EXCLUSIVE: BP Rotterdam to restart partially ahead of Monday talks

26 Nov 2022

Quantum Commodity Intelligence – Workers at BP’s 400,000-bpd Rotterdam refinery are restarting one of two crude distillation units (CDUs) ahead of salary negotiations with BP’s management on Monday.

The entire plant – a key supplier of diesel to northwest Europe – was hit by an unexpected steam outage over a week ago with workers refusing to restart the units as part of an ongoing wage dispute.

“We have decided to allow the CDU4 to be restarted. This means that the CDU4 is being started up, while the equipment behind it is also made operational,” the CNV union told Quantum on Saturday.

While the CDU4 has a nominal capacity of 200,000 bpd, the workers will start the unit with “minimal throughput” while keeping their work-to-order actions in place ahead of the salary talks with BP on Monday.

“Restarting CDU4 now is the next step in supporting the collective labour agreement negotiations. We are counting on BP to take steps towards us on Monday,” the CNV union added.

BP confirmed the partial restart in a statement to Quantum on Saturday, adding that "safety risks are being mitigated by bringing the plants back in operation."

The Rotterdam refinery is one of the largest in Europe and is located in the key ARA trading hub with its oil products exported all across Northwest Europe.

The partial restart will put renewed pressure on diesel refining margins, which hit two-month lows on Friday, as stocks continued to rise while demand remains well below more usual levels for this time of year.

The BP refinery’s other CDU remains offline as it is not yet operationally ready and it will take another week before it can be restarted, Jaap Bosma, CNV's chief negotiator, told Quantum.

“We hope that by then, we’ll have an acceptable offer from the BP management. There is a lot of back and forth with London,” Bosma added.

The unions have demanded a 6% pay increase backdated to April this year and a three-year share match program – which allows workers to benefit from BP's profits – after inflation in the Netherlands hit 14.3% last month.

BP – which had offered a 5% pay increase last month – rejected the unions' demand two weeks ago, calling them “unacceptable and not in line with the market.”