Oil & Gas unions in UK call for government support

The offshore oil and gas unions in the UK have launched a campaign to petition the UK government for direct support for the UK North Sea oil sector.

The Offshore Co-ordinating Group (OCG) – a consortium formed by the unions Unite Scotland, GMB, RMT, Nautilus International, Balpa, and Prospect – said that as many as 3,500 offshore workers could be affected by layoffs by September. Most have been told that business would not return to normal levels until 2022, and more and more rigs were coming off of contract and heading into layup.

The group has called for the UK government to invest taxpayer funds directly in the offshore oil and gas industry. It said that this could be done by lending money at low cost to offshore operators, accompanied by the threat of revoking licenses for operators who do not take part. It also called for operators to support collective bargaining and to engage with the unions.

OCG vice chair John Boland said that “the trade unions are clear that the actions of the industry right now [rig layups] risk the government energy objectives and will severely damage the UK economy, and that cannot be allowed to happen. We are calling for an immediate intervention to halt the ‘carnage’ which is occurring in terms of jobs and to ensure a Just Transition to a carbon neutral state can be achieved,”

In a report issued Tuesday April 28th industry association Oil and Gas UK (OGUK) predicted up to 30,000 lost jobs in the UK offshore sector and the supporting supply chain.

OGUK has predicted that UK North Sea capital expenditure could fall to a 20-year low of about $4bn. Drilling activity could fall by 50% year-over-year, with operating expenditure cuts of between 10% and 20% expected.

OGUK has appealed to governments and regulators to support a “three-stage framework” to support the sector in dealing with the Covid-19 pandemic. This would include government support for the industry’s immediate needs, then its recovery, then its transition to zero emissions.