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Refinery strike hits North Sea platform production

Refinery strike hits North Sea platform production
Thousands of offshore workers will begin shutting down production on 30 North Sea oil platforms today after last night's closure of Scotland's only refinery because of a strike by 1,200 staff.

Thousands of offshore workers will begin shutting down production on 30 North Sea oil platforms today after last night’s closure of Scotland’s only refinery because of a strike by 1,200 staff.

Supplies from more than 50 fields will stop flowing through the vital Forties pipeline system because a power plant at Grangemouth will also be switched off during the 48 hours of industrial action.

Energy industry body Oil & Gas UK made a last-ditch plea for the two sides in the bitter dispute – refinery owner Ineos and the Unite union – to reach a deal to avoid disruption to offshore supplies.

First Minister Alex Salmond urged people to save fuel, avoid unnecessary journeys and use public transport.

His plea came as many forecourts throughout the north and north-east reported shortages and continued to ration supplies as panic-buying of fuel continued in some areas.

The Forties pipeline system transports about 700,000 barrels of North Sea oil a day, nearly half the total UK output. It is owned by offshore giant BP and comes ashore at Cruden Bay, near Peterhead, in Aberdeenshire.

Fields linked to the pipeline include Forties, Buzzard, Nelson and Miller.

Oil & Gas UK said workers would be as busy as usual when the pipeline system was shut down, concentrating on maintenance. It was unlikely any would be flown home.

Even though the strike is due to last only 48 hours, it will have after-effects on the offshore industry.

Oil & Gas UK’s chief executive, Malcolm Webb, said: “It will take several days for the shut-down platforms to come back into full production.

“This is costing the UK economy £50million daily in lost production.

“The potential effect of the industrial action at Grangemouth on UK oil and gas production is wholly disproportionate to the scale of the dispute itself.

“The strike can go ahead without the issue spilling over into oil and gas production and that is what is now important for the UK economy.

“The provision of the essential utilities that would enable continued oil and gas production can be dealt with outside this dispute and it is vital that Ineos and Unite recognise this.”

The 1,700-acre Grangemouth site, the main fuel supplier north of the border, was shut down by Ineos as it prepared for a 48-hour walkout by staff from tomorrow morning.

Tony Woodley, joint leader of the Unite union, addressed a mass meeting of more than 1,000 workers yesterday afternoon and said they were determined to win the dispute, which centres on plans by Ineos to end its final-salary pension scheme for new workers.

“There is no justification for what the company is proposing because it is profitable and the Grangemouth site is profitable,” he said.

“After the strike, we have a pause for peace and I hope we can resume negotiations to try to resolve this.”

Mr Woodley said he had invited Ineos to hold more talks but these were not now expected to be held before the strike starts.

If the company remained “intransigent”, he said, an escalation of the dispute was “absolutely inevitable”.

Ineos chief executive Tom Crotty said: “We have addressed the issues for existing staff, so now the union say the dispute is about future staff.

“Unite are asking their members to strike in support of non-existent colleagues.”

The company said that, despite “repeated requests”, Unite had refused to maintain the power and steam supplies needed to keep the Kinneil plant at Grangemouth – vital to the Forties pipeline operation – in production.

At a press conference in Edinburgh last night, Mr Salmond, who has been criticised for his use of a chauffeur-driven car, said Scottish ministers and the public sector had been asked to set an example and act responsibly. He said: “That behaviour will be led by the ministerial team. I have been enjoying walking around Edinburgh over the last couple of days.

“It has been doing me a great deal of good and I will be on the train to Inverurie at some point this evening.”

Mr Salmond acknowledged there were shortages at filling stations, particularly of diesel, and repeated warnings against panic-buying.

The Gordon MSP added: “My judgment, from speaking to both parties, is that they both realise an escalation of the dispute would be enormously damaging, not just to the wider economy but to the interests of both the company and workers.”

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