Category: Engineering, Infrastructure, and Extractions

The release of a new report highlights that natural gas is not a viable solution for Aotearoa’s energy future, further underscoring the need for a well-planned Just Transition for workers and communities in Taranaki.

The report, released by 350 Aotearoa, Common Grace Aotearoa and the Centre for International Corporate Tax Accountability and Research (CICTAR), argues that tightening gas supplies and declining production margins are increasingly shifting Methanex’s business model from methanol production to on-selling gas, at a significant mark-up.

E tū is concerned about the job insecurity facing its members at Methanex, Aotearoa’s largest natural gas consumer, and the broader impact on downstream workers in Taranaki’s engineering and construction sectors.

Jesse Davis, a tradesperson in the industry in Taranaki, says workers are feeling the pressure.

The uncertainty in the oil and gas industry is stressful for workers unsure about their future,” Jesse says.

“Many of us may have to leave Taranaki without work, but we want to stay, support our families, and help the region thrive. I want my children to have opportunities here, not be forced to leave due to a lack of jobs.

“Oil and gas have provided well-paying jobs, but when that ends, we don’t want Taranaki to decline. A Just Transition can keep Taranaki prosperous and vibrant. A clear plan would reduce workers’ stress and provide a path forward. New sustainable energy projects could let us use our skills locally and support our families.

The Government must urgently act on a Just Transition – it’s time for action, not words. A Just Transition needs long-term vision and commitment beyond short political cycles.”

E tū Assistant National Secretary, Annie Newman, says workers are in a “wait and see” mode:

“There are redundancy clauses in place for some workers, but no Just Transition commitments at the employer level. Workers are aware that nothing is guaranteed in the medium-to-long term, and the lack of a clear plan leaves many in limbo.”

Methanex plays a key role in Aotearoa’s gas industry, yet financial reporting suggests the company faces a gradual decline, with some analysts predicting a complete exit from New Zealand by 2029, if not sooner. This has significant implications for the region, with challenges going beyond Methanex itself.

“Downstream companies that support Methanex have already seen significant job losses. Traditionally, Taranaki-based contractors had 80% of their work locally and 20% elsewhere. Now that’s flipped, with only 20% of their work coming from the region.”

The report highlights a growing understanding that the oil and gas industries have limited long-term benefits. Offshore wind projects, such as those proposed by Copenhagen Infrastructure Partners and NZ Super Fund, present a better opportunity for Taranaki workers and communities.

“Offshore wind projects are a real solution for a Just Transition in Taranaki, providing both construction and long-term maintenance jobs while contributing to Aotearoa’s energy security. The recent exit of BlueFloat highlights the need for a coordinated national approach to ensure these opportunities are realised.

“E tū also calls for a focus on more sustainable energy solutions as the price of renewable energy technology, such as wind, solar, and battery storage, continues to fall. Natural gas is not the answer for Aotearoa’s energy future. Financially and geologically, the industry cannot deliver the energy security that New Zealand needs.

Annie says any energy transition must prioritise the workers and communities that have powered Aotearoa for generations.

“The Taranaki community deserves better than being left to pick up the pieces. We need a Just Transition that ensures good jobs, community stability, and a sustainable future for Taranaki and all of Aotearoa.”

Workers at OJI Fibre Solutions’ Kinleith mill in Tokoroa are hugely disappointed to learn today about a company proposal to end paper manufacturing, which would result in the loss of 230 jobs.

The workers, who are members of E tū, FIRST Union, and AWUNZ, were told about the proposal in a meeting this morning. Head delegate Ian Farall says the proposal demonstrates the failures of the company.

“I think it’s been a long time in the making, but the company has known it was going to get to this point, and have mismanaged the whole process,” Ian says.

“We’re all very disappointed by their inability to turn it around. They can’t control what the market does, but they could have been much better prepared for this point in the cycle.

“There have been many problems at the mill, they have not kept up with maintenance, and they have not made the right investments to secure a future for paper production.”

Ian says all members are feeling let down.

“There were a lot of angry people in the meeting this morning. People were speaking from the heart, about how disappointed they are. Union members had a near-unanimous vote of no-confidence in the management, to show how frustrated we are. Many chose to simply walk out.

