Chevron, a major energy company, and the unions that represent its workers have reached an agreement to stop strikes at two major LNG facilities in Australia.
The Offshore Alliance, a coalition of two unions, claimed that workers had agreed to terms presented by the country’s labor authority.
A union official announced that they will be ending their strike.
Since September 8th, workers at the Gorgon and Wheatstone factories have been on strike over wages and working conditions.
“At a late night mass meeting members endorsed the latest offer which incorporates the Fair Work Commission’s recommendations,” Brad Gandy, a representative for the Offshore Alliance, said in a statement.
The Fair Work Commission of Australia, the country’s industrial arbitration, had mediated talks between the corporation and the union.
Mr. Gandy further mentioned that “the Offshore Alliance will now work with Chevron to finalize the drafting of the agreement” and that its members will shortly end their strike.
The BBC’s request for comment from Chevron Australia went unanswered for some time.
More than 5% of the world’s LNG capacity comes from the US oil and gas giant’s Gorgon and Wheatstone operations in Western Australia.
Concern that the walkouts would affect global gas supplies sparked volatility trading in LNG markets amid the disagreement.
The Russian invasion of Ukraine at the beginning of last year has put a strain on the global energy markets. When the cost of oil and gas increased, so did the cost of powering homes and businesses.
The Kremlin has also reduced natural gas exports to Europe, forcing several countries to seek substitute energy sources. LNG is being used by many countries as a stopgap measure.
Along with Qatar and the United States, Australia is one of the world’s top producers of LNG, and its supplies have contributed to reduce energy prices around the world.
“It was quite remarkable that a few hundred workers offshore Western Australia have managed to roil global markets and cause tens of billions of dollars in market movements,” energy sector specialist Saul Kavonic said on the BBC’s Asia Business Report.
But, he noted, “it happened because there is no resilience left in our global gas system.”
Natural gas liquids (LNG) are methane or a mixture of methane and ethane that has been purified and chilled to around -160 degrees Celsius.
By doing so, the gas is converted into a liquid that can be transported in pressurized tankers.
Once it reaches its destination, LNG is converted back into gas and used for the same purposes as regular natural gas, including heating, cooking, and generating electricity.
