The negotiations on wage increases have broken down between oil service companies and the Safe labour union in Norway.

The 850 members of Safe are currently not allowed to strike, but they could strike in the event negotiations do not materialise into an agreement, reported Reuters.

Meanwhile, labour union Industri Energi had agreed to a wage deal that covers 6,500 workers.

The talks involved pay and other terms for workers including well service crews, drillers, divers and others working at firms such as Subsea 7, Aker Solutions, and Schlumberger, which function as subcontractors to the industry.

No date has so far been set to resume the negotiations between Safe labour union and the Norwegian Oil and Gas Association (NOG).

Speaking on behalf of the oil industry, NOG stated: “It’s regrettable that Safe did not accept the same offer as Industri Energi.”

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By GlobalData

Safe alleged that the rights of some of its members had been eliminated, and there could be potential consequences of wages being reduced by up to 47% in some cases.

Safe leader Hilde-Marit Rysst said: “The union demands a continuation of the current agreement.”

Although a three-week strike among oil service workers in the country disrupted the drilling activities in new wells, it did not affect the oil and gas production.

Norway has a daily production of around four million barrels of oil equivalent, 50% of which is natural gas and the other 50% as crude and other liquids.

Earlier this month, the industry’s key production employees, who are directly employed by oil firms and do not form part of the latest negotiations, settled their wage demands.

While Lederne went on a strike, Safe and Industri Energi refrained from the strike. The strike of Lederne had reduced production.