Unions Say Bay Area Refineries Have Dismissed More Than 1,000 Contract Workers
April 23, 2020
With demand for gasoline plunging and global oil markets in turmoil, more than 1,000 electricians, pipefitters and other skilled workers have been let go from projects at Bay Area refineries.
The workers have been sent home as the refinery operators halt or slow down activity at their facilities due to fallout from the coronavirus crisis.
Bill Whitney, CEO of the Contra Costa Building and Construction Trades Council, said the slowdown’s impact has been immediate.
“There will be men and women of the building trades in Contra Costa that will be on the bench,” he said. “You don’t get paid unless you work, so they’ll not be receiving a paycheck.”
The refineries hire skilled workers on contract for both major maintenance and capital improvement projects, many of which are now on hold. Oil companies might hire several hundred workers for turnaround projects, where they take a major piece of equipment offline to clean and repair it. Much of that work has been put delayed for now, Whitney said.
Timothy Jefferies, business manager for the Boilermakers Local 549 union, said between 85% and 90% of the unit’s 850 members are out of work, mostly because of the refinery slowdown.
Tom Hansen, president of the International Brotherhood of Electrical Workers Local 302, said about 150 of its members were in a similar situation.
“There won’t be any contractors in refineries for a little while,” he said.
Hansen says periodic unemployment is part of the construction business and that he’s confident work will pick back up soon. Certain construction projects are still considered essential, like building affordable housing and schools.
Che Timmons, business manager for Plumbers and Steamfitters Local 342, said about 300 of the local’s members are out of work as oil refineries adjust to market conditions.
“We are being affected at the end of the day, but we’ll survive this by picking up other work,” Timmons said.
The suspension of work is a direct result of the plummeting demand for gasoline and oil statewide. According to the California Energy Commission, demand for gasoline has declined 44% since mid-February, while demand for jet fuel has declined 63%. Diesel has taken less of a hit because trucks are still on the road.
Marathon Petroleum announced plans last week to indefinitely idle its Martinez refinery on April 27.
A Marathon spokesperson confirmed that the company is limiting the number of contractors at its facilities “to only those needed for critical support functions” to allow workers to maintain appropriate distancing.
The company has retained all of its direct employees for regular maintenance and operations, despite effectively stopping processing of transportation fuels and refined products. The facility normally processes 160,000 barrels of oil a day.
To manage the sharp decrease in demand, Marathon is holding its processing units in “standby mode” for the foreseeable future, the spokesperson said. Certain parts of the plant will remain in operation, like wastewater treatment, steam systems, and vapor recovery and flare systems.
The coronavirus crisis has affected operations at the four other Bay Area oil refineries.
Chevron has said it’s making adjustments to operational plans at refineries due to lower demand. But it has not specified what changes they are making at the Richmond refinery, or if any contracted workers have been let go.
Phillips 66 announced last month it was reducing all of its refineries, including its facility in Rodeo, to minimum production levels. Valero, which operates a refinery in Benicia, has cut its production by at least 15%.
And PBF Energy, which recently purchased Shell’s refinery in Martinez, has responded to the downturn by cutting production to 30% of capacity and selling off hydrogen plants at the complex.