Woodside seeks to reassure WA opposition

WOODSIDE Petroleum has responded to concerns from the Western Australian opposition leader Mike Nahan who is calling on the Labor premier Mark McGowan to ensure oil and gas engineering and fabrication work is conducted by WA businesses with local workers.
Woodside seeks to reassure WA opposition Woodside seeks to reassure WA opposition Woodside seeks to reassure WA opposition Woodside seeks to reassure WA opposition Woodside seeks to reassure WA opposition

Woodside says over 2,000 jobs will be created through the development of Scarborough.

Paul Hunt

Senior Journalist: Energy & Commodities

Paul Hunt

 

Yesterday Nahan told Energy News the Liberal Opposition was concerned "that engineering works of a type that have historically been done in Western Australia by WA workers are now being outsourced to overseas companies".  

The state opposition took particular issue with Woodside awarding Scarborough FEED contracts to Houston-based McDermott.

Today Woodside sought to reassure the Opposition telling Energy News that despite some contracts going to international engineering firms, its Scarborough development would create about 2,500 local jobs.

 "Over a two-year period, Woodside estimates a total of about 2,500 jobs will be created by Scarborough for activities including subsea and pipeline installation, drilling and completions work, floating production unit installation and near-shore civil works," a Woodside spokesperson told Energy News.

"The major engineering design contracts have been awarded to Australian entities. All project management and a substantial amount of engineering design work will be undertaken in Perth."

"Historically, around 80% of the workforce employed during the construction phase of projects of this scale and nature are employed locally."

Concerns around Woodside's choice to award engineering contracts to overseas firms have been raised previously, after the company announced in October last year that Bechtel would provide concept definition for the Pluto LNG expansion to process gas from Scarborough.

In January Woodside awarded FEED work to American multinational McDermott, Italy's Saipem Australia, Worley Parsons subsidiary Intecsea and Subsea Integration Alliance, and then this month Canadian firm SNC Lavalin was awarded two Scarborough contracts for FEED support.

This week McDermott released four tenders of its own for construction of Scarborough's floating production unit. It is not yet known whether this contract will be allocated to local firms. 

Woodside noted that specialist components, such as offshore floating facilities and LNG trains are being constructed overseas but "expect there will be many other options for local business, based on capability and competitiveness" and would seek to maximise local contracts where possible.

"Woodside also anticipates that ongoing engineering work will result from the 20 or more years of operational activity, predominantly in Perth as we see demonstrated from our existing operations," Woodside's spokesperson told Energy News.