“It’s not just the directly impacted workers who are angry. We’re in unity here, and we know the downstream effects will harm the whole community. It’s the truck drivers, the local cafes and other businesses – many people locally rely on the mill as the heartbeat of south Waikato.”

E tū Negotiation Specialist, Joe Gallagher, has been meeting with the members and management this morning. He calls on the company to do better by their workers.

“OJI have got themselves into this situation, and they can’t just hang the workers out to dry,” Joe says.

“We don’t believe the company has done everything they can to avoid this outcome. It’s a hell of a thing to tell people with Christmas just around the corner, and we need a longer period of consultation to really understand the potential alternatives to stopping paper production completely.”

Joe says the Government must also step up to support domestic manufacturing.

“The crisis in manufacturing is not simply about unstoppable global market forces. It’s the result of an ineffective energy market, a lack of planning for a Just Transition, and a Government asleep at the wheel.

“We will not become a high-skill, high-wage economy while our political leadership continues with such a hands-off approach to our industries. Kinleith is not the first plant to be in this position recently and it may not be the last.

“Now’s the time for both businesses and the Government to get real about the crisis before us and work to reverse it. That’s the leadership communities like Tokoroa deserve.”

E tū and FIRST Union members are devastated to learn that Winstone Pulp International (WPI) has confirmed their intention to close the Karioi pulp mill and Tangiwai sawmill despite significant last-minute efforts to keep the mills open and save around 300 jobs in the community.

Jude Sinai, a FIRST Union delegate at the Karioi pulp mill, said workers were gutted, disappointed and let down by the decision to close.

“We were hoping that the Government and wood sector would find a positive outcome and look for a way forward that’s profitable,” said Mr Sinai.

“But they didn’t come to the party and couldn’t put together a long-term strategy to lock in power prices. Whatever was offered wasn’t enough.”

“It’s sad being here today and nostalgic – some of us have been here 20, 30, 40 years. We’ve spent so long at these sites, but the end was really sudden, with only 2 weeks to prepare physically, financially and emotionally for this outcome.”

“But we have a lot of aroha for our community and want to thank everyone who supported us. They’ve been staunchly behind us, and our hearts go out to you.”

“This will have a huge ripple effect across the Ruapehu district – these jobs are a financial backbone for the region.”

“We’re the coaches, we sit on the boards of trustees, we send our kids to the local schools… without the support, it will open up a huge vacuum in the community.”

“There’s disappointment we couldn’t make a go of it, and we want to thank the community for fighting and supporting us through this anxious time,” said Daniel Abernethy, E tū delegate.

“There are some of us that call these communities home, and leaving here is the last option. I never thought the plant was going to close, I considered this to be my retirement job.”

Dennis Maga, FIRST Union General Secretary, said that WPI’s decision to close is a tragedy for workers, families, community, local iwi and hapū, and other businesses in the area.

“The decision to close the doors of the two mills follows the spike in electricity prices during August that led to the company suspending production for over a month,” said Mr Maga.

“The closure shows a Government asleep at the wheel with no care for the destruction that its previous electricity reforms have caused for workers, communities and businesses across the country.”

“As Ruapehu Mayor Kirton put it – what’s the use of Prime Minister Luxon touring Asian countries trying to get more investment into NZ when our broken electricity supply system means existing investors are closing mills and leaving the country?”

“The unions thank Mayor Kirton and other Mayors, opposition parties and Hon Shane Jones for joining the fight to keep the mills open.”

Mr Maga said that the unions will immediately start working with the company, local government and iwi and hapū to put in place a redundancy support programme for mill workers and their families.

“We will be calling on MSD and other government agencies to lift their game and provide the support needed for workers, their families and communities within the district,” said Mr Maga.

“It’s a very sad day for affected workers, and the whole community which relies on decent jobs in the area,” said Rachel Mackintosh, E tū National Secretary.

“I know our members have been heartened by the outpouring of community support – people are deeply concerned about their neighbours and the turbulent time ahead for those who will need to find other work.

“Large workplaces in rural areas are often the backbone of their communities. People living in the Ruapehu district have fought hard to protect the mills’ futures, and many will be devastated by the news today.”

Ms Mackintosh says the closure demonstrates a failure of the Government to step up.

