Chevron seeks deal with workers at Australian LNG plant

US company Chevron will accept the terms of an agreement with workers at its liquefied natural gas (LNG) plant in Australia. Workers had objected to pay and working conditions at two projects. The agreement was brokered by the Fair Work Commission, but the unions have yet to respond, Reuters reported. If successful, the agreement would end strikes that began almost two weeks ago and initially unsettled global gas prices.

The commission, which has the authority to impose an agreement, said it strongly recommends that the parties to the dispute accept the proposals to end the strikes. „Having considered the offers, Chevron has accepted the recommendation to resolve all outstanding issues and finalise an agreement,“ a company spokesperson said today. Union representatives then agreed to meet to discuss the agreement.

The prospect of prolonged disputes at three LNG facilities in Australia caused gas prices to rise by up to 35 percent in August. But when the dispute involving the country’s largest LNG production plant was resolved, markets calmed.

The commission’s recommendation came a day after the latest talks between Chevron and the unions over strikes at the Wheatstone and Gorgon facilities ended without an agreement. Both sides have until 9 a.m. on Friday to decide whether to accept the commission’s recommendation ahead of a hearing scheduled for later that day.

Australia is the world’s largest LNG exporter, but supplies almost all of its output to Asian markets. The strike in Australia therefore poses no immediate threat to Europe. However, if the strikes were to last longer and less gas were available to buyers in Asia, they might start seeking gas elsewhere in the world, competing with Europeans to buy LNG from other regions.