(Bloomberg) -- Liquefied natural gas workers at key Chevron Corp. sites in Australia will begin partial strikes Friday after talks failed to reach an agreement in a dispute that’s roiled the sector.
Discussions between the San Ramon, California-based company and unions ended without any resolution, the producer said in a statement. Chevron has been advised industrial action will begin Friday at the Gorgon and Wheatstone facilities, which accounted for about 7% of global LNG supply in 2022.
Read more: How LNG Strikes in Australia Will Impact Natural Gas Supply
A threat of strikes has jolted global gas markets since early August, when unions first voted for potential labor actions at the Chevron sites and Woodside Energy Group Ltd. facilities. Woodside reached a compromise deal last month.
Partial strikes from Friday will included work stoppage and bans on carrying out overtime and some other duties. Disruptions are scheduled to ratchet up to full 24-hour walkouts from Sept. 14 at the Chevron facilities — Gorgon, Wheatstone Downstream and Wheatstone Platform — if no new concessions are made.
Chevron’s “bargaining performance has been the most inept effort of any employer the union has dealt with in the past five years and our members have had enough,” the Offshore Alliance, a group that represents two major unions, said in a post on Facebook earlier on Friday.
The impact on LNG shipments isn’t likely to be immediate, and LNG consumption is currently muted in both Europe and Asia. Still, the prospect of disruptions to future supply has sent prices higher as it threatens greater competition for cargoes during peak demand in the northern hemisphere winter.
“The initial strikes set to begin today appear lower level, designed to create costs and inefficiencies for Chevron, but not yet impact production materially,” said Saul Kavonic, an energy analyst at Credit Suisse Group AG.
Union members at Chevron’s Wheatstone Downstream facility have already offered to work during strikes to help ensure domestic gas supplies continue after the facility recently tripped offline.
(Updates with details throughout.)
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