July 23, 2018 / 10:01 AM / 23 days ago

Total's North Sea oil platforms hit by 24-hour strike

LONDON (Reuters) - About 40 rig workers started a 24-hour strike on Monday on the Alwyn, Elgin and Dunbar platforms in the British North Sea, curbing gas flows to shore, but stored crude was expected to mitigate any oil supply disruption.

FILE PHOTO: The logo of French oil giant Total is seen on a flag at La Defense business and financial district in Courbevoie near Paris, France. May 16, 2018. REUTERS/Charles Platiau/File Photo

The platforms halted production at 0500 GMT, said Unite, Britain’s largest labor union. Unite and Total, which operates the platforms, had failed to agree on work shifts and pay, a union spokesman said.

No fresh talks are currently planned, another union spokesman said.

The fields account for about 10 percent of Britain’s gas output, while their oil production contributes about 45,000 to 50,000 barrels per day (bpd) to the Forties and Brent Blend crude streams.

Forties and Brent Blend are key oil grades used to set the dated Brent benchmark that prices more than half of the world’s oil trades.

Brent futures were up 68 cents at $73.75 a barrel at 1527 GMT, off the day’s high of $74.50.

Gas traders said the strike had curbed flows to shore, helping to boost the within-day wholesale gas price by 1.9 percent to 58.3 pence per therm. The contract had already been at multi-year highs for this time of year.

The affected fields contribute about 10 percent of the Forties stream, but supply can be supported by using stored crude. July loadings of Forties were set at 330,000 bpd and August at 271,000 bpd.

A Total spokeswoman confirmed that industrial action had gone ahead “despite the new proposals that were made by the company”.

Other 24-hour stoppages are slated to take place on Aug. 6 and 20, while the 12-hour strikes will occur on July 30 and Aug. 13.

Total shares finished the day unchanged from Friday’s close.

Total is seeking to extend the time workers at its fields spend offshore to three-week rotations instead of two, matching the rota system at its newly acquired Maersk fields.

“However, we’re pleased to be able to continue discussions with staff at the Shetland Gas Plant and remain committed to further consultation and open dialogue with offshore staff,” the spokeswoman said.

“What is at stake here is to ensure the long-term sustainability of our business in the North Sea, to enhance overall safety and remain the most efficient in our operations.”

Other strikes are looming in the North Sea.

Unite union members at services company Aker Solutions announced their decision to strike at Equinor’s non-producing Mariner platform.

GMB, another British union representing oil workers on Mariner, said its members had also voted to strike. It was not clear whether the two strikes would be coordinated.

Equinor said that offshore work on Mariner was progressing well and that there was no change to its plan to start production from the field by the end of this year.

Aker Solutions said it had offered an enhancement to terms and conditions worth up to 8,000 pounds ($10,482.40) per employee, adding that it has sought further discussions with the unions.

In a separate development, Unite was balloting 2,500 offshore oil service workers for another possible strike over pay, which would affect 106 North Sea oil platforms.

Last week 1,600 Norwegian rig drillers ended industrial action.

Reporting by Shadia Nasralla, Ron Bousso and Julia Payne; additional reporting by Sabina Zawadzki and Gwladys Fouche, Editing by Dale Hudson, Louise Heavens, Kirsten Donovan and David Goodman

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