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Around 260 jobs set to go at Sullom Voe

While seasonal redundancies are a regular feature of life at Sullom Voe, Unite says a steep fall in oil prices has exacerbated this year's situation.

TWO MAIN contractors at Sullom Voe Terminal (SVT) are consulting on making a total of around 260 workers redundant ahead of the winter in the wake of a sustained slump in global oil prices.

Wood Group confirmed on Wednesday that it is in talks with unions and staff about shedding 90 of its 250 jobs at the BP-operated terminal in Shetland following a review of its personnel requirements due to “changes in the shop of work being conducted at this site”.

Bilfinger Industrial Services (BIS), meanwhile, said it had also initiated a consultation “as a result of a reduction in seasonal workloads due to winter working conditions and some changes to work scopes”.

“Unfortunately, this may result in a number of roles being made redundant,” a BIS spokesman said. “We are continuing to work closely with trade unions during discussions and effort is being made to find alternative solutions where possible.

“As consultations are ongoing it would be inappropriate for us to comment further at this stage.”

But the Unite trade union told Shetland News that, in addition to more than a third of Wood Group employees potentially losing their jobs, Bilfinger was looking to make some 170 redundancies – more than half of its 290-strong workforce at the terminal.

Unite regional officer John Boland said that, in addition to the usual “down-manning at this time of year” due to the winter weather, there was no question that the fall in oil prices was “having an impact”.

Shetland MSP Tavish Scott said he would be looking to raise the issue with Nicola Sturgeon at First Minister’s Questions on Thursday.

“This is a worrying development especially for the employees who will be directly affected,” Scott said. 

“Sullom Voe Terminal is a major employer in Shetland and its continuing future is very important for the local economy. I will be asking BP to clarify what changes are taking place at SVT that has triggered today’s announcement.”

There have been massive worldwide job losses in the industry over the past year as oil prices have plummeted from a previous level of $90-$100 a barrel to around the $50 mark. Many oil analysts do not expect a sustained recovery in oil prices for several years.

Boland said many of the jobs to go would be in engineering, maintenance and repair.

“There would be a reduction in manning anyway, but BP as the client that gives out the work to Wood Group and Bilfinger, they’ve not got so much money to go around so they’re reducing the workforce.

“If things were better BP would be having more work done over this period and there would be less redundancies.”

He added: “We have been involved in the consultation throughout the process. We’ve basically agreed what the selection criteria are, and over the next couple of weeks we’ll be having one-to-one meetings with the individuals to let them know whether they’ll be made redundant or not.”

A BP spokesman said the terminal typically experienced reduced activity due to the adverse winter weather when “many activities cannot be efficiently executed”.

“That, coupled with the work we are doing to ensure a competitive business for the future, has led to changes in some work scopes on site,” he said. “SVT continues to deliver a programme of critical maintenance and renewal activity and we are currently planning our programme of work for 2016.”

Initial oil from Schiehallion will go to Rotterdam – BP says long term situation undecided

Meanwhile, BP has confirmed that initial production on the Schiehallion field, which previously accounted for a large chunk of processing at the terminal, will initially bypass Sullom Voe. No decision has yet been taken on where the oil will be processed in the longer term.

A BP spokeswoman said the decision to bypass SVT – in favour of Rotterdam – when processing the first oil from the rehabilitated Schiehallion field was due to the fact that the oil will contain MEG/methanol-rich fluids that were used to preserve the drill centres when the field was out of action.

SVT does not have the facilities required to process those fluids, whereas Rotterdam does.

The spokeswoman said: “We are currently reviewing all of our options with regards to the long term export of Quad 204 oil. No final decisions have yet been made and we are discussing this issue with both the OGA [Oil & Gas Authority] and Schiehallion partners to determine what is best for the project and for SVT long term.”