UPDATE 2-Norway's oil sector faces strike threat

Thu Apr 4, 2013 10:32am EDT

Related Topics

* Strike expected at bases which supply 20 platforms

* Top Statoil and Shell fields could be affected

* Strike would start on Monday if no wage deal is reached

By Nerijus Adomaitis

OSLO, April 4 (Reuters) - Norway's vast oil sector could face disruption as employees at key supply bases plan to walk off the job on Monday, threatening supplies to offshore platforms.

The nationwide strike for higher wages would affect Mongstad Base AS and Vestbase AS, which supply 20 major platforms that account for just over a third of the country's oil production.

"The twenty platforms which receive their supplies from Mongstad Base AS and Vestbase AS will probably have to shut down operations within a few days after a strike has begun," trade union Industri Energi said on Thursday.

"The platforms can not operate for longer than three days, if the vital supplies, which also include the food, are stopped," it said.

Strikes have become common in Norway over the past year as workers are demanding a greater share of the country's rare economic success. Offshore workers last summer shut down large parts of the oil sector in demand for higher wages, forcing the government to intervene.

Platforms that could be affected include some of Norway's top offshore installations, including Statoil's Troll B and C, Grane, Oseberg, Njord, and Aasgard A, and Shell's Draugen, Industri Energi said.

The bases supply platforms with everything from fresh food to diesel and drilling fluids, making several deliveries each week.

"The strike involves 170 of our employees, which means that Vestbase will not be able to maintain normal operations," the company said in a statement.

Mongstad Base said over half of its 230 employees would be on strike and hoped it would be able to maintain at least partial operations.

However, Statoil said the strike would have no "immediate" impact on production or other major activities.

Unions and employers will have one final attempt over the weekend to thrash out a wage deal through state mediators and if talks fail, 17,000 people across Norway would walk off the job on Monday.

The strike could eventually grow to involve over 170,000, or just under 10 percent of Norway's private sector workforce.

However, an extended strike is unlikely as the government generally intervenes if the oil sector is at risk of major disruption. The sector accounts for around a fifth of Norway's $500-billion gross domestic product.

Besides supply bases, oil services firm Aker Solutions could lose close to 1,400 workers to the strike while Kvaerner, which builds heavy installations like platforms, is set to lose around 1,000 people.

Although Norway's economy has outperformed Europe for the past several years and per capita GDP is over $100,000, employers are reluctant to pay higher wages as workers already make 60 percent more than the European average.

Norwegian wages rose by 4 percent last year even as productivity broadly stagnated and the central bank sees wages up at least 4 percent in each of the next three years.

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