Home' Trinidad and Tobago Guardian : January 12th 2017 Contents BG6 | NEWS
BUSINESS GUARDIAN guardian.co.tt JANUARY 12 • 2017
Major oil producing coun-
tries have witnessed a
surge in industrial un-
rest in their petroleum
sectors within the recent
The proposed strike action by the Oilfield
Workers Trade Union (OWTU) against state-
run Petrotrin as it sought to increase workers
wages should therefore come as no surprise
given the international trend in the petroleum
So strong has been the rallying effort of un-
ionised workers for the actions of their "com-
rades" across the globe, that the OWTU even
received letters of support from trade unions in
the UK, Greece and Switzerland commending
them for their fight on behalf of workers.
No doubt a major contributing factor in
this regard would have been the precipitous
decline in oil prices that started in 2014. In
2016 alone, four major oil producing countries
saw workers draw up battle lines and gather
in strike formation.
Common themes appear to permeate most
stand-offs: state-run companies in need of
restructuring, making consistent financial
losses, with workers agitating for higher wages.
The lessons and outcomes could prove in-
structive in the current industrial relations
On December 23, 2016, workers at Brazil's
state oil company, Petrobras, began strike ac-
tion, paralysing all activities at the company's
refinery and maritime platforms. The largest
union in the petroleum sector, the Federation
of Petroleum Workers (FUP) took the decision
to go on strike after it said the offer made by
Petrobras for wage increases was "insufficient"
and fell short of inflation. The union also ac-
cused the company of breaching a 2016/2017
collective work agreement.
Additionally, the union also voiced concerns
about changes in their employment contract
that could let Petrobras lower the number of
The Brazilian oil giant subsequently took a
decision to go to court over the matter with a
request for conciliation to continue negotia-
tions with the union as it felt that throughout
the negotiating process, progress was being
made to meet some of the unions request with-
in the financial constraints that the company
After three days, the strike was halted.
Petrobras has been the source of massive cor-
ruption and financial graft in the recent past
with several executives and political figures
being convicted and even jailed for financial
Former Brazilian president Dilma Rousseff
was also implicated in the corruption scandal
leading in part to her impeachment and sub-
sequent removal from the presidency.
The company, which employs about eighty-
five thousand workers and contributes roughly
thirteen per cent to Brazilian GDP accumulat-
ed estimated losses of US$5.3 billion between
January and October 2016.
Oil workers in Nigeria entered strike action
in July 2016 as talks between the Petroleum and
Natural Gas Senior Staff Association of Nigeria
(Pengassan), the Nigerian National Petroleum
Corporation (NNPC) and the federal govern-
ment broke down, leading to the withdrawal
close to 2000 workers from offshore, loading
bays and flow stations throughout the country.
The workers' grievance against the company
surrounded the issue of joint venture funding
and cash call debts owed to international oil
companies by the government. Typical ar-
rangements in Nigeria involve oil being pro-
duced under joint venture agreements with
upstream producers with the NNPC usually
holding between 55 to 60 per cent equity in
the joint ventures.
Cash call payments are each partners share
of the operating and capital expenses contrib-
uted by both partners to the joint venture. The
federal government, through budgetary alloca-
tions, pays the cash call, but has not funded it
adequately as the NNPC has for years amassed
multi-billion dollar cash call debts.
The accumulated debt, estimated at US$7
billion, owed to the companies as cash call
arrears, meant that development projects
are NNPC were delayed, a lack of investment
in the company and the termination of union
members by the company.
The union also cited a lack of clear policy
direction by the government on the petroleum
sector, the poor state of the country's refineries
and a spate of redundancies and retrenchments
in the Nigerian oil and gas industry.
A week after the strike commenced it was
called off by the union, citing that an agree-
ment had been reached with itself, the gov-
ernment and international oil companies to
settle approximately US$4.8 billion in arrears
owed to the multinational corporations, and
that no workers who engaged in the industrial
action would be victimised.
In September 2016, Norwegian oil service
workers began strike action as talks between
the representative union, Industri Energi, and
the Norwegian Oil and Gas Association which
represents employers in the oil service sector
broke down as mediation between both parties
over a collective oil service agreement failed.
The union took the decision to remove
roughly 300 of its members from five com-
panies: Halliburton, Baker Hughes Norway,
Schlumberger Norway, Oceaneering, and
Oceaneering Asset Integrity.
The strike had major consequences for
drilling and well operations in the Norwegian
continental shelf which produces around two
million barrels of oil per day.
The Norwegian Oil and Gas Association
deemed the demands by the workers union
as "unreasonable" stating that oil firms could
ill afford to increase costs at a time when crude
prices had plunged over 60 per cent in the last
The union countered that the strike was in-
tended to even out significant wage differen-
tials that existed between oil service employees
and other oil workers.
During the strike, service companies took the
decision to temporarily lay-off workers stat-
ing that this was necessary to reduce financial
losses associated with the strike action.
share common grievances
Nigerian women holding placards reading "Subsidy Removal = Death Sentence" in a protest
against hiked in pump price by the government, which labour insist must be reversed, during a
worker's rally at Gani Fawehinmi Partk, Ojota district in Lagos on January 13, 2012. The
government and Labour are scheduled to meet again tomorrow to resolve the stalement at
yesterday's meeting in order to put an end to on-going strike following government scrapping
of fuel subsidy.
Continued on Page 7
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