LONDON (ICIS)--Shell has submitted a new pay offer in a bid to end industrial action at its Pernis refinery and Moerdijk petrochemicals complex in The Netherlands which has been accepted by the trade unions.Moerdijk site in The Netherlands. Source: Shell
The Anglo-Dutch oil and gas major is projecting that the strikes will end on Friday afternoon.
Union FNV confirmed to ICIS on Friday that it has accepted an improved benefits offer from Shell after nearly three weeks of strikes that delayed a long-planned turnaround for the cracker at Moerdijk, one of the largest in Europe.
The new salary offer will be discussed at an employee meeting on Friday.
In what a Shell spokesperson termed an “ultimate” offer, the company has increased its wage hike offer for Pernis and Moerdijk employees to 3% this year, 2% in 2020 and 2.5% in 2021, plus a 1.5% annual merit pot.
Unions will advise members to end the strikes on the basis of the new offer.
“It is a result, not a great result,” a spokesperson for union FNV said.
“We will talk with our members. They dedicated themselves in the actions and they will decide whether this is enough. Shell expects we [will] cancel further actions as of this afternoon.
"We will take this up in a meeting with the action committee later today.”
The trade union's spokesperson added that whether the action committee agrees to end actions, Shell would "take over control" at Moerdijk as of 16:00 on Friday, local time.
If Shell is permitted to take full control of Moerdijk and Pernis, FNV will schedule meetings with members on 7-8 May to present the results and formally vote on the proposals.
Action at the sites has reduced output at the Pernis refinery to 65% of capacity, according to union estimates, and considerably slowed a turnaround at Moerdijk.
The moves to reduce capacity also initially prevented the start of shutdown preparation, and a refusal to work overtime slowing the process once employees agreed to begin the turnaround.
The work, which heralds the beginning of a crowded turnaround season in Europe through the summer, was expected to begin on 16 April and last through 21 June, according to market sources.
The company has not provided an updated schedule for the turnaround.
In documentation submitted as part of summary legal proceedings against the unions initiated by Shell late last week, and subsequently overturned in court, Shell estimated that that first nine days of the action had resulted in €14.5m in costs.
Shell's Moerdijk site produces ethylene, propylene, benzene, butadiene, crude C4, ethylbenzene, ethylene glycols, surfactants, and ethylene oxide, among others, according to ICIS data.
Additional information by Nel Weddle