Chevron slashes 1200 jobs from Gorgon LNG project
The Australian
December 23, 2015 12:00AM
More than 1200 jobs have been axed from Chevron’s $US54 billion Gorgon gas project in Western Australia in the lead-up to Christmas, fuelling the state’s worst unemployment rate in 13 years as the one-time boom economy is hit by plunging commodity prices.
The Australian has learnt that about 530 electrical workers on Gorgon were laid off last Thursday and Friday.
Unions claimed they previously had been assured that the positions would be safe until at least March.
The redundancies are in addition to about 700 other job losses at Barrow Island, the site of the Gorgon gas plant, over the past two weeks. The positions axed included boilermakers, pipe fitters, welders and trades assistants.
The total workforce on Barrow Island has shrunk by 15 per cent — from 8200 to 7000 — in recent weeks.
Thousands more jobs on the project will be cut in coming months as Chevron ends the long and expensive construction phase and begins exporting gas to Asian markets.
It is understood Chevron has also laid off about 300 employees from its head office in Perth in recent months after a decision by executives in the US to cull its global workforce by up to 7000 people in response to the collapse in the oil price.
The end of the Gorgon jobs bonanza in Western Australia comes after the unemployment rate hit 6.6 per cent last month. The Australian Bureau of Statistic reported that the state lost 10,000 fulltime jobs and a record 96,000 people were looking for work last month.
Treasurer Mike Nahan revealed on Monday that Western Australia was facing an unprecedented debt and deficit crisis, sparked by what he described as the biggest revenue shock of any Australian government since the Great Depression.
The West Australian economy is growing at its slowest rate since 1990-91 as the construction of projects such as Gorgon and Gina Rinehart’s $10bn Roy Hill iron ore mine come to an end.
A number of public and private projects have been either abandoned or shelved because of low commodity prices.
Chevron said yesterday that the recent job cuts at Gorgon were inevitable.
“As the Gorgon project moves closer to first gas and work scopes are completed, contractor workforces continue to demobilise from Barrow Island,” a spokeswoman said.
“Similar to the construction phase of all resource projects, the duration of jobs is determined by the requirements of individual scopes of work.
“According to third-party economic modelling by ACIL Allen, the Chevron-led Gorgon and Wheatstone natural gas projects alone have created 17,000 direct jobs in Australia and committed more than $45 billion in goods and services to local businesses.”
Electrical Trades Union assistant state secretary Jim Murie said about 530 electrical workers employed by subcontractor Kentz were made redundant last week, accounting for one-third of the electrical workforce contracted to work on the Gorgon project
They included 360 electricians, 90 instrument workers and 70 electrical assistants.
Mr Murie said he was surprised by the move given the amount of electrical work that still needed to be done on Barrow Island.
“It was quite unexpected — we didn’t expect these numbers until about March,” he said.
Mr Murie said the workers were shocked by the company’s actions.
“Their method of delivery was not good,” he said.
“Some people got SMSs, others got a note slipped under their door or a phone call.
“Among those made redundant were people on workers compensation, sick leave and income protection.”
Mr Murie said he believed many of the positions made redundant would need to be refilled.
“A cynical person could also link it to the 2 per cent wage increase that will be handed down on the first pay period after January 1,” he said. “There are lots of workers with accumulated leave and the value of it would have gone up by 2 per cent.”
A spokesman for the Australian Manufacturing Workers Union confirmed that hundreds of its members who worked on Gorgon had been made redundant this month.
He said the workers had believed their jobs were safe until March and the union was angry that lead contractor Chicago Bridge & Iron had sacked them just before Christmas.
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