North Sea offshore oil workers rank job security as most important factor in a Just Transition

Three  environmental groups in the U.K. have released a new report on September 29: Offshore:  Oil and gas workers’ views on industry conditions and the energy transition . The report summarizes the views of 1,383 workers in the North Sea oil and gas industry (representing 4.5% of the workforce),  as provided in a survey conducted  in the summer of 2020 by  Friends of the Earth Scotland , Greenpeace UK , and the less well-known, London-based Platform.  In addition to the worker’s responses, the report summarizes the economic and working conditions of North Sea offshore oil and gas workers, includes case studies of the personal experiences of eight workers, and makes recommendations for government action. In the final call to action, the three environmental groups invite energy workers, unions, and others to participate in a planned consultation process across the UK, with workshops where energy workers can draft policy demands for a transition that works for them.

Almost 35% of respondents identified themselves as union members, – the two largest unions being  RMT-OILC (52.5%)  and Unite (36%).  In response to the report, RMT issued this press release, which states: “The skills and expertise of offshore oil and gas workers are key to a Just Transition.… To hear this strong, pro-worker, pro-trade union message from influential environmental groups is a significant moment in the debate which operators, contractors and Governments must listen to and act on. We applaud Platform, FoE Scotland and Greenpeace for taking this initiative and RMT will continue to work with them and like-minded NGOs in the fight for action to protect offshore jobs and skills from an unjust transition.”

Workers reveal an appetite for change, fueled by a desire for more job security

Selected survey results show:

  • 42.8% of oil and gas workers have been made redundant or furloughed since March 2020;
  •  Satisfaction with health and safety standards was most commonly rated 3/5;
  • 81.7% said they would consider moving to a job outside of the oil and gas industry- only 7% said they would not.
  • The most important consideration for those willing to transition outside the oil and gas industry was job security (58%). Second most important, at 21%, was pay level.
  • When asked what part of the energy sector they would be willing to retrain for and move to, 53% chose Offshore wind 53%;  51% Renewables ; 38%  Rig decommissioning ; 26% Carbon capture and storage . 20% would also consider moving outside the energy sector.

Based on these responses, the report makes recommendations for three key areas of action: 1. Consultation with workers:  “a representative section of the workforce should be involved in participatory policy-making, where workers are able to help determine policy, in addition to engagement with trade unions”; 2. Immediate government intervention and regulation to “improve job security and working conditions for workers in the oil and gas sector, to boost morale, improve quality of life, and mitigate the risk of workers leaving the energy sector altogether”; and  3. “Address barriers to entry and conditions within the renewables industry, including creating sufficient job opportunities.”

Platform is a U.K.-based environmental and social justice collective with campaigns focused on the global oil industry, fossil fuel finance and climate justice and energy democracy.  Readers may remember that Platform partnered with Friends of the Earth Scotland and  Oil Change International, to publish  Sea Change: Climate Emergency, Jobs and Managing the Phase-Out of UK Oil and Gas Extraction , released on May 2019 and highlighted by WCR here .

Are there lessons for Newfoundland in a Just Transition strategy for the U.K. Offshore oil industry?

sea-change-cover-212x300Sea Change: Climate Emergency, Jobs and Managing the Phase-Out of UK Oil and Gas Extraction was released on May 15 by Oil Change International, in partnership with Platform and Friends of the Earth Scotland.  The press release summary is here . The report examines the offshore oil and gas industry in the U.K., with special attention to the transition for workers and communities currently dependent on oil  – making it highly relevant to Canadians, especially Newfoundlanders.   Sea Change argues that  with the right transition policies, clean industries could create more than three jobs for every North Sea oil job at risk, which can enable an “equivalent job guarantee” for every oil worker.

The report contrasts two pathways available for the U.K. and Scotland to stay within Paris climate limits:   1. Deferred collapse, in which the countries “continue to pursue maximum extraction by subsidising companies and encouraging them to shed workers, until worsening climate impacts force rapid action to cut emissions globally; the UK oil industry collapses, pushing many workers out of work in a short space of time.” Or  2. Managed transition: in which countries “stop approving and licensing new oil and gas projects, begin a phase-out of extraction and a Just Transition for workers and communities, negotiated with trade unions and local leaders, and in line with climate change goals, while building quality jobs in a clean energy economy.”

To achieve the clearly superior “managed transition” pathway, the report recommends that the U.K. and Scottish Governments:

  • Stop issuing licenses and permits for new oil and gas exploration and development, and revoke undeveloped licenses;
  • Rapidly phase out all subsidies for oil and gas extraction, including tax breaks, and redirect them to fund a Just Transition;
  • Enable rapid building of the clean energy industry through fiscal and policy support to at least the extent they have provided to the oil industry, including inward investment in affected regions and communities;
  • Open formal consultations with trade unions to develop and implement a Just Transition strategy for oil-dependent regions and communities.

offshore oil rigOffshore Oil and Gas in Newfoundland: In Newfoundland, the importance of the offshore oil industry is evidenced by the fact that a  snap election was called shortly after the province reached agreement with the federal government on royalty payments on April 1.  The two governments announced agreement on  a “renewed Atlantic Accord”  – including the “Hibernia Dividend Backed Annuity”, valued at $2.5 billion for the province, according to a CBC report . This is new money that comes from Ottawa’s 8.5 per cent stake in the Hibernia offshore project, and will be paid out in annual installments over 38 years. According to the Q1 2019 Company Benefits Report ,   Hibernia operations employ 1,458 workers, of which 90.8% are Newfoundlanders.

The federal and provincial governments are also closely intertwined in a new consultation process which was launched for the Regional Assessment of Offshore Oil and Gas Exploratory Drilling East of Newfoundland and Labrador  in April, along with the Canada-Newfoundland and Labrador Offshore Petroleum Board. The provincial Minister is quoted in the federal press release:  “Our government is committed to working collaboratively with our federal partners to ensure responsible development of our oil and gas industry. The Regional Assessment is an important step towards exempting routine, low impact activities, such as exploration wells, where potential impacts and standard mitigations are well known, from federal assessment. This is another step we are taking to achieve the vision we set out in Advance 2030 to benefit all Newfoundlanders and Labradorians.”

The Advance 2030 document, released in 2018, is subtitled:  A Plan for growth in the  Newfoundland and Labrador Oil and Gas Industry, and is based on the government’s commitment “to resource development as a key economic driver and to positioning the industry for continued growth.”   In releasing the Advance 2030 report, the government announced some long-term targets, including the direct employment of at least 7,500 people in operations, drilling of over 100 new exploration wells by 2030, and doubling oil production by 2030.  That same Liberal government was returned to power as a minority government on May 16, and compiles news of oil and gas development  here .