Collective pay talks held over the past three days in Norway, between the oil companies and the land base workers serving the offshore sector have collapsed.

The Norwegian Oil Industry Association, representing the employers, said that the talks on collective pay deals with the Norwegian Union of Industry and Energy Workers (Industry Energy) and Parat on the land base agreement broke down as the involved parties were too far apart for agreement to be possible.

“The land base business is in a restructuring process, and experiencing heavy pressure on costs,” said Jan Hodneland, lead negotiator for Norwegian Oil and Gas. “In such circumstances, there’s no room for pay growth.”

The organization representing employers said many of its member companies are experiencing demanding times, and are in the middle of a restructuring process with extensive downsizing. Unemployment in the industry has risen, and is expected to increase further in the time to come, it further said.

Given these conditions, Norwegian Oil and Gas said it believed it would be “irresponsible towards both the companies and their employees to agree terms which weaken profitability and flexibility.”

Unfortunately, the organization said, the Norwegian Union of Industry and Energy Workers (Industry Energy) does not appear to share this understanding of reality.

“The growth in costs must be halted and reversed if the companies are to be able to preserve as many jobs as possible,” says Hodneland.

The settlement will now go to mediation.

About 800 people are covered by onshore base agreements. They work at supply bases along the whole Norwegian coast for the following companies: KCA Deutag Drilling Norge AS, Asco Norge AS, NorSea AS, Coast Center Base AS, Vestbase AS, Polarbase AS, CCB Mongstad AS, Helgelandsbase AS and Saga Fjordbase AS.