Woodside Energy Reports Positive Progress In LNG Strike Talks

Talks between workers and LNG producers in Australia are continuing this week although there is talk of positive progress.

Woodside Energy, one of the companies risking LNG supply disruptions due to potential industrial action, said negotiations with trade unions had resulted in some “positive progress”, as quoted by Reuters.

On the other hand, the unions themselves have said that differences remain on some key issues, the report notes.

"Positive progress is being made and the parties have reached an in-principle agreement on a number of issues that are key to the workforce," Woodside told Reuters, adding "We continue to engage actively and constructively in the bargaining process."

Woodside and Chevron—the other company involved in negotiations—have good reason to want to speed up things. Together, the two produce a tenth of the world’s liquefied natural gas and last week the very talk about strikes led to a 40% jump in European gas prices.

With 99% of workers at Woodside’s North West Shelf LNG facilities voting for industrial action a few days ago, negotiations have become even more important. The Australian labor regulator has already allowed the strike if the negotiations fail.

"Woodside are well off the pace on key bargaining issues including job security and remuneration," the Offshore Alliance trade union representing the platform workers said on social media.

Chevron workers, meanwhile, are yet to vote on whether they will strike or not, which, according to the trade union, will take place next week.

Meanwhile, Reuters reported that Woodside is likely to report strong first-half results thanks to the resilience in LNG prices, according to analysts.

Woodside’s North West Shelf is the largest LNG production project in Australia, with a capacity of 16.9 million tons annually, followed by Chevron’s Gorgon, which has a capacity of 15.6 million tons. The Wheatstone project, also operated by Chevron, can produce 8.9 million tons of LNG annually.

By Irina Slav for Oilprice.com

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