Australia’s IR laws make it ‘tough’ to operate

BHP Billiton oil and gas boss Tim Cutt says strike action at Bass Strait oil and gas fields will have a big effect on production.

BHP Billiton’s oil and gas boss Tim Cutt says Australia’s industrial relations laws make it a tough place to operate and has admitted strike action at the big Bass Strait oil and gas fields it owns with Exxon Mobil will have a substantial effect on production this quarter.

As revealed in The Australian yesterday, strike action over enterprise agreement negotiations, timed to extend maintenance shut downs, stopped production of oil and gas at the fields for 2½ months from March to the end of April, costing up to $US170 million of lost revenue.

“It will have an effect and that will come out in the mid-year (production report), but obviously with the whole system being down that long, it’s quite substantial,” Mr Cutt told reporters at the Australian Petroleum and Production Association conference in Melbourne yesterday.

The Houston-based petroleum boss said he thought Exxon Mobil, which operates the joint venture between the two, had done a good job in negotiations, which are ongoing.

“It’s not one of the easiest jurisdictions in the world when it comes to those kind of relationships,” Mr Cutt said. “Fundamentally we believe workers should have their rights ... but at these kinds of prices and things it’s a really difficult thing for both parties.”

While the strikes have stopped for now, talks are ongoing and future action is possible.

But now the maintenance has been complete more strikes should not have the same impact or completely shut down production.