Article content

(Bloomberg) — Chevron Corp. and labor unions reached an agreement to end strikes at key liquefied natural gas facilities in Australia that have roiled the global market for the fuel.

Workers accepted a proposed settlement on pay and conditions put forward by the country’s labor regulator and will suspend industrial action, the Offshore Alliance, a grouping of two major unions, confirmed Friday in a statement.

Article content

“The Offshore Alliance will now work with Chevron to finalize the drafting of the agreement and members will soon cease current industrial action,” Brad Gandy, Western Australia Secretary for the Australian Workers’ Union, said in the statement. The agreement includes improvements on issues including pay, job security, and rosters, he said.

Chevron on Thursday confirmed it had accepted the proposal. The producer declined to comment immediately Friday on the decision by union members. 

The move to accept the regulator’s terms effectively resolves a dispute that triggered industrial action from Sept. 8 at the Gorgon and Wheatstone facilities, which accounted for about 7% of global LNG supply last year. Union members at the Chevron sites ramped up their initial wave of disruptions last week, beginning a series of 24-hour stoppages. 

About 350 workers met late Thursday and endorsed the regulator’s proposals, which included suggested improvements to allowances for remote work and travel delays, according to Gandy.

Australia’s LNG sector has been grappling with the possibility of disruptions since late July. Woodside Energy Group Ltd. last month settled a separate dispute.

Worries over the prospects of lower gas exports from one of the world’s biggest suppliers — and other unrelated outages — have prompted spikes in global LNG prices over recent weeks, though traders and investors are also weighing weaker demand.

While Australia isn’t a major supplier to Europe, the prospect of missed deliveries has raised the risk of tighter seaborne trade — and increased competition for available cargoes — during a peak demand season in the northern hemisphere winter.

(Updates with union comment from second paragraph)