Wednesday, December 6, 2006

by Victor Epstein

USA (Bloomberg), HOUSTON: Valero Energy Corp., the largest US refiner, has reached agreement with workers at its Aruba plant on a five-year labour contract, ending a strike that lasted six days.

The agreement was reached Monday with the United Steelworkers Union, which represents 328 of the refinery's 710 workers, San Antonio-based Valero said in a statement. Most of the workers were due to be back on the job Tuesday, the company said.

Fuel production wasn't affected during the strike, Valero said.

Valero didn't disclose terms of the settlement. Workers went on strike after rejecting an offer that included a 47 percent increase in salary and benefits and expanded vacation and pension benefits, the company said. The two sides were also disputing bonuses.

Employees ultimately accepted the 47 percent increase in pay and blocked an effort by Valero to tie bonuses to performance, said Francis Croes, a spokesman for the United Steelworkers Union Local 1961. The new contract raises pay for the Aruba workers to about half the level of Valero refinery employees in the US, he said.

"Everyone is happy and everyone is going back to work today because we really got what we wanted," Croes said in a telephone interview from Aruba. "We wanted a piece of the energy industry's record profits, and we got our fair share."

The Aruba plant has processing capacity of 275,000 barrels of oil a day. The refinery may play a key role in Valero's efforts to expand its operations in Europe, Executive Vice President Richard Marcogliese said in a September interview. The plant's geographic location allows its refined fuel products to be sold in either Europe or North America.

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