SINCE August 2014 the average price of oil has dropped from just over $100 a barrel to just under $40.

For most people the only effect of this has been a (slight) fall in the cost of petrol.

But for the 400,000 people working in the North Sea offshore industry it has meant redundancies, a reduction in terms and conditions and, in some cases, the loss of some hard-won safety measures.

In a rushed reaction to the decrease in prices, the world’s biggest oil and gas groups have slashed spending and jobs, cut drilling and cancelled or deferred projects.

Many have renegotiated existing contracts, effectively blackmailing contractors to accept reduced terms or lose the contract completely.

While it would be entirely predictable for the oil companies to claim that cost savings are a necessity to combat the reduction in oil prices, they overlook the cyclical nature of the sector and the risk of some specialist skills being lost forever.

The price of oil has followed a boom/bust cycle which will be familiar to those in the financial sectors.

In the mid-1980s prices slumped and thousands lost their jobs, only for the industry to see record highs just 10 years later.

Further slumps occurred in 2005 and 2008, but prices had peaked at nearly $150 in the intervening years of 2007 and 2010.

However, the North Sea is not like any other sector or even like other offshore sectors. It is one of the most treacherous places on the planet and short-sighted job cuts in the face of a probable short-term downturn can have catastrophic results in such a safety-critical industry.

My union, Nautilus International, represents seafarers working primarily aboard specialist offshore vessels including supply and support vessels in the North Sea.

They work on waters where huge waves are common, alongside the high winds and driving rain.
Understandably, the skills needed to work in these conditions are unique, and once they are lost, they could be gone forever.

The UK Continental Shelf supports approximately 400,000 jobs and there have been thousands of redundancies announced, with hundreds already implemented. Over the next six months, hundreds, if not thousands, more are expected.

As well as job cuts, companies are reducing pay, cutting leave, sickness pay and pension contributions. They are also making changes to rotas and cutting vital search and rescue services.

Nautilus International, along with sister unions representing offshore workers, is concerned that too many offshore companies are using low oil prices as an excuse to slash jobs, worsen terms and conditions and scrap safety initiatives. Many of these safety measures were brought in as a result of major disasters such as Piper Alpha in 1988 where 167 workers were killed.

Many members in the sector accept that some changes need to be made, but any job losses should be part of a clear long-term strategic plan, properly negotiated with unions and, vitally, not at the expense of safety.

In April BP announced that it intended to end the use of autonomous rescue and recovery craft (ARRC) and end the provision of the Jigsaw helicopter capability for search and rescue provision.

The company stated that it was terminating the use of the ARRC vessels — introduced in 2009 to improve safety in the North Sea — as they were frequently underused.

The end of the Jigsaw helicopter came as a result of the decommissioning of the BP Miller platform where the Jigsaw helicopter was based.

While the Jigsaw helicopter has been replaced by a new employer-funded SAR helicopter, this is based at Aberdeen International Airport and can only provide rescue and recovery, and medevac cover for offshore workers out to around 160 nautical miles from the shore.

One of the other changes employers are making to is to terms and conditions, increasing the number of weeks worked.

Some workers are now expected to work for six weeks without a day off — 42 days straight — in very difficult conditions.

Short-sighted cost reduction is bad for employees, bad for business, bad for Britain’s economy and bad for safety.

The offshore industry is vital to our economy, with £316 billion paid in taxes since 1970, and between 2010 and 2011 the industry paid more in corporation tax than any other industry in Britain.

It also provides over 70 per cent of the UK’s energy needs, ensuring we are not as reliant on external energy sources as many of our European neighbours.

Nautilus believes that the government must do more to safeguard the sector’s skills and keep the UK Continental Shelf competitive.

The short-term quick fixes adopted by the government do little to incentivise the industry to take a longer-term view. The government must introduce incentives for investment in new developments and ensure that safety and training standards are protected.

Operators should be working with unions to preserve jobs and skills and to sustain safety standards, rather than imposing opportunistic, unsustainable and unworkable changes on workers’ conditions.

Evidence exists in Norway of the long-term benefits that can be achieved for the entire nation when government and industry adopt a long-term view of the oil industry, and this includes sensible and measured plans for a future which is not reliant on fossil fuels.

We must safeguard the decades of skills and experience built up while helping to put in place the most effective and efficient operating environment for the industry to ensure it is even stronger and internationally competitive as the oil price begins to recover.

This month we will be calling on colleagues at the TUC to join us to campaign to resist commercial pressures that could erode safety standards and reduce employment and training levels, and to support unions resisting changes to working hours, rest and leave entitlement and the provision of emergency support services.

We are also urging the TUC to press the government to adopt measures to protect skills and experience in the offshore sector, to ensure that the UK Continental Shelf is not exposed to unfair competition.

Mark Dickinson is general secretary of Nautilus International.