July 13, 2018 / 1:46 PM / 5 days ago

UPDATE 1-Norway oil strike: sides not talking, Aker BP warns of production hit

(Adds comments from union, mediator, background)

By Lefteris Karagiannopoulos

OSLO, July 13 (Reuters) - A four-day oil workers’ strike in Norway that may escalate on Monday would have to last a month to impact Aker BP’s production from the Valhall field in the North Sea, the Norwegian energy company said.

Hundreds of workers on Norwegian offshore oil and gas rigs went on strike on Tuesday after rejecting a proposed wage deal, closing Shell’s Knarr field, which produces 23,900 barrels of oil equivalent per day.

Four days in and the conflicting parties were still not talking to each other, a union official and a mediator told Reuters on Friday.

Aker BP Chief Executive Karl Johnny Hersvik said activity at the Valhall IP water injection and Valhall DP drilling platforms would stop if the strike escalated.

“If the strike is prolonged it will have later in the year impact on when wells are back in production ... if that is going to happen it means the strike has to be quite long,” he said during the firm’s second-quarter results presentation.

Aker BP later told Reuters a strike of a month to six weeks could impact output at the field by “a few thousands barrels per day”.

“Some of the wells that are drilled are planned to be put in production at the end of this year. If the strike lasts, the output will move to next year, which would have an impact on this year’s production outlook,” investor relations contact Kjetil Bakken said.

In the short term, Aker BP plans to use any lost drilling time to perform maintenance and activities to raise the flow of oil and gas, Hersvik said.

Aker BP holds a 90 percent stake in the Valhall field, which produced 13.5 million barrels of oil equivalent in 2017. The firm has plans to increase production.

NO CONTACT

Just two days before 901 more oil workers could walk out, Norway’s Safe union and the country’s Shipowners’ Association, representing employers, have yet to talk to each other, the union’s negotiator said.

“So far there is no contact. If they want to talk they have to do so,” Roy Aleksandersen told Reuters.

A mediator appointed to smooth negotiations said neither side had tried to reach him since the industrial action began. (Editing by Dale Hudson and Jason Neely)

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