Chevron threatens to fire Bangladesh staff protesting asset sale

U.S. oil company Chevron has threatened to fire staff protesting against the planned sale of its assets in Bangladesh to Chinese investors, according to a letter seen by Reuters, in a row that could delay the estimated $2 billion deal.

Chevron in April announced the sale of its stakes in three Bangladesh gasfields in Sylhet to a Chinese consortium Himalaya Energy Co. Ltd.

The deal would mark China’s first major energy investment in the South Asian country, where Beijing is pumping in billions of dollars in a race with India and Japan for influence.

Six hundred staff at Chevron’s subsidiary have halted work related to the transition because the deal has not been approved by the government, said Shahriar Abedin, secretary general of Chevron Bangladesh Employees Union (CBEU), who called the process illegal.

Chevron said in the letter, dated May 23, that all employees must comply with requests to do work related to the transition to ensure a smooth and efficient move to new ownership.

“A refusal by any employee to comply with such requests by their supervisor will be subject to disciplinary action, including up to a termination of employment,” the letter said.

Chevron sells all the output from its Bangladeshi fields, which amounts to 16 million tons a year of oil equivalent and is more than half the country’s total gas production, to state-run Petrobangla.

The Bangladesh government has the right of first refusal in any sale of Chevron’s assets in the country. Mahbub Sarwar, a director at Petrobangla, said the U.S. company needed Petrobangla’s approval for a sale to proceed.

He said the government’s decision about whether to use its preemption rights depended on a report from energy consultant Wood Mackenzie, which has been mandated to evaluate Chevron’s assets in Bangladesh.

The Chevron workers union sent a notice on Tuesday to Kevin Lyon, President of Chevron Bangladesh, terming the company’s activities as non-compliant, said the CBEU’s Abedin.

“We need security and guarantee of our job at least for three years after the handover to the new company. We also wanted guarantee of our achieved gratitude money and compensation,” he said.

Chevron Bangladesh said it had offered a generous compensation package for staff.

“The package included guaranteed employment for two years and a goodwill bonus payment equivalent to nine months salary,” Chevron said in an emailed response to Reuters.

“Regretfully, employee representatives have refused to accept this benefits package and have instead elected to declare an industrial dispute with the company,” it said.

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