year, while Gorgon has an annual capacity of 15.6 million tons and Wheatstone 8.9 million tons.
About 99% of workers at offshore platforms that feed gas to North West Shelf have already backed industrial action, but the unions have not yet called for action there.
A two-month fight last year against Shell at its Prelude floating LNG site off northwest Australia cost the company about $1 billion in lost exports until it reached a pay deal.
Reporting by Renju Jose in Sydney; additional reporting – Reuters
