“The voice of the British oil industry has spoken of a ‘glimmer of optimism’ for the North Sea oil and gas sector, but the reality is that we are in a really deep, dark, dark place at the moment.”
That was the stark warning last night to a chastened group of Holyrood MPs on the Scottish parliament’s cross-party group on oil and gas by Jake Molloy, Regional Organiser of the RMT.
Earlier this week, the Oil and Gas UK industry association hailed a 2-point rise of ‘less pessimism’ as a ‘glimmer of optimism’ in its Business Sentiment Index, while burying the fact that more than half of North Sea employers have, or will cut jobs in the current crude oil price slump.
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Molloy told MSPs that the industry is operating in a ‘climate of fear’ as offshore workers fear for their jobs – a ‘human factor’ which could potentially jeopardise safety.
He said: “The situation we face today has been described as everything from a slump to a ‘period of change’ to the most co-ordinated attack on workers’ terms and conditions in a generation.
“I have been in this industry for 35 years and I have never seen anything like this. I spent half that time offshore and I know the pain of redundancy.
“I was one of thousands dumped in the 1986 downturn. With a young family – my daughter was only a few weeks old – it was devastating to join the dole queue.
“I did get back but on significantly reduced rates and in an environment where you kept your head down for fear of being NRB’d (‘not required back’). As well as the culture of fear, it was a ‘them and us’ world where contract workers were second-class citizens when it came to pay and conditions.
“It was a bloody awful time and the casualty and fatality rate reflected that. But then something happened which was to change all that – Piper Alpha blew apart killing 167 workers in 1988.
“The reason I mention this now is because of the similarities we’re seeing again today in an environment where thousands of people are being made redundant and where fear underpins everything you do.”
He said contractors were being told by the employers (ie ‘Tier 1’ major oil companies) to ‘reduce your prices by 25% or it won’t be renewed’ while workers are facing an effective pay cut of 15% by have to work an additional 350 hours per year offshore under new 3 weeks on-off rotas.
He added: “Nobody offshore is unaware that we have problems. The issue is how we address these problems.”
And, as far as the RMT is concerned, the Offshore Contractors Association and OGUK are two of the systemic problems. The RMT will tomorrow (13 Nov 2015) announce a new strategic group to deal with the problem OGUK and the OCA of being ‘puppets’ for the major oil companies – ie though ‘they never appear in public, they pull all the strings on pay, conditions, publicity and PR’.
Molloy added: “Something needs to change – quickly – or the employers/clients will lose the ability to deliver. This could seriously damage reputations.
“Change is not just cutting costs – we need real workforce engagement, like they have in the Norwegian North Sea. Norway is affected by the same $50-barrel crude oil price as we are, yet they work a 2 weeks on, 3 weeks off rota.
“The 3 on, 3 off rota being implemented in the North Sea is wrong, unprecedented, un-tested and un-tried – and there are no studies on safety and work performances.
“At the moment, the workforce is not ‘buying in’ to the current crisis. ‘Shared principles and values’ are not flowing down to the workforce and all they see is money coming out of their pockets.”
* Les Linklater, Executive Director of Step Change in Safety, earlier outlined how the industry could save up to £340 million a year in removing ‘over-duplication’ of induction and HSE, company, contractor and site-based work safety procedures.
Getting MER from the UK North Sea: The 2016 Oil & Gas Collaboration Conference, Aberdeen