“We need to protect local manufacturing. By leaving the industry so vulnerable to the fluctuations of the energy market, there’s a clear risk that we lose opportunities for well-paid work, and damage Aotearoa’s wider productive economy.”

“Mega profits from the partially privatised gentailers, and the lack of an effective strategy for a clean and secure energy future, are huge factors in the closures today. It’s simply not good enough for the Government to let our local industries fail like this – it’s an abdication of responsibility.”

A proposal by Downer Group New Zealand to reduce their power workforce by 12% should set off alarm bells for people concerned about our infrastructure.

The company, which is a major contractor responsible for implementing and maintaining energy infrastructure, is holding meetings with their workforce across the country this week to present their new proposal, which they say is in response to shareholder and investor pressure in the face of uncertain foreseeable work.

A Downer worker, who wishes to remain anonymous for fear of retribution from the company, says the decision is short-sighted and presents real risk to our infrastructure networks.

“We struggle to fill our stand-by rosters now as it is, which has huge implications for the standard of service we can provide,” they say.

“A smaller workforce means people waiting longer when their power goes off. It means taking longer to get to a power pole after a car accident – people could die before we get there to turn off the power.

“If there’s a serious storm, it’s all hands on deck. A smaller workforce at Downer means they’ll have to get in other contractors in that situation, who might charge double for the work. It doesn’t make sense.”

The worker says he’s worried about what these redundancies will mean for workers and their families.

“There are generations of people working in these jobs. Some depos might have an older worker, their kid, and their grandkid at the same place. Job losses on this scale will really hurt families.

“There’s usually work going somewhere, but you might have to up sticks and move somewhere you don’t know anyone. You might get worse pay and conditions. Some guys might bugger off to Australia.”

E tū Negotiation Specialist Joe Gallagher says the proposal shows the model for providing and maintaining this essential infrastructure is broken.

“More and more, we’re seeing the dangerous effects of the competitive contracting model in the delivery of services,” Joe says.

“This is a well-established workforce with a long history of looking after New Zealand’s electricity networks. Having a series of smaller contractors undercutting Downer to win the contracts results in a scattered, less cohesive approach to the delivery and maintenance of the infrastructure.

“The asset owners need to understand what it really takes to keep the lights on, and we’re worried that they are letting some immediate cost-cutting present a real risk not just to the livelihoods of the Downer workforce, but to the very core of New Zealand’s infrastructure.”

Workers at New Zealand Aluminium Smelter at Tiwai Point are celebrating the company Rio Tinto’s new electricity deal with Meridian Energy, finally securing a longer-term future for the plant.

The 20-year deal ends years of uncertainty about Tiwai Point, which is the largest employer in the Southland region and also supports the local economy by providing many opportunities for businesses in the area.

E tū delegate at Tiwai Point, Curtis Omelvena, says workers are thrilled with the news.

“We finally have job security after five years of constantly being threatened with closure,” Curtis says.

“I was wondering what to do if the place closed down, and I would have most likely left Invercargill and even New Zealand altogether. If it did close, I could imagine a lot of us younger workers leaving the area, leading to a big recession in Invercargill.

“It’s a hugely positive thing for the workers and the wider community in Invercargill, especially as the smelter is working hard to clean up the area.

Curits says the uncertainty has taken a big toll on the workforce.

“The last few years have been very trying on our patience and mental health. Morale will start improving from now.”

E tū National Secretary, Rachel Mackintosh, says the economic impact of this decision for the Southland economy is significant.

“The smelter contributes about $400 million to the Southland economy – it is vital for work and business opportunities in the region,” Rachel says.

“E tū members have been working through the uncertainty as best they can. Our union is committed to a Just Transition through economic changes, which means making sure that workers and local communities don’t bear the full brunt of the everchanging future of work.

“It is a big relief that our members at Tiwai Point, and everyone whose work is connected to the smelter, now have some real certainty about the future. We are looking forward to continuing progress on a collective agreement for E tū members at Tiwai, and with the company’s newly improved position, Tiwai workers should expect some real improvement on wages and conditions as a result of their collective activity.”

Members of AWUNZ, E tū, and the PSA have endorsed a multi-union, multi-employer collective agreement that will help improve water services, overcome critical staff shortages, and ensure decent workplaces for everyone working in the industry.

