A UNION has warned of a potential health and safety "catastrophe" in the North Sea oil industry as energy giants Royal Dutch Shell and Taqa announced plans to cut hundreds of jobs.
Shell is to cut 250 jobs in its North Sea operations and introduce changes to shift patterns. Staff and agency contractors based in Aberdeen and on installations in the North Sea were informed yesterday.
And Abu Dhabi-based Taqa said it planned to cut about 100 jobs because of the "challenging" time facing the industry.
Shell said its plans would affect staff and agency contractors and were part of a range of initiatives to manage costs and improve the competitive performance of its operations around the world.
It said it would switch to an "even time" offshore shift pattern, an industry-wide cost-cutting move that is being steadfastly fought by trade unions.
It is the latest move by energy firms to cut costs as oil prices have plunged by nearly 50 percent since last summer.
Unite, the offshore industry's biggest trade union, is concerned that quick-fire cuts to jobs and pay generally will have a detrimental impact on the future prosperity and safety of the industry in the long term.
A Unite spokesman said: "Our fear is by imposing longer shifts in the offshore environment, while cutting back human resources to the bare bones and more, the offshore industry will seriously compromise workplace health and safety. "
A consultative ballot of Unite's membership in the Offshore Contractors Association is taking place.
Unite's Scottish secretary, Pat Rafferty said: "There is no doubt we are witnessing a concerted effort by the offshore industry to impose a race to the bottom on jobs, terms, conditions and ultimately safety across the North Sea.
"The only barriers to the industry's ongoing attacks are the offshore trades unions but we need our politicians to wake up to the reality of what's happening in the North Sea - it's a growing scandal which could turn into a catastrophe."
He pointed out that last week the industry got a £1.3 billion tax break in the Chancellor's Budget which it was claimed was necessary to boost growth and sustainability.
In his Budget statement, the Chancellor said Petroleum Revenue Tax (PRT) would be cut from 50 per cent to 35 per cent to support continued production in older fields.
The existing supplementary charge for oil companies would also be cut from 30 per cent to 20 per cent, backdated to January.
Mike Tholen, economics director of offshore industry body Oil and Gas UK, said: "While these are tough decisions to take given the impact on people, the measures are being taken by many companies and will allow the UK to benefit in the long-term from a boost to energy security, hundreds of thousands of highly skilled jobs and billions of pounds worth of supply chain exports."
Paul Goodfellow, Shell's upstream vice president for the UK and Ireland, said: "The North Sea has been a challenging operating environment for some time. Reforms to the fiscal regime announced in the Budget are a step in the right direction, but the industry must redouble its efforts to tackle costs and improve profitability if the North Sea is to continue to attract investment.
"Changes are vital if it is to be sustainable. They will be implemented without compromising our commitment to the safety of our people and the integrity of our assets."
The Shell cuts are in addition to 250 job losses announced last August.
Shell employs around 2,400 staff and agency contractors in its North Sea business, but that figure will fall by the end of the year after the two job loss announcements.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article