“This is a historic opportunity to work collaboratively with the incoming government to build a workforce that will improve public health,” says Blake Monkley, AWUNZ lead organiser.

“This collective agreement provides career pathways that can attract people to an industry that desperately needs to attract and develop a skilled workforce.”

“Events including widespread flooding, the recent cryptosporidiosis outbreak in Queenstown and sink holes in Auckland show an industry in crisis,” says Ian Gordon, PSA National Sector Lead.

“To respond to this crisis, the country needs a skilled, sustainable water workforce. Without the provisions of this agreement, the industry will keep losing skilled workers it already has and won’t be able to recruit and develop new ones. This agreement is a huge victory for workers and Aotearoa.”

The benefits for workers are clear. “A national employment framework will create clear career paths that will draw people to the industry and keep them there. It will allow the industry to focus on training and developing staff across the industry instead of in isolated pockets,” says Amy Hansen from E tū.

“While negotiating this agreement, it has become increasingly apparent how damaging a fractured approach to employment relations has been to retaining and developing the workforce we need.

“The incoming government needs to recognise how essential the provisions of this agreement are, and it needs to treat workers justly as well, no matter what happens with the water reforms.”

The Amalgamated Workers Union NZ (AWUNZ), E tū, and the Public Service Association Te Pūkenga Here Tikanga Mahi (PSA) represent workers across water management, including technicians, engineers, electricians, administrators, fitters, reticulation workers water, and wastewater treatment operators, local and central government officials, and more.

For two years, the unions worked with members and non-members in the workforce, and the Department of Internal Affairs, to find best path forward. The membership of all three unions have now endorsed this approach by supporting the proposed agreement.

Some useful numbers

• There is currently a shortage of skilled staff with vacancy rates sitting at approximately 15% across the industry
• Economic analysis projects that the industry will need 6,000 to 9,000 jobs over the next 30 years.
• Unions in the sector represent approximately 1850 employees across a wide range of occupations.
• There are currently 87 collective agreements covering impacted workers with a wide range of different conditions.

ENDS

For more information please contact Hamish McCracken (AWUNZ)
Phone: 0212885609
Email: hamish.mccracken@awunz.org.nz

E tū and members working at the New Zealand Steel mill in Glenbrook have welcomed the Government’s offer to contribute funding for a new electric furnace to halve coal use at the site.

On Sunday, the Government announced it would be partially funding up to $140 million to reduce carbon emissions at Glenbrook, by replacing an existing steelmaking furnace and two of its four coal-fuelled furnaces with the electric one.

It means half of the steel produced at the site would be made using electricity to recycle scrap metal, rather than producing new steel using coal and iron sands.

Site delegate Lester Udy says the announcement signals “exciting times” for workers and the company.

“New Zealand Steel contributes a lot to our communities and the area in general,” he says.

“Covid illustrated the importance of having industry in New Zealand, and a lot of other businesses benefit from the fact that we produce our own steel here.

Lester says the move represents a solid strategy for reducing carbon emissions in the steel industry and is a positive step for all industry. But workers still need to be at the forefront, he says.

“The transition also needs to be a Just Transition for workers. It’s about finding new and different ways of production, while at the same time making sure workers keep their jobs.”

E tū Negotiation Specialist Joe Gallagher says the announcement is “huge” for the workforce and local community.

“Jobs at the Glenbrook steel mill are high value jobs and critical to the community, so it’s really important that we support steel made in here in Aotearoa.

“The Government’s announcement is about protecting our local steel-making industry for the future by assisting in the transition to lower carbon steel production.

“It means that we’ll keep business here, rather than pushing it offshore.”

Joe says the funding could be a blueprint for other industries to transform to a low carbon model, which will mean they remain viable as the businesses transform in response to climate change.

However, he says a Just Transition for workers will be needed, including reskilling or upskilling, so they are able to take on the new roles required as technology at the site changes.

This also includes working with suppliers and other businesses who will inevitably be affected.

“We need to work with Government, the company, and workers, to create a Just Transition process that can be modified and adapted for other industries, so we are not able to only protect valuable industry but workers and their communities as well.”